Document:

Exhibit 10.5

 

WHENEVER CONFIDENTIAL INFORMATION IS OMITTED HEREIN
(SUCH OMISSIONS ARE DENOTED BY AN ASTERISK *) SUCH CONFIDENTIAL INFORMATION HAS
BEEN SUBMITTED SEPARATELY TO THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO
A REQUEST FOR CONFIDENTIAL TREATMENT.

 

LICENSE
AGREEMENT

 

This agreement (the “Agreement”), dated the [      ]th
day of [October], 2008 (the “Effective
Date”), is by and between [PURCHASER], a Delaware corporation (“Purchaser”),
and [THE COMPANY], a Delaware corporation (the “Company”).

 

INTRODUCTION

 

1.                                       The
Company owns the Product Intellectual Property (as such term is defined
herein).

 

2.                                       The
Purchaser is in the business of developing and marketing pharmaceutical
products.

 

3.                                       The
Company and the Purchaser are interested in establishing a licensing
relationship pursuant to which the Company shall grant the Purchaser certain
rights and licenses under the Product Intellectual Property.

 

NOW, THEREFORE, the Purchaser and the Company agree as
follows:

 

Article I

Definitions

 

When used in this Agreement, each of the following
terms shall have the meanings set forth in this Article I:

 

Section 1.1                                      “Affiliate”
means, with respect to a Party, any Person that controls, is controlled by, or
is under common control with such Party. For purposes of this Section 1.1,
“control” shall refer to (a) in the case of a Person that is a corporate
entity, direct or indirect ownership of fifty percent (50%) or more of the
stock or shares having the right to vote for the election of directors of such
Person and (b) in the case of a Person that is not a corporate entity, the
possession, directly or indirectly, of the power to direct, or cause the
direction of, the management or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.

 

Section 1.2                                      “Bankruptcy
Code” means 11 U.S.C §§ 101-1330, as amended.

 

Section 1.3                                      “Confidential
Information” means non-public information disclosed by the Company to the
Purchaser relating to the Products, Licensed Patent Rights or Licensed
Know-How, but specifically excluding Product Clinical Data disclosed in
connection with the clinical development of, or regulatory approval for, a
Product.

 

*CONFIDENTIAL TREATMENT REQUESTED

 

1

 

Section 1.4                                      “Control”
and cognates thereof means, with respect to any Licensed Know-How, Patent
Rights or Confidential Information, the possession by a Party, whether directly
or through Affiliates of such Party, of the ability to grant the right to
access or use, or to grant a license or the right to disclose or transfer such
Licensed Know-How, Patent Rights or Confidential Information, without violating
the terms of any agreement or other written arrangement with, or the rights of
any Third Party.

 

Section 1.5                                      “Cover”
and cognates thereof means, with respect to a product, that, but for a license
granted to a Party under a Valid Claim, the Development or Commercialization of
such product would infringe such Valid Claim.

 

Section 1.6                                      “FDA”
means the U.S. Food and Drug Administration.

 

Section 1.7                                      “Governmental
Authority” means any court, tribunal, arbitrator, arbitrational panel or
authority, agency, commission, official or other instrumentality of the United
States or any other country, or any supra-national organization, state, county,
city or other political subdivision or any self-regulatory organization.

 

Section 1.8                                      “Improvements”
means any improvements, modifications, developments or inventions which a Party
may make to the Product Intellectual Property after the Effective Date.

 

Section 1.9                                      “Licensed
Know-How” means all inventions, methods, processes, techniques,
improvements, designs, formulae, specifications, and technical, scientific and
business information (including, without limitation, all biological, chemical,
pharmacological, toxicological, clinical and assay information, data and
analyses), whether or not patentable, which are Controlled by the Company and
which relate to the Licensed Patent Rights or the Product in any way, in any
field or for any purpose and in whatever form existing (including, without
limitation, paper, notebooks, books, files, ledgers, records, tapes, discs,
diskettes, CD-Rom and any other media on which the foregoing can be stored).

 

Section 1.10                                “Licensed Patent
Rights” means (a) the Patent Rights set forth on Exhibit A
hereto, (b) counterparts of the Patent Rights set forth on Exhibit A
in any country of the world and (c) all other patent rights owned or
licensed by the Company and related in any way to the Product.

 

Section 1.11                                “Net Sales”
means the aggregate amount invoiced on account of sales of a Product by the
Purchaser or any of its Affiliates or sublicensees to a third party in the
Territory (but not including sales between the Purchaser and its Affiliates
where the Product is intended for resale) less the following reductions
relating to such sales:

 

(i) trade, quantity and cash discounts or
rebates, which are not already reflected in the amount invoiced;

 

(ii) any adjustments or allowances on account of
price adjustments, billing errors, rejected goods, damaged goods, returns and
withdrawal, recall or relabeling of Product;

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

2

 

(iii) credits, volume rebates, charge-back and
prime vendor rebates, reimbursements or similar payments granted or given to,
or related administrative, processing or other fees charged to, wholesalers and
other distributors, buying groups, health care insurance carriers, pharmacy
benefit management companies, health maintenance organizations or other
institutions or health care organizations, which are not already reflected in
the amount invoiced;

 

(iv)  any tax, tariff, customs duty, excise or
other duty or other governmental charge including, without limitation, value
added taxes(other than a tax on income) levied on the manufacture, sale,
transportation or delivery of the Product and remitted to the applicable taxing
authority;

 

(v) payments or rebates paid in connection with
sales of the Product to any governmental or regulatory authority in respect of
any state or federal Medicare, Medicaid or similar programs, or other managed
care programs, which are not already reflected in the amount invoiced;

 

(vi) freight, postage, handling, shipping,
insurance or other transportation costs charged to the customer whether
invoiced separately or included within the selling price; and

 

(vii) amounts allocated for bad debt determined
by generally accepted accounting principles consistently applied.

 

For purposes of this definition, the Product shall be
considered “sold” and “reductions” allowed when so recorded in the Purchaser or
its Affiliates or sublicensees (as the case may be) consolidated and
consolidating financial statements prepared in accordance with generally
accepted accounting principles. The first sale to a third party in an
arms-length transaction shall be regarded as the first sale for the purpose of
calculating Net Sales.

 

Section 1.12                                “NDA” means a
New Drug Application and amendments thereto filed pursuant to the requirements
of the FDA, as defined in 21 C.F.R. § 314 et seq., for FDA approval of a new
drug product.

 

Section 1.13                                “Order” means
any writ, judgment, decree, injunction, award or similar order of any
Governmental Authority, including any award in an arbitration proceeding (in
each case, whether preliminary or final).

 

Section 1.14                                “Parties” means
the Purchaser and the Company.

 

Section 1.15                                “Party” means
the Purchaser or the Company, as the context may require.

 

Section 1.16                                “Patent Rights”
means United States and foreign patents and patent applications and all
substitutions, divisions, continuations, continuations-in-part, requests for
continued examinations, reissues, reexaminations and extensions thereof.

 

Section 1.17                                “Person” means
any natural person or any corporation, company, partnership, joint venture,
firm or other entity, including without limitation a Party.

 

Section 1.18                                “Product” and
cognates thereof mean celecoxib in all delivery methods, formulations and
dosages.

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

3

 

Section 1.19                                “Product Clinical
Data” means all pre-clinical and clinical data, databases and intellectual
property relating to the Product and the Licensed Patent Rights, including
without limitation, raw case report files, final study reports, toxicology
reports, regulatory information including all investigational new drug
applications and such other information and data as may have been generated
during or in connection with any pre-clinical and phase I clinical studies or
other studies conducted on the Product or with respect to any Licensed Patent
Rights.

 

Section 1.20                                “Product
Intellectual Property” means all Product Clinical Data, Licensed Patent
Rights and Licensed Know-How, and any Improvements to any such Product
Intellectual Property to the extent performed by the Company or by a third
party at the Company’s direction in accordance with the terms of this
Agreement.

 

Section 1.21                                “Product Payments”
means the Upfront License Payment and the Regulatory Milestone Payment.

 

Section 1.22                                “Regulatory
Milestone Payment” has the meaning ascribed to such term in Section 2.11.

 

Section 1.23                                “Requirements of Law”
means any law, statute, code, treaty, Order, ordinance, rule, regulation or
other requirement promulgated or enacted by any Governmental Authority.

 

Section 1.24                                “Royalty” has
the meaning ascribed to such term in Section 2.11.

 

Section 1.25                                “Tax” and
cognates thereof mean all of the following: (i) any sales, use ad valorem,
transfer, franchise, license, excise, stamp, production, withholding, value
added, environmental, or other tax, custom or duty or governmental fee or other
like assessment or charge to the extent directly related to the sale of
Products (thereby explicitly excluding any income, employment or profits tax or
any sort) that may be imposed by any Governmental Authority for such sale of
Products and (ii) any liability for the payment of amounts described in (i) above
as a result of being a member of an affiliated, consolidated, combined or
unitary group for any taxable period.

 

Section 1.26                                “Territory”
means all locations and jurisdictions worldwide.

 

Section 1.27                                “Third Party”  means any person or entity other than a Party
or any of its Affiliates.

 

Section 1.28                                “Upfront License
Payment” has the meaning ascribed to such term in Section 2.9.

 

Section 1.29                                “Valid Claim”
means a claim of any issued, unexpired United States or foreign patent, which
shall not have been donated to the public, disclaimed, nor held invalid or
unenforceable by a court of competent jurisdiction in an unappealed or
unappealable decision.

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

4

 

Article II

Grant of License; Disclosure of Know-How; Clinical
Data

 

Section 2.1                                      License Grant.
Subject to the terms and conditions of this Agreement, the Company hereby
grants to the Purchaser the exclusive, worldwide, irrevocable right and license
under the Licensed Patent Rights and the Licensed Know-How for any and all
applications, uses and purposes and in any field with respect to the Product,
including without limitation, to develop, make, have made, use, offer for sale,
sell and import pharmaceutical formulations and products. The term of such
license shall be determined on a country-by-country basis, with such license to
continue with respect to a specific country until the expiration in such
country of any Patent Rights owned by Company providing market exclusivity to
the Purchaser under the Product in the applicable country, including any
Licensed Patent Rights.

 

Section 2.2                                      Commercialization.
The Purchaser agrees to use
commercially reasonable efforts to develop and commercialize the Product in the
United States on a timely basis and thereafter to sell the Product in the
United States.

 

Section 2.3                                      Disclosure of
Licensed Know-How. During the term of this Agreement, the Purchaser shall
have access, as reasonably requested by the Purchaser, to personnel of the
Company and its Affiliates at reasonable times during normal business hours and
upon prior notice for discussions relating to regulatory, scientific, medical
and other technology contained in or relating to the Licensed Know-How. In
addition, to the extent required by the Purchaser, the Purchaser shall have
access to all documents of the Company and its Affiliates related in any way to
any such discussions.

 

Section 2.4                                      Transfer of
Pre-Clinical and Clinical Data. During the term of this Agreement, the
Purchaser shall have access, as reasonably requested by the Purchaser, to personnel
of the Company and its Affiliates at reasonable times during normal business
hours and upon prior notice for discussions relating to regulatory, scientific,
medical and other matters relating to preclinical and clinical data related in
any way to the Product or the Product Intellectual Property. In addition, to
the extent required by the Purchaser, the Company shall provide access to its,
and its Affiliates, facilities, personnel and records in connection with any
regulatory filings or submissions that the Purchaser may make with respect to
the Product. After the transfer of such preclinical and clinical data related
in any way to the Product Intellectual Property, the Company shall have no
right, title or interest in such data.

 

Section 2.5                                      Sublicensees.
The Purchaser shall be entitled to grant one or more sublicenses under the
licenses granted pursuant to this Agreement, provided, however, that the
Purchaser shall not be permitted to sublicense rights broader than those
granted hereunder. Notwithstanding the foregoing, no such sublicense by
Purchaser shall alter Purchaser’s obligation to pay the Royalty to the Company
in accordance with Section 2.11.

 

Section 2.6                                      Section 365(n) of
the Bankruptcy Code. All rights and licenses granted under or pursuant to
this Agreement are, and shall otherwise be, deemed to be, for purposes of Section 365(n) of
the Bankruptcy Code, licenses of rights to “intellectual property” as defined
under Section 101(35A) of the Bankruptcy Code. The Parties shall retain
and may fully exercise all of their respective rights and elections under the
Bankruptcy Code.

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

5

 

Section 2.7                                      Improvements.
Each Party shall own all right, title and interest in and to any Improvements
it creates or develops. To the extent that the Company creates or develops
Improvements, such Improvements shall become part of the Product Intellectual
Property and shall be licensed to the Purchaser pursuant hereto, and the
Company shall notify the Purchaser of such Improvements and deliver such
Improvements and all records, data, information and know-how related thereto to
the Purchaser, in each such case promptly after the creation or development of
such Improvements and no later than thirty (30) days after the creation or
development of such Improvements.

 

Section 2.8                                      Additional
Assignments. On the Effective Date, the Parties shall execute the
Assignment Agreement attached hereto as Exhibit D.

 

Section 2.9                                      Upfront
License Payment. Upon the Effective Date, the Purchaser shall pay to the
Company a one-time upfront license payment of Five Million U.S. Dollars
($5,000,000) (the “Upfront License Payment”).

 

Section 2.10                                Regulatory Milestone
License Payment. In addition to the Upfront License Payment, upon the
Purchaser’s receipt from the FDA of final approval of the first NDA prepared by
the Purchaser with respect to the Product for any indication, the Purchaser
shall pay within thirty (30) days of such final approval to the Company an
additional one-time payment of Fifteen Million U.S. Dollars ($15,000,000) (the “Regulatory
Milestone Payment”).

 

Section 2.11                                Royalties. In
addition to the Product Payments, the Purchaser shall pay to the Company a
royalty of * percent (*%) of Net Sales of the Products in the Territory (the “Royalty”).
The Purchaser shall pay such royalty on a country-by-country basis for the Net
Sales of the Products in the applicable country during each calendar quarter,
within forty-five (45) days after the end of the applicable calendar quarter. The
Purchaser shall pay the Royalty applicable to each country in US dollars. At
the time of such payment, the Purchaser shall also provide to the Company a
written statement of Net Sales showing in reasonably specific detail, on a country-by-country
basis, (a) the calculation of Net Sales; (b) royalties payable in US
dollars, which shall have accrued hereunder based upon Net Sales; (c) withholding
taxes, if any, required by law to be deducted with respect to such sales; (d) the
dates of the first commercial sales of the Product in any jurisdiction during
the reporting period; and (e) the exchange rates used to determine the
amount of US dollars (collectively, the “Royalty Statement”). If any currency
conversion shall be required in connection with the calculation of payments
hereunder, such conversion shall be made using the average exchange rates
published by OANDA.com or a comparable service for the applicable period in
which Purchaser records the sale giving rise to the payment obligation set
forth herein. Purchaser shall be entitled to deduct Purchaser’s actual currency
conversion costs from the Royalties payable hereunder.

 

Section 2.12                                Consideration. The
Product Payments, the Royalty payments and the mutual promises provided herein
shall constitute consideration for the licenses and other rights granted
hereunder.

 

Section 2.13                                Records and Audit.
During the term of this Agreement, for a period of three (3) years after
the conclusion of the applicable calendar year, the Purchaser shall keep
complete and accurate records of Net Sales in sufficient detail to permit the
Company to confirm

 

*CONFIDENTIAL TREATMENT REQUESTED

 

6

 

the completeness and accuracy of: (i) the information presented in
each Royalty Statement and (ii) the calculation of Net Sales. The
Purchaser shall permit a recognized independent auditing firm reasonably
acceptable to the Purchaser to audit and/or inspect records of the Purchaser
solely to the extent required to verify: (A) the completeness and accuracy
of the Royalty Statements; (B) the calculation of Net Sales and (C) the
amount of Royalty payments for the Product for the previous year. Such
inspection shall be conducted during the Purchaser’s normal business hours, no
more than once in any twelve (12) month period and upon at least thirty (30)
days prior written notice by the Company to the Purchaser. If such firm
establishes that such payments were underpaid for the preceding year, the
Purchaser shall have the right to engage a recognized independent auditing firm
to verify the findings of the audit. If the firm engaged by Purchaser verifies
the findings of the firm engaged by the Company, the Purchaser shall pay the
Company the amount of any such underpayments for the preceding year, plus
interest at a rate equal to the Prime Rate of interest as reported in the Wall
Street Journal on the date payment is due, within thirty (30) days after the
date the Purchaser delivers to the Company the report of the firm engaged by
the Purchaser, which report so establishes that such payments were underpaid
for the preceding year. Notwithstanding the foregoing, the firm engaged by the
Purchaser shall deliver its findings in a prompt manner after being engaged by
the Purchaser. If the firm engaged by the Company establishes that such
payments were overpaid for the preceding year, the Company shall pay the
Purchaser the amount of any such overpayment for the preceding year, within
thirty (30) days after the date the Company delivers to the Purchaser such firm’s
report so establishing that such payments were overpaid for the preceding year.
The Company shall bear the full cost of the firm it engages unless such audit
discloses an underpayment by more than five percent (5%) of the amount due for
the preceding year and such underpayment of more than five percent (5%) is
verified by the firm engaged by the Purchaser if it chooses to engage a firm
for audit verification purposes. The Purchaser shall bear the full cost of the
firm it engages to verify the audit findings.

 

Section 2.14                                Payments. The
Product Payments and the Royalty payments shall be made electronically in US
Dollars and to such place and account as may be designated from time to time
for that purpose by the Company to Purchaser in writing.

 

Section 2.15                                Withholding Taxes.
All sums payable by either Party under this Agreement (including without
limitation the Product Payments and the Royalty payments) shall be paid in full
and without any set-off, counterclaim, taxes, duties, levies, fees, charges,
deduction or withholding on any ground whatsoever, except as may be required by
law. The Parties shall consider together to what extent, if at all, it may
lawfully be possible to mitigate the amount of such deduction or withholding or
of the amount required to be paid as aforesaid, including the use of best
efforts to make timely and procedurally correct application for relief from
withholding tax in respect of any such payment. For any taxes, duties, levies,
fees, charges, deduction or withholding on any ground whatsoever withheld or to
be withheld, each Party agrees to timely deliver all certificates and forms as
may be necessary and appropriate to establish an exemption from Tax or file Tax
returns as would be necessary with respect to such Taxes.

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

7

 

Article III

Regulatory Issues, Intellectual Property
Protection, Licensing and Related Matters

 

Section 3.1                                      Prosecution
and Maintenance of Licensed Patent Rights; Preparation of FDA Filings.

 

(a)                                  Right
to Prosecute and Maintain. The Purchaser shall have the sole right and
option to file and prosecute any patent applications, to maintain any patents
included in the Licensed Patent Rights or the Product Intellectual Property and
to make any regulatory filings applicable to any Products, including without
limitation preparation of NDA filings. The Purchaser shall provide the Company
with copies of such filings or applications promptly. Notwithstanding the foregoing,
with respect to the filing or prosecution of patent applications that do not
include claims that specifically cover the Product, the Company shall have the
right and obligation to file and prosecute any patent applications and to
maintain any existing patents included in the Licensed Patent Rights or the
Product Intellectual Property, provided, however, that in the event that the
Company fails to use commercially reasonable efforts to do so, the Purchaser
shall be entitled to deliver notice of such failure to the Company and the
Purchaser shall have the right to itself perform such filings or prosecution in
accordance with the terms hereof. In its filing and prosecution of such
patents, the Company shall: (i) only engage advisors and counsel reasonably
acceptable to the Purchaser; (ii) provide all draft patent applications to
the Purchaser sufficiently in advance of filing for the Purchaser to have a
reasonable opportunity to comment thereon and shall give effect to all
reasonable comments of Purchaser in the application filed; (iii) promptly
furnish the Purchaser with copies of all substantive communications between the
Company and applicable patent offices relating to such patent applications, and
give effect to all reasonable comments or advice of the Purchaser when framing
responses and submissions to such patent offices; and (iv) keep the
Purchaser advised of the status of actual and prospective patent filings
arising out of such patents.

 

(b)                                 Costs
and Expenses. Each Party shall bear its own costs and expenses in
preparing, filing, prosecuting and maintaining Licensed Patent Rights and other
filings or applications (including regulatory filings) arising out of the
Product Intellectual Property.

 

(c)                                  Cooperation.
Each Party agrees to cooperate with the other with respect to the filing,
prosecution and maintenance of patents, patent applications and regulatory
filings pursuant to this Section 3.1, including without limitation:

 

(i)                                     the
execution of all such documents and instruments and the performance of such
acts as may be reasonably necessary in order to permit the other Party to file,
prosecute or maintain patents and patent applications as provided for in Section 3.1(a);

 

(ii)                                  making
its employees, agents and consultants reasonably available to the other Party
(or to the other Party’s authorized attorneys, agents or representatives), to
the extent reasonably necessary to enable the prosecuting Party to prepare,
file, prosecute and maintain patents and patent applications as provided for in
Section 3.1(a);

 

(iii)                               providing available
data, records and information to support preparation and prosecution of patent
applications; and

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

8

 

(iv)                              providing
available data, records, information and personnel to support preparation of
all regulatory filings and consultant with regulatory authorities related
thereto.

 

Section 3.2                              Third Party
Infringement.

 

(a)                                  Notifications
of Competitive Infringement. Each Party agrees to notify the other Party
when it becomes aware of the reasonable probability of infringement of the
Licensed Patent Rights (“Competitive Infringement”).

 

(b)                                 Infringement
Action. The Purchaser shall have the initial right, but no obligation, to
institute an infringement suit or take other appropriate action that it
believes is reasonably required to protect the Licensed Patent Rights or the
Product Intellectual Property from such Competitive Infringement. The Purchaser
shall be permitted to act, or choose not to act, subject to its sole
discretion, including, if it so chooses, taking no action with respect to
Competitive Infringement or settling any such Competitive Infringement in its
sole discretion. Subject to Section 3.4, the expenses of any suit or suits
that the Purchaser elects to bring shall be paid for entirely by the Purchaser.
If the Purchaser does not take action in the prosecution, prevention, or
termination of any infringement suit and has not commenced negotiations with
the infringer for the discontinuance of such infringement within forty-five
(45) days (or longer if the Parties mutually agree) of becoming aware of such
infringement, the Company may elect to do so. If the Company elects to bring
suit against such infringer and the Purchaser is joined as a party in such suit
(which it shall do if so requested by the Company), the Purchaser shall have
the right to approve counsel selected by the Company to represent the Parties,
which approval shall not be unreasonably withheld, conditioned or delayed. The expenses
of such suit or suits that the Company elects to bring, including any
reasonable out-of-pocket expenses of the Purchaser incurred in connection
therewith, shall be paid for entirely by the Company. Neither Party shall
compromise or settle any litigation in a manner that imposes any obligation on
the other Party or that otherwise adversely impacts the development or
commercialization of the Product, or the Licensed Patent Rights or the Product
Intellectual Property without the prior written consent of the other Party,
which consent shall not be unreasonably withheld, conditioned or delayed.

 

(c)                                  Recoveries.
Any recovery obtained by any Party as a result of any proceeding described in
this Section 3.2, by settlement or otherwise, shall be applied in the
following order of priority:

 

(i)                                     first,
to reimburse each Party for all litigation costs in connection with such
proceeding paid by that Party and not otherwise recovered (on a pro rata basis
based on each Party’s respective litigation costs, to the extent the recovery
was less than all such litigation costs); and

 

(ii)                                  second,
all remaining amounts, to the Purchaser.

 

Section 3.3                                      Infringement
of Third Party Patents. If a claim alleging infringement of Third Party
patents is made against the Purchaser, then the Purchaser shall defend against
such a claim at its cost and expense, but the Company may be represented in
such event by legal counsel

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

9

 

in an advisory capacity at its own expense. The Purchaser shall keep
the Company informed of the status of the case.

 

Section 3.4                                      Cooperation.
In the event that the Purchaser takes action pursuant to Section 3.2 or Section 3.2(c) above,
the Company shall participate in such action (including, without limitation,
joining as a party to such action) and cooperate with the Purchaser to the
extent reasonably requested by the Purchaser. The Company shall provide
assistance and cooperation to the Purchaser without any charge to the Purchaser,
provided, however, that the Purchaser shall pay the Company’s reasonable
out-of-pocket expenses incurred in connection with such assistance and
cooperation.

 

Section 3.5                                      Third Party
Licenses. All third-party licenses pursuant to which the licenses or rights
in this Agreement are granted are attached in Exhibit B hereto (“Third
Party Licenses”). The Company hereby sublicenses to the Purchaser, to the
fullest extent permissible under the Third Party Licenses, all rights and
licenses of the Company under such licenses, including any rights to grant
further sublicenses.

 

Article IV

Confidentiality

 

Section 4.1                                      Confidential
Information. All Confidential Information disclosed by the Company to the
Purchaser during the term of this Agreement shall not be used by the Purchaser
except in connection with the activities contemplated by this Agreement
(including, without limitation, the licenses granted pursuant to Section 2.1),
shall be maintained in confidence by the Purchaser (except to the extent
reasonably necessary in connection with regulatory filings relating to the
Product and/or relating to practicing the Licensed Patent Rights or Licensed
Know-How in any way, in any field and for any purpose; for the filing,
prosecution and maintenance of Patent Rights; or to develop, make, have made,
use, offer for sale, sell and import pharmaceutical formulations and products
Covered by the Licensed Patent Rights or Licensed Know-How), and shall not
otherwise be disclosed by the Purchaser to any other person, firm, or agency,
governmental or private (except consultants, advisors and Affiliates in
accordance with Section 5.4), without the prior written consent of the
Company, except to the extent that the Confidential Information:

 

(a)                                  was
known or used by the Purchaser or its Affiliates prior to its date of
disclosure to the Purchaser; or

 

(b)                                 either
before or after the date of the disclosure to the Purchaser is lawfully
disclosed to the Purchaser or its Affiliates by sources other than the Company
rightfully in possession of the Confidential Information; or

 

(c)                                  either
before or after the date of the disclosure to the Purchaser becomes published
or generally known to the public through no fault or omission on the part of
the Purchaser; or

 

(d)                                 is
independently developed by or for the Purchaser or its Affiliates without
reference to or reliance upon the Confidential Information; or

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

10

 

(e)                                  is
required to be disclosed by the Purchaser or its Affiliates to comply with
applicable laws or regulations, to defend or prosecute litigation or to comply
with legal process.

 

Section 4.2                                      Employee,
Consultant and Advisor Obligations. The Purchaser agrees that it and its
Affiliates shall provide Confidential Information received from the Company
only to its and their respective employees, consultants and advisors who have a
need to know such Confidential Information.

 

Section 4.3                                      Term. All
obligations of confidentiality imposed under this Article IV shall expire
ten (10) years following termination or expiration of this Agreement.

 

Article V

Representations and Warranties

 

Section 5.1                                      Representations
of Authority. The Purchaser and the Company each represents and warrants to
the other that, as of the Effective Date, it has full right, power and
authority to enter into this Agreement and to perform its respective
obligations under this Agreement.

 

Section 5.2                                      Consents. The
Purchaser and the Company each represents and warrants to the other that, as of
the Effective Date, all necessary consents, approvals and authorizations of all
government authorities and other persons required to be obtained by such Party
in connection with execution, delivery and performance of this Agreement have
been obtained.

 

Section 5.3                                      No Conflict.
The Purchaser and the Company each represents and warrants to the other that,
as of the Effective Date, the execution and delivery of this Agreement and the
performance of such Party’s obligations hereunder (a) do not conflict with
or violate any requirement of applicable laws or regulations and (b) do
not conflict with, violate or breach or constitute a default of, or require any
consent under, any contractual obligations of such Party, except such consents
as have been obtained as of the Effective Date.

 

Section 5.4                                      Employee,
Consultant and Advisor Obligations. The Purchaser and the Company each
represents and warrants to the other that, as of the Effective Date, each of
its and its Affiliates’ employees, consultants and advisors has executed an
agreement or has an existing obligation under law obligating such employee,
consultant or advisor to maintain the confidentiality of Confidential
Information to the extent required under Article IV.

 

Section 5.5                                      Litigation.
The Company represents and warrants that there is no pending or, to its
knowledge, threatened litigation against it relating to the Products or the
Product Intellectual Property, except as disclosed in Exhibit C
hereto.

 

Section 5.6                                      Intellectual
Property. The Company represents and warrants to the Purchaser that, as of
the Effective Date, and except as described in Section 3.5, (a) the
Company owns the entire right, title and interest in and to the Licensed Patent
Rights and Licensed Know-How, (b) the Company has the right to grant to
the Purchaser the rights and licenses under the Licensed Patent Rights and
Licensed Know-How granted in this Agreement, (c) none of the Licensed
Patent Rights was fraudulently procured from the relevant governmental patent granting
authority, (d) as of the Effective Date, there is no claim or demand of
any Person

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

11

 

pertaining to, or any
proceeding which is pending or threatened, that asserts the invalidity, misuse
or unenforceability of the Licensed Patent Rights or challenges the Company’s
ownership of the Licensed Patent Rights or Licensed Know-How or makes any
adverse claim with respect thereto, and, to the knowledge of the Company, there
is no basis for any such claim, demand or proceeding, (e) to the knowledge
of the Company, as of the Effective Date, the Licensed Patent Rights are not
being infringed and the Licensed Know-How is not being used by any Third Party,
(f) to the knowledge of the Company, the Products and the processes used
to make the Products do not infringe any Third Party Patent Rights, except as
disclosed in Exhibit C, and (g) the Licensed Patent Rights
include all of the Patent Rights Controlled by the Company on the Effective
Date which Cover the Product, or, in the case of patent applications included
in the Patent Rights, claims if issued, would Cover the Product.

 

Section 5.7                                      No Warranties.
EXCEPT AS OTHERWISE EXPRESSLY SET FORTH HEREIN, THE PARTIES MAKE NO
REPRESENTATIONS AND EXTEND NO WARRANTIES OF ANY KIND, EITHER EXPRESS OR
IMPLIED.

 

Article VI

Term and Termination

 

Section 6.1                                      Term. This
Agreement shall become effective as of the Effective Date, may be terminated as
set forth in this Article VI, and otherwise remains in effect until the
expiration of all of the licenses described in Section 2.1.

 

Section 6.2                                      Termination
For Material Breach. Upon any material breach of this Agreement by either
Party (in such capacity, the “Breaching Party”), the other Party may terminate
this Agreement by providing sixty (60) days’ written notice to the Breaching
Party, specifying the material breach. The termination shall become effective
at the end of the sixty (60) day period unless the Breaching Party cures such
breach during such sixty (60) day period.

 

Section 6.3                                      Voluntary
Abandonment. Should the Purchaser determine that is wishes to abandon
development, commercialization or sale of the Product within any jurisdiction
within the Territory, it shall so notify the Company and shall terminate this
Agreement solely with respect to such jurisdiction.

 

Section 6.4                                      Survival. Upon
expiration or termination of this Agreement for any reason, nothing in this
Agreement shall be construed to release either Party from any obligations that
matured prior to the effective date of expiration or termination; and the
following provisions shall expressly survive any such expiration or
termination:  Article I, Section 2.7,
Article IV, Article V and Article VII.

 

Article VII

Miscellaneous Provisions

 

Section 7.1                                      Indemnification.

 

(a)                                  The
Purchaser. The Purchaser agrees to defend the Company, its Affiliates and
their respective directors, officers, employees and agents at the Purchaser ‘s
cost and expense, and shall indemnify and hold harmless the Company and its
Affiliates and their 

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

12

 

respective directors,
officers, employees and agents from and against any liabilities, losses, costs,
damages, fees or expenses arising out of any Third Party claim relating to (i) any
breach by the Purchaser of any of its representations, warranties or
obligations pursuant to this Agreement or (ii) personal injury, property
damage or other damage resulting from the development or commercialization by
the Purchaser or its Affiliates or sublicensees of a product Covered by any of
the Licensed Patent Rights.

 

(b)                                 The
Company. The Company agrees to defend the Purchaser, its Affiliates and
their respective directors, officers, employees and agents at the Company’s
cost and expense, and shall indemnify and hold harmless the Purchaser and its
Affiliates and their respective directors, officers, employees and agents from
and against any liabilities, losses, costs, damages, fees or expenses arising
out of any Third Party claim relating to any breach by the Company of any
of its representations, warranties or obligations pursuant to this Agreement or
(ii) personal injury, property damage or other damage resulting from the
development or commercialization by the Company or its Affiliates or
sublicensees of a product Covered by any of the Licensed Patent Rights.

 

(c)                                  Claims
for Indemnification. A person entitled to indemnification under this Section 7.1
(an “Indemnified Party”) shall give prompt written notification to the person
from whom indemnification is sought (the “Indemnifying Party”) of the
commencement of any action, suit or proceeding relating to a Third Party claim
for which indemnification may be sought or, if earlier, upon the assertion of
any such claim by a Third Party (it being understood and agreed, however, that
the failure by an Indemnified Party to give notice of a third-party claim as
provided in this Section 7.1(c) shall not relieve the Indemnifying Party
of its indemnification obligation under this Agreement except and only to the
extent that such Indemnifying Party is actually damaged as a result of such
failure to give notice). Within thirty (30) days after delivery of such
notification, the Indemnifying Party may, upon written notice thereof to the
Indemnified Party, assume control of the defense of such action, suit,
proceeding or claim with counsel reasonably satisfactory to the Indemnified
Party. If the Indemnifying Party does not assume control of such defense, the
Indemnified Party shall control such defense. The Party not controlling such
defense may participate therein at its own expense; provided  that,
if the Indemnifying Party assumes control of such defense and the Indemnified
Party reasonably concludes, based on advice from counsel, that the Indemnifying
Party and the Indemnified Party have conflicting interests with respect to such
action, suit, proceeding or claim, the Indemnifying Party shall be responsible
for the reasonable fees and expenses of counsel to the Indemnified Party solely
in connection therewith; provided, however, that in no event
shall the Indemnifying Party be responsible for the fees and expenses of more
than one counsel for all Indemnified Parties. The Party controlling such
defense shall keep the other Party advised of the status of such action, suit,
proceeding or claim and the defense thereof and shall consider recommendations
made by the other Party with respect thereto. The Indemnified Party shall not
agree to any settlement of such action, suit, proceeding or claim without the
prior written consent of the Indemnifying Party, which shall not be
unreasonably withheld, delayed or conditioned. The Indemnifying Party shall not
agree to any settlement of such action, suit, proceeding or claim or consent to
any judgment in respect thereof that does not include a complete and unconditional
release of the Indemnified Party from all liability with respect thereto or
that imposes any liability or obligation on the Indemnified Party without the
prior written consent of the Indemnified Party.

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

13

 

Section 7.2                                      Governing Law;
Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed
by and construed in accordance with the Requirements of Law of the State of
Delaware without giving effect to the principles of conflict of laws. Each of
the parties hereto hereby irrevocably and unconditionally consents to submit to
the exclusive jurisdiction of the courts of the State of Delaware or the United
States District Court for the District of Delaware and the appellate courts
having the jurisdiction with respect to appeals from such courts, for any
action arising out of or relating to this Agreement (and agrees not to commence
any action relating thereto except in such courts), and further agrees that
service of any process, summons, notice or document by U.S. registered mail to
its respective address set forth in this Agreement, or such other address as
may be given by one or more parties to the other parties in accordance with the
notice provisions of Section 7.5, shall be effective service of process
for any action, suit or proceeding brought against it in any such court. Each
of the parties hereto hereby irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement or the transactions contemplated hereby in the courts of the
State of Delaware or the United States District Court for the District of
Delaware and the appellate courts having the jurisdiction with respect to
appeals from such courts, and hereby further irrevocably and unconditionally
waives and agrees not to plead or claim in any such court that any such action
brought in any such court has been brought in an inconvenient forum. Each of
the parties irrevocably and unconditionally waives, to the fullest extent
permitted by applicable Requirements of Law, any and all rights to trial by
jury in connection with any action, suit or proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.

 

Section 7.3                                      Assignment.
Neither this Agreement nor any rights or obligations hereunder may be assigned
or otherwise transferred by either Party without the prior written consent of
the other Party (which consent shall not be unreasonably withheld); provided,
however, that either Party may assign this
Agreement and its rights and obligations hereunder without the other Party’s
consent (a) in connection with the transfer or sale of all or
substantially all of the business of such Party to a Third Party, whether by
merger, sale of stock, sale of assets or otherwise or (b) to any
Affiliate; provided that  no such
assignment to an Affiliate shall relieve the assigning Party of its
responsibilities for performance of its obligations under this Agreement.

 

Section 7.4                                      Entire
Agreement; Amendments. This Agreement constitutes the entire agreement
between the Parties with respect to the subject matter hereof, and supersedes
all previous arrangements with respect to the subject matter hereof, whether
written or oral. Any amendment or modification to this Agreement shall be made
in writing signed by both Parties.

 

Section 7.5                                      Notices.

 

Notices to the Company shall be addressed to:

 

[COMPANY]

[              

[              ]

Attention: Chief Executive Officer

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

14

 

with a copy, which shall not constitute notice, to:

 

Goodwin Procter LLP

53 State Street

Boston, MA 02109

Attention:  Lawrence S.
Wittenberg

 

Notices to the
Purchaser shall be addressed to:

 

[PURCHASER]

[              ]

[              ]

Attention:  General Counsel

 

with a copy, which shall not constitute notice, to:

 

Sidley Austin LLP

One South Dearborn Street

Chicago, IL 60603

Attention:  Pran Jha

 

Any Party may change its address by giving notice to
the other Party in the manner herein provided. Any notice required or provided
for by the terms of this Agreement shall be in writing and shall be (a) sent
by registered or certified mail, return receipt requested, postage prepaid, (b) sent
via a reputable overnight or international express courier service, or (c) personally
delivered, in each case properly addressed in accordance with the paragraph
above. The effective date of notice shall be the actual date of receipt by the
Party receiving the same.

 

Section 7.6                                      Force Majeure.
No failure or omission by the Parties hereto in the performance of any
obligation of this Agreement shall be deemed a breach of this Agreement or
create any liability if the same shall arise from any cause or causes beyond
the control of the Parties, including, but not limited to, the following: acts
of God; acts or omissions of any government; any rules, regulations or orders
issued by any governmental authority or by any officer, department, agency or
instrumentality thereof; fire; storm; flood; earthquake; accident; war;
rebellion; insurrection; riot; and invasion. The Party claiming force majeure
shall notify the other Party with notice of the force majeure event as soon as
practicable, but in no event longer than ten (10) business days after its
occurrence, which notice shall reasonably identify such obligations under this
Agreement and the extent to which performance thereof will be affected.

 

Section 7.7                                      Public
Announcements. Any public announcements or publicity with respect to the
execution of this Agreement shall be agreed upon by the Parties in advance of
such announcement, provided, however, that the foregoing shall not be
interpreted to prevent either Party from taking any actions or making any
disclosures which are required by any Governmental Authority or which, in the
reasonable opinion of such Party and its advisors, are required or desirable in
connection with such Party’s regulatory obligations.

 

Section 7.8                                      Independent
Contractors. It is understood and agreed that the relationship between the
Parties hereunder is that of independent contractors and that nothing in this 

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

15

 

Agreement shall be
construed as authorization for either the Company or the Purchaser to act as
agent for the other.

 

Section 7.9                                      No Strict
Construction. This Agreement has been prepared jointly and shall not be
strictly construed against any Party.

 

Section 7.10                                Headings. The
captions or headings of the sections or other subdivisions hereof are inserted
only as a matter of convenience or for reference and shall have no effect on
the meaning of the provisions hereof.

 

Section 7.11                                No Implied Waivers;
Rights Cumulative. No failure on the part of the Company or the Purchaser
to exercise, and no delay in exercising, any right, power, remedy or privilege
under this Agreement, or provided by statute or at law or in equity or
otherwise, shall impair, prejudice or constitute a waiver of any such right,
power, remedy or privilege or be construed as a waiver of any breach of this
Agreement or as an acquiescence therein, nor shall any single or partial
exercise of any such right, power, remedy or privilege preclude any other or
further exercise thereof or the exercise of any other right, power, remedy or
privilege.

 

Section 7.12                                Severability. If,
under applicable law or regulation, any provision of this Agreement is deemed
invalid or unenforceable, or otherwise directly or indirectly affects the
validity or enforceability of any other material provision(s) of this
Agreement, such provision shall be deemed modified to the extent required to most
fully carry out the intent of the original provision in a valid and enforceable
manner.

 

Section 7.13                                Execution in
Counterparts. This Agreement may be executed in counterparts, each of which
counterparts, when so executed and delivered (whether in person, by mail,
courier, facsimile or e-mail), shall be deemed to be an original, and all of
which counterparts, taken together, shall constitute one and the same
instrument.

 

Section 7.14                                No Third Party
Beneficiaries. No person or entity other than the Company, the Purchaser
and their respective Affiliates and permitted assignees hereunder shall be
deemed an intended beneficiary hereunder or have any right to enforce any
obligation of this Agreement.

 

Section 7.15                                No Consequential
Damages. NEITHER PARTY HERETO WILL BE LIABLE FOR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES ARISING OUT OF THIS
AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, OR FOR LOST PROFITS ARISING
FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF
SUCH DAMAGES. NOTHING IN THIS Section 7.15 IS INTENDED TO LIMIT OR
RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY WITH RESPECT
TO THIRD PARTY CLAIMS.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

*CONFIDENTIAL
TREATMENT REQUESTED

 

16

 

IN WITNESS WHEREOF, the
Parties have executed this Agreement as of the date first set forth above.

 

 

	
   

  	
  [PURCHASER]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [THE COMPANY]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
						

 

Signature Page to License
Agreement

 

 

Exhibit A

 

Pending
and Issued Licensed Patent Rights as of the Effective Date

 

See attached Intellectual Property Schedule.

 

A-1

 

Exhibit A

 

Pending
and Issued Licensed Patent Rights as of the Effective Date

 

	
   

  	
   

  	
  Title

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  File Number

  	
   

  	
  Country Name

  	
   

  	
  Status Description

  	
   

  	
  Application Number

  	
   

  	
  Appl. Date

  	
   

  	
  Patent No.

  	
   

  	
  Date of Grant

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109

  	
   

  	
  Porous
  Drug Matrices And Methods For Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  09/433,486

  	
   

  	
  Nov 04 1999

  	
   

  	
  6,395,300

  	
   

  	
  May 28 2002

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109/110

  	
   

  	
  Porous
  Drug Matrices And Methods Of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Australia

  	
   

  	
  Grant

  	
   

  	
  768022

  	
   

  	
  May 25 2000

  	
   

  	
  768022

  	
   

  	
  Mar 11 2004

  
	
   

  	
   

  	
  Austria

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Belgium

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Brazil

  	
   

  	
  Pending

  	
   

  	
  PI0010984-3

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Canada

  	
   

  	
  Grant

  	
   

  	
  2,371,836

  	
   

  	
  May 25 2000

  	
   

  	
  2,371,836

  	
   

  	
  Jan 31 2006

  
	
   

  	
   

  	
  China

  	
   

  	
  Grant

  	
   

  	
  00808161.1

  	
   

  	
  May 25 2000

  	
   

  	
  ZL00808161.1

  	
   

  	
  Feb 08 2006

  
	
   

  	
   

  	
  Denmark

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  European
  Patent

  	
   

  	
  Gone
  National

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Finland

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  France

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Germany

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  60024811.9

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Hong
  Kong

  	
   

  	
  Grant

  	
   

  	
  03101310.8

  	
   

  	
  May 25 2000

  	
   

  	
  HK1048956

  	
   

  	
  Jul 28 2006

  
	
   

  	
   

  	
  Ireland

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Israel

  	
   

  	
  Pending

  	
   

  	
  146659

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Italy

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Japan

  	
   

  	
  Pending

  	
   

  	
  2000-620939

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Korea,
  Republic of (South)

  	
   

  	
  Grant

  	
   

  	
  2001-7015052

  	
   

  	
  May 25 2000

  	
   

  	
  10-0752000

  	
   

  	
  Aug 17 2007

  
	
   

  	
   

  	
  Mexico

  	
   

  	
  Grant

  	
   

  	
  PA/a/2001/012106

  	
   

  	
  May 25 2000

  	
   

  	
  244662

  	
   

  	
  Apr 02 2007

  
	
   

  	
   

  	
  Netherlands

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  New
  Zealand

  	
   

  	
  Grant

  	
   

  	
  516083

  	
   

  	
  May 25 2000

  	
   

  	
  516083

  	
   

  	
  Dec 08 2003

  
	
   

  	
   

  	
  Norway

  	
   

  	
  Grant

  	
   

  	
  20015753

  	
   

  	
  May 25 2000

  	
   

  	
  323761

  	
   

  	
  Jul 02 2007

  
	
   

  	
   

  	
  Philippines

  	
   

  	
  Grant

  	
   

  	
  1-2000-01402

  	
   

  	
  May 29 2000

  	
   

  	
  1-2000-001402

  	
   

  	
  Nov 21 2006

  
	
   

  	
   

  	
  Portugal

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Singapore

  	
   

  	
  Grant

  	
   

  	
  200107349-3

  	
   

  	
  May 25 2000

  	
   

  	
  85293

  	
   

  	
  Jan 30 2004

  
	
   

  	
   

  	
  South
  Africa

  	
   

  	
  Grant

  	
   

  	
  2001/10347

  	
   

  	
  May 25 2000

  	
   

  	
  2001/10347

  	
   

  	
  Sep 23 2003

  
	
   

  	
   

  	
  Spain

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Sweden

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Switzerland

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
  Taiwan

  	
   

  	
  Grant

  	
   

  	
  89110363

  	
   

  	
  May 29 2000

  	
   

  	
  I274589

  	
   

  	
  Mar 01 2007

  

 

A-2

 

	
   

  	
   

  	
  Thailand

  	
   

  	
  Pending

  	
   

  	
  057899

  	
   

  	
  May 29 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  Kingdom

  	
   

  	
  Grant

  	
   

  	
  00939365.3

  	
   

  	
  May 25 2000

  	
   

  	
  1180020

  	
   

  	
  Dec 14 2005

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109/110DIV

  	
   

  	
  Porous
  Drug Matrices And Methods Of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  China

  	
   

  	
  Grant

  	
   

  	
  200510136940.4

  	
   

  	
  Dec 15 2005

  	
   

  	
  ZL200510136940.4

  	
   

  	
  Mar 26 2008

  
	
   

  	
   

  	
  European
  Patent

  	
   

  	
  Pending

  	
   

  	
  05027194.9

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Hong
  Kong

  	
   

  	
  Pending

  	
   

  	
  07102209.6

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Korea,
  Republic of (South)

  	
   

  	
  Pending

  	
   

  	
  2007-7012286

  	
   

  	
  May 25 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Philippines

  	
   

  	
  Pending

  	
   

  	
  1-2006-000163

  	
   

  	
  May 29 2000

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109CIP

  	
   

  	
  Porous
  Drug Matrices And Methods For Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Pending

  	
   

  	
  10/053,929

  	
   

  	
  Jan 22 2002

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109CIPDIV

  	
   

  	
  Porous
  Drug Matrices And Methods For Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Pending

  	
   

  	
  10/924,642

  	
   

  	
  Aug 24 2004

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109CIPDIV(2)

  	
   

  	
  Porous
  Drug Matrices and Methods of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Pending

  	
   

  	
  10/928,886

  	
   

  	
  Aug 27 2004

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109DIV

  	
   

  	
  Porous
  Drug Matrices And Methods For Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  09/694,407

  	
   

  	
  Oct 23 2000

  	
   

  	
  6,645,528

  	
   

  	
  Nov 11 2003

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU109DIV(2)

  	
   

  	
  Porous
  Drug Matrices And Methods For Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  09/706,045

  	
   

  	
  Nov 03 2000

  	
   

  	
  6,932,983

  	
   

  	
  Aug 23 2005

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU110

  	
   

  	
  Porous
  Paclitaxel Matrices And Methods Of Manufacturing Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  09/798,824

  	
   

  	
  Mar 02 2001

  	
   

  	
  6,610,317

  	
   

  	
  Aug 26 2003

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU110REISSUE

  	
   

  	
  Porous
  Paclitaxel Matrices and Methods of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  11/213,257

  	
   

  	
  Aug 26 2005

  	
   

  	
  RE40,493

  	
   

  	
  Sep 09 2009

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU111

  	
   

  	
  Porous
  Celecoxib Matrices And Methods of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Canada

  	
   

  	
  Grant

  	
   

  	
  2,412,885

  	
   

  	
  Jun 15 2001

  	
   

  	
  2,412,885

  	
   

  	
  Sep 05 2006

  
	
   

  	
   

  	
  Japan

  	
   

  	
  Pending

  	
   

  	
  2002-510056

  	
   

  	
  Jun 15 2001

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  09/881,289

  	
   

  	
  Jun 14 2001

  	
   

  	
  6,589,557

  	
   

  	
  Jul 08 2003

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACU111CIP

  	
   

  	
  Porous
  Cox-2 Inhibitor Matrices and Methods of Manufacture Thereof

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  United
  States of America

  	
   

  	
  Grant

  	
   

  	
  10/441,440

  	
   

  	
  May 19 2003

  	
   

  	
  6,800,297

  	
   

  	
  Oct 05 2004

  

 

A-3

 

Exhibit B

 

Third Party Licenses

 

None.

 

B-1

 

Exhibit C

 

Litigation and Infringement Disclosure

 

None.

 

C-1

 

Exhibit D

 

Assignment Agreement

 

See Exhibit E to Note Purchase Agreement.

 

D-1Exhibit 10.1

 

AMENDMENT TO AGREEMENT AND PLAN OF
MERGER

 

THIS AMENDING AGREEMENT (“Amending Agreement”)
is made and entered into as of October 21, 2008 among
HealthAxis Inc., a Pennsylvania corporation (“HealthAxis”),
Outsourcing Merger Sub, Inc., a Delaware corporation and wholly owned
subsidiary of HealthAxis (“Merger
Sub”) and BPO Management Services, Inc., a Delaware
corporation (“BPOMS”).
Each of HealthAxis, Merger Sub and BPOMS are sometimes referred to herein as a “Party” or,
collectively, the “Parties”.

 

RECITALS

 

A.    HealthAxis, Merger Sub and BPOMS entered into
an agreement and plan of merger (the “Merger Agreement”) as of September 5,
2008 providing for a merger of Merger Sub into BPOMS and the issuance of shares
of HealthAxis Common Stock and HealthAxis Series B Preferred Stock to the
securityholders of BPOMS.

 

B.    The Parties have agreed to amend certain
provisions of the Merger Agreement, as provided by this Amending Agreement.

 

AGREEMENT

 

IN CONSIDERATION OF the
foregoing and of the mutual covenants and agreements herein contained, the
Parties agree as follows:

 

1.     In this Amending Agreement, all capitalized
terms which are not defined herein shall have the same meanings as set out in
the Merger Agreement.

 

2.     Each of the Exchange Ratios provided for by
the Merger Agreement in respect of each class or series of BPOMS Stock and in
respect of each series of the BPOMS Investor Warrants, BPOMS Non-Investor
Warrants and BPOMS Options indicated below are hereby amended (and remain
subject to adjustment after determination of the Reverse Split and otherwise in
accordance with Section 3.6 of the Merger Agreement) to be the amounts
hereinafter specified (and the definitions of each of the Exchange Ratios in
the Merger Agreement shall be as so specified):

 

	
  Class or
  Series of Stock,

  Warrants or Options

  	
   

  	
  Amended Exchange Ratios

  
	
  BPOMS Common Shares

  	
   

  	
  0.2467 (“Exchange Ratio”)

  
	
  BPOMS Series A Preferred Shares

  	
   

  	
  0.2773 (“Exchange Ratio”)

  
	
  BPOMS Series B Preferred Shares

  	
   

  	
  0.2467 (“Exchange Ratio”)

  
	
  BPOMS Series C Preferred Shares

  	
   

  	
  1.2868 (“Series C Exchange
  Ratio”)

  
	
  BPOMS Series D Preferred Shares

  	
   

  	
  3.9475 (“Series D Exchange
  Ratio”)

  
	
  BPOMS Series D-2 Preferred Shares

  	
   

  	
  3.9475 (“Series D-2 Exchange
  Ratio”)

  
	
  BPOMS Series F Preferred Shares

  	
   

  	
  6.1679 (“Series F Exchange Ratio”)

  
	
  BPOMS Series C Investor Warrant ($0.01)

  	
   

  	
  0.2467 (“Series C Warrant
  Exchange Ratio”)

  
	
  BPOMS Series D Investor Warrant ($0.01)

  	
   

  	
  0.2467 (“Series D Warrant
  Exchange Ratio”)

  
	
  BPOMS Outstanding Investor Warrants

  	
   

  	
  0.2467 (“Exchange Ratio”)

  
	
  BPOMS Non-Investor Warrants

  	
   

  	
  0.2467 (“Exchange Ratio”)

  
	
  BPOMS Options

  	
   

  	
  0.2467 (“Exchange Ratio”)

  

 

3.     Paragraph 9.1(h) of the Merger
Agreement is hereby amended by changing the Termination Date from December 31,
2008 to January 31, 2009.

 

4.     Paragraph 9.3(c) of the Merger
Agreement is hereby deleted and replaced with the following:

 

“HealthAxis shall pay BPOMS a termination fee of
$500,000 upon (i) termination of this Agreement by BPOMS pursuant to Section 9.1(d) at
any time, or (ii) termination of this Agreement by BPOMS or HealthAxis
pursuant to Section 9.1(f) at any time prior to October 27,
2008. HealthAxis shall pay BPOMS a termination fee of $1,000,000: (x) upon

 

 

termination of this Agreement by BPOMS or HealthAxis
pursuant to Section 9.1(f) at any time on or after October 27,
2008, or (y) in the event that HealthAxis terminates this Agreement
pursuant to Section 9.1(h) and, prior to the Termination Date,
HealthAxis has received an Acquisition Proposal from another Person and
HealthAxis then completes an Acquisition Transaction with that Person or any
affiliate thereof at any time on or before December 31, 2009.”

 

5.     Paragraph 9.3(d) of the Merger
Agreement is hereby deleted and replaced with the following:

 

“BPOMS shall pay HealthAxis a termination fee of
$500,000 upon (i) termination of this Agreement by HealthAxis pursuant to Section 9.1(c) at
any time, or (ii) termination of this Agreement by HealthAxis or BPOMS
pursuant to Section 9.1(g) at any time prior to October 27,
2008. BPOMS shall pay HealthAxis a termination fee of $1,000,000 upon
termination of this Agreement by HealthAxis or BPOMS pursuant to Section 9.1(g) at
any time on or after October 27, 2008.”

 

6.     All numerical references in the Merger
Agreement to the number of BPOMS Series A Preferred Shares authorized or
issued and outstanding shall be deemed to be 1,608,612.

 

7.     All numerical references in the Certificate
of Designation of the HealthAxis Series B Preferred Shares shall be
adjusted consistent with the modification of the Exchange Ratios set forth in
this Amending Agreement.

 

8.     As and from the date of this Amending
Agreement, all references in any other documents to the Merger Agreement shall
be construed as references to the Merger Agreement, as amended hereby. Except
as expressly amended hereby, each and every provision of the Merger Agreement
shall continue in full force and effect and is hereby confirmed, and all rights
and obligations of the Parties shall not be affected in any manner except as
specifically provided for in this Amending Agreement.

 

9.     This Amending Agreement may be executed in
any number of counterparts, each of which, when so executed, shall be deemed to
be an original and all of which taken together shall be deemed to constitute
one and the same instrument.

 

2

 

IN WITNESS WHEREOF, the
Parties hereto have executed this Amending Agreement as of the date first above
written.

 

	
   

  	
   

  	
  HEALTHAXIS INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  /s/ JOHN CARRADINE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  Chief Executive Officer and President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OUTSOURCING MERGER SUB, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  /s/ JOHN CARRADINE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BPO MANAGEMENT SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  /s/ PATRICK DOLAN

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Per:

  	
  Chairman of the Board and

  Chief Executive Officer

  

 

3

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