Document:

aafinancial8kex104_462009.htm

     

    Exhibit
10.4 

    EXCLUSIVE
LICENSE AGREEMENT

     

    

              This
Exclusive License Agreement (the Agreement) is made and entered
into this 15 of May 2006 (the
"Effective Date") by and between the Regents of the University of Colorado, a
body corporate, having its principal office at 201 Regent Hall, Regent Drive,
Boulder, CO 80309 (hereinafter "University") and APRO Bio Pharmaceutical
Corporation, a Utah corporation having its principal office at 5820 Tolcate
Woods Lane, Salt Lake City, Utah 84121 (hereinafter
"Licensee").

     

    WHEREAS,
University is the owner of certain Patent Rights (as later defined
herein) invented by University employee Leland Shapiro, and has the right to
grant licenses under said Patent Rights, and;

     

    WHEREAS,
Licensee is interested in licensing and further developing the Patent
Rights for commercial applications, and;

     

    WHEREAS,
University desires to have the Patent Rights developed and commercialized
to benefit the public and is willing to grant a license
hereunder;

     

    NOW,
THEREFORE, in consideration of the promises and the mutual covenants
contained herein, the parties hereto agree as
follows:

     

    SECTION
1. DEFINITIONS

     

    For the purposes of
this Agreement, the following words and phrases shall have the following
meanings:

     

    
      	
              1.1

            	
              "Affiliate(s)"
      shall mean every corporation or entity, which, directly or indirectly, or
      throughone or more
      intermediaries, controls, is controlled by, or is under common control
      with Licensee, as well as every officer and director of any such
      corporation or entity. For the purposes of this definition, the term
      "control" means (a) beneficial ownership of at least fifty percent (50%)
      of the voting securities of a business organization with voting
      securities, or (b) a fifty percent (50%) or greater interest in the net
      assets or profits of a partnership or business organization without voting
      securities.

            

    

     

    
      	
              1.2

            	
              "Fields of Use" shall mean the
      fields of use identified in Exhibit
      A.

            

    

     

    
      	
              1.3

            	
              "Improvement"
      shall mean any invention, the practice of which would also require the
      practice of an invention claimed in or covered by the Patent Rights and
      which is a modification of the inventions claimed in or covered by the
      Patent Rights, made by Dr. Leland Shapiro, or University researchers
      working in the laboratory of Leland
Shapiro.

            

    

     

     

    
      	
              1.4

            	
              "Know-How"
      shall mean University's proprietary information which has been created,
      developed, or fixed in any tangible medium of expression including, but
      not limited to, technical information, devices, models, methods,
      documents, and materials, and which is directly related to the
      use of, or esirable for the practice of, the licensed Patent
      Rights.

            

    

     

     

    
      	
              1.5

            	
              "Licensed
      Process(es)" shall mean any process, art, or method which is covered in
      whole or in part by an issued, unexpired claim or a pending claim
      contained in the Patent Rights or that
      incorporates or makes use of
Know-How.

            

    

     

     

    
      	
              1.6

            	
              "Licensed
      Product(s)" shall mean any:

            

    

     

     

    

    
      
        
          
            
              	
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              (a)

            	
              product or
      part thereof that is covered in whole or in part by an issued, unexpired
      claim or a pending claim contained in the Patent Rights or that
      incorporates or makes use of Know-How;
or

            

    

     

    
      	
               
      

            	
              (b)

            	
              product,
      chemical composition, apparatus, or part thereof that is manufactured or
      discovered by using a Licensed Process(es) or is employed to practice a
      Licensed Process(es); or

            

    

     

    
      	
               
      

            	
              (c)

            	
              product
      produced, discovered, manufactured or created through the use of any
      Licensed Product defined in §1.06(a) or
  §1.06(b).

            

    

     

    
      	
              1.7

            	
              "Net Sales"
      shall mean the total gross receipts for sales of Licensed Products or
      practice ofLicensed
      Processes by or on behalf of Licensee, its Affiliates and sublicensees,
      and from leasing, renting, or otherwise making Licensed Products available
      to others without sale or other dispositions, whether invoiced or not,
      less returns and allowances, packing costs, insurance costs, freight out,
      taxes or excise duties imposed on the transaction (if separately invoiced
      and paid), and wholesaler and cash discounts in amounts customary in the
      trade to the extent actually granted. No deductions shall be made for
      commissions, or for the costs of collections. Net Sales shall also include
      the fair market value of any non-cash consideration received by Licensee,
      its Affiliates and sublicensees, for the sale, lease, or transfer of
      Licensed Products or Licensed
Processes.

            

    

     

    
      	
              1.8

            	
              "Patent
      Rights" shall mean all of the following University intellectual property
      and any utilityapplications,
      PCT applications, continuations, improvements and divisional applications
      thereof, patents issuing on any of the foregoing and all reissues,
      reexaminations or extensions of any of the foregoing, and any and all
      foreign patents and patent applications relating to any of the
      foregoing:

            

    

     

    
      	
               
      

            	
              a.

            	
              the United
      States and foreign patents and/or patent applications and/or provisional
      patent
      applications listed in Exhibit
      B;

            

    

     

    
      	
               
      

            	
              b.

            	
              United States
      and foreign patents issued from the applications listed in Exhibit
      B and from divisionals and continuations of these
      applications;

            

    

     

    
      	
               
      

            	
              c.

            	
              claims of
      U.S. and foreign continuation-in-part applications, and of the resulting
      patents,
      which are directed to subject matter specifically described in the U.S.
      and foreign
      applications fisted in Exhibit
      B;

            

    

     

    
      	
               
      

            	
              d.

            	
              claims of all
      foreign patent applications, and of the resulting patents, which are
      directed to subject matter specifically described in the United States
      patents and/or patent applications described in this Subsection;
      and

            

    

     

    
      	
               
      

            	
              e.

            	
              any reissues
      of United States patents described in this
  Subsection.

            

    

     

    
      
        	
                1.9

              	
                "Territory"
      shall mean the geographical area identified in Exhibit
      A.

              

      

    

     

    SECTION
2. GRANT OF LICENSE

     

    
      	
              2.1

            	
              University
      hereby grants and Licensee and Affiliates accept, during the term and
      subject tothe terms and
      conditions of this Agreement

            

    

     

    
      
        	
                 
      

              	
                a.

              	an exclusive, royalty-bearing license to use the
      Know-How in the Territory and within the
      Fields of Use; and

      

       

      
 

    

    
      
        
          
            
              	
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                b.

              	an exclusive, royalty-bearing license to University's
      Patent Rights in the Territory to make, use,
      sell, lease, offer to sell, and import any Licensed Products in the Fields
      of Use and to
      practice any Licensed Processes in the Fields of
  Use.

      

       

    

    
      	
              2..2

            	
              All Know-How
      due under this Agreement shall be delivered to Licensee prior to or on
      theEffective
      Date in written, oral or other form of communication. No additional
      Know-How shall be due after the Effective
  Date.

            

    

     

    
      	
              2.3

            	
              This Agreement confers no
      license or rights by implication, estoppel, or otherwise under any patent
      applications or patents of University other than licensed Patent Rights
      regardless of whether such patents are dominant or subordinate to licensed
      Patent Rights.

            

    

     

    SECTION
3. IMPROVEMENTS & INDEPENDENT INVENTIONS

     

    
      	
              3.1

            	
              Improvements:
      In the event that University develops any improvements to the
      inventions claimed in the Patent Rights or to any other preexisting patent
      application or patent that is dominated by the Patent Rights, then each
      such improvement or addition will be considered part of this Agreement for
      no additional
consideration.

            

    

     

    
      
        	
                3.2

              	Independent
      Inventions:

      

       

    

    
      	
               
      

            	
              a.

            	
              Provided that
      Leland Shapiro is at the time obligated to assign intellectual property to
      University and is involved as an employee, board member, consultant to or
      10% or greater shareholder of Licensee, in the event that Leland Shapiro
      or anybody working in a laboratory under the supervision or direction of
      Leland Shapiro, makes any invention in the Field of Use, the practice of
      which would not require the practice of an invention claimed in or covered
      by the Licensed Patent Rights ("Independent Invention"), then provided
      such Independent Invention is not subject to any prior contractual or
      legal obligations, the University hereby grants to Licensee an exclusive
      option ("Option") to obtain the exclusive, worldwide, commercial rights to
      each Independent Invention on terms and conditions to be negotiated in
      good faith by the parties following the exercise by Licensee of the
      Option. In addition, Licensee shall have such further rights to future
      Independent Inventions as may be set forth in the sponsored research
      agreement described in Exhibit E
      to be entered into between the
Parties.

            

    

     

    
      	
               
      

            	
              b.

            	
              University shall disclose each
      Independent Invention to Licensee in reasonable written
      detail after the University's Technology Transfer Office receives
      notification from the inventor(s) that such Independent Invention has been
      made, and Licensee shall have ninety (90) days (the "Option Period")
      following receipt of such invention disclosure to exercise the Option with
      respect to such Independent Invention by delivering to University written
      notice indicating that Licensee desires to exercise the Option. Upon such
      notice, the parties shall negotiate in good faith for a period of up to
      sixty (60) days commercially reasonable terms and conditions for a
      license under the intellectual property rights relating to such
      Independent
Invention

            

    

     

    
      	
               
      

            	
               

            

    

     

    SECTION
4. SUBLICENSING

     

    
      	
              4.1

            	
              Upon prior
      written approval by University, such approval not to be unreasonable
      withheld,Licensee may
      sublicense to one or more third parties, the rights granted in Section 2
      subject to the following
limitations:

            

    

     

    
 

    
      
        
          
            
              	
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              a.

            	
              Licensee
      agrees that any sublicenses granted by it shall impose restrictions and
      conditions upon sublicensees equivalent in scope to those imposed upon
      Licensee;

            

    

     

    
      	
               
      

            	
              b.

            	
              Licensee
      agrees that, in the event University terminates this Agreement pursuant to
      Subsection 13,2(b), any sublicenses granted, in University's sole
      discretion, shall be directly enforceable by
  University;

            

    

     

    
      
        	
                 
      

              	
                c.

              	
                Licensee
      agrees that any sublicenses granted shall adequately protect University's
      security and
      property interest in University's Know-How and Patent Rights;
      and

              

      

       

      
        	
                 
      

              	
                d.

              	
                Any
      sublicenses granted by Licensee shall provide only for cash consideration
      from sublicensees
      unless University has expressly consented otherwise in writing in advance.
      Any sublicenses made in other than arm's-length transactions, the value of
      the transaction attributed under this Section to such a transaction shall
      be that which would have been received in an arm's-length transaction,
      based on a like transaction at that time.

                 

                For purposes
      of this Agreement, the term "sublicense" shall mean the license by
      Licensee to a third party of all or a portion of the intellectual property
      rights licensed to it by University hereunder in consideration of payments
      from such sublicensee to Licensee, and shall not include Licensee's
      engagement of or joint venture with subcontractors to perform various
      services for
      Licensee in connection with its development of the Licensed
      Products and Licensed Processes, including, but not limited to, laboratory
      work, pre-clinical and clinical testing, assistance with the regulatory
      approval process, manufacturing, marketing and other similar product
      development services provided that such services are for the sole benefit
      of Licensee and such third party does not have any independent use of the
      Patent Rights or Know-How. Licensee agrees to assume all obligations for
      protecting the University's security and property interest in University's
      Know-How and Patent Rights in any such joint venture work consistent with
      the terms of this Agreement.

              

      

       

    

     

    
      	
              4.2

            	
              Licensee
      agrees to forward to University a copy of each fully executed
      sublicenseagreement
      postmarked within thirty (30) days of the execution of such
      agreement.

            

    

     

    
 

    
      
        
          
            
              	
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    SECTION
5. RETAINED RIGHTS  5.1Government
Rights:

     

    
      	
               
      

            	
              a.

            	
              Notwithstanding
      any use of descriptive terms within this Agreement such as "exclusive",
      this Agreement is subject to all of the terms and conditions of Title 35
      U.S.C. §§ 200-204, et seq., ("Bayh-Dole Act") and 37 C.F.R.
      401, as such may be amended.

            

    

     

    
      	
               
      

            	
              b.

            	
              Further,
      Licensee agrees to take all reasonable action necessary to enable
      University to satisfy its obligations
hereunder.

            

    

     

    
      	
              5.2

            	
              University
      Rights:

            

    

     

    
      	
               
      

            	
              a.

            	
              University
      shall have the right to practice the Patent Rights and Know-How for its
      own research and education, including sponsored research, which right
      shall be transferable to other nonprofit or educational institutions;
      provided that University takes reasonable steps to prevent the commercial
      use of any products or processes resulting from such research and
      education and to avoid the loss of any patent rights as a result of such
      activities.

            

    

     

    
      	
               
      

            	
              b.

            	
              University
      shall have the right to publish any information included in the Patent
      Rights and the Know-How provided that University takes reasonable steps to
      avoid the loss of any patent rights as a result of University exercising
      its rights under this Paragraph. University shall provide Licensee with
      ten (10) days' advance notice of any such publication, including a
      copy of the information proposed to be
  published.

            

    

     

    SECTION
6. FEES & ROYALTIES

     

    
      	
              6.1

            	
              As
      consideration for the disclosure of University's Know-How as well as the
      licenses andrights under
      University's Patent Rights,

            

    

     

    
      	
               
      

            	
              a.

            	
              Licensee
      agrees to pay to University an annual, nonrefundable minimum royalty as
      set forth in Exhibit
      C. The minimum annual royalty is due and payable on first business
      day of each calendar year and may be credited against any earned royalties
      due for Net Sales made that year;

            

    

     

    
      	
               
      

            	
              b.

            	
              Licensee
      agrees to pay University royalties as set forth in Exhibit
      C;

            

    

     

    
      	
              6.2

            	
              No multiple
      royalties shall be payable because any Licensed Products or
      Licensed

            

    

     

    Processes are
covered by more than one of the Patent Rights.

     

    
      	
              6.3

            	
              On sales of
      Licensed Products by Licensee to sublicensees or on sales made in other
      than arm's-length transactions, the value of the Net Sales attributed
      under this Section to such a transaction shall be that which would have
      been received in an arm's-length transaction, based on a like transaction
      at that time.

            

    

     

     

    
      	
              6.4

            	
              Payment
      Due Date:

            

    

     

    
      	
               
      

            	
              a.

            	
              Unless
      otherwise provided herein, all payments required under this Agreement
      shall be due within thirty (30) days of written notice from
      University.

            

    

     

    
      	
               
      

            	
              b.

            	
              Payments past
      due shall bear interest at the rate of one and one-half percent (1 1/2%)
      per month compounded, or the maximum interest rate allowed by applicable
      law, whichever is less.

            

    

     

    
 

    
      
        
          
            
              	
                      
                      

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    SECTION
7. REPORTS, RECORDS, AND AUDITS  7.1 Reports:

     

    
      	
               
      

            	
              a.

            	
              Licensee
      shall, without request by University, within sixty (60) days following
      the

            

    

     

    
      	
               
      

            	
              end of each
      fiscal quarter of Licensee and sixty (60) days following the end of
      Licensee's fiscal year, render to University written reports of the Net
      Sales of Licensed Products and/or Licensed Processes subject to royalty
      hereunder made during the prior three (3) month period and shall
      simultaneously pay to University the royalties due on such Net Sales, if
      any, in United States Dollars. Licensee shall not be required to provide
      any such reports during the period prior to its initial sale of Licensed
      Products and/or Licensed Processes.

            

    

     

    
      	
               
      

            	
              b.

            	
              Minimum
      annual royalties, if any, which are due University for any fiscal year,
      shall be paid by
      Licensee along with the written report due under this Agreement with
      respect to such fiscal year.

            

    

     

    
      	
               
      

            	
              c.

            	
              Unless
      otherwise agreed to by the Parties, the written report shall be in the
      substantially the same form as
      Exhibit
      D.

            

    

     

     

    
      	
              7.2

            	
              Records:

            

    

     

    
      	
               
      

            	
              a.

            	
              Licensee
      shall
      keep accurate
      records and shall compel its Affiliates and sublicensees
      to keep accurate records, in sufficient detail to reflect its operations
      under this Agreement and to enable the royalties accrued and payable under
      this Agreement to be
determined.

            

    

     

    
      	
               
      

            	
              b.

            	
              Such records
      shall be retained for at least three (3) years after the close of the
      period
      to which they pertain, or for such longer time as may be required to
      finally resolve any question or discrepancy raised by
      University.

            

    

     

    
      
      

    

     

    
      	
              7.3

            	
              Audits:

            

    

     

    
      	
               
      

            	
              a.

            	
              Upon the
      request of University, with reasonable notice, but not more frequently
      than once a year,
      Licensee shall permit an independent public accountant selected and paid
      by University to have access during regular business hours to such records
      as may be necessary to verify the accuracy of royalty payments made or
      payable hereunder.

            

    

     

    
      	
               
      

            	
              b.

            	
              Said
      accountant shall disclose information acquired to University only to the
      extent that it
      should properly have been contained in the royalty reports required under
      this Agreement.

            

    

     

    
      	
               
      

            	
              c.

            	
              If an
      inspection shows an underreporting or underpayment in excess of five
      percent (5%) for any
      twelve (12) month period, then Licensee shall reimburse University for the
      cost of the inspection and pay the amount of the underpayment including
      any interest as required by this
  Agreement.

            

    

     

    
       

    

    SECTION
8. CONFIDENTIAL INFORMATION

     

    
      	
              8.1

            	
              Both
      University and Licensee (hereinafter, "Party" or "Parties") shall
      vigilantly protect theconfidential
      information related to the Patent Rights and Know-How from disclosure to
      third parties; and no such disclosure shall be made without the disclosing
      Party's written permission.

            

    

     

     

    

    
      
        
          
            
              	
                      
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              8..2

            	
              All written
      documents containing confidential information and other material in
      tangible formreceived by
      either Party under this Agreement shall remain the property of the
      disclosing Party, and such documents and materials, together with copies
      of excerpts thereof, shall promptly be returned to disclosing Party upon
      request, except one copy may be retained for archival
      purposes.

            

    

     

    
      	
              8.3

            	
              Licensee
      acknowledges that University is subject to the Colorado Open Records
      Act(C.R.S. §
      24-72-201, et seq.). All plans and reports marked "Confidential" shall be
      treated by University as confidential to the extent permitted under §
      24-72-204.

            

    

     

    SECTION
9. LICENSEE DUE DILIGENCE OBLIGATIONS

     

    
      	
              9.1

            	
              Licensee
      shall use commercially reasonable efforts to bring Licensed Products
      andLicensed
      Processes to market through a thorough, vigorous and diligent program
      for      exploitation of the Patent Rights,
      to develop internal or external manufacturing capabilities, to continue
      active, diligent marketing efforts, and to satisfy the needs of such
      market with the Licensed Products and Licensed Processes throughout the
      life of this Agreement.

            

    

     

    
      	
              9.2 

            	
              Licensee
      acknowledges and agrees to the performance and diligence milestones
      defined inExhibit
      E provided
      however that specific dates for such milestones may be adjusted if
      required due to developments beyond the reasonable control of Licensee. No
      changes to the dates of such milestones will be made without the consent,
      which will not be unreasonably denied, of
    University.

            

    

     

    
      	
              9.3

            	
              Licensee
      agrees to use commercially reasonable efforts to develop a sublicensing
      programto
      commercialize Licensed Products and Licensed Processes in any Field of Use
      or Territory that Licensee decides not to exploit for its own
      benefit.

            

    

     

    SECTION
10.
PATENT ADMINISTRATION

     

    
      	
              10.1

            	
              Licensee
      shall reimburse University within thirty (30) days from the Effective Date
      twentythousand
      dollars ($20,000) representing all patent expenses incurred by University
      prior to the Effective
Date.

            

    

     

    
      	
              10.2

            	
              Licensee
      Rights:

            

    

     

    
      	
               
      

            	
              a.

            	
              Licensee
      shall control the preparation, filing, prosecution, and maintenance of any
      and all patent applications or patents included in the Patent Rights on or
      after the Effective Date and shall furnish copies of relevant
      patent-related documents to University. Licensee shall provide University
      with advance written notice of its plans to file or prosecute any such
      patent applications or patents. University shall cooperate with Licensee
      in providing any additional scientific and other information reasonably
      necessary for Licensee to prepare, file, prosecute and maintain such
      patent applications and patents.

            

    

     

    
      	
               
      

            	
              (i)

            	
              University
      shall have thirty (30) business days to review and comment on
      patent-related documents prior to the filing of said
      documents.

            

    

     

    
      	
               
      

            	
              b.

            	
              Licensee may
      request that University assume primary responsibility for all patent
      activities, including all costs, associated with the perfection and
      maintenance of Patent Rights. Licensee shall provide University with sixty
      (60) days' advance written notice of such request. In the event University
      agrees to such
request:

            

    

     

     

    
       

      

      
        
          
            
              
                	
                        
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              (i)

            	
              University's
      patent counsel shall keep Licensee advised as to the status of the Patent
      Rights by providing Licensee, in a timely manner prior to their due date,
      with copies of all official documents and correspondence relating to the
      prosecution, maintenance, and validity of the Patent
    Rights.

            

    

     

    
      

      
        	
                 
      

              	
                (ii)

              	University shall
      consult with Licensee in such prosecution and maintenance, shall
      diligently seek Licensee's advice on all matters pertaining to the Patent
      Rights, shall diligently seek strong and broad claims under the Patent
      Rights, and shall not abandon prosecution of any patent application
      without first notifying Licensee sixty (60) days prior to any bar date, of
      University's intention and reason therefore, and providing Licensee with
      reasonable opportunity to assume responsibility for prosecution,
      maintenance and associated costs of such patents and patent
      applications.

      

       

      
        
          	
                   
      

                	
                  c.

                	No claims of the
      Patent Rights shall be modified, deleted, or abandoned by Licensee or
      its patent counsel without the express, prior written approval of
      University, such approval shall not be unreasonably withheld or
      delayed.

        

         

      

    

    
      	
               
      

            	
              (i)

            	
              Licensee's
      obligations under this Subsection shall include, without limitation, an
      obligation to inform University in a timely manner that Licensee will not
      pursue patents in any foreign countries where patent protection may be
      available such that University may prosecute patents in such countries if
      University so desires.

            

    

     

    
      
        
          	
                   
      

                	
                  (ii)

                	If University
      pursues such foreign patent protection, then from that time forward all
      such subject patent applications and any patents arising there from shall
      no longer be considered Patent Rights under this Agreement and Licensee
      shall forfeit all rights under this Agreement to such patent applications
      and any patents arising there from. University shall be responsible for
      all costs associated with those patent applications and patents it decides
      to pursue and maintain.

        

         

      

    

    
      
        
          	
                   
      

                	
                  d.

                	
                  At any time, University may
      provide Licensee with thirty (30) days' advance written
      notice that
      University wishes to resume control, at Licensee's expense, of the
      preparation, filing, prosecution, and maintenance of any and all patent
      applications or patents included in the Patent Rights. If University
      elects to resume such responsibilities, Licensee agrees to cooperate fully
      with University, its attorneys, and agents in the preparation, filing,
      prosecution, and maintenance of any and all patent applications or patents
      and to provide University with complete copies of any and all documents or
      other materials that University deems necessary to undertake such
      responsibilities.

                

        

         

      

    

     

     

    SECTION
11. PATENT ENFORCEMENT

     

    
      	
              11.1

            	
              University
      and Licensee agree to inform the other Party promptly in writing of
      anysuspected
      infringement of the Patent Rights by a third party. Licensee shall have,
      for a period of 120 days from the date of any notice of infringement of
      the Patent Rights, the first right to institute suit against such third
      party and any recovery or settlement shall be applied first to defray the
      unreimbursed costs and expenses (including reasonable attorneys' fees)
      incurred by Licensee in the action, second to pay University an amount
      equal to the Sublicensing Royalty that University would otherwise be
      entitled to at that time pursuant to Exhibit C to this Agreement if the
      amount remaining after the reimbursement of costs and expenses was treated
      as Sublicensing revenue, and third any remaining balance shall be paid to
      Licensee.

            

    

     

    
 

    
      
        
          
            
              	
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              11.2

            	
              Thereafter,
      University and Licensee shall each have the right to institute an action
      forinfringement
      of the Patent Rights against such third party in accordance with the
      following:

            

    

     

    
      	
               
      

            	
              a.

            	
              If both
      University and Licensee agree to institute suit jointly, the suit shall be
      brought
      in both their names, the out-of-pocket costs thereof shall be borne
      equally, and any recovery or settlement, after the reimbursement of costs
      and expenses (including reasonable attorneys' fees incurred in the action,
      shall be shared equally.

            

    

     

    
      	
               
      

            	
              b.

            	
              University
      and Licensee shall agree to the manner in which they shall exercise control over
      such suit. Each Party, at its option, may be represented by separate
      counsel of its own selection, the fees for which shall be paid by
      University.

            

    

     

    
      	
               
      

            	
              c.

            	
              In the
      absence of an agreement to institute a suit jointly, University may, but
      is not obligated to,
      institute suit, and at its option, join Licensee as a plaintiff. If
      University decides to institute suit, it shall notify Licensee in
      writing.

            

    

     

    
      	
               
      

            	
              d.

            	
              Licensee's
      failure to notify University in writing within thirty (30) days after the
      date of
      University's notice pursuant to 11.2(c) above, that it will join in
      enforcing the Patent Rights pursuant to the terms hereof, shall be deemed
      conclusively to be Licensee's assignment to University of all rights,
      causes of action, and damages resulting from any such alleged
      infringement. University shall bear the entire cost of such litigation and
      shall be entitled to retain the entire amount of any recovery or
      settlement.

            

    

     

    
      
        	
                 
      

              	
                e.

              	In the absence
      of an agreement to institute a suit jointly, and if University does not
      notify
      Licensee of its intent to pursue legal action within ninety (90) days, as
      provided in Subsections 11.1
      —
      11.2, Licensee may again have the right to institute suit. In such
      event, Licensee shall bear the entire cost of such litigation and any
      recovery or settlement shall be applied first to defray the unreimbursed
      costs and expenses (including reasonable attorneys' fees) incurred by
      Licensee in the action, second to pay University an amount equal to the
      Earned Royalty that University would otherwise be entitled to pursuant to
      Exhibit C to this Agreement if the amount remaining after the
      reimbursement of costs and expenses was treated as Net Sales, and third
      any remaining balance shall be paid to
      Licensee.

      

       

    

    
      
        	
                 
      

              	
                f.

              	If Licensee
      undertakes to defend the Patent Rights by litigation, Licensee may deduct from
      its royalty payments to University with respect to the Patent Rights
      subject to suit an amount not exceeding fifty (50%) of Licensee's expenses
      and costs of such action, including reasonable attorney's fees, provided
      however, that such reduction shall not exceed fifty percent (50%) of the
      total royalty due to University for each calendar
  year.

      

       

    

    
      	
              11.3

            	
              In the event
      that a declaratory judgment action alleging invalidity or non-infringement
      of any of the Patent Rights shall be brought against Licensee or raised by
      way of counterclaim or affirmative defense in an infringement suit brought
      by Licensee under this Section, pursuant to this Agreement and the
      provisions of Title 35 U.S.C. § 29 or other statutes, Licensee
      may:

            

    

     

    
      
        
          	
                   
      

                	
                  a.

                	defend the suit in
      its own name, at its own expense, and on its own behalf for presumably
      valid claims in the Patent Rights;

        

         

      

    

     

    
 

    
      
        
          
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                  b.

                	in any such suit,
      ultimately to enjoin infringement and to collect for its use, damages,
      profits, and awards of whatever nature recoverable for such infringement
      consistent with this Section; and

        

        
           

          
            
              
                	
                         
      

                      	
                        c

                      	
                        settle any
      claim. or suit for declaratory judgment involving the Patent Rights, except that
      Licensee shall have no right to deny the validity of any patent, patent
      claim, or patent application included in the Patent Rights in any
      compromise or settlement of any claim or suit for declaratory judgment
      without the express prior written consent of University; provided however,
      that University shall have the first right to take such actions described
      in this Subsection and shall have a continuing right to intervene in such
      suit. Licensee shall take no action to compel University either to
      initiate or to join in any such declaratory judgment
      action.

                      

              

               

            

          

        

      

    

    
      
        
          
            	
                     
      

                  	
                    d.

                  	
                    If Licensee
      elects not to defend against such declaratory judgment action, University,
      at its option, may do so at its own expense and shall be entitled to
      retain the entire amount of any recovery or
    settlement.

                  

          

           

        

      

    

    
      
      

    

     

    
      	
              11.4

            	
              In all cases,
      Licensee agrees to keep University reasonably apprised of the status
      andprogress of
      any litigation.

            

    

     

     

    SECTION
12. WARRANTIES, INDEMNIFICATIONS, AND INSURANCE

     

    
      	
              12.1

            	
              Representations.
      University is the owner of the Patent Rights and has full right and
      authority to
      enter into this Agreement.

            

    

     

    
      	
              12.2

            	
              Negation
      of Warranties:

            

    

     

    
      	
               
      

            	
              a.

            	
              UNIVERSITY
      MAKES NO REPRESENTATIONS, EXTENDS NO WARRANTIES OF ANY KIND,
      EITHER EXPRESS OR IMPLIED, AND ASSUMES NO RESPONSIBILITIES WHATSOEVER WITH
      RESPECT TO USE, SALE, OR OTHER DISPOSITION BY LICENSEE, SUBLICENSEE(S), OR
      THEIR VENDEES OR OTHER TRANSFEREES OF LICENSED PRODUCTS OR LICENSED
      PROCESSES INCORPORATING OR MADE BY USE OF THE PATENT RIGHTS. THERE ARE NO
      EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
      PARTICULAR PURPOSE, OR THAT THE USE OR SALE OF SUCH PRODUCTS OR PROCESSES
      WILL NOT INFRINGE ANY PATENT, COPYRIGHT, TRADEMARK, SERVICE MARK, OR OTHER
      RIGHTS.

            

    

     

    
      	
               
      

            	
              b.

            	
              Notwithstanding
      anything in this Agreement to the contrary, nothing in this Agreement
      shall be construed as:

            

    

     

    
      	
               
      

            	
              (i).

            	
              A warranty or
      representation by University as to rights in Know-How or the validity or
      scope of any of the Patent
Rights;

            

    

     

    
      	
               
      

            	
              (ii).

            	
              A warranty or
      representation that the Patent Rights or anything made, used, sold or
      otherwise disposed of under the License will or will not infringe patents,
      copyrights or other rights of third parties;
  or

            

    

     

    
      	
               
      

            	
              (iii).

            	
              An obligation
      to furnish any know-how or technology not agreed to in this Agreement, to
      bring or prosecute actions or suits against third parties for infringement
      (except to the extent described in Subsections 11.1 — 11.2), or to provide
      any services other than those specified in this
      Agreement.

            

    

     

    
      
      

    

     

    
 

    
      
        
          
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              12.2

            	
              Indemnification:
      Licensee shall indemnify, defend, and hold University, its regents,
      employees,
      students, officers, agents, Affiliates, and representatives harmless from
      and against all liability, demands, damages, losses, and expenses
      (including reasonable attorney fees) (collectively, "Claims"), for death,
      personal injury, illness, property damage, noncompliance with applicable
      laws and any other claim, proceeding, demand, expense and liability of
      any kind whatsoever in connection with or arising out
      of:

            

    

     

    
      	
               
      

            	
              a.

            	
              the use by or
      on behalf of Licensee, its sublicensees, Affiliates, directors, officers,
      employees, or
      third parties of any Patent
Rights;

            

    

     

    
      	
               
      

            	
              b.

            	
              the design,
      manufacture, production, distribution, advertisement, consumption, sale, lease,
      sublicense or use of any Licensed Product(s), Licensed Process(es) or
      materials by Licensee, or other products or processes developed in
      connection with or arising out of the Patent Rights;
    or

            

    

     

    
      	
               
      

            	
              c.

            	
              any right or
      obligation of Licensee under this
Agreement.

            

    

     

    With respect to
Licensee's indemnification provided for in this Section 12.3, the following
provision shall apply, Licensee shall (i) receive prompt notification from
University in writing of any such Claims, (ii) have full authority, information
and assistance from University to defend such Claims, and (iii) have sole
control over the defense of such Claims and all negotiations for the compromise
or settlement thereof.

     

    
      	
              12.3

            	
              Insurance:
      Licensee shall obtain general
      liability insurance, including product liability insurance, on
      such terms and in
      such amounts as are reasonable and customary within its
      industry.

            

    

     

    SECTION
13. DURATION, TERMINATION, AND CONVERSION

     

    
      	
              13.1

            	
              This
      Agreement shall become effective as of the Effective Date and shall expire
      on theexpiration
      date of the last to expire patents within Patent
  Rights.

            

    

     

    
      	
              13.2

            	
              Termination
      of Agreement:

            

    

     

    a.  Licensee
may terminate this Agreement at any time on sixty (60) days written notice to
University, if Licensee:

    
       

      
        	
                 
      

              	
                (i).

              	pays all amounts due as well as all non-cancelable costs
      to University through the
      termination date;

      

       

      
        	
                 
      

              	
                (ii).

              	submits a final report of the type described in Section
      7;

      

       

    

    
      	
               
      

            	
              (iii).

            	
              returns any
      confidential materials provided to Licensee by University in connection
      with this Agreement;

            

    

     

    
      	
               
      

            	
              (iv).

            	
              suspends its
      use and sales of the Licensed Product(s) and Licensed Process(es);
      provided however, that subject to making the payments required by Section
      6 and the reports required by Section 7, Licensee may, for a period of
      ninety (90) days after the effective date of such termination, sell all
      Licensed Products which may be in inventory;
  and

            

    

     

    
      
        	
                 
      

              	
                (v).

              	provides University the right to access any regulatory
      information filed with any U.S. or
      foreign government agency with respect to Licensed Products and Licensed
      Processes.

      

       

      
        
        

      

       

    

    

    
      
        
          
            
              	
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                b.

              	
                University
      may terminate this Agreement in the event that:

                 

                Licensee
      fails to pay University any amounts when due to University hereunder and
      Licensee fails to make such payment within thirty (30) days written
      notice;

              

      

    

     

    
      
        	
                 
      

              	
                (ii).

              	Licensee becomes
      insolvent, files a petition in bankruptcy, or has such a petition
      filed against it and such petition is not dismissed within sixty (60) days
      of the filing date,
or

      

       

      
        	
                 
      

              	
                (iii).

              	Licensee is in
      breach or default of this Agreement .other than those occurrences
      listed in this Subsection and Licensee fails to cure the breach or default
      within thirty (30) days of written notice of the breach or default unless
      such breach or default is of a character that cannot be cured within
      thirty (30) days, in which event, Licensee shall not be deemed to be in
      default hereunder unless it fails to diligently commence and pursue action
      to cure such default during such thirty day period. Events constituting a
      breach or default shall include, but are not limited to, the
      following:

      

       

    

    
      	
               
      

            	
              (a)

            	
              failure by
      Licensee to meet any material due diligence requirement of Exhibit
      E; in this event, University retains the right to convert this
      Agreement to a non-exclusive
Agreement,

            

    

     

    
      	
               
      

            	
              (b)

            	
              operation,
      manufacture, use of or sale of the Licensed Products or Licensed Processes
      outside the Fields of Use or
Territory;

            

    

     

    
      	
               
      

            	
              (c)

            	
              failure to
      keep adequate records or permit inspection or
  audit.

            

    

     

    
      
        	
                 
      

              	
                c.

              	The exclusive
      license granted by this Agreement shall immediately revert to University
      upon Licensee's dissolution, liquidation, insolvency, or bankruptcy. The
      exclusive license shall NOT pass to a trustee in bankruptcy or be held as
      an asset of said
bankrupt.

      

      .

    

    SECTION
14. GENERAL

     

    
      	
              14,1

            	
              Assignment:
      This Agreement shall be binding upon and inure to the benefit of
      the respective
      successors and assigns of the Parties hereto, However, Licensee may not
      assign its rights in this Agreement without prior written approval by
      University, such approval not to be unreasonably withheld or
      delayed.

            

    

     

    
      	
              14.2

            	
              Notice:
      Notice hereunder shall be deemed sufficient if given by registered
      mail, postage prepaid, and
      addressed to the Party to receive such notice at the address given below,
      or such other address as may
      hereafter be designated by notice in
writing.

            

    

     

    
      
        	
                University:

                License
      Administrator

                Office of
      Technology Transfer

                University of
      Colorado, 588 SYS Suite
      390, 4001 Discovery Drive Boulder, CO
      80309-0589

              	
                Licensee:

                APRO Bio
      Pharmaceutical Corporation Atten: David Floor, Secretary

                5820 Toicate
      Woods Lane

                Salt Lake City,
      Utah
84121

              

      

    

     

    
 

    
      
        
          
            
              	
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                14.3

              	
                Use
      of Names and Marks: Licensee agrees not to identify University in
      any promotional advertising, press releases, sales literature or other
      promotional materials to be disseminated to the public or any portion
      thereof without University prior written consent in each case, except that
      Licensee may state that it has a license for the Patent Rights from
      University. Licensee further agrees not to use the name of University or
      any University faculty member, inventor, employee or student or any
      trademark, service mark, trade name, copyright or symbol of University,
      without the prior written consent of the University, entity or person
      whose name is sought to be used, which consent shall not be unreasonably
      withheld or delayed.

              

      

    

     

    
      	
              14.4

            	
              Marking:
      Licensee agrees to:

            

    

     

    
      	
               
      

            	
              a.

            	
              Cause
      Licensed Products or the product of Licensed Processes sold under this
      license to be marked with the notice of the patent numbers or patent
      pending, as may be appropriate.

            

    

     

    
      	
               
      

            	
              b.

            	
              Comply with
      all laws and regulations of the United States and any other country as
      appropriate concerning or controlling the import or export of the Licensed
      Products, data, software, laboratory prototypes or other commodities.
      University makes no representation that a license or consent for export
      will not be required by applicable governmental agencies, or if required,
      that it will be issued.

            

    

     

    
      	
               
      

            	
              c.

            	
              Comply with
      all applicable statutes, regulations, and guidelines, including applicable
      governmental regulations, policies and guidelines in its use of any
      University- supplied materials. Licensee agrees not to use the materials
      for research involving human subjects or clinical trials in the United
      States without complying with 21 C.F.R. Part 50 and 45 C.F.R. Part 46 (as
      those regulations may be amended from time to time). Licensee agrees not
      to use the materials for research involving human subjects or clinical
      trials outside of the United States without notifying University in
      writing, of such research or trials and complying with the applicable
      regulations of the appropriate national control authorities. Written
      notification to University of research involving human subjects or
      clinical trials outside of the United States shall be given no later than
      sixty (60) days prior to commencement of such research or
      trials.

            

    

     

    
      	
              14.5 

            	
              Compliance
      with the Law: Licensee shall comply with all commercially material
      local, state,
      federal, and international laws and regulations relating to its
      obligations under this Agreement regarding the development, manufacture,
      use, and sale of Licensed Products and Licensed
  Processes.

            

    

     

    
      
        	
                14.6 

              	
                Choice
      of Law: This Agreement shall be governed by and construed in
      accordance with the laws of the State of
  Colorado.

              

      

    

     

    
      	
              14.7 

            	
              Dispute
      Resolution: In the event of any dispute arising out of or relating
      to this Agreement, the affected Party shall promptly notify the other
      Party ("Notice Date"), and the Parties shall attempt in good faith to
      resolve the matter.

            

    

     

    
      	
               
      

            	
              a.

            	
              Any disputes
      not so resolved shall be referred to senior executives, who shall meet at
      a mutually acceptable time and location within thirty (30) days of the
      Notice Date and shall attempt to negotiate a
  settlement.

            

    

     

    
      	
               
      

            	
              b.

            	
              If the senior
      executives fail to meet within thirty (30) days of the Notice Date, or if
      the matter remains unresolved for a period of sixty (60) days after the
      Notice Date,

            

    

     

    
 

    
      
        
          
            
              	
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    the Parties hereby
irrevocably submit to the jurisdiction of a court of competent jurisdiction in
the State of Colorado, and, by execution and delivery of this Agreement, each
(i) accepts, generally and unconditionally, the jurisdiction of such court and
any related appellate court, and (ii) irrevocably waives any objection it may
now or hereafter have as to the venue of any such suit, action or proceeding
brought in such court or that such court is an inconvenient forum.

     

    
      
        	
                14.8

              	
                Merger
      and Modification of Agreement: The terms and provisions contained
      in this Agreement constitute the entire Agreement between the Parties and
      shall supersede all previous communications, representations, agreements
      or understandings, either oral or written, between the Parties hereto with
      respect to the subject matter hereof, and no agreement or understanding
      varying or extending this Agreement will be binding upon either Party
      hereto, unless in writing which specifically refers to this Agreement,
      signed by duly authorized officers or representatives of the respective
      Parties, and the provisions of this Agreement not specifically amended
      thereby shall remain in full force and effect according to their
      terms.

              

      

    

     

    
      
        	
                14.9

              	
                Severability;
      The provisions and clauses of this Agreement are severable, and in the
      event that any provision or clause is determined to be invalid or
      unenforceable under any controlling body of the law, such invalidity or
      unenforceability will not in any way affect the validity or enforceability
      of the remaining provisions and clauses
hereof.

              

      

    

     

    
      
        	
                14.10

              	
                Scope:
      This Agreement does not establish a joint venture, agency or partnership
      between the Parties, nor create an employer - employee
      relationship.

              

      

    

     

    
      
        	
                14.11

              	
                Preservation
      of Immunity: The Parties agree that nothing in this Agreement is
      intended or shall be construed as a waiver, either express or
      implied, of any of the immunities, rights, benefits, defenses or
      protections provided to University under governmental or sovereign
      immunity laws from time to time applicable to University, including,
      without limitation, the Colorado Governmental Immunity Act (C.R.S. §
      24-10-101, et seq.) and the Eleventh Amendment to the United States
      Constitution.

              

      

    

     

    
      
        	
                14.12

              	
                Headings:
      Headings are included herein for convenience only and shall not be used to
      construe this Agreement.

              

      

    

     

    
      
        	
                14.13

              	
                The
      provisions of Sections 6 and 10, and Subsections 7.1, 7.2, 12.1, 12.2,
      13.1, 14.3, 14.6 — 14.9, and 14.11, and any other provision of this
      Agreement that by its nature is intended to survive, shall survive any
      termination or expiration of this
Agreement.

              

      

    

     

    
 

    
      
        
          
            
              	
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    IN WITNESS WHEREOF the parties
hereto have caused this Agreement, to be executed in duplicate by their
respective duly authorized officers.

     

    
       

       

      

      
        
          
            	
                  	 
      
	
                    University: /s/ David N.
    Allen

                  	
                    Licensee:  
      /s/ David Floor

                  
	
                    By:  David
      N. Allen

                  	
                    By: 
      David Floor

                  
	 
      	 
      
	
                    Title:
      Associate VP for Technology Transfer

                  	
                    Title:
      Executive VP

                  
	
                    Date:  19
      April ’06

                  	
                    Date:
      5/15/06

                  
	
                    Office
      of Technology Transfer

                  	
                    APRO
      Bio Pharmaceutical Corporation

                  
	
                    University
      of Colorado

                  	
                    5820
      Tolcate Woods Lane

                  
	
                    Suite
      390, 4001 Discovery Drive

                  	 
      
	
                    588
      SYS

                  	
                    Salt
      Lake City, Utah 84121

                  
	
                    Boulder,
      CO 80309-0589

                  	 
      
	
                    Approved
      as to Legal Sufficiency:

                  	 
      
	
                    By:
      /s/ Kristin
      Diamond

                  	 
      
	
                    Title:  Asst.
      Univ. Counsel

                  	 
      
	
                    Date:
      19 April ‘06

                  	 
      

          

        

      

    

     

     

    
 

    
      
        
          
            
              	
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    EXCLUSIVE
LICENSE AGREEMENT

     

    EXHIBIT
A

     

    FIELDS
OF USE and TERRITORY

     

    -
Fields
of use:   treatment of bacterial infections; and all research,
studies, testing, preclinical and clinical testing and developments relating to
internal, topical or other treatment of bacterial infections, including the
treatment of (i) Anthrax, (ii) Mycobacterium Tuberculosis (TB) and other
Mycobacteria and (iii) Bacterial Pneumonia, and further including the cutaneous
anthrax cream .

     

    Territory:  
worldwide.

     

    

    
      
        
          
            
              	
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    EXHIBIT
B

    PATENT
RIGHTS

     

     

    
      	
               
      

            	
              1.

            	
              "Inhibitors
      Of Serine Protease Activity And Their Use In Methods And Compositions For
      Treatment Of Bacterial Infections" PCT/USO4/27711, filed August 26,
      2004

            

    

     

    
      	
               
      

            	
              2.

            	
              "Inhibitors
      Of Serine Protease Activity And Their Use In Methods And Compositions For
      Treatment Of Bacterial Infections" United States Patent Application US
      10/925,051, filed August 26, 2004

            

    

     

    
 

    
      
        
          
            
              	
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      EXHIBIT
C

       

      ROYALTIES

       

      In
accordance with Section 6, Licensee shall pay the following royalties to
University:

       

      
        
          
            	
                        Minimum annual
      royalty:

                  	
                    Twenty five
      thousand dollars ($25,000) payable on each anniversary of the Effective
      Date commencing with the fifth anniversary of the Effective Date. The
      minimum annual royalty shall be deductible from any earned royalties due
      the University.

                  
	 
    	 
    
	
                        Earned
      royalty:

                  	
                    Four percent
      (4%) of Net Sales.

                  
	
                     

                    Milestone
      royalties per indication, other than Anthrax which is specifically
      excluded, are as follows:

                     

                  
	 
    	
                    Upon the
      completion of any preclinical testing, including animal testing, for any
      Licensed Product, Licensee shall pay thirty thousand dollars ($30,000),
      within thirty (30) days of completion of such preclinical trial. There
      shall be no subsequent fee for any additional or supplemental preclinical
      testing.

                     

                  
	 
    	
                    Upon the
      completion of any phase I clinical trial for any Licensed Product,
      Licensee shall pay a one-time fee of fifty thousand dollars ($50,000)
      within sixty (60) days of completion of such clinical trial.

                    Upon the
      completion of any phase II clinical trial for any Licensed Product,
      Licensee shall pay a one-time fee of one hundred thousand dollars
      ($100,000) within sixty (60) days of completion of such clinical
      trial.

                     

                  
	 
    	
                    Upon the
      completion of any phase Ill clinical trial for any Licensed Product,
      Licensee shall pay a one-time fee of two hundred thousand dollars
      ($200,000) within sixty (60) days of completion of such clinical
      trial.

                     

                  
	 
    	
                    Upon approval
      from the United States Food and Drug Administration (FDA), or foreign
      equivalent, of any Licensed Product, Licensee shall pay three hundred
      thousand dollars ($ 300,000) within sixty (60) days of such
      approval.

                     

                  
	
                    Sublicensing
      royalties as follows:

                     

                  
	 
    	
                    Thirty
      percent (30%) of all Sublicensing revenue received during the first year
      after the Effective Date.

                     

                  
	 
    	
                    Twenty-Five
      percent (25%) of all Sublicensing revenue received during the second year
      after the Effective Date.

                     

                  
	
                     

                  	 
    

          

        

      

       

    

    

    
      
        
          
            
              	
                      Exclusive
      License Apro Biopharmaceutical, Inc. Final April 19, 2006 
      

                      18
      of 21

                      CU1085H

                    

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

    

    

    

     

     

    
      	
              Expiration of
      Royalties:

            	
              Twenty
      percent (20%) of all Sublicensing revenue received during the third year
      after the Effective Date and each year thereafter until this Agreement is
      terminated or expires.

               

              All royalties
      payable hereunder (minimum royalties, earned royalties and sublicensing
      royalties) with respect to each Licensed Product or Licensed Process shall
      expire and terminate on the respective expiration date of the Patent
      Rights applicable to each such Licensed Product or Licensed
      Process.

            

    

     

    
 

    
      
        
          
            
              	
                      Exclusive
      License Apro Biopharmaceutical, Inc. Final April 19, 2006 
      

                      19
      of 21

                      CU1085H

                    

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
D

     

    FORM OF
ROYALTY REPORT

     

    
       

      
        
          	
                  Licensee:
      ____________________________________________

                	
                  Case
      No.:  _______________________________________

                
	
                  Inventor: 
      ____________________________________________

                	
                  Patent
      No.  _______________________________________

                
	
                  Period
      Covered: From:  __________________________________

                	
                  Through: 
      _________________________________________

                
	
                  Prepared
      By:  _________________________________________

                	
                  Date:
       ____________________________________________

                
	
                  Approved
      By:  ________________________________________

                	
                  Date: 
      ____________________________________________

                

        

      
                                           

     

    If
license covers several major product lines, please prepare a separate report
for each
line. Then combine all product lines into a summary report.

     

    A
discussion of the progress and results, as well as ongoing plans, with respect
to the Licensed Products
and/or Licensed Processes, see § 6.01, is attached.

     

    
      	 Report
      Type:  	 ____	 Single
      Product Line Report: ______________________	 	 	 
	 	 ____	 Multiproduct
      Summary Report  Page 1
      of   ___  Pages	 	 	 
	 	 ____	 Product Line
      Detail	 
      Line: _______	 Trademark:
      _______	 Pages
      _______
	 	 	 	 	 	 

    

                    

     

    

    
      	
              Country

            	
              Gross

              Sales

            	
              *
      Less:

              Allowances

            	
              Net

              Sales

            	
              Royalty

              Rate

            	
              Period
      Royalty Amount

            
	
              This
      Year

            	
              Last
      Year

            
	
              U.S.A.

            	 
      	 
      	 
      	 
      	 
      	 
      
	
              Canada

            	 
      	 
      	 
      	 
      	 
      	 
      
	
              Europe

            	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              Japan

            	 
      	 
      	 
      	 
      	 
      	 
      
	
              Other:

            	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
              TOTAL:

            	 
      	 
      	 
      	 
      	 
      	 
      

    

    

     

    Sublicense
Fees this quarter: $ ____ (attach page showing names, addresses, and
telephone numbers;
and amount of fees received; territory; field of use)

     

    Total
Royalty: $ ____

     

    The
following royalty forecast is non-binding and for University internal planning
purposes only:

     

    

    
      
        
          
            
              	
                      Exclusive
      License Apro Biopharmaceutical, Inc. Final April
      19,2006        

                      20
      of 21

                             CU
      1085 H

                    

            

            

          

           

        

        
           

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
E

     

    PERFORMANCE
MILESTONES 

     

    Milestones are defined for the first
indication

     

    
      	
              Pre Clinical
      testing

            	
              4Q/07

            
	
              Phase Ill
      initiation

            	
              40/09

            
	
              FDA
      submission

            	
              4Q/11

            
	
              Market
      launch

            	
              4Q/13

            

    

     

     

    DILIGENCE
MILESTONES 

     

       1.   Company
shall deliver to University:

     

    
      	
               
      

            	
              (a)

            	
              within
      forty-five (45) days of the
      Effective Date, a comprehensive business plan that describes the Company's
      technology commercialization strategy, including product development plans
      and timelines, marketing strategies, and plans for obtaining necessary
      financing. The business plan shall include forecasts showing the funds,
      personnel, and time budgeted and planned for development of the
      Intellectual Property Rights and Know- How;
and

            

    

     

    
      	
               
      

            	
              (b)

            	
              within thirty
      (30) days of the Effective Date, evidence that Company has secured funding
      commitments of three hundred thousand dollars ($
  300,000)

            

    

     

    2.         Company
shall negotiate with the University and enter into a sponsored research
agreement for the benefit of Dr. Leland Shapiro which shall include a
requirement to initiate a program to perform animal toxin testing for an amount
not less than sixty-five thousand dollars ($65,000) within thirty (30) days of
the Effective Date.

     

    3.         From
its inception through that date which is twelve (12) months of Effective Date,
the Company shall have raised a minimum of nine hundred thousand dollars
($900,000) in debt or equity capital.

     

     

    
       

      

      
        
          
            
              
                	
                        Exclusive
      License Apro Biopharmaceutical, Inc. Final April
      19,2006        

                        21
      of 21

                               CU
      1085 Haafinancial8kex105_462009.htm

    Exhibit 
10.5

    
      
 

      
        THE
SECURITIES REFERRED TO IN THIS SUBSCRIPTION AGREEMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT
BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT COVERING SUCH SECURITIES OR THE
COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER REASONABLY SATISFACTORY TO
THE COMPANY STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS
EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE
SECURITIES ACT.

         

        APRO
BIO PHARMACEUTICAL CORPORATION

        SUBSCRIPTION
AGREEMENT

         

        THIS
SUBSCRIPTION AGREEMENT (this "Agreement"), dated as of May
15 2006, is
by and between APRO Bio Pharmaceutical Corporation, a Utah corporation (the
"Company"), and
University License Equity Holdings, Inc., a Colorado nonprofit corporation (the
"Investor").

         

        Recital

         

        The
Investor desires to acquire 406,000 shares of the Company's Common Stock, par
value $0.001 per share (the "Company Stock"), in partial
consideration for the grant of an exclusive license by The Regents of The
University of Colorado, a constitutional body corporate, to the Company of
certain patent rights under that certain License Agreement, dated of even date
herewith (the "License
Agreement"), and the Company desires to issue such shares of Company
Stock to the Investor in connection with consideration for the grant of the
exclusive license under the License Agreement, upon the terms and conditions set
forth herein.

         

        Agreement

         

        NOW, THEREFORE, in
consideration of the foregoing recital and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:

         

              1.    Subscription.
At or prior to the Effective Date (as such term is defined in the License
Agreement), subject to the terms and conditions hereof, the following shall
occur:

         

        a.           The
Investor and the Company shall execute this Agreement;

         

        b.           The
Company shall issue to the Investor 406,000 restricted shares of Company Stock
(the "Shares") and shall
deliver to the Investor a stock certificate evidencing its ownership of the
Shares; and

         

        c.           The
Investor and the Company shall execute the License Agreement.

         

              2.    Representations
and Warranties of the Company. The Company hereby represents
and warrants to the Investor that as of the date of this Agreement, immediately
prior to issuing the Shares:

         

            a.    Organization; Corporate Power.
The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Utah. The
Company has all requisite corporate power and authority to own and operate its
properties and assets, to execute and deliver this Agreement, to carry out the
provisions of this Agreement, to issue and sell the Shares and to carry on its
business as presently conducted and as presently proposed to be conducted. The
Company is duly qualified and is authorized to do business and is in good
standing as a foreign corporation in all

        
          
             

          

          
            Page 1 of
15

            
              

            

          

          
             

          

        

        jurisdictions
in which the nature of its activities and of its properties (both owned and
leased) makes such qualification necessary.

         

            b.           Capitalization.
Other than as set forth on Schedule
A attached hereto, the Company does not have any other shares of capital
stock authorized. Schedule
A  attached hereto sets forth the type and number of shares of
capital stock authorized by the Company, all of the Company's issued and
outstanding capital stock and all securities of the Company convertible into or
exchangeable for shares of capital stock or voting securities of the Company or
warrants, subscription rights, options, stock appreciation rights, phantom
equity or other rights to acquire from the Company, or other obligation of the
Company to issue, any capital stock, voting securities or securities convertible
into or exchangeable for capital stock or voting securities of the Company and
the name of each record holder thereof. Schedule
A sets forth all equity, option, incentive and stock purchase plans and
all other plans or arrangements under which the Company may issue any capital
stock or securities of the Company and the number of shares of capital stock
authorized to be issued under such plans or arrangements. All issued and
outstanding securities of the Company are set forth on Schedule
A attached hereto and (i) have been duly authorized and validly issued,
(ii) are fully paid and nonassessable, and (iii) were issued in compliance with
all applicable state and federal laws concerning the issuance of securities.
When issued in compliance with the provisions of this Agreement, the Shares will
be validly issued, fully paid and non-assessable and free of any liens or
encumbrances and will not violate or be subject to any preemptive rights or
rights of first refusal granted by the Company. The Shares will be issued in
compliance with all applicable federal and state securities laws. The Shares
represent four percent (4%) of the issued and outstanding capital stock of the
Company, calculated pursuant to Section 5(a) below.

         

            c.           Due Authorization; Enforceability.
All corporate action on the part of the Company, its officers, directors
and stockholders necessary for the authorization of this Agreement, the
performance of all of the Company's obligations hereunder, and the
authorization, sale, issuance and delivery of the Shares pursuant hereto has
been taken. This Agreement, when executed and delivered, constitutes the legal,
valid and binding obligation of the Company enforceable against the Company in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors' rights and (ii) general principles of equity
that restrict the availability of equitable remedies. No authorization,
approval, consent or license of any third party, court or governmental
regulatory body or authority is required on the part of the Company in
connection with the execution and delivery of this Agreement and the valid
issuance and sale of the Shares or the consummation of any other transaction
contemplated hereby.

         

            d.           Intellectual Property. The
Company owns or possesses no patents, trademarks, service marks, trade names,
copyrights, trade secrets, licenses, information or other proprietary rights and
processes other than the intellectual property rights licensed to the Company
from The Regents of the University of Colorado pursuant to the License
Agreement.

         

            e.           Litigation. There is no
action, suit, proceeding or investigation pending or, to the Company's
knowledge, threatened against the Company that questions the

        
          
             

          

          
            Page 2 of
15

            
              

            

          

          
             

          

        

        validity
of any of this Agreement or the right of the Company to enter into this
Agreement, or to consummate the transactions contemplated hereby, or which would
reasonably be expected to result, either individually or in the aggregate, in
any material adverse change in the assets, properties, condition, affairs,
business or operations of the Company, financially or otherwise, or any change
in the current equity ownership of the Company. The Company is not a party or,
to the best of its knowledge, subject to the provisions of any order, writ,
injunction, judgment or decree of any arbitration panel or tribunal, court or
government agency or instrumentality.

         

            f.           Compliance with Laws; Permits.
The Company is not in violation of any applicable statute, rule,
regulation, order or restriction of any domestic or foreign government or any
instrumentality or agency thereof in respect of the conduct of its business or
the ownership of its properties which violation would materially and adversely
affect the business, operations, assets, properties, liabilities, financial
condition or operations of the Company.

         

            g.           Consents. All consents,
approvals, orders, or authorizations of, or registrations, qualifications,
designations, declarations, or filings with, any third parties or governmental
authority, required on the part of the Company in connection with the valid
execution and delivery of this Agreement, the offer, sale or issuance of the
Shares or the consummation of the transactions contemplated hereby have been
obtained and are effective as of the date hereof, except for notices required or
permitted to be filed with certain state and federal securities commissions,
which required notices will be filed on a timely basis.

         

            h.           Newly Formed Entity. The
Company was formed with the Utah Secretary of State on February 28, 2006 and
since that time has conducted no business operations and has not incurred any
liabilities or acquired any assets, other than as contemplated in connection
with the transaction contemplated by the License Agreement and in connection
with the sale of Company Stock.

         

            i.           Full Disclosure. The Company
has provided Investor with all information requested by the Investor in
connection with its decision to purchase the Shares. To the Company's knowledge,
none of this Agreement, any attachments hereto, or any other information
delivered by the Company to the Investor or its attorneys or agents in
connection herewith or therewith contain any untrue statement of a material fact
nor, to the Company's knowledge, omit to state a material fact necessary in
order to make the statements contained herein or therein not
misleading.

         

            j.           Defaults. The Company is not
in violation or default of any term of (i) its articles of incorporation or
bylaws, or (ii) any judgment, decree, order, or writ applicable to the Company.
The Company is not a party to any material mortgage, indenture, contract,
agreement or instrument. The execution, delivery, and performance of and
compliance with this Agreement and the issuance and sale of the Shares, will
not, with or without the passage of time or the giving of notice, result in any
such violations, or be in conflict with or constitute a default under any of the
foregoing, or result in the creation of any mortgage, pledge, lien, encumbrance
or charge upon any of the properties or assets of the Company or the suspension,
revocation, impairment, forfeiture or nonrenewal of any permit license,
authorization or approval applicable to the Company.

        
          
             

          

          
            Page 3 of
15

            
              

            

          

          
             

          

        

            k.    Exemption. The offer,
issuance, and sale of the Shares are being made in reliance
on exemptions from the registration and prospectus delivery requirements of the
Securities
Act of 1933, as amended (the "Act"), and applicable state
securities laws.

         

            1.    Broker Fees. The Company has
not employed any broker, finder or agent, or agreed
to pay or incurred any brokerage fee, finder's fee or commission with respect to
the transactions contemplated by this Agreement, and has not dealt with anyone
purporting to act in the capacity of a broker, finder or agent with respect
hereto as a result of which any claim for a fee can or will be made against the
Investor.

         

              3.    Representations
and Warranties of the Investor. The Investor hereby represents
and warrants as of the date hereof to the Company as follows:

         

           a.           Experience; Investigation;
Investment. The Investor has such knowledge
and experience in financial and business matters that it is capable of
evaluating the merits and risks of an investment in the Shares. The Investor
understands that the Company is a newly formed corporation, that it has no
significant assets or operations and that intends to enter into the License
Agreement and raise additional debt or equity capital to fund the development of
products and processes licensed under the License Agreement. The Company has
made all requested information available to the Investor and the Investor has
received sufficient information to enable it to evaluate the merits and risks of
its investment. The Investor understands that its investment in the Company is
speculative and any return on the investment is highly uncertain. The Investor
is able to bear the economic risk of the investment and has the ability to hold
the Shares indefinitely and the ability to suffer a complete loss of its
investment. The Investor is purchasing the Shares for investment for its own
account, for investment purposes only, and not with a view towards their
distribution.

         

           b.           Transfer Restrictions. The
Investor will not sell, offer for sale, assign, pledge, hypothecate or otherwise
transfer or encumber all or any part of its interest in the Shares in the
absence of either (i) an effective registration statement covering such
transaction under the Securities Act of 1933, as amended (the "Securities Act"), and
effective qualification or registration under all applicable state securities
laws and regulations, or (ii) an opinion of counsel reasonably satisfactory to
the Company to the effect that registration under the Securities Act is not
required and qualification or registration under any such state securities laws
and regulations is not required (or that any applicable state qualification or
registration requirements have been satisfied in full); provided,
however, that the Company agrees that the Investor may transfer the
Shares to any entities or organizations that are control affiliates of the
Investor ("Exempt Transfer") and who agrees to
be bound by the terms and conditions of this Agreement to the same extent as if
it had been an original party hereto. The Investor understands and agrees that
the following legend (or one substantially similar) will be placed on the
certificates for the Shares:

         

        "THE
SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO
AN

        
          
             

          

          
            Page 4 of
15

            
              

            

          

          
             

          

        

        EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN APPLICABLE EXEMPTION TO THE REGISTRATION REQUIREMENTS OF SUCH ACT
OR SUCH LAWS."

         

            c.            Registration.
The Investor acknowledges that neither (i) the United States Securities
and Exchange Commission nor the securities regulatory agency of any state or
other federal agency has made any determination as to the merits of purchasing
the Shares; and (ii) the purchase of the Shares involves a high degree of risk.
The Investor understands that the Shares are being issued and sold in reliance
upon exemptions provided in the Securities Act. The Investor understands that
the Company is under no obligation to register the Shares or to assist the
Investor in complying with any exemption from registration if the Investor
should at a later date wish to dispose of such Shares. The Investor understands
that the Shares may not qualify for sale or other disposition under Rule 144
promulgated under the Securities Act.

         

            d.            Market
Standoff and Lock-Up/Leak-Out Agreements.

         

        (i)           In
the event the Company files a registration statement under the Securities Act
with respect to an initial public offering by the Company, and if required by
the underwriter(s) of such offering, Investor hereby agrees to enter into a
customary market standoff agreement with such underwriter providing that during
a period of up to one hundred eighty (180) days following the effective date of
such registration statement, Investor will not, without the prior consent of the
underwriter, sell or otherwise transfer, make any short sale of, grant any
option for the purchase of, or enter into any hedging or similar transaction
with the same economic effect as a sale, of any shares of Common Stock (or other
securities of the Company) held by it; provided, that all officers and directors
of the Company and holders of at least five percent (5%) of the Company's voting
securities enter into similar agreements.

         

        (ii)         In
the event the Company should engage in a transaction other than a registered
initial public offering pursuant to which a public trading market develops for
the Company's securities, Investor will, if requested by the Company, enter into
a lock­up/leak out agreement providing that it will not, without the prior
consent of the Company, sell any of its shares of Company Stock (or the shares
received by it in exchange for such shares in connection with such transaction)
in any public trading market during a period not to exceed one year (the "Lock-Up
Period") following the date of the closing of such transaction and that
thereafter it will limit its sales of the Company Stock (or the shares received
by it in exchange for such shares in connection with such transaction) in any
public trading market to an amount that is not more than 1/24 of its total
holdings during each calendar month occurring during a period of not more than
two years following the expiration of the Lock-Up Period; provided, that all
officers and directors of the Company and holders of at least five percent (5%)
of the Company's outstanding voting securities enter into similar
agreements.

        
          
             

          

          
            Page 5 of
15

            
              

            

          

          
             

          

        

             
4.          Indemnity.
The Company agrees to indemnify and hold harmless the Investor, its directors,
officers, stockholders, agents and employees from and against any claim, demand,
loss, liability and expense (including, without limitation, reasonable
attorneys' fees and disbursements) incurred as a result of any misrepresentation
or breach of any agreement, representation, warranty or covenant made by the
Company herein.

         

             
5.           Anti-Dilution and Preemptive
Rights Covenant.

         

            a.           Calculation. The Company
agrees to maintain the Investor's ownership percentage of the Company's total
outstanding capital stock at four percent (4%) (the "Investor's Ownership Interest"),
subject to adjustment downward if the Investor transfers stock (as
discussed below), as calculated in this Section 5(a). The calculation of the
Company's total outstanding capital stock shall include the Company's issued and
outstanding common stock, the Shares, any additional shares of stock issued to
the Investor pursuant to this Section 5, and any other outstanding shares of
capital stock of the Company. This calculation shall not include (i) any (I)
shares of restricted stock or (II) shares issued upon the exercise of options,
each as granted to the Company's employees, directors or consultants pursuant to
any stock purchase, restricted stock or stock option plans or other similar
compensatory arrangements that are approved by the Company's board of directors
("Board of Directors");
(ii) any shares of stock issued by the Company in a public offering of
such stock pursuant to a registration statement filed under the Securities Act
(a "Public Offering");
or (iii) any shares of stock issued by the Company in connection with an
acquisition or merger with an unaffiliated third party that is approved by the
Board of Directors (an "Approved Merger")
(collectively, the "Excluded Securities"). The
Company shall maintain the Investor's Ownership Interest by issuing to the
Investor additional securities (the "Additional Securities") of
the same type of security that triggers this provision (the "Triggering Issuance"). Upon
the occurrence of a Triggering Issuance, for any and all purposes the Additional
Securities shall (y) automatically and without any further action be deemed to
have been issued by the Company to Investor with Investor being the owner of
record of the Additional Securities on the books and records of the Company, and
(z) be deemed issued and outstanding securities of the Company. The Company
shall issue to Investor certificates representing all Additional Securities
issued during each calendar quarter within ten (10) days after the end of each
calendar quarter. If the Investor transfers any of the Shares, or any additional
shares issued to the Investor under this Section 5 (other than in an Exempt
Transfer), the Investor's Ownership Interest shall be reduced proportionately
and the Company's anti-dilution obligation under this Section 5 shall be
proportionately reduced.

         

            b.           Notice. If the Investor is
entitled to receive additional securities pursuant to Section 5(a) above, the
Company shall provide the Investor with prompt written notice thereof. A
capitalization table showing the new capitalization of the Company, including
the adjustment in the number of securities issued to the Investor, shall be
provided with such notice. The Company shall promptly deliver to the Investor
the additional securities, and the Investor shall not be obligated to pay any
additional consideration for such additional securities received.

         

            c.           Termination. The Investor's
rights under Section 5(a) shall terminate on the earliest to occur of the
following: (i) immediately prior to a sale of all or substantially all of the
assets of the Company, (ii) immediately prior to any issuance or exchange
of

        
          
             

          

          
            Page 6 of
15

            
              

            

          

          
             

          

        

        stock in
connection with an Approved Merger in which the stockholders of the Company
immediately prior to such transaction own less than 50% of the Company's or
other surviving entity's voting power immediately following such transaction;
(iii) upon the completion of equity financings which result in the Company
having received a cumulative total of at least three million dollars
($3,000,000) since its inception (the "Threshold Amount") and shall
not apply to any equity issued in any financing in excess of the Threshold
Amount (regardless of whether the Threshold Amount is exceeded in the equity
financing in which the Threshold Amount is reached); or (iv) immediately prior
to the effective date of any Public Offering.

         

           d.    Preemptive Rights. If the
Investor's rights pursuant to Section 5(a) are terminated
pursuant to Section 5(c)(iii), from and after that time, the Investor shall
immediately have the preemptive right to purchase its pro rata share of New
Securities (as defined below) which the Company may, from time to time, sell
and/or issue at the price at which such New Securities are to be issued
(including in an equity financing in which the Threshold Amount is reached),
such pro rata share to be determined in the same manner as the Investor's
Ownership Percentage (the "Preemptive Share"). In the
event the Company proposes to undertake an issuance of New Securities, it shall
give the Investor written notice of its intention, describing the type of New
Securities, the price and the general terms and conditions upon which the
Company proposes to issue the New Securities (the "Issuance Notice"). The
Investor shall have fifteen (15) business days from the date of receipt of the
Issuance Notice (the "Exercise
Period") to agree to purchase all or a portion of the Investor's
Preemptive Share of such New Securities for the price and upon the general terms
specified in the Issuance Notice by giving written notice to the Company, which
notice shall state the quantity of New Securities to be purchased by the
Investor (the "Preemptive
Notice"). The
Company shall have 90 after the expiration of the Exercise Period (the "Offering Period") to sell the
New Securities which are not purchased pursuant to the Preemptive Notice (the
"Remaining New Securities")
at a price and upon general terms no more favorable to the purchasers
thereof than specified in the Issuance Notice. In the event the Company has not
sold the Remaining New Securities within the Offering Period, the Company shall
not thereafter issue or sell any New Securities without first complying with
this Section 5(d). For purposes of this Section 5(d), "New Securities" shall mean
any equity securities of the Company whether or not now authorized and any
securities convertible, exchangeable or exercisable for any equity security of
the Company other than (i) Excluded Securities, or (ii) securities issuable upon
the exercise, conversion or exchange of derivative securities which were
originally issued as New Securities in accordance with Section 5(d). The
Investor's rights under this Section 5(d) shall terminate upon the completion of
equity financings which result in the Company having received a total of at
least twenty million dollars ($20,000,000) in the aggregate since its inception
(the "Preemptive Threshold
Amount") and shall not apply to any equity issued in any financing in
excess of the Preemptive Threshold Amount (regardless of whether the Preemptive
Threshold Amount is exceeded in the equity financing in which the Preemptive
Threshold Amount is reached).

         

              6.    Other
Covenants. The Company agrees that, so long as the Investor owns the
Shares or
any additional shares issued to the Investor under Section 5
above:

        
          
             

          

          
            Page 7 of
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            a.           Corporate Existence. The
Company will preserve, renew and keep in full force and effect, its corporate
existence.

         

            b.           Compliance with Laws. The
Company will comply with all applicable laws, ordinances, rules, regulations,
and requirements of governmental authorities except where the necessity of
compliance therewith is contested in good faith by appropriate proceedings or
where such noncompliance would not, individually or in the aggregate, have a
material adverse effect on the business, operations, prospects or financial
condition of the Company.

         

            c.           Books and Records. The Company
will maintain true books and records of account in which full and correct
entries will be made of all its business transactions pursuant to a system of
accounting established and administered in accordance with United States
generally accepted accounting principles consistently applied (except as noted
therein), and will set aside on its books all such proper accruals and reserves
as shall be required under United States generally accepted accounting
principles consistently applied.

         

            d.           Information
Delivery Requirements.

         

            (i)           The
Company shall deliver to Investor no later than ninety (90) days after the close
of its fiscal year, an audited income statement, balance sheet and statement of
cash flows prepared in accordance with United States generally accepted
accounting principles consistently applied and a summary of corporate events,
each for the preceding fiscal year.

         

            (ii)           The
Company shall deliver to Investor all minutes of meetings of and resolutions and
written consents adopted by of the Board of Directors and stockholders of the
Company, including all exhibits thereto, within ten (10) days after the date of
any such meeting or the effective date of any such resolutions or consents, as
the case may be. The Company may request the return of any and all documents and
materials provided to Investor pursuant to this Section 6(d)(ii) other than
documents and materials which Investor would otherwise be entitled to receive as
a stockholder of the Company. If the Company requests the return of any such
documents or materials, the Company shall prominently and clearly mark the
documents and materials for which it is requesting return to the Company and
shall include a self-addressed envelope for the return of such documents and
materials by Investor. Investor shall use its reasonable efforts to return all
such documents and materials to the Company within fourteen (14) business days
from the date of receipt by Investor.

         

             
7.    Miscellaneous.

         

            a.           Remedy. In addition to other
remedies to the Investor may be entitled for a material breach by the Company of
this Agreement by contract, by law or otherwise, the Investor shall also be
entitled to terminate the License Agreement.

         

            b.           Confidentiality. Subject to
Section 24-72-201, et. seq., of the Colorado Revised Statutes, the Investor
agrees that it will hold in strict confidence any information that is disclosed,
delivered or made available to it in connection with or pursuant to this
Agreement (the "Company
Confidential Information") and shall not disclose nor

        
          
             

          

          
            Page 8 of
15

            
              

            

          

          
             

          

        

        permit
disclosure of any such information to anyone, except to employees or agents of
the Investor to whom disclosure is necessary, and shall not use such information
for any purpose other than to monitor its investment in the Company.
Notwithstanding the foregoing, the Investor may disclose such information to the
transferee in any Exempt Transfer (an "Exempt Transferee") so long
as such Exempt Transferee agrees, subject to Section 24-72-201, et. seq., of the
Colorado Revised Statutes, to keep any such information confidential under terms
no less stringent than is required pursuant to this Agreement. Notwithstanding
anything in this Agreement to the contrary, the Investor shall have no
obligation to preserve the confidential nature of any Company Confidential
Information which: (i) is or becomes generally available to the public by other
than unauthorized disclosure, (ii) was or is independently discovered by
Investor or its employees or affiliates after the date of the this Agreement, or
(iii) is disclosed to the Investor by a party under no duty of confidentiality
with respect to such information. Disclosure of Confidential Information shall
not be precluded if disclosure is: (i) required by law or (ii) is in response to
a valid order of a court or other governmental body of the United States
(provided the Investor first gives written notice to the Company and makes a
reasonable effort to obtain a protective order requiring the Company
Confidential Information be used solely for the purpose for which the original
order was issued).

         

            c.           Entire Agreement. This
Agreement contains the entire agreement among the parties with respect to the
subject matter hereof. This Agreement may be modified only in writing by the
parties hereto.

         

            d.           Governing Law. The terms of
this Agreement shall be construed in accordance with the laws of the State of
Colorado, as applied to contracts entered into by Colorado residents within the
State of Colorado and to be performed entirely within the State of Colorado,
without regard to the law of conflicts of the State of Colorado. The Company
hereby (i) submits to the non-exclusive jurisdiction of the courts of the State
of Colorado and the Federal courts of the United States sitting in the State of
Colorado for the purpose of any action or proceeding arising out of or relating
to this Agreement, (ii) agrees that all claims in respect of any such action or
proceeding may be heard and determined in such courts, (iii) irrevocably waives
(to the extent permitted by applicable law) any objection which it now or
hereafter may have to the laying of venue of any such action or proceeding
brought in any of the foregoing courts in and of the State of Colorado, and any
objection on the ground that any such action or proceeding in any such court has
been brought in an inconvenient forum, and (iv) agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner permitted by
law.

         

            e.           Successors and Assigns. This
Agreement shall be binding upon the successors and assigns of the parties
hereto.

         

            f.           Severability. If any provision
of this Agreement shall be held invalid, illegal or unenforceable for any
reason, the validity, legality and enforceability of the remaining provisions
shall not in any way be affected or impaired thereby.

         

            g.           Counterparts; Facsimile Signatures.
This Agreement may be executed in multiple counterparts, each of which
need not contain the signatures of more than one party, but all such
counterparts taken together will constitute one and the same
Agreement.

        
          
             

          

          
            Page 9 of
15

            
              

            

          

          
             

          

        

        This
Agreement may be executed by delivery of an original executed counterpart
signature page by facsimile transmission.

         

            h.           Notice. Any and all notices,
requests, consents and demands required or permitted to be given hereunder shall
be given in writing and shall be deemed to have been duly given and received (i)
upon personal delivery, (ii) upon the first business day following delivery to a
nationally recognized overnight delivery service, (iii) the next business day
after delivery to reputable overnight courier addressed as set forth below, or
(iv) upon the third business day after deposit in the United States first class
mail, postage prepaid and addressed as set forth below. Any party hereto may by
notice so given change its address for future notices hereunder. Notices shall
be sent to the addresses specified below:

         

        If to the
Investor:

         

        University
License Equity Holdings, Inc. 4001 Discovery Drive, Suite 390C Campus Box
591

        Boulder,
CO 80309-0588

         

        Attn:
David N. Allen

         

        If to the
Company:

         

        APRO Bio
Pharmaceutical Corporation 5820 Tolcate Woods Lane

        Salt Lake
City, Utah 84121

         

        Atten:
David W. Floor

         

            i.           Headings. The titles and
subtitles used in this Agreement are used for convenience
only and are not to be considered in construing or interpreting this
Agreement.

        
          
             

          

          
            Page 10
of 15

            
              

            

          

          
             

          

        

        IN
WITNESS WHEREOF, the parties have executed this Subscription Agreement as
of the date first above written.

         

        INVESTOR:

         

        University
License Equity Holdings, Inc.

        By: /s/R.C.
Mercure, Jr.

        Its:
Chairman

         

        COMPANY:

         

        APRO
Bio Pharmaceutical Corporation

        By: /s/ David Floor

        Its:
Executive V.P.

        

        
          
             

          

          
            Page 11
of 15

            
              

            

          

          
             

          

        

        Schedule
A

        CAPITALIZATION

         

        As of the
date hereof, the authorized capital consists of 10,000,000 shares of preferred
stock, par value $0.001, none of which is issued or outstanding, and 90,000,000
shares of common stock, par value $0.001, of which 10,150,000 shares are issued
and outstanding. As of the date hereof, there are no outstanding options,
warrants, convertible securities or other rights entitling the holders to
acquire shares of the Company's capital stock.

         

        Attached
hereto is the shareholder list of the Company as of the date
hereof.

        
          
             

          

          
            Page 12
of 15

            
              

            

          

          
             

          

        

        Confidential

         

        APRO
BIO PHARMACEUTICAL CORPORATION

         

        List of Stockholders
5-15-06

         

         

         

         

        
          
            
            

          

          
            Page 13
of 15

            
              

            

          

          
            
            

          

        

      

    

     

    
      AMENDMENT
TO SUBSCRIPTION AGREEMENT

       

      

      This Agreement, dated March 17, 2009,
is between Apro Bio Pharmaceutical Corporation (”Company”) and University
License Equity Holdings, Inc., a Colorado nonprofit corporation (the
“Investor”), and amends a Subscription Agreement dated May 15, 2006 (the
“Subscription Agreement”) between the Company and the Investor.

      

      WHEREAS, Section 5 of the Subscription
Agreement provided certain anti-dilution protections to the Investor in the
event the Company issued or sold any capital stock following the date of the
Subscription Agreement, except in certain circumstances; and

      

      WHEREAS, Section 5 of the Subscription
Agreement could prevent the Company from engaging in financing transactions for
the purpose of advancing the Company’s business; and

      

      WHEREAS, the parties have agreed that
Section 5 should be replaced with a provision which will allow the Company to
engage in future financing transactions.

      

      NOW THEREFORE, the parties, for good
and valuable consideration, the receipt of which is hereby acknowledged, agree
as follows:

      

      
               1.  Section 5
of the Subscription Agreement shall be deleted in its
entirety.

      

      

      2. The
Company hereby agrees that, in lieu of Section 5 of the  Subscription
Agreement, the Company shall issue to Investor within
thirty (30) days of the effective date of the Company’s proposed merger with
Across America Financial Services, Inc. (the “Merger”), shares of the Company's
common stock representing two percent (2%) of all outstanding shares of capital
stock of Company on a fully diluted basis at the closing of Company’s Merger,
which calculation shall include all Placement Agent Warrants, Units, and Shares
issued in connection with the closing of the Merger, as described in the Merger
term sheet.   The shares shall be issued to University License
Equity Holdings, Inc., a Colorado nonprofit corporation ("ULEHI"), pursuant to
ULEHI's standard form stock subscription agreement.

      
        
           

        

        
          Page 14
of 15

          
            

          

        

        
           

        

      

      

      3. In all
other respects, the Subscription Agreement shall remain in full force and
effect.

      

      INVESTOR:

      

      University
License Equity Holdings, Inc.

       

      /s/ David N.
Allen

      By: David
N. Allen

      Its:
Secretary

      

      COMPANY:

      

      Apro Bio
Pharmaceutical Corporation

       

      /s/ Vicki D.E.
Barone

      By: Vicki
D.E. Barone

      Its:
Chairperson

      
        
           

        

        
          
          

          Page 15 of 15

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