Document:

Exhibit 10.4

 

Exclusive Intermediary Contract

 

This intermediary contract is a contract based
on the standard intermediary contract terms and conditions established by the Ministry of Land, Infrastructure, Transport and Tourism.

 

	Description of request Sale/purchase. Exchange

 

	
    This contract is a full-time intermediary contract
    type among the following three contract types.

    ・
    Exclusive full-service intermediary contract model

    The client cannot request the brokerage or agency
    of the sale or exchange of the target property to a real estate agent other than our company.

    The client cannot conclude a sales or exchange
    contract with the other party he/she discovers.

    A will register the target property with the designated
    distribution organization designated by the Minister of Land, Infrastructure, Transport, and Tourism.

    ・
    Exclusive intermediary contract model

    The client cannot request the brokerage or agency
    of the sale or exchange of the target property to a real estate agent other than our company.

    The client can conclude a sales or exchange contract
    with the other party he/she discovers.

    A will register the target property with the designated
    distribution organization designated by the Minister of Land, Infrastructure, Transport, and Tourism.

    ・
    General intermediary contract model

    The client may request the real estate agent other
    than our company to act as an intermediary or agent for the sale or exchange of the target property.

    The client can conclude a sales or exchange contract
    with the other party he/she discovers.

 

According
to this contract and the exclusive brokerage contract, the client A requests the real estate agent (target property) shown in the attached
table to mediate the sale (exchange) of the real estate (target property) to the residential land and building trader B, and B consents
to this.        
   [●]

 

    

    

    

 

	A・Requester	 	B・Real estate broker
	
    Address

     

    Lead Real Estate Co., Ltd

    6F, MFPR Shibuya Nanpeidai Building
    16-11, Nampeidai-cho, Shibuya-ku, Tokyo, 150-0036, Japan

     

    Full name

     

    Representative: Director, Eiji Nagahara

    Minister of Land, Infrastructure, Transport,
    and Tourism (2) No. 8801

     

    TEL

    TEL[] FAX[]

     

    email address

     

    [●]
	 	
    Address [●]

     

    Full Name [●]

     

    Location of main office [●]

     

    License number [●]

 

1. Obligation to conclude a contract

 

(1). B will search for the other party of the
contract, adjust the contract conditions with the other party of the contract, etc., and make an active effort toward the conclusion
of the contract.

 

(2).
B will notify A of the processing status of the business at a frequency of 1 * 2 weeks / once or more by writing and mailing.

 

(3). When B apply for sale or exchange of the
target property, B will report to A without delay.

 

(4).
In order to search for the other party of the contract widely, B will discuss the location, scale, characteristics, brokerage price
and other matters of the target property * 2x(public
interest incorporated foundation) East Japan Real Estate Distribution Organization  ̈ (public
corporation) Chubu Area Real Estate Distribution Organization  ̈ (Public
corporation) Kinki area real estate distribution organization  ̈(Public
corporation) Register with the West Japan Real Estate Distribution Organization within 7 days (excluding holidays of B) from the
day after the conclusion of this intermediary contract.

 

In addition, when the target property is registered,
a document certifying the registration stipulated in Article 50-6 of the Building Lots and Buildings Transaction Business Law will
be delivered to A without delay. When a contract for sale or exchange of the target property is concluded, B will notify the designated
distribution organization of the information regarding the contract based on Article 34-2, Paragraph 7 of the Building Lots and Buildings
Transaction Business Law, and the information regarding the contract will be provided. It is used for the business of the designated distribution
organization stipulated in Article 50-3 and Article 50-7 of the Building Lots and Buildings Transaction Business Law, such as
being provided to the residential land and building trader by the designated distribution organization.

 

* 1 Frequency stipulated in Article 34-2,
Paragraph 9 of the Building Lots and Buildings Transaction Business Law (at least once every two weeks)

 

Enter the specific frequency within the range
of.

 

* 2 We are conducting registration work for the
area including the location of the target property.

 

Check the name of the designated distribution
organization.

 

2. Business related to intermediary B will fulfill
the obligations listed in 1 and will perform the following tasks.

 

(1) B
will tell B about the price or valuation to buy or sell the target property.

 

    

    

    

 

When giving an opinion, A will clarify the rationale
and explain it.

 

(2) In
the case where A requests B to purchase or acquire the target property, B shall act as a residential land and building trader until the
contract for sale or exchange of the target property is concluded. A will issue a document signed and stamped by the residential land
and building trader to explain the important matters stipulated in Article 35 of the Building Lots and Buildings Transaction Business
Law.

 

(3) When the contract for sale or exchange
of the target property is concluded, B prepares a document stipulated in Article 37 of the Building Lots and Buildings Transaction
Business Law to A and the other party of A without delay and sends the document to the building lots and buildings trader. A will issue
this after B have B’s name stamped.

 

(4) B shall be involved in the delivery of
the target property such as registration and settlement procedures to A.

 

A will assist B in the office work.

 

(5) others

 

[●]

 

3. Presence or absence of intermediary of the
person who carries out the building condition inspection (Yes / No)

 

4. Penalties, etc.

 

(1) A
will become a real estate agent other than B within the valid period of this intermediary contract.

 

When requesting the intermediary or agency of
the sale or exchange of the target property and concluding the sale or exchange contract by this, the B shall ask A to the consumption
tax amount related to the intermediary of the amount equivalent to the contracted remuneration amount. And the amount equivalent to the
total amount of local consumption tax is excluded.) Can be charged as a penalty.

 

(2) If,
within the valid period of this intermediary contract, A conclude a contract for sale or exchange of the target property with the other
party that A have discovered, or if this intermediary contract is canceled due to reasons that cannot be attributed to B., B may request
A to reimburse the costs required to fulfill this intermediary contract.

 

5. Validity period

 

Three
months from the date of conclusion of this intermediary contract (until [●])

 

6. Contract reward amount

 

(Amount of compensation excluding consumption
tax and local consumption tax) (Total amount of consumption tax and local consumption tax)

 

The
total amount of the main unit contract price x [●]%yen and including tax man yen

 

*
Consumption tax and local consumption tax-excluded remuneration amount = "Price excluding the total amount of consumption tax and
local consumption tax related to the building" x [●]% + including tax man yen

 

* Total amount of consumption tax and local consumption
tax = Total amount of consumption tax and local consumption tax related to "consumption tax and compensation amount excluding local
consumption tax"

 

7. Timing of receipt of contract information

 

Half price at the time of sale / purchase / exchange
contract, and balance at the time of delivery.

 

    

    

    

 

8. Special provisions

 

(1) Prior
to concluding the brokerage contract, A received a written explanation of the outline of real estate transactions, the scope of brokerage
business, and the handling of personal information.

 

(2) If the trading price is settled by actual
measurement clearing, the selling price will increase or decrease.

 

The above "contracted remuneration amount"
will also be settled (increased or decreased) in proportion to.

 

(3)A
shall, to B and the person designated by B, the target property in the attached table of this contract.

 

A will delegate the following items necessary
for the sales contract, etc.

 

(i) Viewing the fixed asset tax book

 

(ii) Acquisition of fixed asset evaluation
certificate and public dues certificate

 

(iii) Viewing of water and sewage and gas
pipe piping drawings (front road, house, etc.) and acquisition of documents

 

(iiii) Acquisition of survey reports, etc.
from the management company

 

(4) If
the content of the request of A is a sale, A will transfer or move overseas.

 

When it is decided to do so, A will promptly notify
B.

 

(5) If B receive the contracted remuneration
by transfer from A to B’s designated account, B shall replace the issuance of a receipt with a copy of the transfer form.

 

(Separate
table)

 

interest in selling

 

	owner	Address       same as A・Requester on the left        (TEL)           Name
	Registered nominee	Address                                                                                                                      Name

                                                                                 

                                                                                Same as above

	Address	 
	Display of the intended property	land	actual measurements
	[●]m2out of [●] m2	land classification	Residential land rice paddies fields forests	Ownership	Ownership leasehold
	public registry	[●]m2
	building	Building area	[●]m2	type	 	structure
	total size (of land)	[●]m2	plan of a house	 	Construction thatched roof floors
	mansion	name	     Floor   no
	type	 	structure	           Construct          stories
	Exclusive area	[●]m2	joint ownership	 
	A is a taxable entity→	Intermediary price	   	 
	A is a taxable entity →	Intermediary price	 	 
	 	 	 	 	 	 	 	 	 	 	 

    

    

    

 

Purchase request

 

	
    Type of Property

     
	 	Desired degree	 
	
    Value

     
	 	 
	Size, Floor Plan, etc.	 	 
	Property Location	 	 

 

Other conditions, other special matters

 

	 
	 
	 
	 
	 

 

Items to be declared from A to B (When the content
of A’s request is "sale")

 

	The transfer to a foreign country at the time of the intermediary contract conclusion. Relocation schedule(yes/no)
	 

 

Others

 

	Our company buys and sells real estate such as special deductions of [●] yen for residential use, special deductions of [●] yen for vacant houses, transfer income tax, deduction for housing, and tax exemption system for funds such as housing acquisition. Although it is possible to explain the outline of the tax system at that time, please check with the tax office or tax accountant etc. by B’s self about the applicability of the system and the tax amount.

 

Responsible
jurisdiction [●]          Person in charge [●]

 

Registration Number

	 	 	 	 	 	 	 	 

 

    

    

    

 

(Customer's copy)

 

Exclusive Intermediary Contract Terms

 

(Purpose)

 

Article 1

 

The purpose of this agreement is to clarify the matters that the parties
should determine when concluding the contract and the matters that the parties must comply with each other regarding the performance of
the contract regarding the exclusive intermediary contract for the sale or exchange of residential land or building.

 

(Indication of parties and definition of terms)

 

Article 2

 

In this agreement, the requester is referred to as "A" and
the residential land and building trader who receives the request is referred to as "B" for the parties to the intermediary
contract.

 

    

    

    

 

2.In
this agreement, the "exclusive intermediary contract" is the residential land or building for which A are requesting (hereinafter
referred to as "target property").

 

It is an intermediary contract that cannot be requested to a real estate
agent other than B as an intermediary or agent for the sale or exchange of.

 

(Display of target property, etc.)

 

Article 3

 

The display required to identify the target property and the price
at which the target property should be bought or sold or the valuation price to be exchanged (hereinafter referred to as the “intermediary
price”) are stated in the attached table of the exclusive brokerage contract.

 

(Obligations of real estate brokers, etc.)

 

Article 4

 

B is obligated to fulfill the following matters.

 

(1). Search for the other party of the contract, adjust the contract
conditions with the other party of the contract, and make an active effort toward the conclusion of the contract.

 

(2). Report the processing status of the business to A by the method
and frequency described in the exclusive intermediary contract.

 

(3). When there is an application for sale or exchange of the target
property, report to that effect to A without delay.

 

(4). To search for the other party of the contract widely, the location,
scale, characteristics, brokerage price and other matters of the target property will be described in the dedicated brokerage contract
to the designated distribution organization from the day after the conclusion of the brokerage contract. Register within the period stated
in (not including the holidays of B).

 

(5). When the registration of the previous item is made, a document
certifying the registration stipulated in Article 50-6 of the Building Lots and Buildings Transaction Business Law issued by the
Designated Distribution Organization shall be delivered to A without delay.

 

2. B will fulfill the obligations listed in the preceding paragraph
and perform the following business.

 

(1). When determining the intermediary price, when giving an opinion
on the price to A, show the grounds and explain.

 

(2). If A asks B to purchase or acquire the target property, he will
act as a residential land and building trader until the contract for sale or exchange of the target property is concluded with A. Have
the residential land and building trader issue and explain the important matters stipulated in Article 35 of the Trading Business
Law.

 

(3). When a contract for sale or exchange of the target property is
concluded, a document stipulated in Article 37 of the Building Lots and Buildings Transaction Business Law will be prepared for A
and the other party of A without delay, and the signature will be stamped on the document to the building lots and buildings trader. After
letting it be delivered.

 

(4). To assist the office work related to the delivery of the target
property such as registration and settlement procedures to A.

 

(5). Perform the work described in the exclusive intermediary contract.

 

(Advice on changing the brokerage price, etc.)

 

Article 5

 

If the brokerage price is found to be inappropriate due to changes
in land prices, prices, or other circumstances, Second Party will advise First Party on the grounds for the change in brokerage prices.

 

(2). If B intend to change the brokerage price, A will notify B to
that effect. In this case, if the price change is an increase (in the case where A request B to purchase or acquire the target property,
it is a decrease), B will need B consent.

 

    

    

    

 

(3). When B intend to refuse the consent set forth in the preceding
paragraph, B must show the grounds.

 

(Intermediary of a person who conducts a building condition survey)

 

Article 6

 

If B decides to mediate a person who conducts a building condition
survey under this intermediary contract, he / she must mediate a person who conducts a building condition survey to A.

 

(Valid period)

 

Article 7

 

The validity period of the full-time brokerage contract will be determined
after consultation between A and B within the range not exceeding 3 months.

 

(Request for compensation)

 

Article 8

 

When a contract for sale or exchange of the target property is concluded
through the introduction of Second Party, Second Party may claim compensation from First Party. However, if the contract for sale or exchange
is concluded as a contract with suspension conditions, B may only claim compensation if the conditions are fulfilled.

 

(2). The amount of remuneration set forth in the preceding paragraph
shall be determined after consultation between A and B within the range of the limit stipulated in the notification of the Ministry of
Land, Infrastructure, Transport and Tourism.

 

(When to receive the reward)

 

Article 9

 

B shall prepare the document stipulated in Article 37 of the Building
Lots and Buildings Transaction Business Law and deliver it to the parties to the contract that has been concluded, or the remuneration
set forth in Paragraph 1 of the preceding Article (hereinafter referred to as "contract remuneration").

 

(2). After the contract for sale or exchange of the target property
is concluded on the condition that the loan for the price or exchange difference is not established, if the loan is confirmed to be unsuccessful,
or if the loan is unsuccessful, A can cancel the contract. If the loan is confirmed to be unsuccessful and the contract is canceled for
this reason, B will give A the full amount of the contracted compensation received without delay.

 

A must return it. However, no interest will be accrued on this.

 

(Cost related to special request)

 

Article 10

 

A will bear the cost of advertising specially requested by A or the
travel expenses to remote areas, and A must pay the actual cost based on B request.

 

(Direct transaction)

 

Article 11

 

If, within the validity period of the exclusive intermediary contract
or within two years after the expiration of the validity period, A conclude a contract to buy, sell or exchange the target property with
the other party that A learned through the introduction of B, excluding B. B can charge A considerable amount of compensation according
to the percentage that contributed to the conclusion of the contract.

 

    

    

    

 

(Charge for penalty)

 

Article 12

 

A may does not request a real estate agent other than B to mediate
or act as an agent for the sale or exchange of the target property within the valid period of the exclusive intermediary contract. If
B violate this and conclude a sales or exchange contract, B will be asked by A.

 

Excludes the amount equivalent to the total amount of consumption tax
and local consumption tax related to the intermediary of the amount equivalent to the contracted remuneration amount. Penalty payment
can be requested.

 

(Notice when trying to contract with the other party that B found B’s
self)

 

Article 13

 

If A intends to conclude a contract for sale or exchange of the target
property with the other party discovered by itself within the valid period of the exclusive intermediary contract, A must notify B to
that effect.

 

(Request for reimbursement of expenses)

 

Article 14

 

If, within the valid period of the exclusive intermediary contract,
A conclude a contract for sale or exchange of the target property with the other party that A have discovered, or if the exclusive intermediary
contract is canceled due to reasons that cannot be attributed to B. B may request A to reimburse the costs required to fulfill the exclusive
brokerage contract.

 

(2). The amount of expenses set forth in the preceding paragraph cannot
exceed the contracted remuneration amount.

 

(update)

 

Article 15

 

The validity period of the exclusive intermediary contract can be renewed
based on the agreement of First Party and Second Party.

 

(2). When attempting to renew the validity period, A shall notify B
in writing at the expiration of the validity period.

 

(3). When the validity period is renewed pursuant to the provisions
of the preceding two paragraphs, if there is no other agreement on the content of the exclusive intermediary contract between A and B,
it is considered that the contract with the same content as the previous contract has been concluded.

 

(Cancellation of contract)

 

Article 16

 

If A or B does not perform in accordance with the purpose of fulfilling
the obligations stipulated in the exclusive intermediary contract, the other party will notify the performance for a reasonable period,
and if there is no performance within that period, B can cancel the exclusive intermediary contract.

 

Article 17

 

In any of the following cases, A may cancel the exclusive intermediary
contract.

 

(1). When B violates the obligation to carry the business related to
the exclusive intermediary contract in good faith.

 

(2). When B does not tell the facts intentionally or due to gross negligence
or tells the truth about important matters related to the exclusive intermediary contract.

 

    

    

    

 

(3). When B has committed an illegal or significantly unjust act regarding
the residential land and building transaction business.

 

(Exclusion of antisocial forces)

 

Article 18

 

First Party and Second Party each assure the other party of the following
matters.

 

(1). The person himself / herself is not a gangster, a gangster-related
company, a general assembly shop, a person equivalent to these, or a member thereof (hereinafter collectively referred to as "antisocial
forces").

 

(2). The officers (meaning employees, directors, executive officers
or equivalent persons who execute business) are not antisocial forces.

 

(3). Do not allow antisocial forces to use their name and conclude
a exclusive intermediary contract.

 

(4). Do not perform the following acts by B’s self or by using
a third party within the valid period of the exclusive intermediary contract.

 

(i) Acts that use threatening behavior or violence against the
other party

 

(ii) Acts that interfere with the other party's business or damage
the credibility by using counterfeiting or power

 

2. If either Party A or Party B falls under any of the following within
the validity period of the exclusive intermediary contract, the other party needs to make any notification.

 

B can cancel the exclusive intermediary contract without doing so.

 

(1). When it is found that a declaration is made contrary to the promise
of item 1 or 2 of the preceding paragraph

 

(2). When it is found that the contract is made contrary to the promise
of item 3 of the preceding paragraph

 

(3). In the case of an act contrary to the promise of item 4 of the
preceding paragraph

 

3. When B cancels the exclusive intermediary contract pursuant to the
provisions of the preceding paragraph, the amount equivalent to the contracted remuneration amount (if a part of the contracted remuneration
has already been received, the amount excluding that amount) shall be applied to A. In addition, the amount equivalent to the total amount
of consumption tax and local consumption tax related to this intermediary is excluded.) B can claim as a penalty.

 

(Special contract)

 

Article 19

 

Matters not stipulated in this agreement can be stipulated separately
by A and B in consultation.

 

2. Special contracts that violate the provisions of each clause of
this contract and are disadvantageous to A will be invalid.elanco-tarsustopicalagre

CERTAIN IDENTIFIED INFORMATION HAS BEEN OMITTED FROM THIS DOCUMENT BECAUSE IT IS BOTH NOT  MATERIAL AND WOULD LIKELY CAUSE COMPETITIVE HARM TO THE REGISTRANT IF PUBLICLY DISCLOSED, AND   HAS BEEN MARKED WITH  “[***]” TO INDICATE WHERE OMISSIONS  HAVE BEEN MADE.        Exhibit 10.1  AMENDED AND RESTATED LICENSE AGREEMENT    THIS AMENDED AND RESTATED LICENSE AGREEMENT (the “Agreement”), is made and  entered into by and between Elanco Tiergesundheit AG, a Swiss corporation having place of business  at Mattenstrasse 24A, 4058 Basel, Switzerland (“Elanco”) and Tarsus Pharmaceuticals, Inc., a  Delaware corporation having its principal offices at 15440 Laguna Canyon Rd., Suite 160, Irvine, CA  92618 (“Tarsus”) as of June 3, 2022 (the “Amended and Restated Date”), and amends and restates in  its entirety that certain License Agreement made and entered into by and between Elanco and Tarsus as  of January 31, 2019 (the “Effective Date”) as amended on September 3, 2020 (the “Original  Agreement”).  Each of Elanco and Tarsus may be referred to herein as a “Party” and collectively as the  “Parties.”    BACKGROUND    A. Elanco is the owner, and has the right to license the Licensed IP (as defined below) on and  subject to the terms and conditions set forth in this Agreement.     B. Tarsus wishes to license the Licensed IP, and Elanco is willing to grant to Tarsus a license  under the Licensed IP, on and subject to the terms and conditions set forth in this Agreement.    C. The Parties wish to clarify certain terms from the Original Agreement.    NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements of  the Parties contained in this Agreement, the Parties, intending to be legally bound, hereby agree as  follows:    1. CERTAIN DEFINITIONS.  In addition to any terms defined elsewhere in this Agreement, the  following terms, when used in this Agreement, shall have the meanings set forth in this Section 1.     1.1 “Affiliate” means, with respect to an entity, any other entity which controls, is controlled by,  or is under common control with such first entity (but only so long as such control exists), whether as  of the Effective Date or any time after the Effective Date.  The term “control”, in relation to an entity,  means the ownership or control, directly or indirectly, of fifty percent (50%) or more of the shares (or  other securities or rights) entitled to vote for the election of directors or other governing authority of  such entity.    1.2 “Applicable Law” means, with respect to any Person or matter, any and all laws, ordinances,  constitutions, regulations, statutes, treaties, rules, codes, licenses, requirements and injunctions adopted,  enacted, implemented, promulgated, issued, entered by or under the authority of any governmental body  having jurisdiction over such Person or matter or any Person’s properties or assets.    1.3 “Commercially Reasonable Efforts” of a Party means, with respect to an objective, the  reasonable, diligent, good faith efforts of a Party, (which it may effect through the efforts of its  Affiliates, and sublicensees) of the type to accomplish such objective as a similarly situated (with  respect to size, stage of development, and assets) pharmaceutical company, as the case may be, would  normally use to accomplish a similar objective under similar circumstances, it being understood and  agreed that, with respect to efforts to be expended in relation to a product (including implementation of  development and commercialization strategies), such efforts shall be substantially equivalent to those  efforts and resources that a similarly situated pharmaceutical company, as the case may be, would  typically devote to its own internally discovered compound or product, which compound or product is  

 

      2  at a similar stage in its development or product life and is of similar market and economic potential as  products expected to result from the Compounds at a similar stage in their development or product life,  taking into account the risks of development, the commercial potential for the Product, its proprietary  position and other relevant factors.    1.4 “Compound” means Lotilaner and any salts, stereo isomers, prodrug, ester, metabolite,  solvate, or polymorph thereof, and any derivative of the foregoing containing one or more atoms  substituted with a radioisotope (including a derivative containing deuterium).     1.5 “Confidential Information” means information that is disclosed by one Party (the  “Disclosing Party”) to the other Party (the “Receiving Party”) in connection with this Agreement  (which may include, without limitation, trade secrets, technology, information pertaining to business  operations and strategies, and information pertaining to customers, pricing and marketing information)  or considered confidential under the Confidentiality Agreement as well as all information provided in  the data room by Elanco as of the Effective Date.  Confidential Information does not include information  that: (a) was already known to the Receiving Party prior to disclosure by the Disclosing Party; (b) is  independently developed by the Receiving Party; (c) was or becomes generally known by the public  other than as a result of a breach of this Agreement or the Confidentiality Agreement by the Receiving  Party; or (d) was received by the Receiving Party from a Third Party who was not, at the time of  disclosure, under any obligation to the Disclosing Party or any of its Affiliates to maintain the  confidentiality of such information.      1.6 “Confidentiality Agreement” means that certain Confidentiality Agreement by and between  Elanco and Tarsus effective May 3, 2018.      1.7 “Control”, “Controls” or “Controlled by” means, with respect to any item of or right under  any intellectual property, as the context requires, the possession (whether by ownership or license, other  than pursuant to this Agreement) or ability of a Party to grant access to, or a license or sublicense of,  such items or rights.     1.8 “Cover” with respect to any subject matter (e.g. a Licensed Product), means that absent a  license, the making, having made, using, importing, offering to sell or selling such subject matter would  infringe a Valid Claim.    1.9 “Cut-off Date” means the second (2nd) anniversary of the Effective Date.  1.10 “Elanco Field” means all applications for non-human animals, agricultural applications,  seed treatment applications and urban pest applications related to structural, turf, lawns and gardens,  including treatment of premises and ornamental pest markets but excluding, for clarity, any mosquito  vector control for human disease or any human therapeutics.    1.11 “Enroll” or “Enrollment” with respect to a clinical trial means a patient is dosed with the  applicable investigatory drug.   1.12 “Existing Manufacturer” means a third party that manufactures for which Tarsus pays (or  has paid) Elanco [***] dollars pursuant to Section 3.1 of that certain License Agreement entered into  by and between Tarsus and Elanco on or around even date herewith (the “Systemic License  Agreement”).    1.13 “FDA” means the U.S. Food and Drug Administration and any successor agency thereto.     1.14 “Field” means the treatment, palliation, prevention, or cure of any disease or condition in eye  care or dermatology in humans.    

 

      3  1.15 “First Commercial Sale” for a country means the first commercial sale of a Licensed Product  to a Third Party by Tarsus or any of its Affiliates or sublicensees of such Licensed Product after final  approval by the applicable government authority to market such product for human use in the Field in  such country (e.g. NDA approval).  “First Commercial Sale” excludes the sale of a Licensed Product  for use in a clinical trial or for expanded access (or similar term) and any sale of any Licensed Product  by Tarsus or any of its Affiliates or sublicensees to or among themselves.     1.16 “INAD” means an Investigational New Animal Drug filed with the FDA or the equivalent  application or filing filed with any equivalent agency or government authority outside of the United  States (including any supra-national agency such as in the European Union) necessary to commence  animal clinical trials in such jurisdiction, and including all regulations at 21 CFR § 511.1, and equivalent  foreign regulations.    1.17 “IND” means an Investigational New Drug Application filed with the FDA or the equivalent  application or filing filed with any equivalent agency or government authority outside of the United  States (including any supra-national agency such as in the European Union) necessary to commence  human clinical trials in such jurisdiction, and including all regulations at 21 CFR § 312 et. esq., and  equivalent foreign regulations.    1.18 “Know-How” means all know-how relating to the Compound or any Licensed Product,  including, without limitation, inventions (whether patentable or not), technology, discoveries, methods,  techniques, and scientific information, medical information, all manufacturing, preclinical, and clinical  data, materials, samples, protocols, specifications, processes, structures, trade secrets, analytical and  quality control information and procedures, pharmacological, toxicological, and clinical test data and  results, stability data, and studies and procedures.       1.19 “LianBio Agreement” means that certain Development and License Agreement entered into  by and between Tarsus and LianBio Ophthalmology Limited, as of March 26, 2021.    1.20 “LianBio Milestone and Upfront Payments” means the aggregate amount of upfront  payments and milestone payments received by Tarsus under the LianBio Agreement.    1.21 “Licensed Know-How” means all Know-How Controlled by Elanco as of the Effective Date.        1.22 “Licensed IP” means the Licensed Patents and the Licensed Know-How.      1.23 “Licensed Patents” means (a) the patents and patent applications set forth in Exhibit A hereto  or otherwise Controlled by Elanco or any of its Affiliates as of the Effective Date and Covering any  product that contains a Compound as an active pharmaceutical ingredient (alone or with other active  ingredients) in any forms, presentations, formulations or dosage strengths,  or any manufacture or use  of the foregoing, (b) any patent or patent application Covering any product that contains a Compound  as an active pharmaceutical ingredient (alone or with other active ingredients) in any forms,  presentations, formulations or dosage strengths, or any manufacture or use of the foregoing where the  patent or patent application Covers Know-How Controlled by Elanco or any of its Affiliates and arises  after the Effective Date and prior to the Cut-off Date; (c) any patent application filed after the Effective  Date on any of the Licensed Know-How; (d) any patent applications claiming priority to any of the  foregoing, including continuations, divisionals, continuation-in-part and foreign patent applications, (e)  all patents issuing from any of the foregoing patent applications described in (a) through (d); and (f) all  reissues, reexaminations, renewals, re-validations, re-registrations, patents of addition, supplementary  patent certificates and extensions of any of the foregoing.  Notwithstanding the foregoing, the Licensed  Patents do not include the Tarsus Patents.         1.24 “Licensed Product” means any product that: (a) contains a Compound as an active  pharmaceutical ingredient (alone or with other active ingredients) in any forms, presentations,  formulations or dosage strengths; or (b) the manufacture, sale, use or importation of which, absent the  

 

      4  license granted to Tarsus from Elanco under this Agreement, would infringe a Valid Claim of a Licensed  Patent.    1.25 “Major European Country” means any of Germany, France, Spain, Italy, and the United  Kingdom.       1.26 “MTA” means that certain Material Transfer Agreement dated on or around September 25,  2018.     1.27 “NADA” means a New Animal Drug Application, or any successor applications or  procedures, filed with the FDA for approval to market and sell a product in the United States.     1.28 “NDA” means a New Drug Application, or any successor applications or procedures, filed  with the FDA for approval to market and sell a product in the United States.     1.29 “Net Sales” means, with respect to a Licensed Product, the gross amount invoiced by Tarsus  (including a Tarsus Affiliate) or any sublicensee thereof to unrelated Third Parties, for such Licensed  Product in the Field in the Territory during the Royalty Term in the country of sale, less the following  items applied consistent with U.S. Generally Accepted Accounting Principles:    (a)       Trade, quantity and cash discounts allowed;    (b)      Discounts, refunds, rebates, chargebacks, retroactive price adjustments, and any other  allowances which effectively reduce the net selling price;    (c)     Licensed Product returns and allowances;    (d)      That portion of the sales value associated with drug delivery systems, where  applicable;     (e)      Any tax imposed on the production, sale, delivery or use of the Licensed Product,  including, without limitation, sales, use, excise or value added taxes;    (f)       Wholesaler inventory management fees;    (g)      Allowance for distribution expenses; and    (h)      Any other similar and customary deductions which are in accordance with GAAP.    Such amounts shall be determined from the books and records of Tarsus, Affiliates of Tarsus or any  sublicensee maintained in accordance with U. S. Generally Accepted Accounting Principles  consistently applied.  Tarsus further agrees in determining such amounts, it will use Tarsus’s then  current standard procedures and methodology, including Tarsus's then current standard exchange rate  methodology, utilizing a reputable source such as the Wall Street Journal or Reuters, for the translation  of foreign currency sales into U.S. Dollars.  For purposes of determining Net Sales, (i) sales of a  Licensed Product shall not include transfers, uses or dispositions for charitable, promotional, pre- clinical, clinical, regulatory or governmental purposes, and (ii) sales between or among Tarsus, its  Affiliates and sublicensees for re-sale shall be excluded from the computation of Net Sales, but  subsequent sales by Tarsus, its Affiliates, and sublicensees to third parties shall be included in the  computation of Net Sales.    1.30 “Person” means any individual, corporation, partnership, joint venture, limited liability  company, governmental authority, unincorporated organization, trust, association or other entity.     

 

      5  1.31 “Phase 2 Clinical Trial” means a clinical trial phase 2a, 2b or adaptive design for an  indication in the Field that is designed to evaluate clinical efficacy and safety for a pharmaceutical  product, in a manner that is generally consistent with 21 C.F.R. § 312.21(b), as amended (or its  successor regulation) and/or any analogous applicable law outside of the United States, as applicable.    1.32 “Phase 3 Clinical Trial” means a pivotal clinical trial for an indication in the Field that has  a defined dose or a set of defined doses of a pharmaceutical product designed to ascertain efficacy and  safety of such product, in a manner that is generally consistent with 21 C.F.R. § 312.21(c), as amended  (or its successor regulation) and/or any analogous applicable law outside of the United States, as  applicable.      1.33 “Regulatory Approval” in a particular country means all approvals (including any applicable  governmental price and reimbursement approvals), licenses, registrations, and authorizations of any  federal, national, multinational, state, provincial or local Regulatory Authority, department, bureau and  other governmental entity that are necessary for the marketing and sale of a Licensed Product in a  country.    1.34 “Regulatory Authority” means any applicable governmental authority responsible for  granting Regulatory Approvals or pricing approvals for Licensed Products, including the FDA, the  European Medicines Agency and any corresponding national or regional regulatory authorities.    1.35 “Regulatory Materials” means any regulatory application, submission, notification,  communication, correspondence, registrations, approvals and other filings made to or received from a  Regulatory Authority relating to any Licensed Product, including, without limitation, INADs, INDs  clinical trial applications, NADAs, NDAs and any other marketing authorizations.     1.36 “Regulatory Materials Receipt” means the date on which Elanco provides Tarsus with the  Regulatory Materials in existence as of the Effective Date that are reasonably necessary to research,  develop, make, use or otherwise exploit Licensed Products in the Field in the Territory.  Such materials  include, without limitation, [***], FDA approval letter, and FDA correspondence related to 21 Sep 18  Safety Communication.    1.37 “Royalty Term” means, with respect to any Licensed Product in a given country, the period  of time commencing on the date of the First Commercial Sale of such Licensed Product in such country  and ending on the latest of: (a) expiry of the last-to-expire of the Licensed Patents which has at least  one (1) Valid Claim Covering such Licensed Product in such country; (b) the expiration of regulatory  exclusivity for such Licensed Product in such country; and (c) ten (10) years after first commercial sale  of such Licensed Product in such country.        1.38 “Sensitive Transfer” means a transfer to a new supplier requiring either a technology transfer,  a method transfer or another form of transfer of Licensed Know-How.    1.39 “Sublicense Revenue” means payments that Tarsus receives in consideration for a sublicense  of rights under the Licensed IP in the Field.    1.40 “Tarsus IP” means the Tarsus Patents and the Tarsus Know-How.  Tarsus IP does not include  the Licensed IP.    1.41 “Tarsus Know-How” means Know-How Controlled by Tarsus as of the Effective Date,  excluding Licensed Know-How.    1.42 “Tarsus Patents” means (a) patents and patent applications Controlled by Tarsus as of the  Effective Date and related to the Compound and Licensed Product; (b) any patent applications claiming  priority to any of the foregoing, including continuations, divisionals, continuation-in-part (to the extent  the claims thereof are entitled to such priority) and foreign patent applications, and (c) all patents issuing  

 

      6  from any of the foregoing patent applications described in (a) through (b), including all reissues,  reexaminations and extensions thereof. Notwithstanding the foregoing, the Tarsus Patents do not  include the Licensed Patents.    1.43 “Territory” means the entire world.    1.44 “Third Party” means any Person other than a Party or an Affiliate of a Party.    1.45 “TP-03 Research and Development Expenses” means amounts: (a) that Tarsus commits to  and/or receives invoices from clinical research organizations (e.g., Ora, Inc.) ; and/or (b) that other  vendor(s) invoice for third-party research and development services rendered for (and only for): (i)  toxicology studies, (ii) carcinogenicity studies; or (iii) preservative-free formulation development; in  each case of (a) and (b), to the extent reasonably necessary and specifically related to Licensed Products  in eyedrop form.     1.46 “Valid Claim” means any claim of any issued and unexpired Licensed Patent that has not  been disclaimed, abandoned, revoked or held unpatentable, invalid or unenforceable by final decision  of a court or other governmental body of competent jurisdiction, which decision is unappealable or  unappealed within the time allowed for appeal.  “Valid Claim” shall include any pending claim of any  Licensed Patent that has been pending for less than seven (7) years but shall exclude pending claims  that have been pending, without approval, for seven (7) years or more.    2. LICENSE GRANT; UPSTREAM AGREEMENTS.      2.1 Elanco License.  Elanco hereby grants to Tarsus and its Affiliates an exclusive (even as to  Elanco), perpetual, sublicensable (through multiple tiers), royalty-bearing license, under the Licensed  IP, to research, develop, make, use, sell, offer for sale, import and otherwise exploit Licensed Products  in the Field in the Territory.  Each sublicensee shall agree to comply with the following terms and  conditions of this Agreement:  Section 2.3, allowing an audit pursuant to Section 6.6, Section 9.2(b)  (with respect to the activities of sublicensee and its Affiliates), and Section 10 (with respect to the  Confidential Information of Elanco). Tarsus remains fully responsible and liable under this Agreement  irrespective of any sublicense.    2.2 Tarsus License.  Tarsus hereby grants to Elanco a worldwide non-exclusive, perpetual,  sublicensable (through multiple tiers), royalty-free license, under the Tarsus IP, to research, develop,  make, use, sell, offer for sale, import and otherwise exploit Compounds and Licensed Products in the  Elanco Field.  Tarsus may sublicense any or all rights and/or obligations under this Agreement.     2.3 Right of Reference; Samples.  Each Party has right to reference and receive access to all  Regulatory Materials for the Compound (and any chemical alteration or improvement of the Compound  (e.g. pursuant to Section 8.3)) that are Controlled by the other Party, its Affiliates, or its sublicensees,  whether existing as of the Effective Date, generated from any activities of the Parties in connection with  this Agreement, solely for the purposes set forth in this Agreement, or otherwise existing after the  Effective Date.  Elanco will provide Tarsus with reasonable samples of (a) Elanco’s chemical alterations  or improvements of the Compound, (b) the Compound’s related substances, and/or (c) reference  standards for the Compound, in each case, after Tarsus’s request(s) from time to time.  Tarsus shall pay  Elanco for such samples at an amount equal to [***] paid by Elanco for such samples plus [***]%  thereof.    3. REGULATORY TRANSFER; KNOW -HOW TRANSFER.       3.1 Within [***] days following the date Tarsus pays Elanco the Upfront Payment, Elanco shall  provide all information regarding the Licensed Know-How that is Controlled by Elanco as of the  Effective Date and is reasonably necessary to research, develop, make, use, or otherwise exploit  Licensed Products in the Field in the Territory. Additionally, if Tarsus engages a third party other than  

 

      7  Siegfried to manufacture the Licensed Product and such manufacture requires material manufacturing  Know-How not previously provided to Tarsus then Elanco shall provide (or cause Siegfried to provide)  such Know-How and Tarsus shall pay Elanco [***]. Total hours of Elanco support will be capped at  [***] hours (the “Hours Cap”), and total costs paid by Tarsus will be capped at [***] dollars (the  “Dollars Cap”). If either the Hours Cap or the Dollars Cap is reached and Tarsus requests additional  assistance, the Parties will meet to mutually decide on further support. Payment by Tarsus will be made  to Elanco within thirty (30) days after the earlier to occur of (a) the Dollars Cap is reached, and (b) the  Parties mutually agree that Tarsus has received all of such Know-How.  For purposes of clarity, all costs  charged by Siegfried in conjunction with the transfer of Know-How will be borne by Tarsus. Provided  in any case that Elanco shall only be obliged to provide information to a third party that has been  selected in compliance with Section 8.4.      3.2 Promptly after the Effective Date, Elanco shall provide Tarsus with all Regulatory Materials  that are reasonably necessary to research, develop, make, use or otherwise exploit Licensed Products in  the Field in the Territory, but, in any case, Elanco shall not be required to provide any particular  Regulatory Material to Tarsus more than once.  Elanco shall continually provide Tarsus with any  relevant updates to the Regulatory Materials promptly after their creation or receipt (as the case may  be).    4. DEVELOPMENT AND COMMERCIALIZATION.    4.1 General; Diligence.  Following the Effective Date, as between the Parties, Tarsus, at its  expense, shall be responsible for conducting (or causing its Affiliates or sublicensees to conduct) the  development and commercialization of the Licensed Products in the Field in the Territory. Tarsus shall  use Commercially Reasonable Efforts to develop the Licensed Products and seek and obtain Regulatory  Approval for Licensed Products in the Field in the Territory. A summary of the currently intended  development activities is attached as Exhibit D. Elanco’s sole and exclusive remedy for Tarsus’s breach  of the foregoing sentence is termination of this Agreement pursuant Section 11.2.    4.2 Regulatory. As between the Parties, Tarsus (or its Affiliates or sublicensees) shall be solely  responsible, for all regulatory matters relating to the development and commercialization of the  Licensed Products in the Field in the Territory and shall coordinate and control the related regulatory  strategy and interactions with Regulatory Authorities for the Licensed Products at its own cost. Each  Party shall keep the other Party informed about the regulatory process and status for Licensed Products  and shall immediately or no later than five (5) business days inform the other Party of any human  exposure serious adverse event (as defined in 21 CFR 312.32 and CFR 514.3) or such other matters  agreed to in any pharmacovigilance or that would otherwise reasonably be expected to materially  adversely affect the other Party’s regulatory process for the Licensed Products.    4.3 Progress Reports.  Within [***] days after January 1 of each year prior to First Commercial  Sale, Tarsus shall submit to Elanco a progress report covering in reasonable detail the activities of  Tarsus including a listing of serious adverse events, its Affiliates and sublicensees, as applicable, related  to the development, regulatory status and commercialization of the Licensed Products in the Territory.   All reports provided by Tarsus to Elanco under this Section 4.3 shall be considered Tarsus’s  Confidential Information.     4.4 Reversion of Rights.       (a) If neither Tarsus nor any of its Affiliates or sublicensees achieve any of the milestones set  forth in Exhibit B (each a “Diligence Milestone”) by the corresponding achievement deadline date set  forth in Exhibit B except for reasons outside of Tarsus’ reasonable control, Elanco shall (as its sole and  exclusive remedy for such failure) have the right to terminate the Agreement if such Diligence  Milestone remains unmet one hundred twenty (120) days after Elanco provides Tarsus notice of such  failure.          

 

      8  (b) If neither Tarsus nor any of its Affiliates or sublicensees achieve any of the milestones set  forth in Exhibit C (each a “Dermatology Milestone”) by the corresponding achievement deadline date  set forth in Exhibit C except for reasons outside of Tarsus’ reasonable control, Elanco shall (as its sole  and exclusive remedy for such failure) have the right to reduce the Field of Use to “the treatment,  palliation, prevention, or cure of any disease or condition in eye care in humans” if such Dermatology  Milestone remains unmet one hundred twenty (120) days after Elanco provides Tarsus notice of such  failure.       (c) Tarsus may, at its option, increase all of the milestone dates set forth in Exhibit B and  Exhibit C one time by [***] months by making a one-time payment of $[***].     (d) In the case of termination pursuant to Section 4.4(a), Elanco shall be granted nonexclusive,  sublicensable rights to the Tarsus Know-How and Tarsus Licensed Patents to develop, manufacture,  and commercialize the Compound and Licensed Products in the Field and be provided with Tarsus  Know-How (including such regulatory documentation corresponding to the Licensed Product) but not  any other assets of Tarsus.  Such rights shall be fully paid and royalty free.      5. JOINT STEERING COMMITTEE.      (a) The parties shall establish a joint steering committee (the “Joint Steering Committee” or  “JSC”) consisting of two (2) representatives from each party, which shall serve as a way for Tarsus to  inform (and seek advice from) Elanco in the development and Regulatory Approval efforts for the  Licensed Product in the Territory and other efforts under this License Agreement.  Each party will  provide the other Party Notice with the name, title, email address, telephone number of their respective  Steering Committee Members. The JSC shall meet as needed but not less than on a quarterly basis (or  such other frequency as determined by the JSC).      (b) The Steering Committee meetings will be at times agreed by the Parties and will be in such  form (e.g., in person, telephone, or video conference) as the members of the Steering Committee agree.      (c) A party may change one or more of its representatives to the Steering Committee at any  time. Members of the Steering committee may be represented at any meeting by another member of the  Steering committee or by a proxy. Either Party may permit additional employees and consultants to  attend and participate in the Steering Committee, subject to the confidentiality provisions of the  agreement.  Each Party is responsible for travel costs for their representatives associated with attending  in person JSC meetings.    (d) The Steering Committee will be responsible for keeping accurate minutes of its  deliberations that record decisions and all actions recommended or taken.  Within thirty (30) business  days of each JSC meeting, the Parties will be provided with draft minutes of such meeting.  Minutes  will be deemed approved unless a Steering Committee representative of either Party objects to the  accuracy of such minutes.  In the event that any such objection is not resolved by the Steering  Committee such minutes will be amended to reflect the unresolved objection.  All records of the  Steering Committee will be considered confidential information and available to both Parties.       6. PAYMENTS TO ELANCO.     6.1 Upfront Payment and Early Payment.      (a) Tarsus shall pay to Elanco an upfront fee of one million dollars  (US$1,000,000) (the “Upfront Payment”) within [***] days after the Effective Date.   The Upfront  Payment shall not apply if Tarsus does terminate this Agreement pursuant to Section 11.2(c). The  Parties acknowledge that Tarsus has issued to Elanco 187,500 of TARS shares pursuant to that certain  Letter of Intent dated March 26, 2021, and executed by the Parties.    

 

      9  (b) Elanco currently holds 187,500 TARS shares that are subject to a lock-up  agreement that extends until March 3, 2022 and 222,460 TARS shares that are not subject to a lock-up.  In consideration of Elanco agreeing to subject all TARS shares held by Elanco to a lockup agreement  that extends until September 30, 2022 (the “New Lockup Agreement”), Tarsus shall pay to Elanco an  early payment of [***] dollars (the “Prepayment Amount”) within [***] days of the Amended and  Restated Date.  The New Lockup Agreement shall be in a form agreed to by the Parties and entered into  on the Amended and Restated Date.  The Prepayment Amount shall be creditable, and may be offset  against any payment obligations of Tarsus to Elanco, whether under this Agreement or any other  agreement between the Parties.     6.2 Milestones.     (a) First Indication Development Milestones.  Tarsus shall pay to Elanco the following  one-time milestone payments upon the first achievement of the applicable milestone event set forth  below by Tarsus or any of its Affiliates or sublicensees after the Effective Date:    (i) [***] dollars upon the [***] of [***] of a Licensed Product;    (ii) [***] dollars upon the [***] of [***] of a Licensed Product;    (iii) [***] dollars upon the [***] of [***] of a Licensed Product in [***];    (iv) [***] dollars upon the [***] of [***] of a Licensed Product in [***];    (v) [***] dollars upon the [***] of [***] of a Licensed Product in [***]; and    (vi) [***] dollars upon the [***] of [***] of a Licensed Product in [***].    Each of the foregoing milestone payments set forth in this Section 6.2(a) shall be paid no more than  once, irrespective of how many Licensed Products achieve each milestone or how many times a  Licensed Product achieves such milestone.   Accordingly, in no event shall Tarsus pay Elanco more  than ten million dollars ($10,000,000) in the aggregate pursuant to this Section 6.2(a).  Each milestone  payment due pursuant to this Section 6.2(a) shall be paid within [***]  days after the achievement of  the applicable milestone.    For all purposes of Section 6.2, all indications for the treatment of any type of Blepharitis shall be  deemed the same indication.  For example, if Tarsus [***] and later [***], then Tarsus would pay the  milestone under Section 6.2(a)(i) for the first of [***] but the second [***] would not cause a payment  of a milestone pursuant to Section 6.2(b)(i).    (b) Development Milestones for Other Indications.  Tarsus shall pay to Elanco the  following one-time milestone payments upon the first achievement of the applicable milestone event  set forth below by Tarsus or any of its Affiliates or sublicensees after the Effective Date:    (i) [***] dollars upon the [***] of a Licensed Product for [***];    (ii) [***] dollars upon the [***] of a Licensed Product for [***];    (iii) [***] dollars upon the [***] of a Licensed Product in [***];    (iv) [***] dollars upon the [***] of a Licensed Product in [***];    (v) [***] dollars upon the [***] of a Licensed Product in [***]; and    (vi) [***] dollars upon the [***] of a Licensed Product in [***].  

 

      10    Each of the foregoing milestone payments set forth in this Section 6.2(b) shall be paid no more than  once, irrespective of how many Licensed Products achieve each milestone or how many times a  Licensed Product achieves such milestone.  Accordingly, in no event shall Tarsus pay Elanco more than  ten million dollars ($10,000,000) in the aggregate pursuant to this Section 6.2(b).  Each milestone  payment due pursuant to this Section 6.2(b) shall be paid within [***] days after the achievement of the  applicable milestone.    (c)  Sales Milestones.  Tarsus shall pay to Elanco the following one-time milestone  payments upon the first achievement of the applicable milestone event set forth below:    (i) [***] dollars after the first calendar year in which Net Sales for such calendar  year exceed [***] dollars;    (ii) [***] dollars after the first calendar year in which Net Sales for such calendar  year exceed [***] dollars; and    (iii) [***] dollars after the first calendar year in which Net Sales for such calendar  year exceed [***] dollars.    Each of the foregoing milestone payments set forth in this Section 6.2(c) shall be paid no more than  once, irrespective of how many times each milestone is achieved.  Accordingly, in no event shall Tarsus  pay Elanco more than sixty-five million dollars ($65,000,000) in the aggregate pursuant to this Section  6.2(c).  Each milestone payments due pursuant to this Section 6.2(c) shall be paid within [***] days  after the close of the calendar quarter in which such milestone is achieved.    (d) Milestone Status as of the Amended and Restated Date.  As of the Amended and  Restated Date, the Parties acknowledge and agree that: (i) for all purposes of this Agreement, Tarsus  shall be deemed to have achieved each of the milestones described in Sections 6.2(a)(i) and 6.2(a)(ii);  and (ii) Tarsus has satisfied its payment obligations required pursuant to Section 6.2(a)(i) and Section  6.2(a)(ii).    6.3 Sublicense Revenue.       (a) Sublicense Revenue.  Tarsus shall pay Elanco a percentage of all Sublicense Revenue.   The percentage of such Sublicense Revenue that shall be paid to Elanco shall be as follows (with the  appropriate tier being determined for Sublicense Revenue at the time such Sublicense Revenue becomes  due to Tarsus, and with such percentage of Sublicense Revenue becoming due to Elanco at the time  such Sublicense Revenue is received by Tarsus):  (i) For Sublicense Revenue received prior to first [***] of a Licensed Product:  [***]%; or   (ii) For Sublicense Revenue received after first [***] of a Licensed Product and  thereafter: [***]%.    (b) Sublicense Revenue Exclusions.  Notwithstanding the foregoing, none of the following  shall be deemed Sublicense Revenue: [***].  Any assignment of this Agreement, change of control or  sale of a program involving rights under the Agreement shall not in any way be deemed the grant of a  sublicense. Tarsus shall not act in bad faith to intentionally structure Sublicense Revenue or a sublicense  as such in a manner that is intended to prevent payments of Sublicense Revenue to Elanco becoming  due.    

 

      11  (c) Neither Tarsus nor any of its Affiliates shall act in bad faith to delay invoicing,  payments, or the achievement milestones under this Agreement, or any sublicensing agreement  permitted hereunder, for the purpose of reducing (or eliminating) Sublicense Revenue which would  otherwise be shared with Elanco under this Agreement. In such case, if, absent such bad faith, such  invoice, payment, or milestone could have been sent or achieved before Regulatory Approval, then such  invoice, payment, or milestone shall be deemed sent or achieved prior to Regulatory Approval for all  purposes of Section 6.3(a).    6.4 Treatment of Sublicense Revenue for LianBio Agreement.    (a) LianBio Research and Development Offset Cap.  With respect to the LianBio  Agreement, subject to Section 6.4(b) below, [***] dollars of LianBio Milestone and Upfront Payments  (and no more than [***] dollars of LianBio Milestone and Upfront Payments) (the “LianBio R&D  Cap”) shall be deemed amounts excluded from Sublicense Revenue pursuant to the R&D Exclusion.  For the avoidance of doubt, with respect to the LianBio Agreement, the aggregate R&D Exclusion shall  not exceed the LianBio R&D Cap.           (b) LianBio Research and Development Offset Cap. If aggregate TP-03 Research and  Development Expenses do not meet or exceed the LianBio R&D Cap by [***], then the amount by  which the LianBio Milestone and Upfront Payments exceed the aggregate TP-03 Research and  Development Expenses shall be deemed Sublicense Revenue and subject to payment pursuant to  Section 6.3(a).  Elanco acknowledges and agrees that Tarsus has incurred and/or committed to [***]  dollars of TP-03 Research and Development Expenses as of the Amended and Restated Date.    (c) Clarification on Further Payments.  For clarity, Tarsus shall have no obligation to pay  Elanco a percentage of Sublicense Revenue received after [***] of a Licensed Product except to the  extent LianBio or Tarsus act in bad faith to delay invoicing, payments, or the achievement milestones  of LianBio under the LianBio Agreement for the purpose of reducing (or eliminating) Sublicense  Revenue which would otherwise be shared with Elanco under this Agreement.  In such case, if, absent  such bad faith, such invoice, payment, or milestone could have been sent or achieved before [***], then  such invoice, payment, or milestone shall be deemed sent or achieved prior to [***] for all purposes of  Section 6.3(a).    (d) No Double Counting.  For clarity, any TP-03 Research and Development Expenses  excluded from Sublicense Revenue under the LianBio Agreement in accordance with Section 6.4(a)  shall not be excluded from Sublicense Revenue under a separate sublicense.    (e) Deemed Timing of Sublicense Revenue.  All consideration received by Tarsus pursuant  to the LianBio Agreement shall be deemed received after the Amended and Restated Date (even if such  amounts were received prior to the Amended and Restated Date).    (f) Creditable Sublicense Revenue Advance.  Within [***] days after the Amended and  Restated Date, Tarsus shall pay Elanco [***] dollars as a non-refundable advance that is creditable and  may be offset against future obligations of Tarsus pursuant to Section 6.3(a) (whether as a result of  Sublicense Revenue under the LianBio Agreement or Sublicense Revenue under other agreements) (the  “Advance Sublicense Payment”). The Parties acknowledge that the Advance Sublicense Payment has  been paid in full.  For clarity, the creditable aspect of the Prepayment Amount and the amount of the  Advance Sublicense Payment are cumulative.    (g)  For the avoidance of doubt, the alternative arrangements indicated above for the  LianBio Agreement and particularly the exclusion of R&D expense were agreed to by Elanco on a one- off basis and shall not form the basis for future sublicenses.     6.5 Royalties.      

 

      12  (a) Royalty Rate. Subject to the other terms of this Section 6.5, for each calendar year  during the Royalty Term Tarsus shall pay:    (i) [***] percent royalty on the first [***] dollars of Net Sales of a Licensed Product  in such calendar year;    (ii) [***] percent royalty on the next [***] dollars of Net Sales of a Licensed Product  in such calendar year (i.e. the portion of such Net Sales between US$[***] and $US[***] in such  calendar year);     (iii) [***] percent royalty on the next [***] dollars of Net Sales of a Licensed Product  in such calendar year (i.e. the portion of such Net Sales between US$[***] and $[***] in such calendar  year); and    (iv) [***] percent royalty on all Net Sales of a Licensed Product in such calendar year  in excess of [***] dollars (i.e. the portion of such Net Sales over $[***] in such calendar year).     (b) No Multiple Royalties.  No multiple royalties shall be payable hereunder because the  use, manufacture or sale of any Licensed Product is Covered by more than one Valid Claim.     (c) Timing of Payments; Reports.   Commencing with the calendar quarter during which  the First Commercial Sale of the first Licensed Product is made anywhere in the Territory, and for each  calendar quarter thereafter during the Royalty Term during which royalties are due hereunder,  Tarsus  shall provide Elanco with a report that contains the following information for the applicable calendar  quarter, on a Licensed Product-by-Licensed Product and country-by-country basis: (i) the amount of  gross sales of the Licensed Products, (ii) an itemized calculation of Net Sales showing deductions  provided for in the definition of “Net Sales”, (iii) a calculation of the royalty payment due on such sales,  and (iv) the exchange rate for such country.  Tarsus shall provide such report and make corresponding  payment to Elanco within forty-five (45) days after the end of each calendar quarter.      (d) Exchange Rate.  When conversion of payments from any foreign currency is required,  such conversion shall be calculated using an exchange rate equal to the rate of exchange published in  the Wall Street Journal on the last business day of the applicable calendar quarter for which payment is  due.      (e) No deductions for third party licenses. No deductions from any payments under this  agreement shall be made because Tarsus is required to make payments, royalty payments or otherwise,  to third parties to obtain rights or licenses to intellectual property rights in respect of a Licensed Product.     (f) Royalty Reduction. If at any time during the Royalty Term for a given Licensed Product  in a given country, there is no Valid Claim Covering such Licensed Product in such country, then the  royalty rate payable by Tarsus pursuant to Section 6.4(a) shall be reduced to [***] percent of the rates  set forth in Section 6.4(a).    6.6 Mode of Payment.  Tarsus shall pay all payments to Elanco under this Agreement by wire  transfer of immediately available funds to a USD functional bank account designated in writing by  Elanco, in U.S. Dollars or such other currency as the Parties may mutually agree in writing.     6.7 Audit.  Tarsus shall keep or cause to be kept books of account containing all information that  may be necessary for the purpose of calculating amounts payable by Tarsus in connection with this  Agreement for a period of three (3) calendar years following the end of the calendar year during which  such amounts were payable.  Elanco may appoint an independent public accountant (on a non- contingency basis and reasonably acceptable to Tarsus; any “Big 4” accountant shall be deemed  acceptable to Tarsus), at Elanco’s expense and subject to such accountant entering into a confidentiality  agreement with Tarsus, to inspect such books of account in order to verify the calculation of any  

 

      13  amounts payable to Elanco hereunder.  Such inspections shall be performed not more frequently than  once in any twelve (12) month period and upon reasonable prior written notice, and shall be conducted  during regular business hours in such a manner as to not unreasonably interfere with Tarsus’s normal  business activities.  Elanco’s accountant may only share with Elanco the report containing the summary  results of its inspection, but not the books of account reviewed by the accountant during the audit, and  such report shall constitute Tarsus’s Confidential Information. If any such inspection reveals that any  payment which should have been paid by Tarsus is greater than those which were actually paid by it  and such underpayment is not disputed by Tarsus, then Tarsus shall promptly pay the underpaid amount  to Elanco.  If the undisputed payments which should have been paid by Tarsus are at least [***] percent  greater than those which were actually paid by Tarsus, then Tarsus shall also reimburse Elanco for the  reasonable out-of-pocket costs of such inspection.     6.8 Taxes.  Each Party shall be solely responsible for the payment of all taxes imposed on its  share of income arising directly or indirectly from its activities or receipt of payments under this  Agreement.  To the extent Tarsus is required to deduct and withhold taxes on any payment to Elanco  hereunder, it shall deduct such amounts from payments to Elanco and pay the amounts of such taxes to  the proper governmental authority in a timely manner and promptly transmit to Elanco an official tax  certificate or other evidence of such withholding sufficient to enable Elanco to claim such payment of  taxes.  Elanco shall provide Tarsus any tax forms that may be reasonably necessary in order for Tarsus  not to withhold tax or to withhold tax at a reduced rate under an Applicable Law or bilateral income tax  treaty.      6.9 Sales Forecast.  Within [***] days after January 1 of each calendar year, Tarsus shall provide  Elanco with Tarsus’s projected Net Sales over the next [***] calendar years.  For clarity, such  projections would be for informational purposes only and the foregoing is not binding on Tarsus in any  way.    7. INTELLECTUAL PROPERTY.       7.1 Prosecution and Maintenance of Licensed Patents.      (a) Elanco shall be solely responsible for prosecution and maintenance of the Licensed  Patents including, but not limited to, the filing of patent applications included therein.  Elanco shall  keep Tarsus reasonably informed with respect to the status and progress of any such applications,  prosecutions and maintenance activities.  Elanco shall consider in good faith the comments of Tarsus  with respect to any such applications and prosecutions and maintenance activities.      (b) Elanco may, in its sole discretion, elect to abandon any issued patent or pending patent  application included in the Licensed Patents, or not file any patent application with respect thereto in  any country.  Prior to any such abandonment or decision not to file in any country, Elanco shall give  Tarsus at least [***] days’ notice and a reasonable opportunity to take over such maintenance,  prosecution or filing.  In such event, Tarsus shall have the right, but not the obligation, to commence or  continue such maintenance, prosecution or filing under its own control and at its sole expense.  Tarsus  shall have no further payment obligations (including with respect to royalties and milestone payments)  or other obligations to Elanco with respect to any such patents or patent applications or patents issuing  from such applications.      7.2 Enforcement of Licensed IP.      (a) During the Royalty Term, each Party shall promptly provide written notice to the other  Party of any actual or alleged infringement or misappropriation in the Field by any Third Party of any  intellectual property rights included in the Licensed IP of which it becomes aware.  Elanco shall have  the first right, but not the obligation, to enforce the Licensed IP against any such infringement or  misappropriation claim in the Field at its own expense and utilizing counsel of its choice.  Elanco shall  neither settle nor voluntarily dispose of any action to enforce the Licensed IP in the Field without  

 

      14  Tarsus’s written consent.  If Elanco desires to voluntarily dispose of any action to enforce the Licensed  IP in the Field then Elanco shall notify Tarsus and offer Tarsus the opportunity to assume control of  such enforcement action (“Voluntary Disposal Notice”).  If Tarsus notifies Elanco of its election to  assume control of such enforcement action then Elanco shall take all reasonable actions necessary to  allow Tarsus to properly do so.  Elanco may voluntarily dispose of such enforcement action if: (i) Tarsus  notifies Elanco that it does not desire to assume control of such enforcement action; or (ii) Tarsus does  not notify Elanco of any election within [***] days after Elanco provides Voluntary Disposal Notice.     (b) With respect to any potential enforcement under subsection (a) above, if Elanco does  not notify Tarsus of its intention to enforce against such alleged infringement or misappropriation within  [***] days of the date Elanco becomes aware of such alleged infringement or misappropriation, or does  not commence prosecution of such claim within [***] days after the date Elanco becomes aware of  such alleged infringement or misappropriation, then, Tarsus shall have the right, but not the obligation,  to prosecute such claim at its own expense and utilizing counsel of its choice.      (c) The enforcing Party shall regularly update the other Party in writing with respect to the  status of any such enforcement actions.  Any recovery of damages by shall be applied (i) first, in  satisfaction of any unreimbursed expenses and legal fees of the enforcing Party, (ii) second, in  satisfaction of any unreimbursed expenses and legal fees of the other Party, and (iii) third, if additional  recoveries remain after all of the unreimbursed expenses and legal fees are fully paid as set forth in (i)  and (ii), the balance remaining with respect to any such recovery shall be retained by (or paid by Elanco  to, as the case may be) Tarsus and such amount shall be treated as Net Sales and subject to the payment  of royalties pursuant to Section 6.3.     (d) At the request of the Party bringing the action, the other Party shall provide reasonable  assistance in connection therewith, including by executing reasonably appropriate documents,  cooperating in discovery and joining as a party plaintiff to the action if required to obtain necessary  standing.      7.3 Improvements. Elanco shall own any invention conceived by or for Elanco from the use of  the Compound or otherwise derived by or for Elanco from the Compound (“Elanco Improvements”).  Tarsus shall own any invention conceived by or for Tarsus from the use of the Compound or otherwise  derived by or for Tarsus from the Compound (“Tarsus Improvements”).  To the extent any Research  Invention (as such term is defined in the MTA) exists, Elanco hereby assigns such Research Invention  to Tarsus.  Tarsus hereby grants Elanco an exclusive royalty-free, perpetual license to the Research  Inventions and Tarsus Improvements for applications in the Elanco Field).  This Section 7.3 amends  and supersedes Section 7 of the MTA entirely, such that Section 7 of the MTA shall have no further  force or effect.        8. MANUFACTURE AND SUPPLY.    8.1 Initial Supply Terms.  Each calendar quarter, Tarsus shall supply Elanco with a written,  non-binding forecast showing good faith estimations of its (and its Affiliates’ and sublicensees’)  quarterly requirements for the Compound for the following four (4) calendar quarters (the “Forecast”).   Elanco shall manufacture (or have manufactured) and supply to Tarsus quantities of the Compound as  and when reasonably requested by Tarsus to the extent within the Forecast.  Tarsus’s price for all  Compounds purchased pursuant to this Section 8.1 shall be the price at which Elanco purchases such  Compound plus [***] percent thereof.    8.2 Manufacturing and Supply Agreement.  The Parties agree to enter into a good-faith more  detailed manufacturing and supply agreement within a reasonable timeframe. The supply agreement  should provide for a stated supply price (which price shall represent a small markup over Elanco’s  costs).       8.3 Change of chemistry.   

 

      15    (a) Tarsus acknowledges and agrees that Elanco shall be free to use alternate chemistry  and improve the Compound in its sole discretion without Tarsus consent.    (b) Elanco shall provide Tarsus with [***]  days prior notice (the “Compound Change  Period”) if Elanco will cease to provide any Compound previously provided to Tarsus pursuant to a  chemical change and will supply Tarsus with any quantities of such Compound requested by Tarsus  during the Compound Change Period (even if such quantities exceed the amount projected in the  Forecast).     8.4 Have Made Rights.  For clarity, Section 2.1 grants Tarsus the right to have a third party  make the Compound for Tarsus.  Elanco must approve such third party supplier unless: (a) the transfer  to the supplier qualifies as Sensitive Transfer); or (b) such supplier is reputable and credible.  Such  approval shall not be unreasonably withheld, conditioned, or delayed.  For all purposes of the foregoing,  the following entities and their Affiliates shall be deemed credible and reputable (and shall not require  Elanco consent): [***] (or any Affiliate of the foregoing), [***].      9. INDEMNIFICATION; INSURANCE.    9.1 Indemnification by Elanco.  Elanco shall indemnify, defend and hold harmless Tarsus, its  Affiliates, and its and their respective officers, directors, employees, agents, successors and assigns  against all third party losses, damages, liabilities, deficiencies, claims, actions, judgments, settlements,  interest, awards, penalties, fines, costs or expenses (collectively, “Losses”), resulting from (a) any  action instituted against any of them by any Third Party arising out of from Elanco’s breach of any  representation, warranty or obligations pursuant to this Agreement, or (b) the gross negligence or willful  misconduct of Elanco, except, in each case, to the extent such Losses are Losses for which Tarsus is  obligated to indemnify Elanco pursuant to Section 9.2 or to the extent such Losses arise from the breach  by Tarsus or its Affiliates of its representations, warranties or obligations under this Agreement or from  the failure of any sublicensees to comply with any obligations required of sublicensees under this  Agreement.    9.2 Indemnification by Tarsus.  Tarsus shall indemnify, defend and hold harmless Elanco, its  Affiliates, and its and their respective officers, directors, employees, agents, successors and assigns  against all Losses resulting from (a) Tarsus’s breach of any representation, warranty or obligations  pursuant to this Agreement, ,(b) the gross negligence or willful misconduct of Tarsus; or (c) the  development, making, having made, using, having used, leasing, importing, offering to sell, selling  and/or having sold, any Compound or Licensed Product by Tarsus, its Affiliates and sublicensees or the  failure of any of them to comply with Applicable Law in connection with any such activities, except,  in each case, to the extent Elanco is required to indemnify Tarsus under Section 9.1 for such Losses or  to the extent such Losses arise from the breach by Elanco or its Affiliates of its representations,  warranties or obligations under this Agreement.     9.3 Indemnification Procedure.  The indemnified party shall promptly notify the indemnifying  party in writing of any action for which it intends to seek indemnification hereunder and cooperate  reasonably with the indemnifying party at the indemnifying party’s sole cost and expense.  The  indemnifying party shall have the right, within thirty (30) days after being so notified, to assume the  defense of any action with counsel of its choice that is reasonably satisfactory to the indemnified party.  The indemnifying party shall not settle any action in a manner that adversely affects the rights of any  indemnified party without the indemnified party’s prior written consent, which consent shall not be  unreasonably withheld or delayed. The indemnified party’s failure to provide prompt notice to the  indemnifying party of any action shall not relieve the indemnifying party of its obligations under this  Section 9.3 except to the extent that the indemnifying party can demonstrate that it has been materially  prejudiced as a result of the failure. Subject to the indemnifying party’s right to control the defense and  settlement thereof, the indemnified party may participate in and observe the proceedings at its own cost  and expense with counsel of its own choosing. A Party shall not be responsible for the indemnification  

 

      16  or defense of the other Party to the extent arising from any negligent or intentional acts by such Party,  or the breach by such Party of any representations, obligations or warranty under this Agreement, or  any claims compromised or settled without prior written consent.     9.4 Limitation of Liability. Except with respect to a breach of Section 10, or a Party’s liability  pursuant to Section 9 or Section 7.2, neither Party shall be liable for special, incidental, consequential,  exemplary, punitive, or other indirect or remote damages, or loss of profits, loss of data or loss of use  damages arising in any way out of this Agreement or the exercise of its rights hereunder, whether based  upon warranty, contract, tort, strict liability or otherwise.      10. CONFIDENTIALITY.    10.1 Non-Disclosure and Non-Use.  Each Receiving Party shall:     (a) not disclose any Confidential Information of the Disclosing Party to any Person other  than (i) Persons who have a “need to know” such information for purposes of the Receiving Party’s  performance or exercise of rights under this Agreement, and (ii) any Affiliates or sublicensees (or  potential sublicensees) of the Receiving Party or other Persons working on the Receiving Party’s behalf  (including without limitation consultants, contract manufacturers, and independent contractors),  provided that any such Person agrees to be bound by terms and conditions no less stringent than those  set forth in this Section 10; and      (b) not use any Confidential Information of the Disclosing Party for any purpose other than  in connection with performing its obligations or exercising its rights under this Agreement.      10.2 Disclosure Required by Applicable Law.  Section 10.1 shall not apply to Confidential  Information which the Receiving Party is required by Applicable Law (including, without limitation,  any reporting requirements arising under the federal securities laws or the regulations promulgated by  any national securities exchange on which securities of the Receiving Party are traded), court order, or  similar requirements to disclose, provided that the Receiving Party:     (a) provides the Disclosing Party with prompt written notice thereof such that the  Disclosing Party may seek a protective order or other appropriate remedy with respect to such  Confidential Information, including, without limitation, confidential treatment to the extent available  under any Applicable Law, and the Receiving Party shall provide the Disclosing Party with reasonable  cooperation in order to obtain such a protective order or other remedy, including confidential treatment,  and     (b) discloses only that portion of the Confidential Information that is legally compelled to  disclose.      10.3 Permitted Disclosures.  Section 10.1 shall not prevent either Party from (a) preparing,  filing, prosecuting, defending or maintaining Licensed Patents, (b) disclosing Confidential Information  to Regulatory Authorities to the extent the Receiving Party reasonably believes it is required or desirable  in connection with clinical testing of any Licensed Product or to secure Regulatory Approval for the  development or marketing of any Licensed Product, (c) disclosing Confidential Information to the  extent required by the Securities and Exchange Commission or applicable tax authorities, (d) disclosure  to a Third Party in connection with due diligence by such Third Party, and disclosure to potential Third  Party investors in confidential financing documents, provided that any such Third Party agrees to be  bound by reasonable obligations of confidentiality and non-use, to the extent possible.    11. TERM; TERMINATION.    11.1 Term; Expiration. This Agreement shall commence on the Effective Date and, unless  sooner terminated as provided hereunder, shall expire on a Licensed Product-by-Licensed Product and  

 

      17  country-by-country basis upon the expiration of the Royalty Term with respect to such Licensed Product  in such country.  Following such expiration of the Royalty Term, the license granted by Elanco to Tarsus  in Section 2.1 with respect to such Licensed Product in such country shall become fully-paid, royalty- free, worldwide, exclusive, and perpetual.      11.2 Termination.    (a) Upon any material breach or default of this Agreement by a Party, the other Party shall  have the right to terminate this Agreement upon giving sixty (60) days’ prior written notice thereof to  the breaching Party. Such termination shall become effective thirty (30) days after at the end of such  sixty (60) day period unless the breaching Party shall have cured any such breach or default prior to the  expiration of such sixty (60) day period; or if such breach cannot be reasonably cured within sixty (60)  days, but the breaching Party has commenced reasonable actions to cure such breach, then such longer  period as may be required to cure such breach provided that the breaching Party continues to diligently  cure such breach.  If the material breach or default by the breaching Party applies only to a given  country, the other Party may only terminate this Agreement with respect to such country and thereafter  the Territory shall no longer include the country in which such termination has occurred.    (b) No such termination by a Party pursuant to Section 11.2(a) shall be effective prior to  the resolution of any dispute with respect to the occurrence of any material breach of or default under  this Agreement as to which such Party seeks to exercise such right of termination. If as a result of such  dispute resolution process it is determined that a Party’s notice of breach was proper, then such notice  shall be deemed to have been effective if the breaching Party fails thereafter to cure such breach in  accordance with the determination made in the resolution process within the applicable cure period  following such determination.  If as a result of such dispute resolution process it is determined that the  notice of breach was improper, then no such notice shall be deemed to have been effective and this  Agreement shall remain in effect. All of the terms and conditions of this Agreement shall remain in full  force and effect during the pendency of such dispute resolution process.     (c) Tarsus may terminate this Agreement immediately upon notice to Elanco within thirty  (30) business days after the Effective Date: (a) if, in Tarsus’s reasonable discretion, the Regulatory  Materials reveal any fact that would adversely affect the development and/or regulatory approval of a  Licensed Product in any way; or (b) Regulatory Materials Receipt does not occur within twenty (20)  days after the Effective Date.     (d) If Tarsus or any of its Affiliates or sublicensees, directly or indirectly, (i) initiates or  requests an interference or opposition proceeding with respect to any Licensed Patents; (ii) makes, files  or maintains any claim, demand, lawsuit, or cause of action to challenge the validity or enforceability  of any Licensed Patents; or (iii) opposes any extension of, or the grant of a supplementary protection  certificate with respect to, any Licensed Patents (any of (i) – (iii) a “Challenge”), Elanco shall have the  right to terminate this Agreement upon thirty (30) days written notice to Tarsus. Any such termination  shall only become effective if Tarsus or its Affiliate or sublicensee, as applicable, has not withdrawn  such action before the end of the above notice period.  Notwithstanding the foregoing, Elanco may not  terminate this Agreement for a direct or indirect Challenge made by a sublicensee if Tarsus terminates  the sublicense to such sublicensee within thirty (30) days after Elanco notifies Tarsus of such Challenge.     11.3 Effect of Expiration or Termination.      (a) Upon termination of this Agreement for any reason, the license (and sublicense)  granted to Tarsus under Section 2.1 shall terminate in full with respect to the country(ies) and Licensed  Product(s) which are the subject of such termination.       (b) Notwithstanding subsection (a) above, Tarsus, its Affiliates and/or any sublicensee  thereof may elect to sell all finished Licensed Products and any Licensed Products in the process of  manufacture at the time of such termination for a period not to exceed [***] months after such  

 

      18  termination, provided that Tarsus shall pay or cause to be paid to Elanco all royalty payments in  accordance with Section 6.3 with respect thereto.      (c) Upon termination of this Agreement for any reason and following any request by the  relevant sublicensee (provided that such sublicensee is then in compliance with the applicable terms of  this Agreement in all material respects), any sublicense of the Licensed IP shall become a direct license  between such sublicensee and Elanco  (but shall not obligate Elanco beyond the terms of this  Agreement) and such sublicensee shall assume all of Tarsus’s payment obligations to Elanco under this  Agreement with respect to such sublicensee’s activities (and those of its Affiliates and sublicensees).    (d) Termination or expiration of this Agreement for any reason shall be without prejudice  to any rights that shall have accrued to the benefit of either Party prior to such termination or expiration.   Additionally, the following terms shall survive termination or expiration of this Agreement:  Sections  2.2 (unless terminated by Tarsus pursuant to Section 11.2(a)), 6.1, 6.6, 6.7, 9, 10, 11, and 13.   Termination or expiration of this Agreement shall not affect or prejudice any right of either Party to  receive payments due hereunder or for which the event giving rise to such payment obligation has  occurred prior the effectiveness of such termination or expiration or preclude or hinder the terminating  Party from also bringing, amending or pursuing an action against the other Party for damages and all  other available legal and equitable remedies.    (e) Upon termination of this Agreement by Elanco under Section 4.4 (a) or Section 11.2  (a) Tarsus shall as soon as reasonably practicable provide Elanco with copies of all documented  technical and other information Controlled by Tarsus that is both: (i) specific to preclinical  documentation and technical information with respect to a Licensed Product; and (ii) which are  necessary for the development, manufacture and commercialization of the Licensed Product.   Notwithstanding the foregoing, Tarsus shall have no obligation to provide any Regulatory Materials or  clinical information or data and Elanco shall have no right to (and shall not) reference any Regulatory  Materials of Tarsus after such termination.    (f) Upon termination of this Agreement by Elanco under Section 4.4(a) or Section 11.2(a)  or Section 11.2(d), Tarsus shall promptly return all Confidential Information of Elanco.    12. REPRESENTATIONS AND WARRANTIES.    12.1 Mutual Representations and Warranties.  Each Party hereby represents and warrants to  the other Party as follows:    (a) Corporate Existence and Power.  It is a company or corporation duly organized, validly  existing, and in good standing under the laws of the jurisdiction in which it is incorporated, and has full  corporate power and authority and the legal right to own and operate its property and assets and to carry  on its business as it is now being conducted and as contemplated in this Agreement, including, without  limitation, the right to grant the licenses granted by it hereunder.    (b) Authority and Binding Agreement.  As of the Effective Date, (i) it has the corporate  power and authority and the legal right to enter into this Agreement and perform its obligations  hereunder; (ii) it has taken all necessary corporate action on its part required to authorize the execution  and delivery of the Agreement and the performance of its obligations hereunder; and (iii) the Agreement  has been duly executed and delivered on behalf of such Party, and constitutes a legal, valid, and binding  obligation of such Party that is enforceable against it in accordance with its terms.    (c) No Conflict.  It is not a party to any agreement that would materially prevent it from  granting the rights granted to the other Party under this Agreement or performing its obligations under  the Agreement.     

 

      19  12.2 Additional Representations and Warranties of Elanco.  Elanco represents and warrants to  Tarsus as of the Effective Date that:    (a) it has all rights under the Licensed IP to grant the licenses to Tarsus as purported to be  granted pursuant to this Agreement (including, without limitation, without any payment to any Third  Party);    (b) it has not received any written notice from any Third Party asserting or alleging that  any research or development of any Licensed Product by or on behalf of Elanco prior to the Effective  Date infringed or misappropriated the intellectual property rights of such Third Party;     (c) there are no actual, pending, alleged or, to Elanco’s knowledge, threatened adverse  actions, suits, claims, interferences or formal governmental investigations involving the Licensed  Products and/or the Licensed IP by or against Elanco in or before any court or governmental authority;    (d) there are no patents or patent applications Controlled by Elanco or its Affiliates, other  than the Licensed Patents, that would prevent Tarsus or its Affiliates or sublicensees from developing,  manufacturing and/or commercializing Licensed Products as set forth herein or from exploiting the  rights granted under Section 2.1; and    (e)  the Licensed Patents cover the Compound.  12.3 Additional Representations, Warranties and Covenants of Tarsus.    Tarsus represents, warrants and covenants that:     (a) to its knowledge, no employee, consultant, contractor, agent, or other representative  performing services under this Agreement or any agreement between Tarsus and any other Party  contracted by Tarsus to perform work hereunder has been debarred or disqualified, or is under  investigation for being debarred or disqualified by the FDA, EMEA, or other regulatory authority.   Tarsus agrees to promptly notify Elanco if it learns of any such action; and     (b) as of the Effective Date, it has (or reasonably believes it can obtain or contract third  parties to provide) the capability, resources, and expertise to fulfill its obligations under this Agreement  in compliance with Applicable Law to the extent such capability, resources, and expertise would  reasonably be possessed by a company in a similar stage of financing and development as Tarsus.        12.4 No Other Representations or Warranties.  EXCEPT AS EXPRESSLY STATED IN THIS  ARTICLE 12, NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, WHETHER  EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, WARRANTIES OF  MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, OR  NON-MISAPPROPRIATION OF THIRD PARTY INTELLECTUAL PROPERTY RIGHTS, IS  MADE OR GIVEN BY OR ON BEHALF OF EITHER PARTY.  ALL OTHER REPRESENTATIONS  AND WARRANTIES, WHETHER ARISING BY OPERATION OF LAW OR OTHERWISE, ARE  HEREBY EXPRESSLY EXCLUDED.    13. MISCELLANEOUS.    13.1 Relationship of Parties.  Nothing in this Agreement is intended or shall be deemed to  constitute a partnership, agency, employer-employee or joint venture relationship between the Parties.   Each Party’s performance under this Agreement is that of a separate entity.    13.2 Assignment.  Elanco shall be entitled to freely assign this Agreement or any portion thereof.   Tarsus shall not be entitled to assign its rights hereunder without the express written consent of the other  

 

      20  Party, except that Tarsus may assign this Agreement:  (a) to any of the following entities or any of their  Affiliates: [***]; or any entity listed on a publicly traded exchange and with a market capitalization in  excess of US$[***] (each of the foregoing, a “Permitted Assignee”); or (b) to an Affiliate.      13.3 Further Assurances.  At any time or from time to time after the Effective Date, each Party,  at the other Party’s reasonable request, shall execute and deliver such other documents, agreements and  instruments (including instruments of sale, transfer, conveyance, assignment and confirmation), provide  such materials and information and take such other actions as the other Party may reasonably deem  necessary or desirable in order more effectively effectuate the transactions contemplated by this  Agreement.      13.4 Notice.  Any notice or request required or permitted to be given under or in connection with  this Agreement shall be deemed to have been sufficiently given if in writing and personally delivered  or sent by certified mail (return receipt requested), or overnight express courier service (signature  required), prepaid, to the Party for which such notice is intended, at the address set forth for such Party  below:    (a) In the case of Tarsus, to:      [***]         with a copy to:    [***]; and    Gunderson Dettmer Stough Villeneuve Franklin and Hachigian LLP  3570 Carmel Mountain Rd   San Diego, CA 92130  Attn: Brendan C. McCarthy  Email: [***]    (b) In the case of Elanco, to:      Elanco US Inc.  2500 Innovation Way N  Greenfield IN 46140  Attn: Edward D McGruder  Email: [***]    with a copy to:    Elanco US Inc.  2500 Innovation Way N  Greenfield IN 46140  Attn: General Patent Counsel  Email: [***]    _____    or to such other address for such Party as it shall have specified by like notice to the other Party.  If  delivered personally, the date of delivery shall be deemed to be the date on which such notice or request  was given, unless otherwise set forth in this Agreement.  If sent by overnight express courier service,  the date of delivery shall be deemed to be the next business day after such notice or request was  deposited with such service, unless otherwise set forth in this Agreement.  If sent by certified mail, the  

 

      21  date of delivery shall be deemed to be the third business day after such notice or request was deposited  with the U.S. Postal Service, or the foreign equivalent thereto, unless otherwise set forth in this  Agreement.    13.5 Public Announcements.  Except as required by Applicable Law (including, without  limitation, disclosure requirements of the U.S. Securities and Exchange Commission, Nasdaq or any  other stock exchange on which securities issued by Elanco are traded) and as permitted by Section 10.3,  neither Party shall make any public announcement that the Parties have entered into this Agreement,  without the prior written consent of the other Party (which shall not be unreasonably withheld).  A Party  shall be deemed to provide consent to any public announcement if it does not notify the other Party of  its rejection within ten (10) days after receiving such proposed public announcement.     13.6  Waiver; Remedies.  A waiver by either Party of any of the terms and conditions of this  Agreement in any instance must be made expressly in writing and signed by an authorized  representative of such Party.  Any such waiver shall not be deemed or construed to be a waiver of such  term or condition for the future, or of any subsequent breach hereof.  All rights, remedies, undertakings,  obligations and agreements contained in this Agreement shall be cumulative and none of them shall be  in limitation of any other remedy, right, undertaking, obligation or agreement of either Party.    13.7 Severability.  Each provision of this Agreement will be interpreted in such manner as to be  effective and valid under Applicable Law, but if any provision of this Agreement is held to be prohibited  by or invalid under Applicable Law, such provision will be ineffective only to the extent of such  prohibition or invalidity, without invalidating the remainder of this Agreement.    13.8 Amendment.  No amendment, modification or supplement of any provisions of this  Agreement shall be valid or effective unless made in writing and signed by a duly authorized officer of  each Party.    13.9 Governing Law.  This Agreement shall be governed by and interpreted in accordance with  the laws of the State of New York without regard to its principles of conflicts of laws.    13.10 Entire Agreement.  This Agreement, together with the Exhibits hereto, sets forth the entire  agreement and understanding between the Parties as to the subject matter hereof and merges all prior  discussions, negotiations and agreements between them related to the subject matter hereof.  For clarity,  this Agreement supersedes and replaces the Confidentiality Agreement as of the Effective Date.     13.11 Parties in Interest.  All the terms and provisions of this Agreement shall be binding upon,  inure to the benefit of and be enforceable by the Parties hereto and their respective permitted successors  and permitted assigns.  Nothing in this Agreement, either express or implied, is intended to or shall  confer upon any Third Party any legal or equitable right, benefit or remedy of any nature whatsoever  under or by reason of this Agreement, which right, benefit or remedy such Third Party would not have  independent of this Agreement.    13.12 Counterparts.  This Agreement may be executed simultaneously in any number of  counterparts, any one of which need not contain the signature of more than one Party but all such  counterparts taken together shall constitute one and the same agreement.    13.13 Interpretations and Definitions.  The descriptive headings of this Agreement are for  convenience only, and shall be of no force or effect in construing or interpreting any of the provisions  of this Agreement.  All words and defined terms used in this Agreement shall have the same meaning  whether used in the singular or plural form. When used in this Agreement, (a) the term “day” or “days”  shall mean calendar days, unless otherwise indicated herein, and (b) the term “including” means  “including, without limitation.”  This Agreement has been prepared jointly and shall not be strictly  construed against either Party.      

 

      22    REMAINDER OF PAGE INTENTIONALLY BLANK.  SIGNATURE PAGE FOLLOWS. 

 

      23    IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to be executed by its  duly authorized representative as of the Amended and Restated Date.    TARSUS PHARMACEUTICALS, INC.       By:     /s/ Bobak Azamian                                 Name:        Bobak Azamian                             Title:         Chief Executive Officer                            ELANCO TIERGESUNDHEIT AG      By:        /s/ Olivier Froelich                              Name:     Olivier Froelich                                 Title:      VP External Manufacturing                

 

      24     Exhibit A    Licensed Patents     [***]   

 

      25  Exhibit B    Diligence Milestones    Diligence Milestone Achievement Deadline  [***] [***] months from agreement date  [***] [***] months  [***] [***] years  [***] [***] years      

 

      Exhibit C    Dermatology Milestones    Diligence Milestone Achievement Deadline  [***] [***] months from agreement date  [***] [***] months  [***] [***] years  [***] [***] years     

 

      Exhibit D    Summary of the intended development and commercialization activities.  [***]

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