Document:

Registration Rights Agreement

 Exhibit 4.20 
  
 REGISTRATION RIGHTS AGREEMENT 
  
 This Registration Rights Agreement (this “Agreement”) is made and entered into as of this 28th day of May, 2004 by and among HARKEN ENERGY CORPORATION, a corporation organized under the laws of Delaware (the
“Company”), and the persons identified as Purchasers pursuant to that certain Purchase Agreement of even date herewith by and among the Company and such Purchasers (the “Purchase Agreement”). 
  
 The parties hereby agree as follows: 
  
 1. Definitions. 
  
 Capitalized terms used herein but not otherwise defined
shall have the meaning ascribed thereto in the Purchase Agreement. As used in this Agreement, the following terms shall have the following meanings: 
  
 “Additional Registrable Securities” shall mean any shares of Common Stock which are included within the definition of
Registrable Securities but not included in any Registration Statement filed pursuant to Section 2(a)(i) below. 
  
 “Common Stock” shall mean the Company’s Common Stock $0.01 per share. 
  
 “Conversion Price” shall have the meaning
set forth in the Certificate. 
  
 “Filing
Date” shall mean the date which is forty-five (45) days following Closing Date. 
  
 “Prospectus” shall mean the prospectus included in any Registration Statement, as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities or Additional Registrable Securities covered by such Registration Statement and by all other amendments and supplements to the prospectus,
including post-effective amendments and all material incorporated by reference in such prospectus. 
  
 “Purchasers” shall mean the purchasers identified in the Purchase Agreement and any subsequent holder of any Preferred
Shares, Warrants, Registrable Securities or Additional Registrable Securities as a result of a transfer of such securities. 
  
 “Register,” “registered” and “registration” refer to a registration made by preparing
and filing a registration statement or similar document in compliance with the 1933 Act (as defined below), and the declaration or ordering of effectiveness of such registration statement or document. 
  
 “Registrable Securities” shall mean (i) the
Underlying Shares, the Warrant Shares and any other shares of Common Stock issued or issuable (a) upon conversion of, 

 or payment of dividends on, or redemption of, or otherwise pursuant to, the Preferred Shares, and upon
the exercise of the Warrants, or (b) upon any distribution with respect to, any exchange for or any replacement of such Preferred Shares or Warrants, or (c) upon any conversion, exercise or exchange of any securities issued in connection with any
such distribution, exchange or replacement; (ii) securities issued or issuable upon any stock split, stock dividend, recapitalization or similar event with respect to such shares of Common Stock; and (iii) any other security issued as a dividend or
other distribution with respect to, in exchange for, or in replacement of, the securities referred to in the preceding clauses. 
  
 “Registration Statement” shall mean any registration statement of the Company filed under the 1933 Act that covers the
resale of any of the Registrable Securities or Additional Registrable Securities pursuant to the provisions of this Agreement, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all
material incorporated by reference in such Registration Statement. 
  
 “SEC” means the U.S. Securities and Exchange Commission. 
  
 “1933 Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

  
 “1934 Act” means the
Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. 
  
 2. Registration. 
  
 (a) Registration Statements. 
  
 (i) Registrable Securities. The Company shall use its best efforts to prepare and file with the SEC a Registration Statement on
Form S-3 (or, if Form S-3 is not then available to the Company, on such form of registration statement as is then available to effect a registration for resale of the Registrable Securities, subject to the Purchasers’ consent), covering the
resale of the Registrable Securities in an amount equal to 130% of the number of Underlying Shares issuable upon full conversion of the Preferred Shares at the Conversion Price as of the filing date plus 100% of the number of shares of Common Stock
necessary to permit the exercise in full of the Warrants (in each case without regard to any restrictions on beneficial ownership), as soon as practicable following the Closing Date (but no later than the Filing Date). Such Registration Statement
also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar
transactions with respect to the Registrable Securities. The Registration Statement (and each amendment or supplement thereto) shall be provided in accordance with Section 3(c) to the Purchasers and their counsel prior to its filing or other
submission. 
  

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 (ii) Additional Registrable Securities. At any time and from time to time upon the
written demand of any Purchaser following the existence of any Additional Registerable Securities, and in any event within forty-five (45) days following such demand, the Company shall prepare and file with the SEC one Registration Statement on Form
S-3 (or, if Form S-3 is not then available to the Company, on such form of registration statement as is then available to effect a registration for resale of the Additional Registrable Securities) covering the resale of the Additional Registrable
Securities in an amount equal to the number of Additional Registrable Securities. Such Registration Statement also shall cover, to the extent allowable under the 1933 Act and the rules promulgated thereunder (including Rule 416), such indeterminate
number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Additional Registrable Securities. The Registration Statement (and each amendment or supplement thereto) shall be
provided in accordance with Section 3(c) to the Purchaser and its counsel prior to its filing or other submission. 
  
 (b) Expenses. The Company will pay all expenses associated with each registration, including the Purchasers’ reasonable
expenses (including reasonable attorneys fees), in connection with the registration but excluding discounts, commissions, fees of underwriters, selling brokers, dealer managers or similar securities industry professionals. 
  
 (c) Effectiveness. 
  
 (i) The Company shall use its best efforts to have each
Registration Statement declared effective as soon as possible after filing. If (A) the Registration Statement covering Registrable Securities is not declared effective by the SEC within 150 days following the Closing Date (or if the Company fails to
file an acceleration request within the fifth day following the date on which the Company is notified by the SEC that such Registration Statement will not be reviewed or is no longer subject to further review and comments seeking to have the SEC
declare the Registration Statement effective), (the “Registration Date”), (B) after a Registration Statement has been declared effective by the SEC, sales cannot be made pursuant to such Registration Statement for any reason (including
without limitation by reason of a stop order, or the Company’s failure to update the Registration Statement) but except as excused pursuant to subparagraph (ii) below, (C) the Registrable Securities (or Additional Registrable Securities after
issuance and registration) specifically are not listed or included for quotation on the American Stock Exchange, the New York Stock Exchange, the Nasdaq National Market System or the Nasdaq Small-Cap Market (each an “Approved Market”) or
trading of the Common Stock is suspended or halted thereon, or (D) the Company fails, refuses or is otherwise unable to timely issue Underlying Shares upon conversion of the Preferred Shares or Warrant Shares upon exercise of the Warrants, in
accordance with the terms of the Certificate and Warrants, unlegended certificates for the Underlying Shares or Warrant Shares as required under the Agreements, in each case within ten (10) days following the Purchaser’s written demand for
issuance of such Underlying Shares or Warrant Shares or certificates (any such event under clause (A), (B), (C) or (D) constituting a “Registration Default”), then the Conversion Price shall be automatically 

  

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reduced by 2% as of the occurrence of such Registration Default. The aforementioned 2% reduction shall only be applied once regardless of the reoccurrence of
any Registration Default. The Company shall promptly confirm in writing the adjusted Conversion Price, provided that any failure to do so shall not affect such automatic adjustment. 
  
 (ii) For not more than five (5) consecutive trading days or for a total of not more than twenty (20) trading
days in any consecutive twelve (12) month period, the Company may delay the disclosure of material non-public information concerning the Company, by terminating or suspending effectiveness of any registration contemplated by this Section, the
disclosure of which at the time is not, in the good faith opinion of the Company, in the best interests of the Company (an “Allowed Delay”); provided, that the Company shall promptly (a) notify the Purchasers in writing of the existence of
(but in no event, without the prior written consent of a Purchaser, shall the Company disclose to such Purchaser any of the facts or circumstances regarding) material non-public information giving rise to an Allowed Delay, and (b) advise the
Purchasers in writing to cease all sales under the Registration Statement until the end of the Allowed Delay. 
  
 (d) Underwritten Offering. If any offering pursuant to a Registration Statement pursuant to Section 2(a) hereof involves an
underwritten offering, the Company shall have the right to select an investment banker and manager to administer the offering, which investment banker or manager shall be reasonably satisfactory to the Purchasers. 
  
 3. Company Obligations. The Company will use its best efforts to
effect the registration of the Registrable Securities and Additional Registrable Securities in accordance with the terms hereof, and pursuant thereto the Company will, as expeditiously as possible: 
  
 (a) use its best efforts to cause such Registration
Statement to become effective and to remain continuously effective for a period (the “Registration Period”) that will terminate upon the earlier of (i) the date on which all Registrable Securities or Additional Registrable Securities have
been sold (and no Preferred Shares or Warrants remain outstanding), and (ii) the date on which all Registrable Securities or Additional Registrable Securities, as the case may be, may be sold pursuant to Rule 144(k) (and no Preferred Shares or
Warrants remain outstanding). 
  
 (b) prepare and
file with the SEC such amendments and post-effective amendments to the Registration Statement and the Prospectus as may be necessary to keep the Registration Statement effective for the period specified in Section 3(a) and to comply with the
provisions of the 1933 Act and the 1934 Act with respect to the distribution of all Registrable Securities and Additional Registrable Securities; provided that, at a time reasonably prior to the filing of a Registration Statement or Prospectus, or
any amendments or supplements thereto, the Company will furnish to the 

  

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Purchasers copies of all documents proposed to be filed, which documents will be subject to the comments of the Purchasers; 
  
 (c) at least ten (10) business days prior to the first
anticipated filing date of any Registration Statement, notify each Purchaser of the information the Company requires from such Purchaser if such Purchaser elects to have any of the Registrable Securities or Additional Registrable Securities included
in the Registration Statement and permit counsel designated by the Purchasers to review each Registration Statement and all amendments and supplements thereto no fewer than five (5) business days prior to their filing with the SEC and not file any
document to which such counsel reasonably objects; 
  
 (d) furnish to the Purchasers and their legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company, one copy of any Registration Statement and any amendment thereto, each
preliminary prospectus and Prospectus and each amendment or supplement thereto, and each letter written by or on behalf of the Company to the SEC or the staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each
case relating to such Registration Statement (other than any portion of any thereof which contains information for which the Company has sought confidential treatment), and (ii) such number of copies of a Prospectus, including a preliminary
prospectus, and all amendments and supplements thereto and such other documents as each Purchaser may reasonably request in order to facilitate the disposition of the Registrable Securities and Additional Registrable Securities owned by such
Purchaser; 
  
 (e) in the event the Company
selects an underwriter for the offering, the Company shall enter into and perform its reasonable obligations under an underwriting agreement, in usual and customary form, including, without limitation, customary indemnification and contribution
obligations, with the underwriter of such offering; 
  
 (f) if required by the underwriter, or if any Purchaser is described in the Registration Statement as an underwriter, the Company shall furnish, on the effective date of the Registration Statement, on the date that Registrable Securities or
Additional Registrable Securities, as applicable, are delivered to an underwriter, if any, for sale in connection with the Registration Statement and at periodic intervals thereafter from time to time on request, (i) an opinion, dated as of such
date, from independent legal counsel representing the Company for purposes of such Registration Statement, in form, scope and substance as is customarily given in an underwritten public offering, addressed to the underwriter and any such Purchaser
and (ii) a letter, dated such date, from the Company’s independent certified public accountants in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering,
addressed to the underwriter and any such Purchaser; 
  

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 (g) make effort to prevent the issuance of any stop order or other suspension of
effectiveness and, if such order is issued, obtain the withdrawal of any such order at the earliest possible moment; 
  
 (h) prior to any public offering of Registrable Securities or Additional Registrable Securities, use its best efforts to register or
qualify or cooperate with the Purchasers and their counsel in connection with the registration or qualification of such Registrable Securities or Additional Registrable Securities, as applicable, for offer and sale under the securities or blue sky
laws of such jurisdictions requested by the Purchaser and do any and all other reasonable acts or things necessary or advisable to enable the distribution in such jurisdictions of the Registrable Securities or Additional Registrable Securities
covered by the Registration Statement, provided however, the Company shall not be obligated to take any action pursuant to this Section 3(h) in any particular jurisdiction in which the Company would be required to execute a general consent to
service of process in effecting such registration, qualification or cooperation unless the Company is already subject to service in such jurisdiction and except as may be required by the 1933 Act; 
  
 (i) cause all Registrable Securities or Additional
Registrable Securities covered by a Registration Statement to be listed on each securities exchange, interdealer quotation system or other market on which similar securities issued by the Company are then listed; 
  
 (j) immediately notify the Purchasers, at any time when a
Prospectus relating to the Registrable Securities or Additional Registrable Securities is required to be delivered under the 1933 Act, upon discovery that, or upon the happening of any event as a result of which, the Prospectus included in such
Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances
then existing, and at the request of any such holder, promptly prepare and furnish to such holder a reasonable number of copies of a supplement to or an amendment of such Prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Registrable Securities or Additional Registrable Securities, as applicable, such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of the circumstances then existing; and 
  
 (k) otherwise use its best efforts to comply with all applicable rules and regulations of the SEC under the 1933 Act and the 1934 Act,
take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities and Additional Registrable Securities, if applicable, hereunder. 
  
 4. Due Diligence Review; Information. The Company shall make available, during normal business hours, for inspection
and review by the Purchasers who may be deemed an underwriter, advisors to and representatives of such Purchasers (who may or 

  

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may not be affiliated with the Purchasers and who are reasonably acceptable to the Company), and any underwriter participating in any disposition of Common
Stock on behalf of the Purchasers pursuant to the Registration Statement or amendments or supplements thereto or any blue sky, NASD or other filing, all financial and other records, all SEC Filings and other filings with the SEC, and all other
corporate documents and properties of the Company as may be reasonably necessary for the purpose of establishing a due diligence defense under applicable securities laws and such other reasonable purposes, and cause the Company’s officers,
directors and employees, within a reasonable time period, to supply all such information reasonably requested by such Purchasers or any such representative, advisor or underwriter in connection with such Registration Statement (including, without
limitation, in response to all questions and other inquiries reasonably made or submitted by any of them), prior to and from time to time after the filing and effectiveness of the Registration Statement for the sole purpose of enabling such
Purchasers and such representatives, advisors and underwriters and their respective accountants and attorneys to conduct initial and ongoing due diligence with respect to the Company and the accuracy of the Registration Statement. 
  
 The Company shall not disclose material nonpublic information to the
Purchasers, or to advisors to or representatives of the Purchasers, unless prior to disclosure of such information the Company identifies such information as being material nonpublic information and provides the Purchasers, such advisors and
representatives with the opportunity to accept or refuse to accept such material nonpublic information for review. The Company may, as a condition to disclosing any material nonpublic information hereunder, require the Purchasers’ advisors and
representatives to enter into a confidentiality agreement (including an agreement with such advisors and representatives prohibiting them from trading in Common Stock during such period of time as they are in possession of material nonpublic
information) in form reasonably satisfactory to the Company and the Purchasers. Nothing herein shall require the Company to disclose material nonpublic information to the Purchasers or their advisors or representatives. 
  
 5. Obligations of the Purchasers. 
  
 (a) Each Purchaser shall furnish in writing to the Company
such information regarding itself, the Registrable Securities or Additional Registrable Securities, as applicable, held by it and the intended method of disposition of the Registrable Securities or Additional Registrable Securities, as applicable,
held by it, as shall be reasonably required to effect the registration of such Registrable Securities or Additional Registrable Securities, as applicable, and shall execute such documents in connection with such registration as the Company may
reasonably request. 
  
 (b) Each Purchaser, by
its acceptance of the Registrable Securities and Additional Registrable Securities, if any, agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of a Registration Statement
hereunder, unless such Purchaser has notified the Company in writing of its election to exclude all of its Registrable Securities or Additional Registrable Securities, as applicable, from the Registration Statement. Each 
  

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 Purchaser agrees to comply with the applicable prospectus delivery requirements under the 1933 Act in
connection with any resales of Registrable Securities pursuant to the Registration Statement. 
  
 (c) In the event the Company determines to engage the services of an underwriter which engagement is reasonably acceptable to the
Purchasers, each Purchaser agrees to enter into and perform its obligations under an underwriting agreement, in usual and customary form, including, without limitation, customary indemnification and contribution obligations, with the managing
underwriter of such offering and take such other actions as are reasonably required in order to expedite or facilitate the dispositions of the Registrable Securities or Additional Registrable Securities, as applicable. 
  
 (d) Each Purchaser agrees that, upon receipt of any notice
from the Company of the happening of any event rendering a Registration Statement no longer effective, such Purchaser will immediately discontinue disposition of Registrable Securities or Additional Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities or Additional Registrable Securities, until the Purchaser’s receipt of the copies of the supplemented or amended prospectus filed with the SEC and declared effective and, if so
directed by the Company, the Purchaser shall deliver to the Company (at the expense of the Company) or destroy all copies in the Purchaser’s possession of the prospectus covering the Registrable Securities or Additional Registrable Securities,
as applicable, current at the time of receipt of such notice. 
  
 (e) No Purchaser may participate in any third party underwritten registration hereunder unless it (i) agrees to sell the Registrable Securities or Additional Registrable Securities, as applicable, on the basis
provided in any underwriting arrangements in usual and customary form entered into by the Company, (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under
the terms of such underwriting arrangements, and (iii) agrees to pay its pro rata share of all underwriting discounts and commissions and any expenses in excess of those payable by the Company pursuant to the terms of this Agreement. 
  
 6. Indemnification. 
  
 (a) Indemnification by Company. The Company agrees to
indemnify and hold harmless, to the fullest extent permitted by law, the Purchasers, each of their officers, directors, partners and employees and each person who controls the Purchasers (within the meaning of the 1933 Act) against all losses,
claims, damages, liabilities, costs (including, without limitation, reasonable attorney’s fees) and expenses imposed on such person caused by (i) any untrue or alleged untrue statement of a material fact contained in any Registration Statement,
Prospectus or any preliminary prospectus or any amendment or supplement thereto or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements 
  

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 therein not misleading, except insofar as the same are based upon any information furnished in writing to
the Company by such Purchasers, expressly for use therein, or (ii) any violation by the Company of any federal, state or common law, rule or regulation applicable to the Company in connection with any Registration Statement, Prospectus or any
preliminary prospectus, or any amendment or supplement thereto, and shall reimburse in accordance with subparagraph (c) below, each of the foregoing persons for any legal and any other expenses reasonably incurred in connection with investigating or
defending any such claims. The foregoing is subject to the condition that, insofar as the foregoing indemnities relate to any untrue statement, alleged untrue statement, omission or alleged omission made in any preliminary prospectus or Prospectus
that is eliminated or remedied in any Prospectus or amendment or supplement thereto, the above indemnity obligations of the Company shall not inure to the benefit of any indemnified party if a copy of such corrected Prospectus or amendment or
supplement thereto had been provided to such indemnified party and was not sent or given by such indemnified party at or prior to the time such action was required of such indemnified party by the 1933 Act and if delivery of such Prospectus or
amendment or supplement thereto would have eliminated (or been a sufficient defense to) any liability of such indemnified party with respect to such statement or omission. Indemnity under this Section 5(a) shall remain in full force and effect
regardless of any investigation made by or on behalf of any indemnified party and shall survive the permitted transfer of the Registrable Securities and Additional Registrable Securities. 
  
 (b) Indemnification by Holder. In connection with any
registration pursuant to the terms of this Agreement, each Purchaser will furnish to the Company in writing such information as the Company reasonably requests concerning the holders of Registrable Securities and Additional Registrable Securities or
the proposed manner of distribution for use in connection with any Registration Statement or Prospectus and agrees, severally but not jointly, to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors,
officers, employees, stockholders and each person who controls the Company (within the meaning of the 1933 Act) against any losses, claims, damages, liabilities and expense (including reasonable attorney’s fees) resulting from any untrue
statement of a material fact or any omission of a material fact required to be stated in the Registration Statement or Prospectus or preliminary prospectus or amendment or supplement thereto or necessary to make the statements therein not
misleading, to the extent, but only to the extent that such untrue statement or omission is contained in any information furnished in writing by such Purchaser to the Company specifically for inclusion in such Registration Statement or Prospectus or
amendment or supplement thereto and that such information was substantially relied upon by the Company in preparation of the Registration Statement or Prospectus or any amendment or supplement thereto. In no event shall the liability of a Purchaser
be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such Purchaser and the amount of any damages such holder has otherwise been required to pay by reason of such untrue statement or omission) received by such
Purchaser upon the sale of the Registrable Securities or Additional Registrable Securities included in the Registration Statement giving rise to such indemnification obligation. 
  

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 (c) Conduct of Indemnification Proceedings. Any person entitled to indemnification
hereunder shall (i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party; provided that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of
such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or (b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person or (c) in the
reasonable judgment of any such person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if the person notifies the indemnifying party
in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such person); and provided, further, that the
failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice shall materially adversely affect the indemnifying party
in the defense of any such claim or litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or expenses of more than one separate firm of attorneys at any
time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation. 
  
 (d) Contribution. If for any reason the indemnification provided for in the preceding paragraphs (a) and (b) is unavailable to an
indemnified party or insufficient to hold it harmless, other than as expressly specified therein, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such loss, claim, damage or
liability in such proportion as is appropriate to reflect the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. No person guilty of fraudulent misrepresentation within the
meaning of Section 11(f) of the 1933 Act shall be entitled to contribution from any person not guilty of such fraudulent misrepresentation. In no event shall the contribution obligation of a holder of Registrable Securities or Additional Registrable
Securities be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such holder and the amount of any damages such holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission) received by it upon the sale of the Registrable Securities or Additional Registrable Securities giving rise to such contribution obligation. 
  
 7. Miscellaneous. 
  
 (a) Amendments and Waivers. This Agreement may be amended only by a writing signed by the parties hereto. The Company may take any

  

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 action herein prohibited, or omit to perform any act herein required to be performed by it, only if the
Company shall have obtained the written consent to such amendment, action or omission to act, of the Purchasers affected by such amendment, action or omission to act. 
  
 (b) Notices. All notices and other communications provided for or permitted hereunder shall be made
as set forth in Section 9.4 of the Purchase Agreement. 
  
 (c) Assignments and Transfers by Purchasers. This Agreement and all the rights and obligations of any Purchaser hereunder may be assigned or transferred to any transferee or assignee of the Preferred Shares, Warrants or Registrable
Securities. A Purchaser may make such assignment or transfer to any transferee or assignee of any Note, Warrant, Registrable Securities or Additional Registrable Securities, provided that (i) such transfer is made expressly subject to this
Agreement and the transferee agrees in writing to be bound by the terms and conditions hereof, and (ii) the Company is provided with written notice of such assignment. 
  
 (d) Assignments and Transfers by the Company. This Agreement may not be assigned by the Company
without the prior written consent of the Purchasers, but after notice duly given, the Company shall assign its rights and delegate its duties hereunder to any successor-in-interest corporation, and such successor-in-interest shall assume such rights
and duties, in the event of a merger or consolidation of the Company with or into another corporation or the sale of all or substantially all of the Company’s assets (and it shall be a condition to any such merger, consolidation or sale that
such successor-in-interest assume in writing all obligations hereunder). 
  
 (e) Benefits of the Agreement. The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly
provided in this Agreement. 
  
 (f)
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed by facsimile.

  
 (g) Titles and Subtitles. The titles
and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 
  
 (h) Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and the balance of this Agreement shall be interpreted as if such 
  

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 provision were so excluded and shall be enforceable in accordance with its terms to the fullest extent
permitted by law. 
  
 (i) Further
Assurances. The parties shall execute and deliver all such further instruments and documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the
agreements herein contained. 
  
 (j) Entire
Agreement. This Agreement, together with the Purchase Agreement, Certificate and Warrants and documents contemplated thereby, is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Agreement, together with the Purchase Agreement, and Warrants and documents contemplated thereby, supersedes all prior
agreements and understandings between the parties with respect to such subject matter. 
  
 (k) Applicable Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York
without regard to principles of conflicts of law. 
  
 [Signature
Page Follows] 
  

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

					
	 COMPANY NAME
  
 HARKEN ENERGY CORPORATION

		
	By:	 	 
	 	 	

	 Name:
	 	 
	 Title:
	 	 
	
	 THE PURCHASERS:
  
 THE TAIL WIND FUND LTD.

	By:	 	TAIL WIND ADVISORY AND MANAGEMENT LTD., as investment manager
			
	 	 	By:	 	 
	 	 	 	 	

	 	 	 Name:
	 	David Crook
	 	 	 Title:
	 	CEO
	
	SOLOMON STRATEGIC HOLDINGS, INC.
		
	By:	 	 
	 	 	

	 Name:
	 	Andrew P. MacKellar
	 Title:
	 	Director

  

 13License Agreement

 Exhibit 10.1 
  
 LICENSE AGREEMENT 
 BETWEEN 
 BIODELIVERY SCIENCES INTERNATIONAL, INC. 
 AND 
 ACCENTIA, INC. 
  
 This License Agreement (this “Agreement”) effective as of April 12, 2004, by and
between BioDelivery Sciences International, Inc., a Delaware corporation, having its principal place of business at 185 South Orange Avenue, Administrative Building No. 4, Newark, NJ 07103 (“BDSI”) and Accentia, Inc. having
its principal place of business at 5310 Cypress Center Drive #101, Tampa, Florida 33609 (“ACCENTIA”) (collectively the “Parties”). 
  
 WITNESSETH: 
  
 Whereas, BDSI has rights to certain BDSI Licensed Technology (hereinafter defined) relating to cochleates, geodes, nanocochleates, and liposomes; 
  
 Whereas, ACCENTIA recognizes that the BDSI Licensed Technology represents a valuable means of
delivering Licensed Products (hereinafter defined) for the use and/or sale in the treatment or prevention of human and/or animal diseases; Whereas, ACCENTIA wishes to enter into an agreement to obtain exclusive licenses for specific Licensed
Products which utilize BDSI Licensed Technology in the Field (hereinafter defined) from BDSI in order to research, develop and commercialize therapeutic products made in accordance therewith; and 
  
 WHEREAS, BDSI is willing to grant such licenses to ACCENTIA under the terms and conditions
set forth in this Agreement. 
  
 NOW, THEREFORE, in consideration of the various
promises and undertakings set forth herein, the Parties agree as follows: 
  
 ARTICLE 1 - DEFINITIONS 
  
 As used herein,
capitalized terms shall have the following meanings: 
  
 1.1
“Affiliate”, with respect to any Party, shall mean any person or entity controlling, controlled by, or under common control with such Party. For these purposes, “control” shall refer to (i) the possession, directly or indirectly,
of the power to direct the management or policies of a person or entity, whether through the ownership of voting securities, by contract or otherwise or (ii) the ownership, directly or indirectly, of at least 50% of the voting securities or other
ownership interest of a person or entity. 

 1.2 “Antifungal Products” shall mean any and all products covered by the patent rights licensed to ACCENTIA by
MAYO under the ACCENTIA/MAYO Agreement that are not Licensed Products. “Antifungal Products” include, but are not limited to, topical antifungal products contemplated by the ACCENTIA/MAYO Agreement that do not require approval by the FDA
or appropriate regulatory authority in Europe. 
  
 1.3 “BDSI Licensed
Technology” shall mean any and all information, and all patentable and non-patentable inventions (including, without limitation, all Joint Inventions), improvements, discoveries, claims, formulae, processes, methods, trade secrets,
technologies, data and know-how owned, licensed or controlled by BDSI or to which BDSI has the right to grant licenses or sublicenses before or during the term of this Agreement: (i) related to the cochleate, geode, nanocochleate, or liposome
technology described in Exhibit C, or (ii) claimed, covered or disclosed in any patent or patent application listed in Exhibit B which relates to the cochleate, geode, nanocochleate, or liposome technology described in Exhibit C. 
  
 1.4 “Effective Date” shall mean the date first written above. 
  
 1.5 “Field” shall mean the field of any topical antifungal (including Amphotericin
B) for mucosal surface application for the indications of chronic sinusitis and asthma covered by patents licensed to ACCENTIA by the Mayo Clinic (“MAYO”), and transmucosal vaccine applications covered by a patent held by MAYO for the
indications of chronic sinusitis and asthma. 
  
 1.6 “Joint Invention”
shall mean any invention for which it is determined, in accordance with applicable law, that both: (i) employees or agents of ACCENTIA or any other persons obligated to assign such Invention to ACCENTIA, and (ii) employees or agents of BDSI or any
other persons obligated to assign such invention to BDSI, are joint inventors of such invention. 
  
 1.7 “Know-How” shall mean any and all know-how shared by the Parties under this Agreement. 
  
 1.8 “Licensed Patents” shall mean any current and future Patent, owned or controlled by BDSI, or any of the same jointly owned or controlled by BDSI and that
relate to the BDSI Licensed Technology, including Patents set forth on Exhibit B. 
  
 1.9 “Licensed Product” shall mean a Product in the form of (a) antifungal preparations (including Amphotericin B preparations) for mucosal surface application for the indications of chronic sinusitis and asthma; and (b)
transmucosal vaccine preparations for the indications of chronic sinusitis and asthma. 
  
 1.10 “Net Sales” shall mean the gross amount invoiced for all Antifungal Products or Licensed Products sold by ACCENTIA and/or its Affiliates in arm’s length sales or commercial transactions to a Third
Party (excluding sales to Sublicensees for their resale), less deductions for: 
  
 (a) commissions, trade, quantity and cash discounts or rebates actually allowed or given; 
  
 (b) credits, allowances or refunds given or made for rejected, outdated or returned Licensed Products, if applicable; 
  

 2 

 (c) any tax or government charge (other than an income tax) levied on the sale, transportation or
delivery of a Licensed Product and borne by the seller thereof; and 
  
 (d) any prepaid or invoiced charges for freight, postage, shipping, import or export taxes, insurance or charges for returnable containers. 
  
 1.11 “Party” shall mean ACCENTIA or BDSI and, when used in the plural, shall mean ACCENTIA and BDSI. 
  
 1.12 “Patent” means (i) unexpired letters patent (including inventor’s
certificates) which have not been held invalid or unenforceable by a court of competent jurisdiction from which no appeal can be taken or has been taken within the required time period, including without limitation any substitution, extension,
registration, confirmation, reissue, re-examination, renewal or any like filing thereof and (ii) pending applications for letters patent, including without limitation any continuation, division or continuation-in-part thereof and any provisional
applications. 
  
 1.13 “Product” shall mean a cochleate, geode,
nanocochleate, or liposome preparation of an antifungal that is: (i) based upon, derived from, identified through or related to any BDSI Licensed Technology; and (ii) covered by one or more Licensed Patents and would infringe a Valid Claim thereof.

  
 1.14 “Sublicensee” shall mean any Third Party granted a sublicense
by ACCENTIA pursuant to Section 3.2 hereof. 
  
 1.15 “Sublicensee Net
Sales” shall mean the gross amount invoiced for all Licensed Products sold by a Sublicensee to a Third Party, less deductions for: 
  
 (a) commissions, trade, quantity and cash discounts or rebates actually allowed or given; (b) credits, allowances or refunds given or made for rejected,
outdated or returned Licensed Products, if applicable; 
  
 (c) any
tax or government charge (other than an income tax) levied on the sale, transportation or delivery of a Licensed Product and borne by the seller thereof; and 
  
 (d) any prepaid or invoiced charges for freight, postage, shipping, import or export taxes, insurance or charges for returnable containers. 
  
 1.16 “Sublicensee Revenue” shall mean any and all revenue or other consideration
received by ACCENTIA from a Sublicensee for Licensed Products under this Agreement, including but not limited to, upfront revenue, milestone revenue, royalty income, and the market value at the time of transfer of all non-monetary consideration such
as barter or counter-trade in the country of disposition. 
  
 1.17
“Territory” shall mean the United States and the European Union. 
  
 1.18 “Third Party” means any person or entity other than ACCENTIA, BDSI or any Affiliate of either ACCENTIA or BDSI. 
  

 3 

 1.19 “Valid Claim” shall mean a claim of any issued or granted Licensed Patent which has not been held invalid
or unenforceable by final decision of a court or other governmental agency of competent jurisdiction, unappealable or unappealed within the time allowed for appeal, and which is not admitted to be invalid or unenforceable through reissue, disclaimer
or otherwise. 
  
 ARTICLE 2 - REPRESENTATIONS AND WARRANTIES

  
 2.1 Representations and Warranties of Both Parties. Each Party
represents and warrants to the other Party that: (i) it is free to enter into this Agreement; (ii) in so doing, it will not violate any other agreement to which it is a party; and (iii) it has taken all corporate action necessary to authorize the
execution and delivery of this Agreement and the performance of its obligations under this Agreement. 
  
 2.2 Representations and Warranties of BDSI. BDSI hereby represents and warrants that: 
  
 (a) BDSI either owns or licenses all of the Licensed Patents listed on Exhibit B, and has the exclusive right to grant licenses and sublicenses therefore
without the consent or approval of any Third Party, except as provided in Section 2.3; 
  
 (b) BDSI own or licenses all of the BDSI Licensed Technology in existence on the date of this Agreement, and has the right to grant licenses and sublicenses therefore without the consent or approval of any Third
Party; 
  
 (c) To the best of BDSI’s knowledge, all the
Licensed Patents listed on Exhibit B are in full force and effect and have been maintained to date; (d) BDSI is not aware of any asserted or unasserted claim or demand against the BDSI Licensed Technology; 
  
 (e) To the best of BDSI’s knowledge, none of the BDSI Licensed
Technology infringes upon any patent or other proprietary rights of any other Third Party; and 
  
 (f) BDSI has not entered into any agreement with any Third Party which is in conflict with the rights granted to ACCENTIA pursuant to this Agreement. 
  
 2.3 Disclaimer. 
  
 (a) Government Rights; Research and Development. BDSI’s rights in the Licensed Patents is subject to the rights of the US Government, if any,
in the Patents and BDSI’s and its Affiliates’ reserved, irrevocable, royalty-free right to manufacture, have manufactured, and use any Products, including Licensed Products, for research and development purposes. 
  
 (b) Disclaimer of Other Warranties. EXCEPT AS PROVIDED HEREIN, THE
BDSI LICENSED TECHNOLOGY IS PROVIDED WITHOUT WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR ANY OTHER WARRANTY, EXPRESS OR IMPLIED. EXCEPT AS EXPRESSLY PROVIDED, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY THAT THE BDSI
LICENSED TECHNOLOGY WILL NOT INFRINGE ANY PATENT OR OTHER PROPRIETARY RIGHT OF A THIRD PARTY. 
  

 4 

 2.4 Employee Agreements. Each Party warrants that it has, and covenants that it will have, entered into a
proprietary information and inventions agreement with each of its employees prior to the time that any such employee shall receive confidential information from a disclosing party or begin work related to this Agreement. Such agreement shall
minimally set forth employee obligations to assign inventions to the inventing Party and to maintain confidentiality of confidential information consistent with the terms of this Agreement.  
  
 ARTICLE 3 - LICENSE GRANT 
  
 3.1 Grant of License. 
  
 (a) Subject to the terms and conditions of this Agreement, BDSI hereby grants to ACCENTIA an exclusive license throughout
the Territory, with the right to grant sublicenses (subject to Sections 3.2 and 3.3), to make, use or sell Licensed Products in the Field. 
  
 (b) Subject to the terms and conditions of this Agreement, each Party hereby grants to the other Party a nonexclusive, perpetual license to use its
Know-How to develop, manufacture, use and sell Licensed Products in the Field. 
  
 For the avoidance of doubt, no rights are granted to MAYO under this Agreement including, but not limited to, license and sublicense rights, and rights in BDSI confidential information, trade secrets, data, and other information. No rights
are granted by MAYO to either Party under this Agreement. 
  
 3.2 Right to
Grant Sublicenses. 
  
 (a) United States. ACCENTIA
shall not have the right to sublicense the BDSI Licensed Technology in the United States. 
  
 (b) European Union. ACCENTIA shall have the right to sublicense the BDSI Licensed Technology in the European Union with the prior written approval of BDSI, which approval is not to be unreasonably withheld.
Each sublicense granted by ACCENTIA pursuant to this Agreement shall be consistent the provisions of this Agreement. Prior to the grant of each sublicense hereunder, ACCENTIA shall provide BDSI a copy of the sublicense. ACCENTIA shall not grant any
paid-up license or accept equity in consideration, directly or indirectly, for such sublicenses without BDSI’s written approval. 
  
 3.3 ACCENTIA Responsibility for Sublicenses. ACCENTIA shall be responsible for and guarantees the payment of all royalties to BDSI as provided in Article 4 as
though ACCENTIA itself had sold the Licensed Product and the provision of sales and other reports hereunder. 
  
 3.4 Intellectual Property. Any and all intellectual property developed by the Parties related to the BDSI Licensed Technology, including Joint Inventions and inventions developed solely by either BDSI or
ACCENTIA, shall be the sole and exclusive property of BDSI. Such intellectual property shall be considered BDSI Licensed Technology and therefore subject to the license rights granted to ACCENTIA in this Article 3. All intellectual property
developed by ACCENTIA (Joint Inventions and inventions developed solely by ACCENTIA), related to the Licensed Products but not related to the 
  

 5 

 BDSI Licensed Technology shall be the sole and exclusive property of ACCENTIA. All intellectual property developed solely
by BDSI related to the Licensed Products but not related to the BDSI Licensed Technology shall be the sole and exclusive property of BDSI, subject to a nonexclusive license to such intellectual property to ACCENTIA. ACCENTIA shall have no rights in
any intellectual property related to Licensed Products developed jointly by BDSI with any third parties. 
  
 ARTICLE 4 - ROYALTY PAYMENTS AND REPORTS 
  
 4.1 License Fee. As consideration for entering into this Agreement, ACCENTIA shall pay to BDSI ten (10) dollars within thirty (30) days of the Effective Date. 
  
 4.2 Royalties. As consideration for the license rights granted ACCENTIA under this
agreement, ACCENTIA will pay BDSI the following: 
  
 (a)
Antifungal Products. In lieu of any up front fees and milestone payments, and as an inducement to BDSI to enter into this Agreement, ACCENTIA shall pay to BDSI a royalty equal to twelve percent (12%) of Net Sales of Antifungal Products in the
Territory; 
  
 (b) Licensed Products. ACCENTIA shall pay to
BDSI a royalty of fourteen percent (14%) of Net Sales of any Licensed Products in the Territory; and 
  
 (c) Sublicensee Revenue. ACCENTIA shall pay to BDSI either: (i) an amount equal to fifty percent (50%) of Sublicensee Revenue to BDSI, after the
prescribed royalty payment to MAYO; or (ii) a minimum royalty of eight percent (8%) of Sublicensee Net Sales (regardless of the prescribed royalty to MAYO), whichever is greater, for Licensed Products. 
  
 4.3 Term of Royalty Obligations. The royalty obligations specified in Section 4.2
above shall continue as to each Licensed Product in the Territory for the term of the last to expire of the Licensed Patent rights covering the Licensed Product. 
  
 4.4 Payments for Antifungal Products. Payments under Section 4.2(a) shall be made to BDSI no later than sixty (60) days following the
end of the calendar quarter during which payment is received by ACCENTIA for Antifungal Products 
  
 4.5 Payments for Licensed Products. Payments under sections 4.2(b) and 4.2(c) shall be made to BDSI no later than sixty (60) days following the end of the calendar quarter during which Net Sales and Sublicensee
Net Sales are invoiced and any other Sublicensee Revenue accrued for Licensed Products. 
  
 4.6 Place of Payment. All payments due shall be payable in United States dollars by wire transfer to a bank account designated by each Party from time to time. ACCENTIA shall convert all non-U.S. dollar sales to U.S. dollars using
the average exchange rates quoted in the Wall Street Journal for the final day of each month in the relevant period for which the royalty is being paid. In the event payment of any royalties is restricted or prohibited by the laws or regulations of
a particular country, then to the extent of such a restriction and prohibition, royalties shall be paid to BDSI in that country and in the currency of said country into an account to be designated by BDSI. BDSI shall have the option of requesting
payment in Euros upon notice under Section 10.7. 
  

 6 

 4.7 Taxation of Payments. 
  
 (a) Insofar as any payment that is due under this Agreement is subject to any tax, duty, levy, or other government
imposition, the Party receiving the payment agrees to bear any and all such taxes, duties, levies or impositions. Each Party hereby authorizes the other Party to withhold such taxes, duties, levies or impositions from the payments in accordance with
this Agreement if ACCENTIA or BDSI is required to do so under the laws of the United States or any country in the Territory where such taxes, duties, levies or impositions are payable. Whenever a Party deducts such tax, duty, levy or imposition from
any payments due, then it shall furnish the other Party with a certificate showing the payment of thereof to the United States or any country in the Territory. 
  

(b) In the event any payments which are due to under this Agreement are subject to value added taxation by any government, then the Party receiving the
payment shall bear such value added tax in full and the Party making the payment shall be reimbursed therefore. If appropriate, the Party receiving payment may add such value added taxes to its royalty accounts, provided such value added taxes are
credited against the other Party’s value added tax debt and the other Party is reimbursed in full with respect thereto. Notwithstanding anything herein to the contrary, the Party making the payment shall have no liability for any value added
tax directly or indirectly relating to thereto. 
  
 (c) In the
event any payment is subject to a withholding or other income tax in any country in the Territory, promptly following becoming aware of the applicability of any such tax, the Party making the payment shall so advise the other Party. The Party
receiving the payment shall have the right to contest with the appropriate governmental body any such proposed withholding and the other Party shall provide, at receiving Party’s expense, reasonable cooperation in any such contest. The Parties
shall provide each other with such receipts or other evidence of any tax withheld as is necessary to claim any credit or deduction available to it in other jurisdictions. Payments shall only be reduced for withholding taxes imposed by the
jurisdiction out of which the payment is directly made. 
  
 4.8 Interest.
All payments due hereunder that are not paid when due and payable as specified in this agreement shall bear interest at an annual rate equal to the prime rate (“Prime Rate”) for U.S. dollar deposits in effect from time to time, as
published daily in the Wall Street Journal plus 2%, compounded monthly from the date due until paid, or at such lower rate of interest as shall then be the maximum rate permitted by applicable law. 
  
 4.9 Right to Documentation. Upon request, BDSI shall have the right to request
reasonable documentation of ACCENTIA’s calculations to determine ACCENTIA’s Net Sales, Sublicensee Revenues and/or Sublicensee Net Sales for the Licensed Products and to request discussion of such calculations with appropriate
representatives of ACCENTIA. BDSI shall make all reasonable efforts to provide to ACCENTIA any existing data or other information owned by BDSI to support ACCENTIA’s efforts to obtain FDA approval. 
  
 4.10 Records Retention. ACCENTIA, its Sublicensee and Affiliates shall keep complete
and accurate records pertaining to the sale of Licensed Products in the Territory and covering all transactions which Net Sales are derived for a period of three (3) calendar years after the year in which such sales occurred, and in sufficient
detail to permit BDSI to confirm the accuracy of royalty calculations hereunder. Such records shall be available at all reasonable times for inspection by BDSI or its representatives for verification of royalty payments or compliance with other
aspects of this Agreement. 
  

 7 

 4.11 Audit Request. At the request of BDSI, ACCENTIA, its Affiliates and Sublicensees shall permit an independent,
certified public accountant appointed by BDSI acceptable to ACCENTIA or its Affiliates, at reasonable times and upon reasonable notice, to examine those records and all other material documents relating to or relevant to Net Sales, Sublicensee
Revenue, and Sublicensee Net Sales income in the possession or control of ACCENTIA, its Affiliates or Sublicensees, for a period of three (3) years after such royalties have accrued, as may be necessary to: (i) determine the correctness of any
report or payment made under this Agreement; or (ii) obtain information as to the royalties payable for any calendar quarter in the case of ACCENTIA’s or its Affiliate’s failure to report or pay pursuant to this Agreement. Said accountant
shall not disclose to BDSI any information other than information relating to said reports, royalties, and payments. Results of any such examination shall be made available to both Parties. BDSI shall bear the full cost of the performance of any
such audit, unless such audit demonstrates underpayment of royalties by ACCENTIA of more than ten percent (10%) from the amount of the original royalty payment made by ACCENTIA. In such event, ACCENTIA shall bear the full cost of the performance of
such audit. 
  
 ARTICLE 5 - PATENT PROSECUTION; ENFORCEMENT;
INFRINGEMENT 
  
 5.1 Patent Prosecution and Maintenance. 
  
 (a) Responsibility. BDSI shall continue to have full responsibility
for and shall control the preparation and prosecution and maintenance of all Licensed Patents.  
  
 (b) Cooperation. Each Party agrees to cooperate with the other Party to execute any documents necessary or desirable to secure and perfect the
other Party’s legal rights and worldwide ownership in the other Party’s intellectual property, including, but not limited to documents relating to patent, trademark and copyright applications. Each Party agrees to take actions reasonably
necessary to diligently prosecute and maintain its intellectual property in major commercial markets where viable protection is available. Each party or its representatives shall be entitled to meet and confer with the other Party and their patent
counsel at reasonable times and places. 
  
 5.2 Limitations on
Publications. The Parties agree that no one Party shall publish the results of any studies, whether conducted by its own employees or in conjunction with a Third Party, carried out pursuant to this Agreement or confidential information
received from the other Party that is relating to a Licensed Product, without the prior written approval of the other Party. Each Party agrees to provide the other Party with a copy of any proposed abstracts, presentations, manuscripts, or any other
disclosure which discloses clinical study results pursuant to this Agreement or confidential information received from the other Party at least one hundred twenty (120) days prior to their intended submission for publication and agrees not to submit
or present such disclosure until the Party not seeking to disclose such information provides its prior written approval. Such written approval will not be unreasonably withheld unless such proposed disclosure could reasonably harm or impair a
Party’s intellectual property assets or may reasonably cause commercial harm to a Party. 
  
 5.3 Notification of Infringement. If either Party learns of an infringement or threatened infringement by a Third Party of any Licensed Patent granted hereunder within the Territory, such Party shall promptly
notify the other Party and shall provide such other Party with available evidence of such infringement. Section 5.4 shall then be applicable. 
  

 8 

 5.4 Patent Enforcement. BDSI shall have the first right, but not the duty, to institute patent infringement
actions against third parties based on any Licensed Patent under this Agreement. If BDSI does not institute an infringement proceeding against an offending Third Party within ninety (90) days after receipt of notice from ACCENTIA, ACCENTIA shall
have the right, but not the duty, to institute such an action. The costs and expenses of any such action (including fees of attorneys and other professionals) shall be borne by the Party instituting the action, or, if the Parties elect to cooperate
in instituting and maintaining such action, such costs and expenses shall be borne by the Parties in such proportions as they may agree in writing. Each Party shall execute all necessary and proper documents and take such actions as shall be
appropriate to allow the other Party to institute and prosecute such infringement actions. Any award paid by third parties as a result of such an infringement action (whether by way of settlement or otherwise) shall be paid to the Party who
instituted and maintained such action, or, if both Parties instituted and maintained such action, such award shall be allocated among the Parties in proportion to their respective contributions to the costs and expenses incurred in such action.

  
 5.5 Infringement Action by Third Parties. 
  
 (a) Claim or Suit Against ACCENTIA. In the event of the institution
of any claim or suit by a Third Party against ACCENTIA for patent infringement involving the manufacture, use, lease or sale of any Licensed Product in the Territory, and related to BDSI Licensed Technology, ACCENTIA shall promptly notify BDSI in
writing of such claim or suit. ACCENTIA shall have the right to defend such claim or suit at its own expense and BDSI hereby agrees to assist and cooperate with ACCENTIA, at BDSI’s own expense, to the extent necessary in the defense of such
claim or suit. During the pendency of such claim or suit, ACCENTIA shall continue to make all payments due under this Agreement, but shall have a credit against royalty payments otherwise payable hereunder for the full amount of all costs and
expenses incurred by ACCENTIA in defending against such claim or suit; provided, however, that in applying the credit against any royalty payments, the amount of such payment shall not be reduced by more than 50% and any remaining credit shall be
applied against subsequent royalty payments. 
  
 If as a result of
any judgment, award, decree or settlement resulting from a claim or action instituted by a Third Party, ACCENTIA is required to pay a royalty or other amounts to such Third Party (“Third Party Royalty”), ACCENTIA shall continue to pay
royalties for such Licensed Products in the country which is the subject of such action, but shall be entitled to a credit against such payments in an amount equal to the Third Party Royalty, but in no event shall such credit be more than the
royalties due hereunder for such Licensed Products in such country which is the subject of such action and any remaining credit shall be applied against subsequent royalty payments in the Territory. In addition, if ACCENTIA is required to pay
damages to such Third Party, and such damages are not otherwise reimbursed by BDSI, ACCENTIA shall be entitled to a credit against royalty payments in an amount equal to such damages, to the extent paid by ACCENTIA to such Third Party, but in no
event shall the total credit provided hereunder be more than such royalties due hereunder for such Licensed Products in such country which is the subject of such action. 
  
 (b) Claim or Suit Against BDSI. In the event of the institution of any claim or suit by a Third Party against BDSI
for patent infringement involving the manufacture, use, lease or sale of any Licensed Product in the Territory, BDSI shall promptly notify ACCENTIA in writing of such claim or suit. BDSI shall have the right to defend such claim or suit at its own
expense and ACCENTIA hereby agrees to assist and cooperate with BDSI, at ACCENTIA’s own expense, to the extent necessary in the defense of such claim or suit. 
  

 9 

 ARTICLE 6 - CONFIDENTIALITY 
  
 6.1 Use of Name. BDSI agrees not to use directly or indirectly ACCENTIA’s name without ACCENTIA’s prior written consent.
ACCENTIA agrees not to use directly or indirectly BDSI’s name or information without BDSI’s prior written consent. Notwithstanding the foregoing, ACCENTIA and BDSI may include an accurate description of the terms of this Agreement to the
extent required under federal or state securities or other disclosure; and ACCENTIA may use BDSI’s names in various documents used by ACCENTIA for capital raising and financing purposes. 
  
 6.2 Confidentiality; Exceptions. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing, the Parties agree that, for the term of this Agreement and for three (3) years thereafter, the receiving Party shall keep completely confidential and shall not publish or otherwise disclose and shall not use
for any purpose other than proper performance hereunder any information furnished to it by the other Party pursuant to this Agreement, except to the extent that it can be established by the receiving Party by competent proof that such information:

  
 (a) was already known to the receiving Party, other than
under an obligation of confidentiality, at the time of disclosure by the other Party; 
  
 (b) was generally available to the public or otherwise part of the public domain at the time of its disclosure to the receiving Party; 
  
 (c) became generally available to the public or otherwise part of the public domain after its disclosure and other than
through any act or omission of the receiving Party in breach of this Agreement; 
  
 (d) was disclosed to the receiving Party, other than under an obligation of confidentiality, by a Third Party who had no obligation to the disclosing Party not to disclose such information to others; or 
  
 (e) was independently developed by or for the receiving Party by persons not
having access to such information, as determined by the written records of such party. 
  
 6.3. Obligations of Employees and Consultants. The Parties each represent that all of its employees and the employees of its Affiliates, and any collaborators or consultants to such Party or its Affiliates, who shall have access to
confidential information of the Parties are bound by written obligations to maintain such information in confidence and not to use such information except as expressly permitted herein. Each Party agrees to enforce confidentiality obligations to
which its employees and consultants (and those of its Affiliates) are obligated. 
  
 6.4. Restrictions on Disclosure to MAYO. ACCENTIA agrees that it shall not disclose any BDSI confidential information to MAYO without the prior written consent of BDSI, which consent is not to be unreasonably withheld. ACCENTIA
agrees that it shall not be unreasonable for BDSI to request that MAYO execute a confidentiality agreement with BDSI and/or ACCENTIA prior to disclosure of any such confidential information. 
  

 10 

 ARTICLE 7 - INDEMNIFICATION 
  
 7.1 Indemnification by ACCENTIA. ACCENTIA shall defend, indemnify and hold BDSI, its officers, directors, employees and consultants
harmless from and against any and all Third Party claims, suits or demands, threatened or filed, (“Claims”) for liability, damages, losses, costs and expenses (including the costs and expenses of attorneys and other professionals), at both
trial and appellate levels, relating to the distribution, testing, manufacture, use, lease, sale, consumption on or application of Licensed Products by ACCENTIA, its Affiliates or its Sublicensees pursuant to this Agreement, including, without
limitation, claims for any loss, damage, or injury to persons or property, or loss of life, relating to the promotion and advertising of Licensed Products and/or interactions and communications with governmental authorities, physicians or other
Third Parties relating to the Licensed Products. The foregoing indemnification shall not apply to any Third Party Claims to the extent are caused by the gross negligence of BDSI. 
  
 7.2 Indemnification by BDSI. BDSI shall defend, indemnify and hold ACCENTIA, its officers, directors, employees and consultants
harmless from and against any and all Third Party Claims for liability, damages, losses, costs and expenses (including the costs and expenses of attorneys and other professionals), at both trial and appellate levels, relating to BDSI’s
activities contemplated under this Agreement, including, but not limited to, (a) breach of the representations, warranties and obligations of BDSI hereunder, or (b) any tax, duty, levy or government imposition on any sums payable by ACCENTIA to BDSI
hereunder. The foregoing indemnification shall not apply to any Claims to the extent caused by the gross negligence of ACCENTIA. 
  
 7.3 Notice. In the event that either Party seeks indemnification under Sections 7.1 or 7.2, the Party seeking indemnification agrees to (i) promptly inform the
other Party of the Third Party Claim, (ii) permit the other Party to assume direction and control of the defense or claims resulting therefrom (including the right to settle it at the sole discretion of that Party), and (iii) cooperate as reasonably
requested (at the expense of that Party) in the defense of the Claim. 
  
 7.4
Insurance. 
  
 (a) Prior to the first human clinical
trials of a Licensed Product under this Agreement, ACCENTIA shall obtain and maintain broad form comprehensive general liability insurance and Licensed Products liability insurance with a reputable and financially secure insurance carrier, subject
to approval by BDSI’s primary insurance broker, to cover such activities of ACCENTIA and ACCENTIA’s contractual indemnity under this Agreement. Such insurance shall provide minimum annual limits of liability of $5,000,000 per occurrence
and $5,000,000 in the aggregate with respect to all occurrences being indemnified under this Agreement. Such insurance policy shall name BDSI as an additional insured and shall be purchased and kept in force for the period of five (5) years after
the cessation of sales of all Licensed Products under this Agreement. 
  
 (b) In the event that ACCENTIA chooses to rely on any strategic partners of ACCENTIA to satisfy any of the requirements for insurance under this Section 7.4, then ACCENTIA shall provide details of such coverage to BDSI for its information.
Any such coverage must substantially comply with the form, scope and amounts set forth in this Section 7.4(a) which are applicable to such insurance. In the event that any such insurance is a self-insured plan, ACCENTIA shall determine that such
strategic partner’s self-insured plan is adequate given the financial condition of such strategic partner. At BDSI’s request, which shall not be more frequently than annually, ACCENTIA shall provide BDSI with a certificate of such
insurance or written verification by such strategic partner of such self-insurance. 
  

 11 

 (c) At BDSI’s request, which shall not be more frequently than annually, ACCENTIA shall provide BDSI
evidence of any insurance obtained pursuant to Section 7.4(a). ACCENTIA shall not, and shall not permit any strategic partner to, cancel or materially reduce the coverage of any policy of insurance required under this Section 7.4(a) without giving
BDSI thirty (30) days prior written notice thereof. 
  
 ARTICLE
8 – TERM; TERMINATION 
  
 8.1 Term. This Agreement shall commence
as of the Effective Date and, unless sooner terminated as provided hereunder, shall terminate as to each Licensed Product and as to each country in the Territory, upon the expiration of the last to expire Valid Claim of a Licensed Patent necessary
for the manufacture, use or sale of such Licensed Product in such country. 
  
 8.2
Breach. Failure by either Party to comply with any of the material obligations contained in this Agreement shall entitle the other Party to give to the Party in default notice specifying the nature of the default and requiring it to cure such
default. If such default is not cured within sixty (60) days after the receipt of such notice (or, if such default cannot be cured within such sixty (60) day period, if the Party in default does not commence and diligently continue actions to cure
such default), the notifying Party shall be entitled, without prejudice to any of its other rights conferred on it by this Agreement, in addition to any other remedies available to it by law or in equity, to terminate this Agreement by giving
written notice to take effect within thirty (30) days after such notice unless the defaulting Party shall cure such default within said thirty (30) days. The right of either Party to terminate this Agreement, as hereinabove provided, shall not be
affected in any way by its waiver or failure to take action with respect to any previous default. 
  
 8.3 Termination based on ACCENTIA actions or MAYO Agreement. 
  
 (a) Failure to file an NDA. BDSI may, at its option, terminate the entire license if ACCENTIA has not filed an NDA within 5 years of the Effective
Date, or if the License Agreement between ACCENTIA and MAYO, dated February 10, 2004 (“ACCENTIA/MAYO Agreement”), is terminated. 
  
 (b) Termination of Rights to MAYO Technology. BDSI may, at its option, terminate exclusivity to BDSI Technology if ACCENTIA’s exclusive rights
to MAYO technology terminate and ACCENTIA fails to regain exclusive rights to MAYO technology under the ACCENTIA/MAYO Agreement within sixty (60) days. ACCENTIA is responsible for immediately notifying BDSI of any such above noted circumstances.

  
 (c) Amendment or Termination of ACCENTIA/MAYO
Agreement. Should a breach or default or any other event that can trigger amendment or termination of the ACCENTIA/MAYO Agreement occur, including an event that triggers loss of exclusive rights or termination for Material Change under the
ACCENTIA/MAYO Agreement, ACCENTIA shall immediately inform BDSI of such occurrence. ACCENTIA shall thereafter continue to keep BDSI informed of the status of the ACCENTIA/MAYO Agreement. 
  

 12 

 (d) Assumption of Agreement by MAYO Under the ACCENTIA/MAYO Agreement. BDSI agrees that MAYO may
assume this Agreement under Section 7.03(c) of the ACCENTIA/MAYO Agreement, provided that: (i) BDSI is notified that MAYO will assume this Agreement by 17 March 2009; and (ii) MAYO agrees in writing to BDSI to accept this entire Agreement, including
all responsibilities and obligations to BDSI thereunder, by 17 April 2009. 
  
 (e) Access to IND. In the event that: (i) BDSI files and holds an IND for chronic rhinosinusitus; (ii) the ACCENTIA/MAYO License Agreement is terminated; and (iii) ACCENTIA has paid, in its entirety, for the
IND to the point of termination, BDSI agrees to give MAYO access to the IND as it relates to topical encochleated Amphotericin B for chronic rhinosinusitus. For the purpose of avoiding confusion, the Parties agree that no rights under this Agreement
(including rights under Article 3 of this Agreement and rights to BDSI Licensed Technology), will transfer to MAYO under this Section 8.3(e). 
  
 8.4 Termination by ACCENTIA. ACCENTIA shall have the right to terminate the licenses granted herein, in whole or as to any Licensed Product in the Territory, at
any time, and from time to time, by giving notice in writing to BDSI. Such termination shall be effective thirty (30) days from the date such notice is given, and all ACCENTIA’s rights associated therewith shall cease as of that date, subject
to Section 8.5. 
  
 8.5 Rights to Sell Stock on Hand. Upon the termination
of any license granted herein, in part or in whole or as to any Licensed Product, for any reason other than a failure to cure a material breach of the Agreement by ACCENTIA, ACCENTIA shall have the right for one (1) year or such longer period as the
Parties may reasonably agree to dispose of all Licensed Products or substantially completed Licensed Products then on hand to which such termination applies, and royalties shall be paid to BDSI with respect to such Licensed Products as though this
Agreement had not terminated. 
  
 8.6 Termination of Sublicenses. Upon any
termination of this Agreement, all sublicenses granted by ACCENTIA under this Agreement shall terminate simultaneously, subject, nevertheless, to Section 8.5. 
  

8.7 Effect of Termination. Upon the termination of any license granted herein as to any Licensed Product in the Territory other than pursuant to Section 8.1,
ACCENTIA and its Affiliates and Sublicensees shall promptly: (i) return to BDSI all relevant records, materials or confidential information of BDSI concerning the BDSI Licensed Technology relating to such Licensed Product in such country in the
possession or control of ACCENTIA or any of its Affiliates or Sublicensees; and (ii) assign to BDSI, or BDSI’s designee, its registrations with governmental health authorities, licensees, and approvals of such Licensed Product in such country.

  
 8.8 Surviving Rights. Termination of this Agreement shall not terminate
ACCENTIA’s obligation to pay all royalties which shall have accrued hereunder. The Parties’ obligations under Articles 6, 7 and 8, and Sections 10.6 and 10.10 also shall survive termination. 
  
 8.9 Accrued Rights, Surviving Obligations. Termination, relinquishment or expiration
of this Agreement for any reason shall be without prejudice to any rights which shall have accrued to the benefit of either Party under this Agreement prior to such termination, relinquishment or expiration. Such termination, relinquishment or
expiration shall not relieve either Party from obligations which are expressly indicated to survive termination or expiration of this Agreement. 
  

 13 

 ARTICLE 9 – CLINICAL TRIALS AND SUPPLIES OF MATERIAL 
  
 9.1 BDSI Supply Requirements. BDSI shall provide all quantities of
phospholipids ACCENTIA needs to develop and/or identify Licensed Products for ACCENTIA’s preclinical studies at BDSI’s fully absorbed cost. ACCENTIA shall identify the amounts of phospholipids needed. Provision of phospholipids shall be
accompanied by applicable quantity and quality information necessary to permit use of such Licensed Product in animal testing. If necessary, based on the stage of development, BDSI shall produce Licensed Product in accordance with regulatory
requirements to permit use of such Licensed Products in such pre-clinical testing. 
  
 9.2 Costs of Preclinical and Clinical Trials. ACCENTIA will be responsible, at its sole cost and expense, for all preclinical and clinical trial expenses under this Agreement. ACCENTIA agrees to use its best
efforts to meet the regulatory timelines set forth in Exhibit A. 
  
 9.3
Assistance in Third Party Contractor Identification. In the event that either Party desires to use a Third Party contractor for supply of phospholipids and/or to manufacture of Licensed Product, it shall obtain the other Party’s
prior written approval for use of such Third Party contractor, the approval of which shall not be unreasonably withheld. 
  
 ARTICLE 10 - MISCELLANEOUS PROVISIONS 
  
 10.1 Relationship of Parties. Nothing in this Agreement is or shall be deemed to constitute a partnership, agency, employee or joint venture relationship between
the Parties. No Party shall incur any debts or make any commitments for the other, except to the extent, if at all, specifically provided herein. 
  
 10.2 Assignment. Except as otherwise provided herein, neither this Agreement nor any interest hereunder shall be assignable by any Party without the prior written
consent of the other, which approval is not to be unreasonably withheld; provided, however, that either Party may assign this Agreement to any wholly-owned subsidiary or to any successor by merger or sale of substantially all of its assets to which
this Agreement relates in a manner such that the assignor shall remain liable and responsible for the performance and observance of all its duties and obligations hereunder. This Agreement shall be binding upon the successors and permitted assigns
of the parties and the name of a Party appearing herein shall be deemed to include the names of such Party’s successors and permitted assigns to the extent necessary to carry out the intent of this Agreement. Any assignment not in accordance
with this Section 10.2 shall be void. 
  
 10.3 Further Actions. Each Party
agrees to execute, acknowledge and deliver such further instructions, and to do all such other acts, as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement. 
  
 10.4 Force Majeure. Neither Party shall be liable to the other for loss or damages nor
shall have any right to terminate this Agreement for any default or delay attributable to any act of God, flood, fire, explosion, strike, lockout, labor dispute, shortage of raw materials, casualty, accident, war, revolution, civil commotion, act of
public enemies, blockage or embargo, injunction, law, order, proclamation, 
  

 14 

 regulation, ordinance, demand or requirement of any government or subdivision, authority or representative of any such
government, or any other cause beyond the reasonable control of such Party, if the Party affected shall give prompt notice of any such cause to the other Party. The Party giving such notice shall thereupon be excused from such of its obligations
hereunder as it is thereby disabled from performing for so long as it is so disabled and for thirty (30) days thereafter. Notwithstanding the foregoing, nothing in this Section 10.4 shall excuse or suspend the obligation to make any payment due
hereunder in the manner and at the time provided. 
  
 10.5 No Trademark
Rights. Except as otherwise provided herein, no right, express or implied, is granted by this Agreement to use in any manner the name “ACCENTIA” or “BDSI” or any other trade name or trademark of the other party in connection
with the performance of this Agreement. 
  
 10.6 Public Announcements.
Except as required by law, neither Party shall make any public announcement concerning this Agreement or the subject matter hereof without the prior written consent of the other. In the event of a required public announcement, the Party making such
announcement shall provide the other with a copy of the proposed text prior to such announcement. 
  
 10.7 Notices. Any notice required or permitted to be given or delivered hereunder or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been properly served if: (a)
delivered personally, (b) delivered by a recognized overnight courier service instructed to provide next-day delivery, (c) sent by certified or registered mail, return receipt requested and first class postage prepaid, or (d) sent by facsimile
transmission followed by confirmation copy delivered by a recognized overnight courier service the next day. Such notices, demands and other communications shall be sent to the addresses set forth below, or to such other addresses or to the
attention of such other person as the recipient Party has specified by prior written notice to the sending Party. Date of service of such notice shall be: (i) the date such notice is personally delivered or sent by facsimile transmission (with
issuance by the transmitting machine of confirmation of successful transmission), (ii) three days after the date of mailing if sent by certified or registered mail, or (iii) one day after date of delivery to the overnight courier if sent by
overnight courier. Unless otherwise specified in writing, the mailing addresses of the Parties shall be as described below: 
  
 (a) If to BDSI, addressed to: 
  

	
	 Raphael J. Mannino, Ph.D.

	 Executive Vice President and Chief Scientific Officer

	 BioDelivery Sciences International, Inc.

	 185 South Orange Avenue, Administrative Building No. 4

	 Newark, NJ 07103

  
 (b) If to ACCENTIA,
addressed to: 
  

	
	 Martin G. Baum

	 President

	 Accentia, Inc.
 5310 Cypress Center Drive #101
 Tampa, Florida 33609

  

 15 

 10.8 Amendment. No amendment, modification or supplement of any provision of this Agreement shall be valid or
effective unless made in writing and signed by a duly authorized officer of each Party. This Agreement may be executed in a series of counterparts, all of which, when taken together, shall constitute one and the same instrument. 
  
 10.9 Waiver. No provision of this Agreement shall be waived by any act, omission or
knowledge of a Party or its agents or employees except by an instrument in writing expressly waiving such provision and signed by the waiving Party. 
  
 10.10 Dispute Resolution. 
  
 (a) Senior Officials. The Parties recognize that a bona fide dispute as to certain matters may from time to time arise during the term of this
Agreement which relates to either Party’s rights and/or obligations hereunder. In the event of the occurrence of such a dispute, either Party may, by notice to the other Party, have such dispute referred to their respective senior officials
designated below or their successors, for attempted resolution by good faith negotiations within thirty (30) days after such notice is received. Said designated senior officials are as follows: 
  

			
	 For ACCENTIA:
	 	Martin G. Baum, President
	 For BDSI:
	 	Raphael J. Mannino, Ph.D., EVP & CSO

  
 In the event the designated senior
officials are not able to resolve such dispute within the thirty (30) day period, either Party may invoke the provisions of Section 10.10(b). 
  
 (b) Arbitration. In the event of any dispute, difference or question arising between the Parties in connection with this Agreement, the
construction thereof, or the rights, duties or liabilities of either Party, and which dispute cannot be amicably resolved by the good faith efforts of both Parties, then such dispute shall be resolved by binding arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The arbitration panel shall be composed of three arbitrators, one of whom shall be chosen by BDSI, one by ACCENTIA, and the third by the two so chosen. If both or either of
ACCENTIA or BDSI fails to choose an arbitrator or arbitrators within fourteen (14) days after receiving notice of commencement of arbitration or if the two arbitrators fail to choose a third arbitrator within fourteen (14) days after their
appointment, the then President of the American Arbitration Association shall, upon the request of both or either of the Parties to the arbitration, appoint the arbitrator or arbitrators required to complete the board or, if he shall decline or fail
to do so, such arbitrator or arbitrators shall be appointed by the New York office of the American Arbitration Association. The decision of the arbitrators shall be by majority vote and, at the request of either Party, the arbitrators shall issue a
written opinion of findings of fact and conclusions of law. Costs shall be borne as determined by the arbitrators. Unless the Parties to the arbitration shall otherwise agree to a place of arbitration, the place of arbitration shall be at New York,
New York, U.S.A. The arbitration award shall be final and binding upon the Parties to such arbitration and may be entered in any court having jurisdiction. 
  
 10.11 Governing Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of Delaware. 
  

 16 

 10.12 Severability. Whenever possible, 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. 
  
 10.13 Entire Agreement of the
Parties. This Agreement constitutes and contains the entire understanding and agreement of the Parties and cancels and supersedes any and all prior negotiations, correspondence, understandings and agreements, whether oral or written, between the
Parties respecting the subject matter hereof. 
  
 [NEXT PAGE IS
THE SIGNATURE PAGE] 
  

 17 

 IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be executed by its duly authorized
officer as of the day and year first above written. 
  

			
	 BIODELIVERY SCIENCES INTERNATIONAL, INC.

		
	 By:
	 	 /s/ Raphael J. Mannino.

	 Name:
	 	 Raphael J. Mannino. Ph.D.

	 Title:
	 	Executive Vice President and Chief Scientific Officer
	
	 ACCENTIA, INC.

		
	 By:
	 	 /s/ Martin G. Baum

	 Name:
	 	 Martin G. Baum

	 Title:
	 	 President

  

 EXHIBIT A 
  

REGULATORY TIMELINES 
  

					
	 Meeting with the FDA
	 	 Within three (3) months of the Effective Date

	 File IND
	 	 Within six (6) months of the Effective Date1

	 Should FDA require Phase I or II studies
	 	 
	 	 	 Start Phase I
	 	Within six (6) months of approval of IND by FDA
	 	 	 Start Phase II
	 	Within six (6) months of clearance from FDA to proceed
	 	 	 Start Phase III
	 	Within six (6) months of clearance from FDA to proceed
	 	 	 File NDA
	 	Within 12 months of completing registration Phase III study, subject to Section 7.03(c) hereto
	 Should FDA permit moving directly to Phase III studies
	 	 
	 	 	 Start Phase III
	 	Within 6 months of approval of IND by FDA
	 	 	 File NDA
	 	Within 12 months of completing registration phase III study, subject to Section 7.03(c) hereto.

	1	The IND may be filed up to nine (9) months from the Effective Date in the event that: (a) the FDA has agreed to initiate clinical trial under the IND with a Phase
III protocol, and (b) the FDA consequently requires chronic toxicology data to support the original IND. 

 EXHIBIT B 
  

LICENSED PATENTS 
  

			
	 Docket No./Title/
 Country

	 	 Appln No./Patent No.

	 BSZ-005: Liposome Methods and Composition

	 US
	 	4,663,161
	
	 BSZ-005DV: Reconstituting Viral Glycoproteins Into Large Phospholipid Vesicles

	 US
	 	4,871,488
	
	 BSZ-006: Protein-or Peptide-Cochleate Vaccines and Methods of Immunizing Using the
Same
 BSZ-006CP: Stabilizing And Delivery Means of Biological Molecules

	 US
	 	5,643,574
	 Int’l (PC)
	 	US94/10913
	 Canada
	 	2,169,297
	 Australia
	 	689505
	 Europe (incl.)
	 	0 722 338
	 Great Britain
	 	94930484.4
	 Sweden
	 	0 722 338
	 Austria
	 	0 722 338
	 Switzerland
	 	E 20 3413
	 Ireland
	 	0 722 338
	 Italy
	 	0 722 338
	 France
	 	0 722 338
	 Germany
	 	0 722 338
	 US (CN)
	 	08/629,923
	 US (CP)
	 	5,840,707
	 Int’l (CP2PC)
	 	US96/01704
	 Australia(CP2AU1)
	 	49748/96
	 Australia(CP2AU2)
	 	32599/00
	 Australia(CP2AU3)
	 	2002300615
	 Canada(CP2CA)
	 	2,212,238
	 Europe (CP2EP)
	 	96906334.6
	 Japan (CP2JP)
	 	8-525713
	 US (CP3)
	 	5,994,318
	 Int’l (CP3PC)
	 	US97/02632
	 Canada (CP3CA)
	 	2,246,754

			
	 Docket No./Title/
 Country

	 	 Appln No./Patent No.

	 BSZ-007: Protein-Lipid Vesicles And Autogenous Vaccine Comprising The Same

	 US
	 	5,834,015
	 US (CP)
	 	6,165,502
	 Int’l (PC)
	 	US97/08422
	 Australia
	 	722647
	 Canada
	 	2,264,646
	 Europe
	 	97940721.0
	 Japan
	 	10-513692
	
	 BSZ-009: Nanocochleate Formulations, Process Of Preparation And Method Of Delivery of Pharmaceutical
Agents

	 US
	 	6,153,217
	 Int’l (PC)
	 	US00/01684
	 Australia
	 	3213/00
	 Canada
	 	2,358,505
	 Europe
	 	00 909 961.5
	 Japan
	 	2000-594446
	 US (CP)
	 	09/613,840
	 US (CPCN)
	 	10/421,358
	 Int’l (CPPC)
	 	US01/02299
	 Australia (CPAU)
	 	31114/01
	 Canada (CPCA)
	 	2,397,792
	 Europe (CPEP)
	 	01 903 273.9
	 Japan (CPJP)
	 	2001-552865
	
	 BSZ-010: Cochleates From Purified Soy Phosphatidylserine

	 US
	 	10/105,314
	 US (CN)
	 	10/304,567
	 Int’l (PC)
	 	PCT/US03/09562
	
	 BSZ-014: Geodate Delivery Vehicles

	 US (PR)
	 	60/422,989
	 US (PR)
	 	60/440,284
	 US
	 	10/701,364
	 PCT
	 	PCT/US03/35136
	
	 BSZ-016: Rigid Liposomal Compositions

	 US (PR)
	 	60/531,546

			
	 Docket No./Title/
 Country

	 	 Appln No./Patent No.

	 BSZ-017: Cochleate Preparations of Fragile Nutrients

	 US (PR)
	 	60/440,120
	 US (PR)
	 	60/465,754
	 US
	 	10/759,381
	 PCT
	 	PCT/US04/01236
	
	 BSZ-018: Antisense Cochleates

	 US (PR)
	 	60/461,483
	 US (PR)
	 	60/463,076
	
	 BSZ-020: Cochleates Including Aggregation Inhibitors

	 US (PR)
	 	60/502,557
	 US(PR)
	 	60/537,252
	
	 BSZ-023: Novel Encochleation Methods, Cochleates and Methods of Use

	 US (PR)
	 	60/499,247
	 US(PR)
	 	60/532,755
	
	 BSZ-038: Replacement Enzyme Cochleates

	 US (PR)
	 	60/541,707
	
	 BSZ-039 Apoprotein Cochleate Compositions

	 US (PR)
	 	60/540,269

  

 EXHIBIT C 
  

BDSI LICENSED TECHNOLOGY 
  
 I. COCHLEATE TECHNOLOGY 
  
 Origin of cochleates 
  
 Over the years,
biochemists and biophysicists have studied artificial membrane systems to understand their properties and potential applications. In studying this topic, Demetrios Papahadjopoulos and coworkers began investigating the interactions of divalent
cations with negatively charged lipid bilayers. They reported that the addition of calcium ions to small phosphatidylserine vesicles induced their collapse into discs which fused into large sheets of lipid. In order to minimize their interaction
with water, these lipid sheets rolled up into jellyroll-like structures, termed “cochleate” cylinders, after the Greek name for a snail with spiral shell. 
  
 The Cochleate Advantage 
  
 Cochleate delivery vehicles represent a new technology platform for oral and systemic delivery of clinically important drugs that possess poor bioavailability. For
example, oral cochleates have been successfully used in animal models for the delivery of drugs that previously were only available given by injection. 
  
 High stability: Cochleate delivery vehicles are stable phospholipids-divalent cation precipitates composed of simple, naturally occurring materials, for example,
phosphatidylserine and calcium. They have a unique multilayered structure consisting of a large, continuous, solid, lipid bilayer sheet rolled up in a spiral, with no internal aqueous space. Cochleates can be stored in a cation-containing buffer, or
lyophilized to a powder and stored at room temperature. Lyophilized cochleates can be placed in capsules and given orally, or reconstituted with liquid prior to in vitro use or in vivo administration. Lyophilization has no adverse
effects on cochleate morphology or functions. Cochleate preparations have been shown to be stable for more than two years at 4°C in a cation-containing buffer, and at least one year as a lyophilized powder at room temperature. Encochleation
imparts increased stability to drugs, proteins and polynucleotides. 
  
 Encapsulation: Cochleate delivery vehicles “wrap-up” or encapsulate the drug, rather than chemically bond with the included drug. 
  
 Target delivery: Cochleates carry the encapsulated drug within the interior of the formulation and delivery the drug to the target cell. This results in low blood
levels of free drug and high efficiency delivery to the target cell. Once at the target cell, cochleates can be envisioned as membrane fusion intermediates. When a cochleate comes into close approximation to a target membrane, a fusion event between
the outer layer of the cochleate and the cell membrane occurs. This fusion results in the delivery of a small amount of the encochleated material into the cytoplasm of the target cell. The cochleate may slowly fuse or break free of the cell and be
available for another fusion event, either with this or another cell. Cochleates may also be taken up by endocytosis, and fuse from within endocytic vesicles. 
  

Resistance to environmental attack: The unique structure of the cochleate provides protection from degradation for associated “encochleated”
molecules. Traditionally, many drugs can be damaged from exposure to adverse environmental conditions such as sunlight, oxygen, water and temperature. Since the entire cochleate structure is a series of solid layers, components within the interior
of the cochleate structure remain intact, even though the outer layers of the cochleate may be exposed to harsh environmental conditions or enzymes. 
  
 Oral availability: The drug delivery technology is being developed to enable oral availability of a broad spectrum of compounds, such as those with poor water
solubility, as well as polynucleotides, and protein and peptide biopharmaceuticals, which have been difficult to formulate and administer. 

 Release characteristics: The cochleate technology offers the potential to be tailored to control the release of
the drug depending on the desired application.  
  
 Formulation of
Cochleates 
  
 BDSI scientists have investigated various aspects of the
manufacturing process, including pH, agitation method and rate, type of cation, ratio of lipid to material, and other parameters, in order to optimize the formulation and manufacturing process for a given material. In one typical manufacturing
process, the materials to be formulated (chemical drugs, proteins, peptides, DNA, antigens, nutrients) are added to a suspension of liposomes comprised mainly of negatively charged lipids. The addition of divalent metal ions such as calcium,
(although other multivalent cations can be used) induces the collapse and fusion of the liposomes into large sheets composed of lipid bilayers, which spontaneously roll up or stack into cochleates. If desired, the cochleates can be purified to
remove unencochleated material, and then resuspended in a buffer containing divalent metal ions. 
  
 Various processes have been developed by BDSI scientists to prepare cochleate formulations of a wide variety of drugs, peptides and proteins, with molecular weights ranging from 1 to greater than 200KD, and
oligonucleotides or DNA of 20 to greater than 10,000 base pairs. The percentage of encochleation of material ranges from 40-95%, depending on the material and the manufacturing conditions. 
  
 Biocompatibility of Cochleate Vehicles 
  
 The fundamental components of the cochleate delivery vehicle are phosphatidylserine (PS) and
calcium. Phosphatidylserine is a natural component of all biologic membranes, and is most concentrated in the brain. Clinical studies by other investigators, (more than 30 have been published), to evaluate the potential of phosphatidylserine as a
nutrient supplement indicate that PS is very safe and may play a role in the support of mental functions in the aging brain. Indeed, phosphatidylserine isolated from soy beans is sold in health food stores as a nutritional supplement. 
  
 In mice, BDSI has evaluated the in vivo safety of multiple administrations of
cochleates by various routes, including intravenous, intraperitoneal, intranasal and oral. Multiple administrations of cochleate formulations to the same animal do not result in either the development of an immune response to the cochleate matrix,
or to any side effects relating to the cochleate vehicle. 
  
 Mechanism of
Delivery 
  
 The interaction of calcium with negatively charged lipids has
been extensively studied. Many naturally occurring membrane fusion events involve the interaction of calcium with negatively charged phospholipids (generally phosphatidylserine and phosphatidylglycerol). Calcium induced perturbations of membranes
containing negatively charged lipids, and the subsequent membrane fusion events, are important mechanisms in many natural membrane fusion processes. Hence, cochleates can be envisioned as membrane fusion intermediates. 
  
 During the past several years substantial research by BDSI scientists has demonstrated that
cochleate formulations are simple, safe and highly efficacious mediators of the in vivo delivery of proteins, peptides and polynucleotides for the induction of antigen specific immune responses following oral, intranasal and intramuscular
administration. Significantly, the ability of cochleates to mediate the induction of antigen specific, CD8+ cytotoxic lymphocytes, as well as the efficient induction of immune responses to plasmid encoded antigens, supports the hypothesis that
cochleates facilitate the cytoplasmic delivery of cochleate associated bioactive molecules. 
  
 The observations indicate that, as the calcium rich, highly ordered membrane of a cochleate first comes into close approximation to a natural membrane, a perturbation and reordering of the cell membrane is induced.
This results 

 in a fusion event between the outer layer of the cochleate and the cell membrane. This fusion also results in the
delivery of a small amount of the encochleated material into the cytoplasm of the target cell. The cochleate may slowly fuse or break free of the cell and be available for another fusion event, either with this or another cell. Cochleates may also
be taken up by endocytosis, and fuse from within endocytic vesicles. 
  
 Uptake of Cochleates by Macrophage 
  
 An important observation
relative to the interaction of cochleates with cells is their uptake by macrophage. For example, in vivo, fluorescent cochleates are accumulated by macrophage. Macrophages are on the first line of defense against microbial infections. Many
human pathogens cause diseases because they have developed the capacity to survive within macrophage. Examples include viruses such as HIV, bacteria such as staphylococcus and Mycobacterium tuberculosis, fungi such as Candida and parasites such as
Leishmania. 
  
 Cochleate Mediated Oral Delivery of Drugs 
  
 Cochleate formulation technology is particularly applicable to macromolecules as well as
small molecule drugs that are hydrophobic, positively, or negatively charged, and possess poor oral bioavailability. Proof-of-principle studies for cochleate mediated oral delivery of macromolecules as well as small molecule drugs is being carried
out in appropriate animal models with a well established, clinically important drug which currently can only be effectively delivered by injection, amphotericin B, a potent antifungal agent. 
  
 II. PROTEOLIPOSOME TECHNOLOGY 
  
 Proteoliposome Technology (PLT), relates to novel liposome compositions and methods for
their preparation. Utilization of PLT provides an efficient reconstitution of membrane proteins into large (0.1 to 2 micron diameter) phospholipid vesicles with a large, internal aqueous space. The method has been exemplified with the use of
glycoproteins of influenza (A/PR8/34) and Sendai (parainfluenza type I) viruses. The method comprises (A) extracting out the desired membrane protein from a source biological material with an extraction buffer comprising a detergent; (B) mixing the
extract with a phospholipid solution and deriving a cochleate intermediate; and (C) forming large phospholipid vesicles with integrated membrane protein in a biologically active state. 
  
 PLT has been used to produce liposome structures with improved delivery capabilities for drug delivery and gene therapy as well as enhanced
immune responses. In addition, BDSI PLT can be used to formulate and stabilize biologically important but structurally fragile hydrophobic proteins. 
  
 The PLT is protected by US Patent Nos. 4,663,161 and 4,871,488. 
  
 III. GEODATE TECHNOLOGY 
  
 Geodate technology generally relates to a novel delivery vehicle that encapsulates agents in a stable emulsion, slurry, or powder. Geodate technology is particularly attractive for use with hydrophobic agents, as it
can incorporate them at a high yield. It also is particularly attractive for delivery of fragile or unstable agents as the “geodes” remain intact and protect the fragile core molecules, such as beta-carotene, under environmental conditions
that normally will result in destruction or inactivation of the molecules. 
  
 It
has been discovered by BDSI scientists that a monolayer of lipid can form about a hydrophobic core, and that this monolayer can further be encrusted in a lipid/cation matrix, further protecting the hydrophobic core. The resulting “geode”
is highly stable and protects of the core from degradation or inactivation, even at elevated pressures and temperatures, such as those encountered in food processing technology.

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