Document:

EXHIBIT 10.82

 

[* * *] REDACTED CONFIDENTIAL TREATMENT
REQUESTED

LICENSE AGREEMENT

THIS LICENSE
AGREEMENT (“Agreement”) is made as of February 13, 2001 (the “Effective Date”)
by and between Peregrine Pharmaceuticals, Inc., a corporation organized and
existing under the laws of Delaware, having an office located at 14282 Franklin
Ave., Tustin, CA  92780 (“Licensor”) and
SuperGen, Inc., a corporation organized and existing under the laws of
Delaware, having a principal place of business at 4140 Dublin Blvd., Suite 200,
Dublin, CA  64568 (“SuperGen”).

BACKGROUND

WHEREAS,
Licensor has licensed certain Licensed Patents; and

WHEREAS,
SuperGen wishes to obtain a license from Licensor to the Licensed Patents, all
on the terms and conditions set forth below.

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

ARTICLE 1

DEFINITIONS

As
used in this Agreement, the following terms shall have the meanings indicated:

1.1           “Affiliate” shall mean any
corporation or other business entity which during the term of this Agreement
controls, is controlled by, or is under common control with SuperGen, but only
for so long as such entity controls, is controlled by, or is under common
control with SuperGen.  For this
purpose, control shall mean the possession of the power to direct or cause the
direction of the management and the policies of an entity whether through
ownership directly or indirectly of fifty percent (50%) or more of the stock
entitled to vote, and for non-stock organizations, the right to receive fifty
percent (50%) or more of the profits by contract or otherwise, or in countries
where control of fifty percent (50%) or more of such rights is not permitted in
the country where such entity exists, the maximum permitted in such country.

1.2           “SuperGen” shall mean SuperGen
and its Affiliates.

1.3           “Field” shall mean vascular
endothelial growth factor (“VEGF”), in the native, mutants and variants
thereof, conjugated to cytotoxic drugs, toxins, radionuclides or photodynamic
therapy agents for targeting tumors and cells expressing VEGF receptors and
tumor blood vessels for 

 

 

therapy of cancer and blood vessel
proliferative disorders, including but not limited to macular degeneration,
diabetic retinopathy, and pannus formation.

1.4           “Licensed Patents”
shall mean any and all rights in:

1.4.1        all patents and patent applications
anywhere in the world claiming or disclosing inventions relating to the Field
in or to which Licensor has right, title, and interest, including but not
limited to those patents and patent applications listed in Exhibit 1;

1.4.2        all divisions, continuations,
continuations-in-part, foreign-counterparts, patents of addition, and
substitutions of, and all patents issuing on, any of such patents and patent
applications described in Section 1.4.1 above; and

1.4.3        all registrations, reissues,
reexaminations or extensions of any kind with respect to any of such patents
described in Sections 1.4.1 - 1.4.2 above.

1.5           “Licensed Product” shall mean
a product:

1.5.1        within the scope of one or more Valid
Claims of the Licensed Patents in the country of manufacture or sale, including
any improvements or modifications to such Product as long as such improvement
or modification fall within the definition of a Valid Claim; or

1.5.2        produced, processed or otherwise
manufactured by a process or method within the scope of one or more Valid
Claims of the Licensed Patents in the country of such manufacture, including
any improvements or modifications to such Product as long as improvement or
modification fall within the definition of a Valid Claim; or

1.5.3        used in a process and/or method within
the scope of one or more Valid Claims of the Licensed Patents in the country
where such product is made or sold.

1.6           “Net Sales” shall mean amounts
received by SuperGen and its Sublicensees with respect to sales of Licensed
Products to independent third parties, less: 
(i) rebates, credits and cash, trade and quantity discounts, actually taken,
(ii) excise taxes, sales, use, value added, and other consumption taxes and
other compulsory payments to governmental authorities, actually paid, (iii) the
cost of shipping packages and packing, if billed separately, (iv) insurance
costs and outbound transportation charges prepaid or allowed, (v) import and/or
export duties and tariffs actually paid, (vi) amounts allowed or credited due
to returns or uncollectable amounts.  If
a Licensed Product shall be invoiced for a discounted price substantially lower
than customary in the trade, Net Sales shall be based on the customary amount
received for such Licensed Products, provided that the foregoing shall not
apply in the case of shipments made by SuperGen to third parties at no or low
cost in connection with research and development, clinical trials,
compassionate sales, or indigent programs for which no amounts shall be due to
Licensor.

1.7           “Sublicensee” shall mean any
non-Affiliate third party to whom SuperGen has granted the right to manufacture
and sell Licensed Products.

 

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1.8           “Valid Claim” shall mean a
claim of an issued and unexpired patent or a claim of a pending patent
application which has not been held unpatentable, invalid or unenforceable by a
court or other government agency of competent jurisdiction and has not been
admitted to be invalid or unenforceable through reissue, re-examination,
disclaimer or otherwise; provided, however, that if any holding of invalidity,
unenforceability or unpatentability is later reversed by a court or agency with
overriding authority, the relevant claim shall be reinstated as a Valid Claim
hereunder with respect to sales made after the date of such reversal.  Notwithstanding the foregoing provisions of
this Section 1.8, if a claim of a pending patent application has not issued as
a claim of an issued patent, within five (5) years after the date from which
such claim takes priority, such pending claim shall not be a Valid Claim for
purposes of this Agreement unless and until the patent is issued including such
claim.

ARTICLE 2

LICENSE

2.1           Grant.

2.1.1        Licensed Patents.  Licensor hereby grants to SuperGen an
exclusive, worldwide, royalty-bearing license to Licensor’s entire interest in
and to Licensed Patents within the Field to: (i) make, have made, use, import,
have imported, sell, offer for sale and otherwise exploit and distribute
Licensed Products, (ii) practice any method, process or procedure included
within the Licensed Patents; and to have any of the foregoing performed on its
behalf by a third party.

2.2           Sublicenses.  SuperGen may grant and authorize sublicenses
within the scope of the license granted to SuperGen pursuant to this Agreement,
provided each such Sublicensee shall agree in writing to be bound by terms and
conditions not inconsistent with the terms and conditions hereof.  SuperGen shall notify Licensor in writing of
the grant of any such sublicense, which notice shall identify the
Sublicensee.  The identity of all
Sublicensees shall be Confidential Information (as defined below) of SuperGen.

2.3           Future Licenses.  Licensor agrees that should Licensor be
offered any option or opportunity to license technology within the Field,
Licensor will communicate with SuperGen regarding such option or opportunity to
license.  Any technology licensed by
Licensor and agreed to by SuperGen during the term of this Agreement within the
Field will be incorporated into this Agreement.  Licensor and SuperGen will update Exhibit 1 of this Agreement as
appropriate to reflect incorporation of such technology.

ARTICLE 3

PAYMENTS AND
REPORTS

3.1           Equity Investments, License and
Maintenance Fees.  As consideration
for the rights and licenses granted by Licensor to SuperGen hereunder, SuperGen
agrees to make an equity investment in Licensor and pay the following amounts
at the following times:

 

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3.1.1        Initial Equity Investment.  Within ten (10) days of the Effective Date,
SuperGen shall pay to Licensor six hundred thousand U.S. dollars ($600,000) for
the purchase of 150,000 shares of Licensor common stock (the “Licensor
Shares”).  In connection with such
purchase SuperGen will execute an investment representation statement in the
form set forth as Exhibit 4.  Within 120
days Licensor will file a registration statement providing for the registration
of the resale of all 150,000 shares by SuperGen, all as set forth more fully in
the registration rights agreement attached as Exhibit 5.  SuperGen agrees to sell no more than 75,000
of the Licensor Shares until the one year anniversary of this Agreement.  SuperGen agrees to sell no more than thirty
thousand (30,000) shares of Licensor Shares per trading day, for so long as
SuperGen holds such shares.

3.1.2        Annual License Fee.  On or about each annual anniversary of the Effective
Date, SuperGen will pay to Licensor two hundred thousand U.S. dollars
($200,000) in cash or SuperGen common stock with piggyback registration rights
therefor.  Payments under this Section
3.1.2 will continue until the first filing of an Investigational New Drug
(“IND”) Application in the United States for a clinical indication utilizing
the Licensed Patents.

3.1.3        Milestone
Payments.

(a)           Phase III.  Upon Commencement of the first Phase III
trial in the United States, Europe or Japan by SuperGen for the first
therapeutic clinical candidate covered under the Licensed Patents, not
necessarily restricted to cancer indications, SuperGen will pay to Licensor the
sum of one million five hundred thousand U.S. dollars ($1,500,000) in cash or
SuperGen stock along with piggyback registration rights therefor.  Upon Commencement of Phase III trial in the
United States, Europe or Japan by SuperGen for subsequent therapeutic clinical
candidates covered under the Licensed Patents, SuperGen will pay to Licensor
the sum of seven hundred and fifty thousand U.S. dollars ($750,000) in cash or
SuperGen stock along with piggyback registration rights therefor.  In the event SuperGen undertakes a Phase
II/III clinical trial , then Commencement of such Phase II/III trial, and not
of a Phase III trial, shall trigger the payment described in this section.  A Phase II/III trial is defined as a pivotal
study in which a therapeutic clinical candidate is being tested in humans for
safety and efficacy in an expanded patient population at geographically
dispersed clinical sites on the basis of which SuperGen will seek regulatory
approval in lieu of a Phase III trial. 
Determination that a clinical trial is a Phase II/III shall be
exclusively by SuperGen after conferring with the appropriate regulatory
authority.  Commencement
(“Commencement”) is defined as the dosing of the first patient under a protocol
involving a therapeutic clinical candidate covered under the Licensed Patents,
not necessarily restricted to cancer indications.

(b)           Approvals.  Upon receiving regulatory approval in the
United States for the first therapeutic clinical candidate covered under the
Licensed Patents, not necessarily restricted to cancer indications, SuperGen
will pay to Licensor the sum of three million five hundred thousand U.S.
dollars ($3,500,000) in cash or SuperGen stock along with piggyback
registration rights therefor.  Upon
SuperGen receiving regulatory approval in a European nation for the first
therapeutic clinical candidate covered under the Licensed Patents, not
necessarily restricted to cancer indications, SuperGen will pay to Licensor the
sum of one million five hundred thousand U.S. dollars ($1,500,000) in cash or
SuperGen stock along with piggyback registration rights therefor.  

 

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Upon Supergen
receiving regulatory approval in Japan for the first therapeutic clinical
candidate covered under the Licensed Patents, not necessarily restricted to
cancer indications, SuperGen will pay to Licensor the sum of one million U.S.
dollars ($1,000,000) in cash or SuperGen stock along with piggyback
registration rights therefor.

3.1.4        Acknowledgment.  It is understood and agreed that license fee
and milestone payments received by SuperGen from Sublicensees shall not include
(i) any royalties received by SuperGen for the sale of Licensed Products by a
Sublicensee, (ii) amounts received by SuperGen for research and development,
(iii) reimbursements of amounts expended or to be expended by SuperGen, (iv)
amounts paid to SuperGen under supply, service or research or development
contracts with the Sublicensee, or (v) amounts paid for equity or debt of
SuperGen.

3.2                           Running Royalties.  SuperGen will pay to Licensor the following
amounts, based on its worldwide Net Sales of Licensed Products:

(a)           on its worldwide annual Net Sales of
up to and including $[***], SuperGen will pay to Licensor [***]% of Net Sales;

(b)           on its incremental worldwide annual
Net Sales of more than $[***] but up to and including $[***] SuperGen will pay
to Licensor [***]% of Net Sales;

(c)           on its incremental worldwide annual
Net Sales of more than $[***], SuperGen will pay to Licensor [***]% of Net
Sales.

For
illustration purposes, if the worldwide annual Net Sales of Licensed Products
were $[***], the SuperGen would pay $[***] in Running Royalties derived from
the following:

[***]% on the
first $[***] for a royalty calculated at $[***]

[***]% on the
incremental $[***] for a royalty calculated at $[***]

[***]% on the
final $[***] for a royalty calculated at $[***]

3.3           Royalty Term.  The obligation of SuperGen to pay royalties
under this Article 3 shall continue on a Licensed Product by Licensed Product
and country-by-country basis, for so long as there exists a Valid Claim
covering such Licensed Product in the country of such manufacture or sale.

3.4           One Royalty; Non-Royalty Sales.  Only one royalty shall be paid to Licensor
with respect to a particular Licensed Product subject to royalties under this
Article 3, without regard to whether more than one Valid Claim within the
Licensed Patents is applicable to such Licensed Product.  It is understood that royalties shall only
be payable under this Article 3 with respect to Licensed Products the
manufacture, sale or use of which is within the scope of a Valid Claim within
the Licensed Patents in the country for which such Licensed Product is made or
sold.  In no event shall more than one
royalty be due hereunder with respect to any Licensed Product unit.  It is understood that no royalty shall be
due hereunder with respect to sales or other transfers of Licensed Products for
use as samples, in research and development, or clinical trials.

 

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3.5           Combination Products; Third Party
Obligations.  The amounts payable
under Section 3.2 above are further subject to the following:

3.5.1        Combination Products.  In the event that a Licensed Product is sold
in combination with another product, active component or service (“Other
Product”)  whose sale and use are not
covered by a Valid Claim of the Licensed Patent in the country for which the
combination product is sold, Net Sales from such sales for purposes of
calculating the amounts due under Section 3.2 above shall be calculated by
multiplying the Net Sales of that combination by the fraction
A/(A + B), where A is the gross selling price of the Licensed Product
sold separately and B is the gross selling price of the other product, active
component or service sold separately. 
In the event that no such separate sales are made by SuperGen or its
Sublicensee, Net Sales for royalty determination shall be as reasonably
allocated by SuperGen in consultation with Licensor between such Licensed
Product and such other product, active component or service, based upon their relative
importance and proprietary protection.

3.5.2        Third Party Obligations.  If SuperGen or its Sublicensee is required
to pay a third party a license or similar fee for intellectual property rights
or other technologies which SuperGen, or its Sublicensee, in its reasonable
judgment, determines are necessary or useful to make, use or sell a Licensed
Product, the royalty percentages owed to Licensor for such Licensed Product as
set forth in Section 3.2 (a), (b), and (c) will each be reduced by [***]%, so that
the royalty percentages owed in such case will be [***]%, [***]% and [***]%
respectively.

3.6           Royalty Reports and Payments.  After the first commercial sale by SuperGen,
its Affiliates or Sublicensees of a Licensed Product for which royalties are
payable under this Article 3, SuperGen shall make quarterly written reports to
Licensor within sixty (60) days after the end of each calendar quarter, stating
in each such report the number, description, and aggregate Net Sales of such
Licensed Product sold during the calendar quarter.  Simultaneously with the delivery of each such report, SuperGen
shall pay to Licensor the royalties, if any, due to Licensor for the period of
such report.  If no royalties are due,
SuperGen shall so report.  Such reports
shall be Confidential Information of SuperGen subject to Article 5 herein.

3.7           Payment Method.  Unless otherwise specified by this Agreement
or requested in writing by Licensor, all amounts payable under this Agreement
shall be made by check or wire drawn on a United States bank account and
delivered to Licensor at the address set forth in Section 10.5 or such other
business address as Licensor may designate in writing.  All payments hereunder shall be made in U.S.
dollars.  Any payments that are not paid
on the date such payments are due under this Agreement shall bear interest, to
the extent permitted by applicable law, at the prime rate as reported by the
Chase Manhattan Bank, New York, New York, on the date such payment is due
calculated on the number of days such payment is delinquent.

3.8           Currency Conversion.  If any currency conversion shall be required
in connection with the calculation of royalties hereunder, such conversion
shall be made using the selling exchange rate for conversion of the foreign
currency into U.S. dollars, quoted for current transactions reported in The
Wall Street Journal for the last business day of the calendar quarter to which
such payment pertains.

 

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3.9           Inspection of Books and Records.  SuperGen shall maintain accurate books and
records which enable the calculation of royalties payable hereunder to be
verified.  SuperGen shall retain the
books and records for each quarterly period for three (3) years after the
submission of the corresponding report under Section 3.6 hereof.  Upon thirty (30) days prior notice to
SuperGen, independent accountants selected by Licensor, reasonably acceptable
to SuperGen, after entering into a confidentiality agreement with SuperGen, may
have access to the books and records of SuperGen to conduct a review or audit
once per calendar year, for the sole purpose of verifying the accuracy of
SuperGen’s payments and compliance with this Agreement.  Licensor’s failure to audit shall not be
considered a waiver of any objection to the amounts paid by SuperGen.  The accounting firm shall report to Licensor
only whether there has been a royalty underpayment and, if so, the amount
thereof.  Such access shall be permitted
during SuperGen’s normal business hours during the term of this Agreement and
for three (3) years after the expiration or termination of this Agreement.  Any such inspection or audit shall be at
Licensor’s expense, excepting that if the audit results show underpayment by
SuperGen of more than fifteen percent (15%) over the course of the entire
period audited, then SuperGen will pay for reasonable audit expenses incurred
by Licensee.

3.10         Issuance of SuperGen Stock.  Each time SuperGen shall issue shares of its
common stock in lieu of cash as provided for in this Article 3 (“Licensee
Shares”), Licensor shall execute and deliver to SuperGen an Investment
Representation Statement in the form attached hereto as Exhibit 2 prior to such
issuance.  Brokerage fees payable by
Licensor for sale of Licensee Shares issued by SuperGen under this Agreement
shall be paid by SuperGen, provided that Licensor uses SuperGen’s recommended
broker for such sales.  The Licensee
Shares will be priced at a thirty (30) day running average value as of the date
when a milestone is achieved or the date when a license or maintenance fee is
due.  [***]

ARTICLE 4

TERM AND
TERMINATION

4.1           Term.  The term of this Agreement shall commence on
the Effective Date, and unless earlier terminated as provided herein, shall
continue in full force and effect on a country-by-country and Licensed
Product-by-Licensed Product basis until there are no remaining royalty payment
obligations in a country pursuant to Section 3.3, at which time the Agreement
shall expire in its entirety in such country. 
Notwithstanding the above, upon the expiration of this Agreement in any
country pursuant to this Section 4.1, SuperGen shall have a non-exclusive,
irrevocable, fully paid-up right and license to use and exploit the Licensed
Patents in that country.

4.2           Termination for Cause.  If either party materially breaches this
Agreement, the non-breaching party may elect to give the breaching party
written notice describing the alleged breach. 
If the breaching party has not cured such breach within sixty (60) days
after receipt of such notice, the notifying party will be entitled, in addition
to any other rights it may have under this Agreement, to terminate this
Agreement effective immediately; provided, however, if either party receives
notification from the other of a material breach and if the party alleged to be
in breach 

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notifies the non-breaching party in writing
within thirty (30) days of receipt of default notice that it disputes the
asserted default, the parties shall discuss in good faith and attempt to
resolve such dispute.  If the parties
are unable to resolve such dispute within thirty (30) days after notice of the
dispute is received by the non-breaching party, the matter will be submitted to
arbitration and no termination shall become effective prior to the completion
of such arbitration, and unless approved by the arbitrators.

4.3           Permissive Termination.  SuperGen may terminate this Agreement with
respect to any country and/or any aspect of the Licensed Patents upon thirty
(30) days written notice to Licensor.

4.4           Effect of
Termination.

4.4.1        Accrued Rights and Obligations.  Termination of this Agreement for any reason
shall not release any party hereto from any liability which, at the time of
such termination, has already accrued to the other party or which is
attributable to a period prior to such termination, nor preclude either party
from pursuing any rights and remedies it may have hereunder or at law or in
equity which accrued or are based upon any event occurring prior to such
termination.

4.4.2        Return of Materials.  Upon any termination of this Agreement, each
party shall promptly return to the other party all Confidential Information
received from the other party (except one copy of which may be retained for
archival purposes).

4.4.3        Stock on Hand.  In the event this Agreement is terminated
for any reason, SuperGen and its Sublicensees shall have the right to sell or
otherwise dispose of the stock of any Licensed Product subject to this
Agreement then on hand, subject to Article 3.

4.4.4        Sublicensees.  In the event of any termination of this
Agreement any sublicenses granted by SuperGen shall remain in force and effect
and shall be assigned by SuperGen to Licensor, provided, that such Sublicensee
is currently in good standing with regard to its obligations under the
sublicense or has cured any default or breach within the period provided in
such sublicense, and further provided, that the financial obligations of each
such Sublicensee shall be limited to those due Licensor hereunder for the
practice of such a sublicense.

4.4.5        Unpaid Amounts.  Termination of this Agreement shall not
affect Licensor’s right to recover from SuperGen any royalties, fees or patent
expenses which SuperGen is obligated to pay to Licensor, which obligation
accrued prior to the effective date of such termination.

4.4.6        Licenses.  Subject to Section 4.1, upon termination of
this Agreement, the licenses granted herein shall terminate and the
intellectual property rights granted herein shall revert to Licensor, at no
cost to Licensor.

4.5           Survival.  Articles 1, 5, 7, and 10, and Sections 4.4 -
4.5 shall survive expiration or termination of this Agreement for any reason.

 

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ARTICLE 5

CONFIDENTIALITY

5.1           Confidential Information.  Except as expressly provided in this
Agreement, neither party shall use for its own benefit or the benefit of any
third party, or disclose to any third party, any confidential, proprietary or
trade secret information (the “Confidential Information”) received from the
other party hereto, during the term of this Agreement and for five (5) years
thereafter.  All Confidential
Information must be designated as such by disclosing party in writing at or
before the disclosure is made in writing, or within thirty (30) days of such
disclosure.

5.2           Permitted Disclosures.  Notwithstanding Section 5.1 above,
Confidential Information shall not include any of the following information
which the receiving party can demonstrate by competent evidence:

5.2.1        was already known to the receiving
party, other than under an obligation of confidentiality, at the time of
disclosure;

5.2.2        was generally available to the public or
otherwise part of the public domain at the time of disclosure to the receiving
party;

5.2.3        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;

5.2.4        was independently developed by the
receiving party without reference to any information or materials disclosed by
the disclosing party; or

5.2.5        was subsequently disclosed to the
receiving party by a person other than a party without breach of any legal
obligation to the disclosing party.

In
addition, either party may disclose Confidential Information of the other (i)
to their legal representatives, employees and Affiliates, and legal
representatives and employees of Affiliates, consultants and Sublicensees, to
the extent such disclosure is reasonably necessary to achieve the purposes of
this Agreement, and provided such representatives, employees, consultants and
Sublicensees have agreed in writing to obligations of confidentiality with
respect to such information no less stringent than those set forth herein; (ii)
in connection with the filing and support of patent applications; (iii) to a
potential Sublicensee or as reasonably required in the course of a contemplated
public offering or private financing; (iv) to a corporate partner; or (v) if
disclosure is compelled to be disclosed by a court order or applicable law or
regulation, provided that the party compelled to make such disclosure (x)
requests confidential treatment of such information, (y) provides the other
party with sufficient advance notice of the compelled disclosure to provide
adequate time to seek a protective order and (z) discloses only the minimum
necessary to comply with the requirement to disclose.

5.3           Non-Disclosure.  The terms of this Agreement shall not be
disclosed by SuperGen or Licensor to any third party or be published unless
both parties expressly agree otherwise in writing.  

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The text of any press release to be issued by
SuperGen and/or Licensor concerning this Agreement as well as the precise date
and timing of the press release shall be agreed between the parties in writing
in advance, such agreement not to be unreasonably withheld or delayed.  However, this restriction shall not apply to
announcements required by law or regulation, except that in such event the
parties shall coordinate to the extent possible with respect to the details of
any such announcement.  This restriction
shall not apply to disclosure of this Agreement to certain private third
parties such as the shareholders of either party, investment bankers, attorneys
and other professional consultants, and prospective investors in either
party.  Once a particular disclosure has
been approved, further disclosures which do not differ materially therefrom may
be made without obtaining any further consent of the other party.

ARTICLE 6

PATENT
PROSECUTION, ENFORCEMENT AND DEFENSE

6.1           Licensor’s Responsibilities.  Licensor, in consultation with the
University of Texas and Beth Israel Deaconess Medical Center, as appropriate,
for Licensed Patents licensed to Licensor by the University of Texas and by
Beth Israel Deaconess Medical Center, respectively, shall, using patent counsel
acceptable to SuperGen, have the initial right and obligation to control the
preparation, filing, prosecution and maintenance of the Licensed Patents, and
any interferences, re-examinations, reissues and opposition proceeding relating
thereto.  Licensor shall consult with
SuperGen regarding the conduct of all such activities, by providing SuperGen a
reasonable opportunity to review and comment on all proposed submissions to any
patent office before submission.  For
the purpose of this Agreement, “reasonable opportunity” shall mean that
SuperGen shall receive from Licensor or its patent counsel true copies of all
documents relating to filing, registration, prosecution, and maintenance of
patent applications and patents within the Licensed Patents as soon as
reasonably practical after Licensor has received such documents and materials
and at least forty-five (45) days before any date imposed upon Licensor for
action or response with respect to such patent applications or patents.  Licensor agrees to consider SuperGen’s
comments concerning such documents and materials, and shall use its best
efforts to incorporate into the final version of such documents and materials
any modification(s) and/or claim(s) requested by SuperGen.

6.2           Licensor’s Failure to Prosecute.  In the event Licensor declines to file or
having filed fails to further prosecute or maintain any patent applications or
patents with respect to the Licensed Patents, or conduct any interferences,
re-examinations, reissues, oppositions, within a reasonable time therefor, then
SuperGen shall have the right, upon thirty (30) days prior notice to Licensor,
to prepare, file, prosecute and maintain such patent applications and patents
in such countries as it deems appropriate, and conduct any interferences,
re-examinations, reissues or oppositions, at its sole expense, using patent
counsel of its choice with respect to the Licensed Patents.

6.3           Copies.  Upon request by SuperGen, Licensor shall
promptly provide to SuperGen a copy of any patent applications within the
Licensed Patents filed by Licensor during the term of this Agreement and all
material documents received from or sent to any patent office relating thereto
which relate to the scope, term, maintenance, validity, or enforceability of
any of the Licensed Patents, or any challenge to or change to any of the
preceding.

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6.4           Patent Term Extensions.  With respect to any patent within the
Licensed Patents, Licensor will designate SuperGen or its designee as its agent
for obtaining an extension of such patent or governmental equivalent which
extends the exclusivity of any of the patent subject matter where available in
any country in the world or if not feasible, at SuperGen’s option, permit
SuperGen to file in Licensor’s name or diligently obtain such extension for
SuperGen or its Sublicensee(s), at SuperGen’s expense.  Furthermore, Licensor shall provide
reasonable assistance to facilitate SuperGen’s or its Sublicensees’ efforts to
obtain any such extension.

6.5           Enforcement.  If either party hereto becomes aware that
any Licensed Patents are being or have been infringed by any third party or are
subject to a declaratory judgment action such party shall promptly notify the
other party hereto in writing describing the facts relating thereto in
reasonable detail.

6.5.1        SuperGen.  SuperGen shall have the initial right, but
not obligation, to institute, prosecute and control any such action, suit or
proceeding (an “Action”) at its expense, using legal counsel acceptable to
Licensor, and Licensor shall cooperate with SuperGen in connection with any
such Action, at SuperGen’s expense; provided, SuperGen may not enter into any
settlement which admits that any of the Licensed Patents is invalid or
unenforceable.  Any amounts recovered
from third parties in any such Action shall be used first to reimburse SuperGen
and to Licensor, if applicable, for their costs and expenses associated with
such Action (including, without limitation, attorney and expert fees), and the
remainder shall be the property of SuperGen.

6.5.2        Licensor.  In the event SuperGen fails to initiate or
defend any Action involving the Licensed Patents within one (1) year of
receiving notice of any alleged infringement, Licensor shall have the right,
but not the obligation, to initiate such an Action, at its expense, using legal
counsel of its choice; provided, Licensor may not enter into any settlement
which admits that any of the Licensed Patents are invalid or
unenforceable.  Any amounts recovered
from third parties in any such Action shall be used first to reimburse Licensor
and to SuperGen, if applicable,  for
their costs and expenses associated with such Action (including, without
limitation, attorney and expert fees), and the remainder shall be the property
of Licensor.

6.6           Defense.  If SuperGen, its Sublicensee, distributor or
other customer is sued by a third party charging infringement of patent rights
where the infringing action or product involves the development, manufacture,
use, distribution or sale of a Licensed Product, SuperGen will promptly notify
Licensor.  As between the parties to
this Agreement, SuperGen will be entitled to control the defense in any such
action(s) and withhold further payments of the royalties related to such
Licensed Product in the country of suit otherwise payable to Licensor pending
the final judgment or settlement. 
Licensor agrees to reimburse to SuperGen the legal defense costs and
attorney fees incurred in such infringement suit(s) to the extent that such
amounts do not exceed the total sum paid by SuperGen to Licensor under this
Agreement.  If SuperGen is required to
pay a royalty, damages, or other amount to a third party for activities
involving the development, manufacture, use, distribution or sale of a Licensed
Product as a result of a final judgment or settlement, such amounts shall be
reimbursed to SuperGen by Licensor to the extent that such amounts do not
exceed the total sum paid by SuperGen to Licensor under this Agreement.  If SuperGen is required to take a license
and pay a royalty or other amount to a third party to continue to develop,
manufacture, use, distribute 

-11-

 

or sell a Licensed Product as a result of a
final judgment or settlement, such amounts may be deducted from the royalties
payable to Licensor hereunder.

6.7           Cooperation.  In any suit, action or other proceeding in
connection with enforcement and/or defense of the Licensed Patents, Licensor
shall cooperate fully, including without limitation by joining as a party
plaintiff and executing such documents as SuperGen may reasonably request.  Furthermore, upon the request of SuperGen,
Licensor shall make available at reasonable times and under appropriate
conditions all relevant records, papers, information, samples and other similar
materials in Licensor’s possession.

6.8           Packaging.  SuperGen agrees that all Licensed Products
sold by SuperGen will be marked with the patent number of the applicable
Licensed Patent hereunder in accordance with each country’s patent laws.

ARTICLE 7

INDEMNIFICATION;
INSURANCE

7.1           SuperGen.  SuperGen shall defend and hold Licensor and
its trustees, officers, agents, faculty, employees and students harmless as
against any judgments, fees, expenses, liabilities or other costs arising from
or incidental to any product liability or other lawsuit, claim, demand or other
action (a “Liability”) brought by a third party as a consequence of the
practice of  the Licensed  Patents or the sale of the Licensed Product
(together the “Licensed Subject Matter”) by SuperGen, whether or not Licensor is
named as a party defendant in any lawsuit, except to the extent such Liability
is caused by the negligence or willful misconduct of Licensor.  Practice of Licensed Subject Matter, by a
Sublicensee shall be considered SuperGen’s practice of said Licensed Subject
Matter for purposes of this Section 7.1.

7.2           Licensor.  Licensor shall defend and hold SuperGen and
its directors, officers, employees and agents harmless as against any
judgments, fees, expenses, liabilities, or other costs arising from or incidental
to any product liability or other lawsuit, claim, demand or other action (also
a “Liability”) resulting from any claim, suit or proceeding brought by a third
party against any of the foregoing entities, arising out of or in connection
with any misrepresentation with regard to, or breach of any of, the
representations and warranties of Licensor set forth in Article 8, or to the
extent due to the negligence or willful misconduct of Licensor.

7.3           Procedure.  In the event that any indemnitee intends to
claim indemnification under this Article 7 it shall promptly notify the other
party in writing of such potential Liability. 
The indemnifying party shall have the right to control the defense
thereof.  The affected indemnitees shall
cooperate fully with the indemnifying party and its legal representatives in
the investigation and conduct of any Liability covered by this Article 7.  Notwithstanding the foregoing, neither party
shall have indemnity obligations for any claim if the indemnitee seeking
indemnification makes any admission, settlement or other communication
regarding such claim without the prior written consent of the indemnifying
party.

 

-12-

 

ARTICLE 8

REPRESENTATIONS
AND WARRANTIES

8.1           Licensor.  Licensor represents and warrants that:  (i) it is a corporation duly organized
validly existing and in good standing under the laws of Delaware; (ii) the
execution, delivery and performance of this Agreement have been duly authorized
by all necessary corporate action on the part of Licensor; (iii) to the
Licensor’s best knowledge, Licensor is either the sole and exclusive owner of
all right, title and interest in and to or is the exclusive licensee of the
Licensed Patents; (iv) the Licensed Patents are valid and enforceable; (v) the
Licensed Patents are not invalid or non-enforceable in view of any references
currently known to Licensor;  (vi)
Licensor has the right to grant the rights and licenses granted herein; (vii)
to the best of the Licensor’s knowledge, the Licensed Subject Matter is free
and clear of any lien, encumbrance, security interest or restriction on
license; (viii) to Licensor’s best knowledge, the practice of the Licensed
Subject Matter will not infringe intellectual property of third parties; (ix)
it has not previously granted, and will not grant during the term of this
Agreement, any right, license or interest in or to the Licensed Subject Matter,
or any portion thereof, inconsistent with the license granted to SuperGen
herein; (x) to the best of Licensor’s knowledge, there are no threatened or
pending actions, suits, investigations, claims or proceedings in any way
relating to the Licensed Subject Matter; (xi) that the list of patents and
patent applications in Exhibit 1 is a complete and accurate list of all patents
and patent applications owned or controlled by Licensor that relate to the
Field; (xii) that the list of agreements included in this Agreement as Exhibit
3 is a complete and accurate list of agreements entered into by Licensor regarding
the Licensed Subject Matter; (xiii) that the agreements included in this
Agreement as Exhibit 3 are true copies of all original agreements entered into
by Licensor regarding the Licensed Subject Matter; (xiv) that the licensing of
the Subject Matter of the agreements included in this Agreement as Exhibit 3,
and practice of the Subject Matter by SuperGen, is consistent with any
obligations undertaken by Licensor as a condition of entering into such
agreements, (xv) the Field of the license granted in Article 2 is included
within the licenses granted to Licensor by the University of Texas and Beth
Israel Deaconess Medical Center, and (xvi) Licensor warrants that it will
maintain and avoid breach of the licenses that are the subject of this
Agreement.

8.2           SuperGen.  SuperGen represents and warrants that: (i)
it is a corporation duly organized validly existing and in good standing under
the laws of the State of Delaware and (ii) the execution, delivery and
performance of this Agreement have been duly authorized by all necessary
corporate action on the part of SuperGen.

8.3           Disclaimer of Warranties.  Licensor will not, under the provisions of
this Agreement or otherwise, have any direct or indirect control over the
manner in which SuperGen, or its sublicensees or those operating on its behalf,
practice the Licensed Subject Matter, or any use of Licensed Products by any
party.  LICENSED SUBJECT MATTER IS
PROVIDED “AS IS,” AND LICENSOR MAKES NO REPRESENTATION OR WARRANTY WITH RESPECT
TO THE PERFORMANCE OF LICENSED PRODUCT(S) INCLUDING THEIR SAFETY,
EFFECTIVENESS, OR COMMERCIAL VIABILITY. 
LICENSOR DISCLAIMS ALL WARRANTIES WITH REGARD TO LICENSED PRODUCTS,
INCLUDING, BUT NOT LIMITED TO, ALL WARRANTIES, EXPRESSED OR IMPLIED, OF
MERCHANTABILITY AND FITNESS FOR ANY PARTICULAR PURPOSE.  SuperGen expressly disclaims all liability 

-13-

 

arising from Licensor’s obligations,
including but not limited to financial payments and royalty reports, to any
person or entity from whom Licensor may have licensed the Licensed Patents.

ARTICLE 9

ARBITRATION

Licensor
and SuperGen agree that any dispute or controversy arising out of or relating
to this Agreement shall be settled by binding arbitration in San Francisco,
California, United States of America, under the then-current Commercial
Agreement Arbitration Rules of the American Arbitration Association by one (1)
arbitrator appointed in accordance with such Rules.  The arbitrator shall determine what discovery will be permitted,
based on the principle of limiting the cost and time which the parties must
expend on discovery; provided, the arbitrator shall permit such discovery as
they deem necessary to achieve an equitable resolution of the dispute.  The decision and/or award rendered by the
arbitrator shall be written, final and non-appealable and may be entered in any
court of competent jurisdiction.  The
parties agree that, any provision of applicable law notwithstanding, they will
not request, and the arbitrator shall have no authority to award, punitive or
exemplary damages against any party. 
The costs of any arbitration, including administrative fees and fees of
the arbitrator, shall be shared equally by the parties.  Each party shall bear the cost of its own
attorney and expert fees.

ARTICLE 10

GENERAL

10.1         Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of California, without
reference to principles of conflicts of laws.

10.2         Independent Contractors.  The relationship of the parties hereto is
that of independent contractors.  The
parties hereto are not deemed to be agents, partners or joint ventures of the
other for any purpose as a result of this Agreement or the transactions contemplated
thereby.

10.3         Assignment.  This Agreement shall not be assignable by
Licensor without SuperGen’s prior written consent, not to be unreasonably
withheld; provided, however, that Licensor may assign this Agreement without
such consent in connection with a transfer of all or substantially all of its
assets to which this Agreement relates whether by sale, merger, operation of
law or otherwise.  This Agreement is not
assignable by SuperGen without Licensor’s prior written consent, which shall
not be unreasonably withheld; provided, however, that SuperGen may assign this
Agreement without such consent in connection with a transfer of all or
substantially all of its assets to which this Agreement relates whether by
sale, merger, operation of law or otherwise. 
This Agreement shall be binding upon and inure to the benefit of the
parties and their successors and assigns.

10.4         Right to Develop Independently.  Nothing in this Agreement will impair
SuperGen’s right to independently acquire, license, develop for itself, or have
others develop for it, intellectual 

-14-

 

property and technology performing similar
functions as the Licensed Subject Matter or to market and distribute products
based on such other intellectual property and technology.

10.5         Notices.  Any required notices hereunder shall be
given in writing by certified mail or overnight express delivery service at the
address of each party set forth below, or to such other address as either party
may indicate on its behalf by written notice.

If to SuperGen:

SuperGen, Inc.

4140 Dublin Blvd, Suite 200

Dublin, California 94568

Attention:  Joseph Rubinfeld, Ph.D., President & CEO

With a copy to:

Wilson Sonsini Goodrich & Rosati

650 Page Mill Rd.

Palo Alto, CA 94304

Attn: John
Roos

If to Licensor:

Peregrine Pharmaceuticals, Inc.

14282 Franklin Ave.

Tustin, CA 92780-7017

Attn:  President & CEO

Notice
shall be deemed served when delivered or, if delivery is not accomplished by
reason or some fault of the addressee, when tendered.

10.6         Force Majeure.  Neither party shall lose any rights
hereunder or be liable to the other party for damages or losses (except for
payment obligations) on account of failure of performance by the defaulting
party if the failure is occasioned by war, strike, fire, Act of God, earthquake,
flood, lockout, embargo, governmental acts or orders or restrictions, failure
of suppliers, or any other reason where failure to perform is beyond the
reasonable control and not caused by the negligence, intentional conduct or
misconduct of the non-performing party and the non-performing party has exerted
all reasonable efforts to avoid or remedy such force majeure; provided,
however, that in no event shall a party be required to settle any labor dispute
or disturbance.

10.7         Compliance with Laws.  Each party shall furnish to the other party
any information related to the subject matter of this Agreement requested or
required by that party during the term of this Agreement or any extensions
hereof to enable that party to comply with the requirements of any U.S. or
foreign federal, state and/or government agency.

10.8         LIMITATION OF LIABILITY.  NEITHER PARTY SHALL BE LIABLE TO THE OTHER
FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL OR INDIRECT DAMAGES 

-15-

 

ARISING OUT OF THE PERFORMANCE OF THIS
AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY.

10.9         Further Assurances.  At any time or from time to time on and
after the date of this Agreement, Licensor shall at the written request of
SuperGen (i) deliver to SuperGen such records, data or other documents
consistent with the provisions of this Agreement, (ii) execute, and deliver or
cause to be delivered, all such consents, documents or further instruments of
transfer or license, and (iii) take or cause to be taken all such actions, as
SuperGen may reasonably deem necessary or desirable in order for SuperGen to
obtain the full benefits of this Agreement and the transactions contemplated
hereby.

10.10       Severability.  In the event that any provisions of this Agreement
are determined to be invalid or unenforceable by a court of competent
jurisdiction, the remainder of the Agreement shall remain in full force and
effect without said provision.  The
parties shall in good faith negotiate a substitute clause for any provision
declared invalid or unenforceable, which shall most nearly approximate the
intent of the parties in entering this Agreement.

10.11       Waiver.  The failure of a party to enforce any provision of the Agreement
shall not be construed to be a waiver of the right of such party to thereafter
enforce that provision or any other provision or right.

10.12       Entire Agreement; Amendment.  This Agreement sets forth the entire
agreement and understanding of the parties with respect to the subject matter
hereof, and supersedes all prior discussions, agreements and writings in
relating thereto.  This Agreement may
not be altered, amended or modified in any way except by a writing signed by
both parties.

10.13       Counterparts.  This Agreement may be executed in two counterparts,
each of which shall be deemed an original and which together shall constitute
one instrument.

 

-16-

 

IN
WITNESS WHEREOF, Licensor and SuperGen have executed this Agreement by their
respective duly authorized representatives.

	
  PEREGRINE
  PHARMACEUTICALS, INC.

  	
   

  	
  SUPERGEN, INC.

  
	
   

  	
   

  	
   

  
	
  (“Licensor”)

  	
   

  	
  (“SuperGen”)

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  EDWARD J. LEGERE

  	
   

  	
  By:

  	
  /s/
  JOSEPH RUBINFELD

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Name: Edward J. Legere

  	
   

  	
   

  	
  Dr. Joseph Rubinfeld

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title: President & CEO

  	
   

  	
   

  	
  President & CEO

  

-17-

 

Exhibit 1

List of Patents and Patent Applications

[***]

 

 

 

Exhibit 2

SUPERGEN, INC.

INVESTMENT REPRESENTATION STATEMENT

 

	
  PURCHASER

  	
  :

  	
  Peregrine Pharmaceuticals, Inc.
  (“Peregrine”)

  
	
  COMPANY

  	
  :

  	
  SuperGen, Inc. (“Company”)

  
	
  SECURITY

  	
  :

  	
  Common Stock

  
	
  NUMBER OF SHARES

  	
  :

  	
   

  
	
  DATE

  	
  :

  	
  _______________, _____

  

In
connection with the purchase of the above-listed Securities, Peregrine
represents to the Company the following:

(a)           Peregrine is an accredited investor
within the meaning of Rule 501 under the Securities Act of 1933, as amended
(the “Securities Act”) and has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the
purchase of the Securities.

(b)           Peregrine is aware of the Company’s
business affairs and financial condition, and has acquired sufficient
information about the Company to reach an informed and knowledgeable decision
to acquire the Securities.  In making
the decision to acquire the Securities, Peregrine is not relying on
representations of any officer, director, stockholder or agent of the
Company.  Peregrine is purchasing these
Securities for its own account for investment purposes only and not with a view
to, or for the resale in connection with, any “distribution” thereof for
purposes of the Securities Act.

(c)           Peregrine understands that the
Securities have not been registered under the Securities Act in reliance upon a
specific exemption therefrom, and that reliance by the Company on such an
exemption is predicated in part on the representations set forth in this
letter.

(d)           Peregrine further understands that
the Securities must be held indefinitely unless subsequently registered under
the Securities Act or unless an exemption from registration is otherwise
available.  Moreover, Peregrine
understands that the Company is under no obligation to register the Securities
other than the obligation undertaken in the License Agreement with Peregrine.  In addition, Peregrine understands that the
certificate evidencing the Securities will be imprinted with a legend which
prohibits the transfer of the Securities unless they are registered or such
registration is not required in the opinion of counsel for Peregrine
satisfactory to the Company or unless the Company receives a no-action letter
from the Securities and Exchange Commission.

-2-

 

(e)           Peregrine is familiar with the
provisions of Rule 144, promulgated under the Securities Act, which, in
substance, permits limited public resale of “restricted securities” acquired,
directly or indirectly, from the issuer thereof (or from an affiliate of such
issuer), in a non-public offering subject to the satisfaction of certain
conditions, including, among other things: 
(1) the resale occurring not less than one year after the later of the
date the securities were sold by the Company or the date they were sold by an
affiliate of the Company, within the meaning of Rule 144; and, in the case of
an affiliate, or of a non-affiliate who has held the securities less than two
years, (2) the availability of certain public information about the Company,
(3) the sale being made through a broker in an unsolicited “broker’s
transaction” or in transactions directly with a market maker (as said term is
defined under the Securities Exchange Act of 1934), and (4) the amount of
securities being sold during any three month period not exceeding the specified
limitations stated therein, if applicable.

(f)            Peregrine further understands that
at the time Peregrine wishes to sell the Securities there may be no public
market upon which to make such a sale, and that, even if such a public market
exists, the Company may not be satisfying the current public information requirements
of Rule 144, and that, in such event, Peregrine would be precluded from selling
the Securities under Rule 144 even if the one-year minimum holding period had
been satisfied.

(g)           Peregrine further understands that in
the event all of the applicable requirements of Rule 144 are not satisfied,
registration under the Securities Act, compliance with Regulation A, or some
other registration exemption will be required; and that, notwithstanding the
fact that Rule 144 is not exclusive, the Staff of the SEC has expressed its
opinion that persons proposing to sell private placement securities other than
in a registered offering and otherwise than pursuant to Rule 144 will have a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own
risk.

 

	
   

  	
  Peregrine Pharmaceuticals, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

  	
   

  

-3-

 

Exhibit 3

Licenses granted to Techniclone/Peregrine

[***]

 

 

 

 

Exhibit 4

Peregrine Pharmaceuticals, Inc.

INVESTMENT REPRESENTATION STATEMENT

 

	
  PURCHASER

  	
  :

  	
  SuperGen, Inc. (“SuperGen”)

  
	
  COMPANY

  	
  :

  	
  Peregrine Pharmaceuticals, Inc. (“Company”)

  
	
  SECURITY

  	
  :

  	
  Common Stock

  
	
  NUMBER OF SHARES

  	
  :

  	
   

  
	
  DATE

  	
  :

  	
  ________________, _____

  

In
connection with the purchase of the above-listed Securities, SuperGen
represents to the Company the following:

(a)           SuperGen is an accredited investor
within the meaning of Rule 501 under the Securities Act of 1933, as amended
(the “Securities Act”) and has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of the
purchase of the Securities.

(b)           SuperGen is aware of the Company’s
business affairs and financial condition, and has acquired sufficient
information about the Company to reach an informed and knowledgeable decision
to acquire the Securities.  In making
the decision to acquire the Securities, SuperGen is not relying on
representations of any officer, director, stockholder or agent of the
Company.  SuperGen is purchasing these
Securities for its own account for investment purposes only and not with a view
to, or for the resale in connection with, any “distribution” thereof for
purposes of the Securities Act.

(c)           SuperGen understands that the
Securities have not been registered under the Securities Act in reliance upon a
specific exemption therefrom, and that reliance by the Company on such an
exemption is predicated in part on the representations set forth in this
letter.

(d)           SuperGen further understands that the
Securities must be held indefinitely unless subsequently registered under the
Securities Act or unless an exemption from registration is otherwise
available.  Moreover, SuperGen
understands that the Company is under no obligation to register the Securities
other than the obligation undertaken in the License Agreement with SuperGen.  In addition, SuperGen understands that the
certificate evidencing the Securities will be imprinted with a legend which
prohibits the transfer of the Securities unless they are registered or such
registration is not required in the opinion of counsel for SuperGen
satisfactory to the Company or unless the Company receives a no-action letter
from the Securities and Exchange Commission.

(e)           SuperGen is familiar with the
provisions of Rule 144, promulgated under the Securities Act, which, in
substance, permits limited public resale of “restricted securities” acquired, 

 

directly or indirectly, from the issuer
thereof (or from an affiliate of such issuer), in a non-public offering subject
to the satisfaction of certain conditions, including, among other things:  (1) the resale occurring not less than one
year after the later of the date the securities were sold by the Company or the
date they were sold by an affiliate of the Company, within the meaning of Rule
144; and, in the case of an affiliate, or of a non-affiliate who has held the
securities less than two years, (2) the availability of certain public
information about the Company, (3) the sale being made through a broker in an
unsolicited “broker’s transaction” or in transactions directly with a market
maker (as said term is defined under the Securities Exchange Act of 1934), and
(4) the amount of securities being sold during any three month period not
exceeding the specified limitations stated therein, if applicable.

(f)            SuperGen further understands that at
the time SuperGen wishes to sell the Securities there may be no public market
upon which to make such a sale, and that, even if such a public market exists,
the Company may not be satisfying the current public information requirements
of Rule 144, and that, in such event, SuperGen would be precluded from selling
the Securities under Rule 144 even if the one-year minimum holding period had
been satisfied.

(g)           SuperGen further understands that in
the event all of the applicable requirements of Rule 144 are not satisfied,
registration under the Securities Act, compliance with Regulation A, or some
other registration exemption will be required; and that, notwithstanding the
fact that Rule 144 is not exclusive, the Staff of the SEC has expressed its
opinion that persons proposing to sell private placement securities other than
in a registered offering and otherwise than pursuant to Rule 144 will have a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own
risk.

 

	
   

  	
  SuperGen, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Dr. Joseph Rubinfeld

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title: President & CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date: February 13, 2001

  

 

-2-

 

Exhibit 5

REGISTRATION RIGHTS AGREEMENT

This
Registration Rights Agreement (the “Agreement”) is made as of February 13,
2001, (the “Effective Date”) between Peregrine Pharmaceuticals, Inc. (the
“Company”) and SuperGen, Inc. (the “Purchaser”).

SECTION 1

Restrictions
on Transferability of Securities; 

Compliance with Securities Act; Registration Rights

1.1          Certain
Definitions. 
As used in this Agreement, the following terms shall have the following
respective meanings:

“Commission”
shall mean the Securities and Exchange Commission or any other federal agency
at the time administering the Securities Act.

“Common
Stock” shall mean Company Common Stock, no par value per share.

“Holder”
shall mean (i) the Purchaser and (ii) any person holding Registrable Securities
to whom the rights under this Section 1 have been transferred in accordance
with Section 1.13 hereof.

“License
Agreement” shall mean the License Agreement entered into between the
Company and Purchaser dated February 13, 2001.

“Registrable
Securities” means the Shares until such time that such securities have been
(i) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction, or (ii) sold or are, in the
opinion of counsel for the Company, available for sale in a single transaction
exempt from the registration and prospectus delivery requirements of the
Securities Act so that all transfer restrictions and restrictive legends with
respect thereto are removed upon the consummation of such sale.

The
terms “register,” “registered” and “registration” refer to
a registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.

“Registration
Expenses” shall mean all expenses, except as otherwise stated below,
incurred by the Company in complying with Section 1.5 hereof, including,
without limitation, all registration, qualification and filing fees, printing
expenses, escrow fees, fees and disbursements of counsel for the Company, blue
sky fees and expenses, the expense of any special audits incident to or
required by any such registration (but excluding the compensation of regular
employees of the Company which shall be paid in any event by the Company).

 

“Restricted
Securities” shall mean the securities of the Company required to bear the
legend set forth in Section 1.3 hereof.

“Securities
Act” shall mean the Securities Act of 1933, as amended, or any similar
federal statute and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.

“Selling
Expenses” shall mean all underwriting discounts, selling commissions and
stock transfer taxes applicable to the securities registered by the Holders
and, except as set forth above, all reasonable fees and disbursements of
counsel for any Holder.

“Shares”
shall mean the shares of Common Stock issued to the Purchaser pursuant to the
License Agreement and any other securities issued in respect of such securities
upon any stock split, stock dividend, recapitalization, merger, consolidation
or similar event.

1.2          Restrictions
on Transferability.  The Shares shall not be sold, assigned, transferred or pledged
except upon the conditions specified in this Section 1.  The Holder will cause any proposed
purchaser, assignee, transferee, or pledgee of any such shares held by the
Holder to agree to take and hold such securities subject to the provisions and
upon the conditions specified in this Section 1.

1.3          Restrictive
Legend. 
Each certificate representing Shares and any other securities issued in
respect of the Shares upon any stock split, stock dividend, recapitalization,
merger, consolidation or similar event, shall (unless otherwise permitted by
the provisions of Section 1.4 below) be stamped or otherwise imprinted with a
legend in the following form (in addition to any legend required under
applicable state securities laws):

THE SHARES
REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  SUCH SHARES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY
ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

Each
Holder consents to the Company making a notation on its records and giving
instructions to any transfer agent of the Common Stock in order to implement
the restrictions on transfer established in this Section 1.

1.4          Restrictions
on Transfer; Notice of Proposed Transfers.  The holder of each certificate representing
Restricted Securities by acceptance thereof agrees to comply in all respects
with the provisions of this Section 1.4. 
Prior to any proposed sale, assignment, transfer or pledge of any
Restricted Securities (other than (i) a transfer not involving a change in
beneficial ownership, (ii) any transfer by any Holder to (A) any individual or
entity controlled by, controlling, 

-2-

 

or under common control with, such Holder or
(B) any entity with respect to which such Holder (or any person controlled by,
controlling, or under common control with, such Holder) has the power to direct
investment decisions, or (iv) in transactions in compliance with Rule 144), and
unless there is in effect a registration statement under the Securities Act
covering the proposed transfer, the holder thereof shall give written notice to
the Company of such holder’s intention to effect such transfer, sale,
assignment or pledge.  Each such notice
shall describe the manner and circumstances of the proposed transfer, sale,
assignment or pledge in sufficient detail, and shall be accompanied, at such
holder’s expense by either (i) a written opinion of legal counsel who shall be,
and whose legal opinion shall be, reasonably satisfactory to the Company
addressed to the Company, to the effect that the proposed transfer of the
Restricted Securities may be effected without registration under the Securities
Act, or (ii) a “no action” letter from the Commission to the effect that the
transfer of such securities without registration will not result in a
recommendation by the staff of the Commission that action be taken with respect
thereto, whereupon the holder of such Restricted Securities shall be entitled
to transfer such Restricted Securities in accordance with the terms of the
notice delivered by the holder to the Company. 
Each certificate evidencing the Restricted Securities transferred as
above provided shall bear, except if such transfer is made pursuant to Rule
144, the appropriate restrictive legend set forth in Section 1.3 above, except
that such certificate shall not bear such restrictive legend if in the opinion
of counsel for such holder and the Company such legend is not required in order
to establish compliance with any provision of the Securities Act.  Notwithstanding the foregoing, so long as an
executive officer or director of the Holder serves as an executive officer or
director of the Company, the Holder agrees to not sell or transfer the
Registrable Securities during periods outside of the trading windows applicable
to the officers of the Company as set forth in the Company’s Insider Trading
Program adopted by the Company’s Board of Directors.

1.5          Mandatory
Registration. 
Within one hundred twenty (120) business days after the Effective Date,
the Company shall file with the Commission a registration statement (the
“Registration Statement”) on an appropriate form for registering for resale by
the Holder the Shares and the Company shall use its best efforts to cause the
Registration Statement to be declared effective no later than 120 days after
the issuance of the Shares (the “Required Effective Date”) pursuant to the terms
of the License Agreement.

1.6          Expenses
of Registration. 
All Registration Expenses incurred in connection with all registrations
pursuant to Section 1.5 shall be borne by the Company.  Unless otherwise stated, all Selling
Expenses relating to securities registered on behalf of the Holders and all
other Registration Expenses shall be borne by the Holders of such securities
pro rata on the basis of the number of shares so registered.

1.7          Registration
Procedures. 
In the case of each registration, qualification or compliance effected
by the Company pursuant to this Section 1, the Company will keep each Holder
advised in writing as to the initiation of each registration, qualification and
compliance and as to the completion thereof. 
At its expense the Company will:

(a)           Prepare and file with the Commission
a registration statement with respect to such securities and use its best
efforts to cause such registration statement to become effective as soon as
possible after the filing thereof, and keep the Registration Statement
effective pursuant to Rule 415 at all times, subject to Section 1.8, until such
date as is the earlier of (i) the date 

-3-

 

on which all Registrable Securities have been
sold by each Holder, and (ii) the date on which the Registration Rights
terminate as set forth in Section 1.15; and

(b)           Furnish to the Holders participating
in such registration and to the underwriters of the securities being registered
such reasonable number of copies of the registration statement, preliminary
prospectus, final prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering of such
securities.

1.8          Suspension
of Registration. 
The Company shall promptly notify the Holders of (i) the issuance by the
SEC of a stop order suspending the effectiveness of the Registration Statement,
(ii) the happening of any event, of which the Company has knowledge, as a
result of which the prospectus included in the Registration Statement, as then
in effect, includes an untrue statement of a material fact or omission to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and (iii) the occurrence or existence of any
pending corporate development that, in the reasonable discretion of the
Company, makes it appropriate to suspend the availability of the Registration
Statement, to comply with SEC rules.  In
each case the Company shall use reasonable efforts to promptly prepare a
supplement or amendment to the Registration Statement to correct such untrue
statement or omission, and deliver such number of copies of such supplement or
amendment to each Holder as such Holder may reasonably request; provided that,
the Company may delay to the extent permitted by law the disclosure of material
non-public information concerning the Company 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”).  The
Company shall promptly notify the Holders in writing of the existence of an
Allowed Delay and shall advise the Holders in writing to cease all sales under
the Registration Statement until the end of the Allowed Delay.

1.9          Indemnification.

(a)           The Company will indemnify each
Holder, each of its officers and directors and partners, and each person
controlling such Holder within the meaning of Section 15 of the Securities Act,
with respect to which registration, qualification or compliance has been effected
pursuant to this Section 1, and each underwriter, if any, and each person who
controls any underwriter within the meaning of Section 15 of the Securities
Act, against all expenses, claims, losses, damages or liabilities (or actions
in respect thereof), including any of the foregoing incurred in settlement of
any litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances in which they were
made, not misleading, or any violation by the Company of the Securities Act,
the Exchange Act, state securities law or any rule or regulation promulgated
under such laws applicable to the Company in connection with any such
registration, qualification or compliance, and within a reasonable period the
Company will reimburse each such Holder, each of its officers and directors,
and each person controlling such Holder, each such underwriter and each person
who controls any such underwriter, for any legal and any other expenses
reasonably incurred in connection with investigating, preparing or defending
any such 

-4-

 

claim, loss, damage, liability or action;
provided that the Company will not be liable in any such case to the extent
that any such claim, loss, damage, liability or expense arises out of or is
based on any untrue statement or omission or alleged untrue statement or omission,
made in reliance upon and in conformity with written information furnished to
the Company by an instrument duly executed by such Holder, controlling person
or underwriter and stated to be specifically for use therein.

(b)           Each Holder will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify the
Company, each of its directors and officers, each underwriter, if any, of the
Company’s securities covered by such a registration statement, each person who
controls the Company or such underwriter within the meaning of Section 15 of
the Securities Act, and each other such Holder, each of its officers and
directors and each person controlling such Holder within the meaning of Section
15 of the Securities Act, against all claims, losses, damages and liabilities
(or actions in respect thereof) arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus, offering circular or other document, or any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
within a reasonable period will reimburse the Company, such Holders, such
directors, officers, persons, underwriters or control persons for any legal or
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, in each case to
the extent, but only to the extent, that such untrue statement (or alleged
untrue statement) or omission (or alleged omission) is made in such
registration statement, prospectus, offering circular or other document in reliance
upon and in conformity with written information furnished to the Company by an
instrument duly executed by such Holder and stated to be specifically for use
therein.  Notwithstanding the foregoing,
the liability of each Holder under this subsection (b) shall be limited in an
amount equal to the gross proceeds before expenses and commissions to each
Holder received for the shares sold by such Holder, unless such liability
arises out of or is based on willful misconduct by such Holder.

(c)           Each party entitled to
indemnification under this Section 1.10 (the “Indemnified Party”) shall give
notice to the party required to provide indemnification (the “Indemnifying
Party”) promptly after such Indemnified Party has actual knowledge of any claim
as to which indemnity may be sought, and shall permit the Indemnifying Party to
assume the defense of any such claim or any litigation resulting therefrom,
provided that counsel for the Indemnifying Party, who shall conduct the defense
of such claim or litigation, shall be approved by the Indemnified Party (whose
approval shall not unreasonably be withheld), and the Indemnified Party may
participate in such defense at such party’s expense, 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 under this Section 1
unless the failure to give such notice is materially prejudicial to an
Indemnifying Party’s ability to defend such action and provided further, that
the Indemnifying Party shall not assume the defense for matters as to which
there is a conflict of interest or separate and different defenses.  No Indemnifying Party, in the defense of any
such claim or litigation, shall, except with the consent of each Indemnified
Party, consent to entry of any judgment or enter into any settlement which 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
to such claim or litigation.

-5-

 

1.10        Information
by Holder. 
The Holder or Holders of Registrable Securities included in any
registration shall furnish to the Company such information regarding such
Holder or Holders, the Registrable Securities held by them and the distribution
proposed by such Holder or Holders as the Company may request in writing and as
shall be required in connection with any registration, qualification or
compliance referred to in this Section 1.

1.11        Rule
144 Reporting. 
With a view to making available the benefits of certain rules and
regulations of the Commission which may at any time permit the sale of the
Restricted Securities to the public without registration, after such time as a
public market exists for the Common Stock of the Company, the Company agrees to
use its best efforts to:

(a)           Make and keep public information
available, as those terms are understood and defined in Rule 144 under the
Securities Act, at all times after the effective date that the Company becomes
subject to the reporting requirements of the Securities Act or the Exchange
Act;

(b)           Use its best efforts to file with the
Commission in a timely manner all reports and other documents required of the
Company under the Securities Act and the Exchange Act (at any time after it has
become subject to such reporting requirements); and

(c)           So long as a Holder owns any
Restricted Securities to furnish to the Holder forthwith upon request a written
statement by the Company as to its compliance with the reporting requirements
of said Rule 144, and of the Securities Act and the Exchange Act, a copy of the
most recent annual or quarterly report of the Company, and such other reports
and documents of the Company and other information in the possession of or
reasonably obtainable by the Company as the Holder may reasonably request in
availing itself of any rule or regulation of the Commission allowing the Holder
to sell any such securities without registration.

1.12        Transfer
of Registration Rights.  The rights to cause the Company to register securities granted
Holders under Section 1.5 may be assigned to a transferee or assignee
reasonably acceptable to the Company which acquires at least 100,000 shares of
Registrable Securities in connection with any transfer or assignment of
Registrable Securities by the Holders.

SECTION 2

Miscellaneous

2.1          Governing
Law.  This
Agreement shall be governed in all respects by the internal laws of the State
of California.

2.2          Survival.  The covenants and agreements made herein
shall survive the closing of the transactions contemplated hereby.

2.3          Successors
and Assigns. 
Except as otherwise provided herein, the provisions hereof shall inure
to the benefit of, and be binding upon, the successors, assigns, heirs, executors
and administrators of the parties hereto.

-6-

 

2.4          Entire
Agreement; Amendment.  This Agreement and the License Agreement constitute the full and
entire understanding and agreement between the parties with regard to the
subjects hereof and thereof, and no party shall be liable or bound to any other
party in any manner by any warranties, representations or covenants except as
specifically set forth herein or therein. 
Except as expressly provided herein, neither this Agreement nor any term
hereof may be amended, waived, discharged or terminated other than by a written
instrument signed by the party against whom enforcement of any such amendment,
waiver, discharge or termination is sought; provided, however, that holders of
a majority of the Registrable Securities may, with the Company’s prior written
consent, waive, modify or amend on behalf of all holders, any provisions
hereof.

2.5          Notices,
etc.  All
notices and other communications required or permitted hereunder shall be in
writing and shall be mailed by registered or certified mail, postage prepaid,
or otherwise delivered by hand or by messenger, addressed (a) if to a Holder,
at such address as such Holder shall have furnished the Company in writing, or,
until any such holder so furnishes an address to the Company, then to and at
the address of the last Holder who has so furnished an address to the Company,
or (b) if to the Company, one copy should be sent to its address set forth on
the cover page of this Agreement and addressed to the attention of the
President, or at such other address as the Company shall have furnished to the
Holders.

Each
such notice or other communication shall for all purposes of this Agreement be
treated as effective or having been given when delivered if delivered
personally, or, if sent by mail, at the earlier of its receipt or 72 hours
after the same has been deposited in a regularly maintained receptacle for the
deposit of the United States mail, addressed and mailed as aforesaid.

2.6          Delays
or Omissions. 
Except as expressly provided herein, no delay or omission to exercise
any right, power or remedy accruing to any party to this Agreement upon any
breach or default of any other party under this Agreement, shall impair any
such right, power or remedy of such nondefaulting party nor shall it be
construed to be a waiver of any such breach or default, or an acquiescence
therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any
other breach or default theretofore or thereafter occurring.  Any waiver, permit, consent or approval of
any kind or character on the part of any party of any breach or default under
this Agreement, or any waiver on the part of any holder of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing.  All remedies, either under this Agreement or by law or otherwise
afforded to any party to this Agreement, shall be cumulative and not
alternative.

2.7          Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be enforceable against the parties
actually executing such counterparts, and all of which together shall
constitute one instrument.

2.8          Severability.  In the event that any provision of this
Agreement becomes or is declared by a court of competent jurisdiction to be
illegal, unenforceable or void, this Agreement shall continue in full force and
effect without said provision; provided that no such severability shall be
effective if it materially changes the economic benefit of this Agreement to
any party.

-7-

 

2.9          Titles
and Subtitles. 
The titles and subtitles used in this Agreement are used for convenience
only and are not considered in construing or interpreting this Agreement.

 

[Signature Page(s) Follow(s)]

 

 

 

 

 

 

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The
foregoing Agreement is hereby executed as of the date first above written.

 

	
   

  	
  “COMPANY”

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  “PURCHASER”

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   Dr.
  Joseph Rubinfeld

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
   
  President and CEO

  

 

[Signature Page to Registration Rights
Agreement]

 

 

 

 

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Exhibit 10.56  

	

 	
 	

AXS-One Inc.

301 Route 17 North

Rutherford, New Jersey 07070
	

 	
 	

Telephone:	
 	

201-935-3400	
 	

 
	 	 	Facsimile:	 	201-935-2742	 	 
	

 	
 	

October 21, 2002

	
 	

 

Mr. Matthew Hayden

President

Hayden Communications, Inc.

1401 Havens Drive, Suite 100

North Myrtle Beach, SC 29582 

Dear
Mr. Hayden: 

        This
letter will serve as an agreement between AXS-One Inc. ("AXS-One"), and Hayden Communications, Inc. ("Consultant") regarding
AXS-One's retention of Consultant to provide investor relations services to AXS-One ("Services"). 

          1.    (a)    Consultant
will provide, in a timely and professional manner, the Services to AXS-One as are described in  Exhibit A attached hereto and made a part hereof. In the event of a conflict between the terms of this
Agreement and the terms of  Exhibit A, this Agreement shall govern. 

                (b)    The
content and format of all communications between Consultant and third parties relating to AXS-One must be
approved in advance by the CEO of AXS-One or such AXS-One representatives as shall be designated by such CEO from time to time during the term hereof. Consultant will ensure
that all of its employees contacting third parties relating to AXS-One will conduct themselves at all times during such contacts in a manner that will reflect favorably on
AXS-One and its products and services. 

          2.    (a)    As
full and complete compensation and consideration for Consultant's Services hereunder, including, except as otherwise expressly set forth
in Paragraph 2(d) below, as full reimbursement for Consultant's expenses incurred in performing the Services, AXS-One shall (i) pay to Consultant a monthly service fee
("Fee") of $5,000 for each whole month during the actual term of this Agreement (Fees for partial months during the term shall be pro-rated), and (ii) issue to Consultant the
warrants to purchase AXS-One common stock as provided for in Paragraph 2(b) below. Each Fee shall be invoiced by Consultant to AXS-One on the first business day of the
month for which such Fee is payable, and Fees and permitted expenses shall be paid net 45 days following the date of AXS-One's receipt of a proper written invoice from Consultant. 

                (b)    In
addition to the Fees provided for in Paragraph 2(a) above, AXS-One shall, upon the expiration or
termination of the term of this Agreement, issue to Consultant warrant(s), substantially in the form of Exhibit B attached hereto and made a part
hereof (collectively, the "Warrant"), to purchase the number of shares of common stock of AXS-One which is equal to the product of 10,000 shares multiplied by the number of whole months
during the actual term of this Agreement (shares for partial months during the term shall be pro-rated); but in no event shall the Warrant permit Consultant to purchase more than a total
of 120,000 shares of AXS-One common stock. The Warrant shall be 100% vested on the date of its issuance by AXS-One, as aforesaid, and shall (subject to the conditions set forth
in the Warrant) be exercisable at any time, and from time to time, during a period of three (3) years following the date of such issuance. The exercise price for the Warrant shall be
(i) for the initial up to 60,000 shares covered by the Warrant, $0.41 per share, which represents the closing price for one share of AXS-One common stock on 

 

the American Stock Exchange on October 1, 2002 (the commencement date of the term of this Agreement), and (ii) for the remaining shares covered by the Warrant, if any, the closing price
for one share of AXS-One common stock on the American Stock Exchange (or, if on such date, AXS-One's common stock is not traded on the American Stock Exchange, the closing
price on the principal national stock exchange, or, if there is none, over-the-counter market or "pink sheets", upon which such common stock is then traded) on April 1,
2003. 

                (c)    Notwithstanding
any other provision of this Agreement to the contrary, in the event that during the term of this Agreement,
all, or substantially all, of the business, assets or common stock of AXS-One is acquired by a person or entity owning less than five percent (5%) of AXS-One's common stock as
of October 1, 2002, then, promptly following the later of the date that (i) AXS-One signs a definitive agreement related to such acquisition, or
(ii) AXS-One's Board of Directors approves such acquisition, AXS-One shall, in replacement of and substitution for its obligations under Paragraph 2(b) above,
issue to Consultant the Warrant described in Paragraph 2(b) above for 120,000 shares of common stock, which Warrant shall be 100% vested on the date of such issuance; it being the intent of the
parties that Consultant shall have the opportunity to exercise such Warrant and exchange the resulting shares of common stock for the consideration provided for in the acquisition. If the Warrant is
issued under this Paragraph 2(c) on or prior to April 1, 2003, then the exercise price for all of the shares covered by the Warrant shall be $0.41 per share; otherwise the exercise price
rules of Paragraph 2(b) above shall apply. 

                (d)    AXS-One
shall reimburse Consultant for any reasonable and necessary (i) out-of-town
travel (transportation, lodging and meal) expenses incurred by Consultant's employees, at the express request of AXS-One, during the performance of the Services, in accordance with the
terms and conditions of AXS-One's policies therefor (including documentation requirements) for AXS-One's own employees, and (ii) documented fees paid by Consultant to
third parties (e.g., postage for investor packages or research reports, news wire service fees, fax-broadcasting news release fees, photocopying/printing fees) in connection with the
Services, at Consultant's actual costs therefor; provided, however, that such third party fees must be approved by AXS-One in writing in advance of being incurred if such fees will exceed
$500 in any single instance. AXS-One may pre-approve in writing reimbursement of reasonable and necessary expenses for other extraordinary items such as broker lunch
presentations or media campaigns. 

          3.    (a)    The
term of this Agreement shall commence on October 1, 2002 and expire as of September 30, 2003, unless earlier terminated
by either party, solely as a result of a material breach of this Agreement by the other party, which breach remains uncured for a period of thirty (30) days following the breaching party's
receipt of a written notice from the other party setting forth such breach and demanding its cure. Any such termination by AXS-One as a result of an uncured material breach by Consultant
prior to expiration shall immediately relieve AXS-One of any further obligation to pay any then unpaid Fees or issue warrants to purchase unearned shares pursuant to Paragraph 2
above. Any such termination by Consultant as a result of an uncured material breach by AXS-One prior to expiration shall not relieve AXS-One of the obligation to pay any Fees,
or issue warrants to purchase shares pursuant to Paragraph 2 above for the entire term of the Agreement. 

                (b)    Upon
the expiration or any earlier termination of this Agreement, Consultant shall immediately turn over to AXS-One
all materials belonging to AXS-One, including, without limitation, any and all materials created for AXS-One under this Agreement. Consultant shall not retain any copies of the
foregoing materials. 

          4.    It
is understood and agreed that Consultant is, and shall remain, an independent contractor. Consultant acknowledges and agrees that it shall be solely
Consultant's obligation to report to taxation and similar authorities all compensation received by Consultant pursuant to this Agreement and to pay all taxes or
impositions thereon, and Consultant agrees to indemnify AXS-One and to hold it harmless to the extent of any obligation imposed against AXS-One to pay any withholding taxes,
social security, unemployment or disability insurance, or similar items in connection with any payments made to 

2

 

Consultant by AXS-One pursuant to this Agreement. Consultant's obligations under this paragraph shall survive indefinitely the termination of this Agreement. 

          5.    It
is understood and agreed that Consultant shall have no authority whatsoever to bind AXS-One to any contract or otherwise, or to use
AXS-One's name for any purpose not expressly required as part of the Services; provided, however, that Consultant may include AXS-One's name in its published list of clients. 

          6.    Consultant
acknowledges that it may acquire knowledge and information about AXS-One, including, without limitation, various trade secrets,
confidential terminology, proprietary information, business plans, customer names, programs, compilations of information, records, specifications, etc., and that all such knowledge and information
acquired or developed hereunder are, and shall be and remain, the confidential and proprietary information of AXS-One ("Confidential Information"). Consultant agrees to hold, and to cause
its employees to hold, such Confidential Information in strict confidence and agrees not to disclose the same to others or use the same in any way, commercially or otherwise, either before or after
the expiration or termination of this Agreement, without the prior written consent of the AXS-One's CEO or CFO. Consultant further agrees to take all action necessary to protect the
confidentiality of the Confidential Information, and to prevent the unauthorized use or copying of the Confidential Information, which comes into Consultant's possession. Upon AXS-One's
request or the expiration or termination of this Agreement, Consultant shall return all written, recorded or machine readable Confidential Information to AXS-One. Consultant's obligations
under this paragraph shall survive indefinitely the expiration or termination of this Agreement. 

          7.    (a)    AXS-One
and Consultant agree that any and all work product arising from Consultant's performance of the Services (collectively,
the "Work"), shall belong exclusively to AXS-One, whether or not AXS-One uses such material, and Consultant hereby irrevocably assigns, and shall cause its employees to
irrevocably assign, all rights of every kind, including, without limitation, copyright rights, in the Work to AXS-One. AXS-One shall have the right to hereafter use all of the
Work, any part or parts thereof, or none of the Work, as AXS-One sees fit, without the payment of any compensation to Consultant, other than the compensation expressly provided for in
Paragraph 2 above. No rights to or in the Work are reserved to Consultant or to Consultant's employees, and Consultant shall not use any of the Work for any of its other clients. 

                (b)    Notwithstanding
Paragraph 7(a) above, nothing in this Agreement shall be construed as prohibiting Consultant from
utilizing any of its generalized expertise, methodologies, or increase in residual knowledge resulting from the Services, in any other project. 

          8.    The
rights and obligations of a party hereunder shall not be assigned or transferred by operation of law or otherwise; provided, however, that
AXS-One may, upon written notice to Consultant, assign this Agreement to the successor of its business and/or assets. 

          9.    Consultant
represents and warrants that it is not under any pre-existing obligation inconsistent with the provisions of this Agreement or
Consultant's performance of the Services to the best of its abilities, and Consultant agrees not to hereafter during the term of this Agreement assume any obligation inconsistent with the provisions
of this Agreement or Consultant's performance of the Services to the best of its abilities. Without limiting the generality of the foregoing, Consultant agrees not to perform any investor relations
services for any competitor of AXS-One during the term of this Agreement and for a period of six (6) months following the expiration or termination of this Agreement. 

        10.    In
the performance of the Services, Consultant shall comply with any and all applicable Federal, state or local statutes and laws, and all ordinances, rules and
regulations promulgated thereunder. 

        11.    This
Agreement sets forth the entire understanding, and hereby supersedes any and all prior agreements, oral or written, heretofore made, between the parties with
respect to the subject matter of this Agreement, and there are no representations, warranties, covenants, agreements or understandings, oral 

3

 

or otherwise, express or implied, affecting this Agreement not expressly set forth herein. No delay on the part of a party in exercising any of its respective rights hereunder or the failure to
exercise the same, nor the acquiescence in or waiver of a breach of any term, provision or condition of this Agreement shall be deemed or construed to operate as a waiver of such rights or
acquiescence thereto, except in the specific instance for which given. None of the terms, conditions or provisions of this Agreement shall have been held to have been changed, varied, waived, modified
or altered, except by a statement in writing signed by duly authorized representatives of both of the parties hereto. 

        12.    In
the event that any one or more of the provisions of this Agreement shall be held to be invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby. 

        13.    This
Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without regard to its conflict-of-laws
rules. 

        Please
indicate your acceptance of the terms and conditions of this Agreement by signing the enclosed copy of this letter at the space indicated below and returning it to me at your
earliest convenience. 

	

 	
 	

Very truly yours,
	

 	
 	

AXS-ONE INC.
	

 	
 	

By:	

/s/  JOHN RADE      
 John Rade

President, CFO

The
foregoing is accepted and agreed to as of the date written above. 

	

HAYDEN COMMUNICATIONS, INC.	
 	

 
	

By:	
 	

/s/  MATTHEW HAYDEN      
 Matthew Hayden

President	
 	

 

4

   EXHIBIT A  

SCOPE OF SERVICES/PROGRAMS/ACTIVITIES  

Hayden
Communications, Inc. (HC) will develop, implement, and maintain an ongoing stock market support system for AXS-One Inc. (AXO) with the general objective of expanding
awareness in AXO among stockbrokers, analysts, micro-cap portfolio/fund managers, market makers, and the appropriate financial & trade publications. HC agrees that it will
reasonably be available during regular business hours to advise, counsel and inform designated officers and employees of AXO about the software industry, business, financial marketplace, competitors,
business acquisitions and other aspects of or concerning AXO's business about which HC has knowledge or expertise. In addition, HC will perform the following: 

1. PROFESSIONAL INVESTMENT COMMUNITY AWARENESS to build a core of informed stockbrokers, market makers, security analysts and portfolio/fund managers
who are interested in understanding and becoming involved in AXO. The system will be established through the following methods (the appropriate audience will be a subset of HC's entire database): 

	A.
	Introductions to professionals at select firms, with a focus on members of the Financial Community in various geographic regions: the
United States, Canada and Europe. The targeted group of professionals, which has been drawn from HC's proprietary database of contacts, would include:

	1.
	Over
25,000 Equity Brokers

	2.
	Over
1,500 Analysts (Buy and Sell Side—both generalists and industry specialists)

	3.
	Over
4,500 Micro-Cap Portfolio/ Fund Managers

	4.
	Over
120 Market Makers (both retail and wholesale)

	5.
	Financial,
Trade and Industry Publications 

	B.
	Introductions to High Net-Worth accredited investors who build positions in companies similar to AXO and are familiar with
other quality companies, which HC currently and previously represented.

	C.
	Broker conference calls/presentations arranged by HC in select cities (and at compatible times) with top management at AXO. Cities we
would schedule meetings include New York, Philadelphia, Baltimore, Boston, Dallas, Denver, Ft. Lauderdale, Houston, Atlanta, Chicago, LA, Minneapolis, Miami, Orange County, CA, Raleigh, San Diego, San
Francisco, St. Louis, D.C. and other select cities.

	D.
	All interested parties will be continually updated of Client's progress via phone conversations and through our fax/e-mail
list for news releases. 

2. SHAREHOLDER COMMUNICATIONS focuses on maintaining shareholder awareness of AXO activities and fostering a sense of loyalty in the ownership of the
stock. Current shareholders represent the "Supply Side" and with proper communication to that audience, the dynamics of supply and demand are likely to work in AXO's favor. 

	A.
	Handle investor requests for timely information via the telephone and e-mail. HC will have a knowledgeable associate
available during market hours to field and respond to all investor inquiries in a timely manner. A majority of these calls will be generated from HC Clients who take a position or have an interest in
AXO.

	B.
	HC will provide the names and addresses of those requesting due diligence packages to the appropriate contact at AXO within 2 business
hours after receiving the request. 

5

 

	C.
	"CEO letter" to the shareholders updating AXO achievements and properly positioning the company's strategic growth opportunities. This
letter can be placed on the corporate Web site, where it can easily be updated at appropriate times. Due to Regulation FD, all correspondence must be forwarded to the wire prior to web posting. This
letter can be combined with the following:

	D.
	Quarterly Interim-Reports to the shareholders, which provide a complete update on AXO's performance, financial position and material
developments. HC will assist in the creation, design, printing and mailing of a 3-fold brochure that is attractive and informative, yet simple. In order to be conscious of corporate costs,
these quarterly interim reports may be posted on the corporate web site. 

3. MEDIA RELATIONS is utilized to provide information on AXO to both industry and financial professionals who follow the software services industry. A
positive article from a national publication can provide substantial credibility among investors, shareholders and current or prospective customers. 

	A.
	HC's Media Department will develop a focus list of industry, trade and financial publications and contact appropriate editors, make
introductions and review and manage editorial calendars for relevant upcoming articles. Interested parties will be updated on material news releases and corporate developments. Examples of these
publications are: Smart Money, Fortune, Kiplinger's, Business Week, Forbes ASAP, Business 2.0, Investors Business Daily, The Wall Street Journal, Bloomberg and Worth. Other Software and Technology
Publications include: Smart Business, Fast Company, CIO, New Jersey Online, Business & Technology, Commerce & Industry, Computer Technology News, Computer Technology Review,
E-Business World, Electronic Servicing & Technology, eWeek Magazine, Fortune Small Business Magazine, Inc., Industrial Process Products & Technology, New Technology
Week, Small Cap Center, Smart Business, Technology at Work, Technology Review & Today, Techscan: The Managers Guide to Technology, Trade & Commerce. ZDNet Magazine, 123 Jump, and
Micro-Cap News Network.

	B.
	Financial Newsletter campaign. We will work with our many financial newsletter editors and publishers for a "Buy Recommendation" for
AXO. The newsletters we contact have a paid subscription base of investors who focus solely on micro cap stocks. A "Buy Recommendation" from one of these letters can produce a great deal of new
investor interest. A recommendation of this type gives third party support and opinion. HC has been able to achieve "Buy Recommendations" for former and current clients in: The Kon-Lin
letter, The Conservative Speculator, Dick Davis Digest, George Southerland's Special Investment Situations, The Patient Inve$tor, and Equities Special Situations. Other publications we have worked
with and will introduce AXO to include: The Red Chip Review, Investor's Digest, The Quiet Investor, Acker Letter, High-Growth Newsletter, Bullish Investor, Low-Priced Stocks,
Micro-Stock Digest and The Napeaugue Letter. 

4. THE FINANCIAL PRESS is utilized to disseminate newsworthy events quickly and efficiently through the newswire services (Dow Jones, Reuters, The Wall
Street Journal, New York Times, The Associated Press, Moody's, Standard & Poors, Fitch Financial, Knight-Ridder, Bloomberg, and Investor's Business Daily). 

	A.
	HC will assist AXO to draft and complete press releases on all material events as deemed by the Company. AXO management and corporate
counsel will approve all releases before they are sent to the wire.

	B.
	HC will disseminate news releases through a Broadcast Fax and/or electronic mail (e-mail) to our established database of
financial professionals including: special situation analysts, brokers, fund managers, individual investors, money managers, and current or prospective individual shareholders who are already invested
or have expressed an interest in AXO. 

6

 

	C.
	HC will work with national and regional circuits to put AXO news releases and story in front of newspapers, television, radio stations
and the relevant technology trade publications. 

5. STRATEGIC OPPORTUNITIES are utilized to introduce management to new companies, which could become key strategic partners, customers or acquisition
candidates. HC will also manage a schedule of industry and financial trade shows and conferences where applicable. 

	A.
	HC will continually evaluate strategic M&A and partnership opportunities for AXO, which are consistent with management's focus and could
include introductions to investment banking entities and/or acquisition candidates.

	B.
	HC will screen all investment firms for upcoming financial conferences, which would be appropriate for AXO. HC will work through the
proper channels with the goal of receiving invitations for management to present at relevant conferences. 

AGENDA (Initial 180 days)  

	A.
	Establish
a time line of expected corporate events. Streamline the presentation to articulate AXO's story in a clear and concise format, focusing on Corporate Image, AXO's competitive
position and key growth strategies.

	B.
	Generate a two and four-page Corporate Profile, which clearly articulates
AXO's current business and financial position, as well as its strategy for future growth.

	C.
	Assist AXO in updating its investor package and investor information via the company's corporate Web site. Assist with Shareholders'
letter and quarterly update.

	D.
	Assist AXO management in developing and/or updating its Power Point presentation to utilize during corporate presentations. Key points
of this presentation include: Financial and market overview, information on key management and core business strengths, AXO's strategic growth plans, customer list, and the competitive landscape.

	E.
	Target select brokers and micro-cap fund managers, which follow companies that have a similar profile to AXO, and/or are
focused on value situations.

	F.
	Expand the number of market makers, which utilize retail support.

	G.
	Plan in house broker meetings/conference calls in select cities. Assist management with presentations to the Stock Broker's society.
Follow up with phone calls to create "action" and to gauge management's effectiveness in articulating the story.

	H.
	Target newsletter editors and publishers for a "Buy Recommendation". Focus on Trade, Financial and Industry Publications for appropriate
stories on AXO's services, attributes and value proposition to the marketplace.

	I.
	Maintain and update the database to ensure that all press releases are faxed and/or e-mailed to all interested
professionals.

	J.
	Target "Buy" and "Sell" side analysts, including those at boutique and 2nd Tier firms for a "Buy Recommendation", along
with analysts representing institutional money.

	K.
	Contact Brokerage Firms who hold conferences for the purpose of receiving an invitation for management to present.

	L.
	If appropriate, introduce AXO to possible acquisition and/or joint venture candidates.

	M.
	Provide progress reports to senior management when appropriate. As AXO attains a higher market capitalization and share price we will
open new doors, which will enable our firm to introduce AXO to an expanded audience. 

7

 

	N.
	Evaluate achievements after the first 180 days and develop a new agenda. 

Many
of the above items will occur simultaneously. Certain items will have chronological priority over others, however for the most part agenda items will progress in unison throughout the initial
180-day period. As AXO grows and evolves, we will recommend changes to the Agenda that compliment that growth. As the company continues to execute its strategic growth plan by expanding
its product portfolio and showing continued financial performance, we will have new doors open, which will enable us to target a different group of brokers, analysts and portfolio/fund managers. At
each stage of growth, the appropriate approach to the market will be incorporated into the agenda for optimal results. A new formal Agenda will be created after the 180-day period, or
earlier if necessary. 

Assuming a clear and honest reason to believe that AXO's efforts are leading ultimately to success and greater profitability, the end results of this financial communication
and awareness campaign should be:

	*
	An
increase in the number of financial professionals (including brokers, institutions and analysts) and individual investors well educated and knowledgeable about AXO: including senior
management, the company's services and technology, as well as its current financial condition and growth opportunities.

	*
	An
increase in the number of articles printed in both trade and financial publications.

	*
	An
increase in the realistic price/earnings (P/E), price/cash flow ratio (P/CF) or price/net asset value, in relation to the overall average P/E or P/CF ratio of the stock market in any
given time.

	*
	An
increase in liquidity of the common stock.

	*
	A
broader and more diverse shareholder base.

	*
	An
increase in AXO's market capitalization.

	*
	Easier
access to the capital markets, if attractive acquisitions are found or additional capital is required. 

8

EXHIBIT B  

THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND NEITHER THIS WARRANT NOR ANY INTEREST HEREIN MAY BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS AN APPLICABLE
REGISTRATION STATEMENT UNDER SUCH ACT AND RULES AND REGULATIONS THEREUNDER IS THEN IN EFFECT, OR IN THE OPINION OF HOLDER'S COUNSEL (WHICH OPINION IS REASONABLY SATISFACTORY TO THE COMPANY), SUCH
REGISTRATION UNDER SUCH ACT IS NOT REQUIRED. BY ITS ACCEPTANCE HEREOF, THE HOLDER OF THIS CERTIFICATE REPRESENTS THAT IT IS ACQUIRING THE WARRANT FOR INVESTMENT AND AGREES TO COMPLY IN ALL RESPECTS
WITH ARTICLE III OF THIS WARRANT. 

WARRANT

to Purchase Common Stock of

AXS-ONE INC.

Expiring                        ,             

        THIS IS TO CERTIFY THAT, for value received, HAYDEN COMMUNICATIONS, INC., or its permitted and registered assigns (collectively, the "Holder"), is entitled
to purchase from the Company            shares of Common Stock at a purchase price payable upon exercise hereof (the "Exercise Price") of
$            per share. The Common Stock and the
Exercise Price are subject to adjustment in accordance with Article IV hereof. Certain terms used in this Warrant are defined in Article V. 

 
 

ARTICLE I
  Exercise of Warrant    
  

        1.1    Method of Exercise. To exercise this Warrant in whole or in part, at any time, subject to Section 1.3 below,
commencing on the date of issuance of this Warrant and ending on the expiration date set forth above (the "Expiration Date"), the Holder shall deliver to the Company, at the Warrant Office designated
pursuant to Section 2.1, (a) a written notice, in substantially the form of the Subscription Notice attached as Schedule A hereto, of such Holder's
election to exercise this Warrant, which notice shall specify the number of shares of Common Stock to be purchased, (b) payment of the Exercise Price in immediately available funds and
(c) the signed original of this Warrant. This Warrant shall be deemed to be exercised on the date when delivery of such notice, such funds and this Warrant is made, and any
such date is referred to herein as the "Exercise Date." Upon exercise, the Company shall issue only in the name of, and deliver to, such Holder a certificate or certificates for the number of full
shares of Common Stock to which such Holder is entitled and a check or cash with respect to any fractional interest in a share of Common Stock as provided in Section 1.2. The Holder shall be
deemed to have become a holder of record of such issued Common Stock on the applicable Exercise Date. Upon exercise of only a portion of the number of shares covered by this Warrant, the Company shall
issue and deliver to the Holder, at the expense of the Company, a new Warrant covering the number of shares representing the unexercised portion of this Warrant so surrendered. 

        1.2    Fractional
Shares. No fractional shares of Common Stock or scrip shall be issued upon exercise of this Warrant. Instead of any fractional
shares of Common Stock which would otherwise be issuable upon exercise of this Warrant, the Company shall pay a cash adjustment in respect of such fractional interest in an amount equal to that
fractional interest of the then Current Market Price. 

        1.3    Listing
on National Securities Exchange. The Company shall, prior to the issuance of any Warrant Shares, at its expense, promptly obtain and
maintain the listing of the Warrant Shares on such principal national securities exchange or NASDAQ as the other shares of Common Stock are at such time listed. The Company shall use its best efforts
to file the listing application for the Warrant Shares with said exchange or NASDAQ, as the case may be, within thirty (30) days following the Company's issuance of this Warrant, and,
notwithstanding any other provision of this Warrant to the contrary, the Holder may not exercise this Warrant until the Company notifies the Holder in writing that said listing application has been
approved by such exchange or NASDAQ, as the case may be. 

 

 
 

ARTICLE II
  Warrant Office; Transfer,
  Division or Combination of Warrant    
  

        2.1    Warrant Office. The Company shall maintain an office for certain purposes specified herein (the "Warrant Office"),
which office shall initially be the Company's office at 301 Route 17 North, Rutherford, New Jersey 07070 and may subsequently be such other office of the Company or of any transfer agent of the Common
Stock in the continental United States as to which written notice has previously been given to the Holder. 

        2.2    Ownership
of Warrant. The Company may deem and treat the person in whose name this Warrant is then registered as the Holder and owner hereof
(notwithstanding any notations of ownership or writing hereon made by anyone other than the Company) for all purposes and shall not be affected by any notice to the contrary, until presentation of
this Warrant for registration of transfer as provided in this Article II. 

        2.3    Transfer
of Warrants. The Company agrees to maintain at the Warrant Office books for the registration of the issuance, exercise and any
transfers of this Warrant and, subject to the provisions of Article III, this Warrant and all rights hereunder are transferable, in whole or in part, on such books, upon surrender of this
Warrant at such office, together with a written assignment of this Warrant, in substantially the form of the Assignment attached as Schedule B hereto, duly executed by the Holder or its duly
authorized agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and payment, the Company shall execute and deliver a new
Warrant or Warrants in the name of the assignee or assignees and in the denominations specified (in increments of the lesser of (i) 20,000 shares, or the number of shares for which this Warrant
is then exercisable) in such instrument of assignment, and this Warrant shall promptly be cancelled. 

 
 

ARTICLE III
  Restrictions on Transfer and
  Registration Under The Act    
  

        3.1    Restrictions on Transfer. Neither this Warrant, the Warrant Shares nor any interest herein or therein shall be
transferable except upon the conditions specified in Article II and this Article III, which conditions are intended to ensure compliance with the provisions of the Act in respect of the
transfer of this Warrant or any interest herein. The Holder will cause any transferee of this Warrant, the Warrant Shares or any interest herein or therein held by it to agree to take and hold this
Warrant, the Warrant Shares or an interest herein or therein subject to the provisions and upon the conditions specified in this Article. 

        3.2    Restrictive
Legend. This Warrant and each Warrant Share shall (unless otherwise permitted by the provisions of Section 3.3) include a
legend in substantially the following form, referring to this Warrant or Warrant Shares, as appropriate: 

[THIS
WARRANT] [THESE SHARES] [HAS] [HAVE] NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 AND
NEITHER [THIS WARRANT] [THESE SHARES] NOR ANY INTEREST THEREIN MAY BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE DISPOSED OF UNLESS AN APPLICABLE
REGISTRATION STATEMENT UNDER SUCH ACT AND RULES AND REGULATIONS THEREUNDER IS THEN IN EFFECT, OR IN THE OPINION OF HOLDER'S COUNSEL (WHICH OPINION IS REASONABLY SATISFACTORY TO THE COMPANY), SUCH
REGISTRATION UNDER SUCH ACT IS NOT REQUIRED. BY ITS ACCEPTANCE HEREOF, THE HOLDER OF THIS CERTIFICATE REPRESENTS THAT IT IS ACQUIRING [THIS WARRANT] [THESE
SHARES] FOR INVESTMENT AND AGREES TO COMPLY IN ALL RESPECTS WITH ARTICLE III OF [THIS WARRANT] [THE WARRANT FOR THESE SHARES]. 

2

 

        3.3    Notice
of Proposed Transfers. The Holder and any holder of any Warrant Share by acceptance hereof or thereof agrees to comply in all
respects with the provisions of this Section. Prior to any proposed transfer of this Warrant or any Warrant Share, the Holder or holder of Warrant Shares, as the case may be, shall give written notice
to the Company of such holder's intention to effect such transfer. Each such notice shall describe the manner and circumstance of the proposed transfer in reasonable detail, and shall be accompanied
by (a) a written opinion of counsel for such holder, reasonably satisfactory to the Company, addressed to the Company, to the effect that the proposed transfer may be effected without
registration under the Act or (b) written assurance from the staff of the Commission that it will not recommend that any action be taken by the Commission in the event such transfer is effected
without registration under the Act. Such proposed transfer may be effected only if the Company shall have received such notice and such opinion of counsel or written assurance, whereupon the Holder or
the holder of Warrant Shares, as the case may be, shall be entitled to transfer this Warrant or Warrant Shares in accordance with the terms of this Warrant and of the notice delivered by said holder
to the Company. Each certificate evidencing this Warrant or Warrant Shares transferred as above provided shall bear the legend set forth in Section 3.2, except that such certificate shall not
bear such legend if the opinion of counsel or written assurance referred to above is to the further effect that neither such legend nor the restriction on transfer in this Article are required to
ensure compliance with the Act. 

        3.4    Termination
of Conditions and Obligations. The conditions precedent imposed by this Article upon the transferability of the Warrant Shares
(but not of this Warrant) shall terminate as to any particular Warrant Shares when such shares shall have been effectively registered under the Act and sold or otherwise disposed of in accordance with
the intended method of disposition by the seller or sellers thereof set forth in the registration statement covering such shares or at such time as an opinion of counsel as specified in
Section 3.3 shall have been rendered to the effect set forth in the last sentence of Section 3.3. 

        3.5    Registration
Rights. The Holder shall be entitled to the benefits of the registration rights set forth in Schedule C attached hereto. 

 
 

ARTICLE IV
  Antidilution Provisions    
  

        4.1    Adjustments. (a) The Exercise Price and the number of Warrant Shares issuable upon exercise of this Warrant
shall be subject to adjustment from time to time as follows: 

        (i)    Stock
Dividends. If the number of shares of Common Stock outstanding at any time after the date of issuance of this Warrant is increased by
a stock dividend payable in shares of Common Stock or by a subdivision or split-up of shares of Common Stock, then immediately after the record date fixed for the determination of holders
of Common Stock entitled to receive such stock dividend or the effective date of such subdivision or split-up, as the case may be, the Exercise Price shall be appropriately reduced and the
number of shares of Common Stock to be acquired on exercise of this Warrant shall be increased so that the Holder, upon exercise of this Warrant thereafter, shall be entitled to receive the number of
shares of Common Stock which it would have owned immediately following such action had this Warrant been exercised immediately prior thereto at the aggregate Exercise Price effective prior thereto. 

        (ii)    Combination
of Stock. If the number of shares of Common Stock outstanding at any time after the date of issuance of this Warrant is
decreased by a combination of the outstanding shares of Common Stock, then, immediately after the effective date of such combination, the Exercise Price shall be appropriately increased and the number
of shares of Common Stock to be acquired on exercise of this Warrant shall be decreased so that the Holder, upon exercise of this Warrant thereafter, shall be entitled to receive the number of shares
of Common Stock which it would have owned immediately following such action had this Warrant been exercised immediately prior thereto. 

3

 

        (iii)    Reorganization,
Etc. In case of any capital reorganization of the Company, or any reclassification of the Common Stock, or in case of the
consolidation of the Company with or the merger of the Company with or into any other Person or in case of the sale, lease or other transfer of all or substantially all of the assets of the Company to
any other Person, this Warrant shall, after such capital reorganization, reclassification, consolidation, merger, sale, lease or other transfer, be convertible into the number of shares of stock or
other securities or property to which the Common Stock issuable (at the time of such capital reorganization, reclassification, consolidation, merger, sale, lease or other transfer) upon exercise of
this Warrant would have been entitled upon such capital reorganization, reclassification, consolidation, merger, sale, lease or other transfer; and in any such case, if necessary, the provisions set
forth herein with respect to the rights and interests thereafter of the Holder shall be appropriately adjusted so as to be applicable, as nearly as may reasonably be, to any shares of stock or other
securities or property thereafter deliverable on the exercise of this Warrant. The subdivision or combination of shares of Common Stock issuable upon exercise of this Warrant at any time outstanding
into a greater or lesser number of shares of Common Stock of the Company (whether with or without par value) shall not be deemed to be a reclassification of the Common Stock of the Company for the
purposes of this clause (iii). 

        (iv)    Rounding
of Calculations; Minimum Adjustment. All calculations under this Article IV shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. Any provision of this Article IV to the contrary notwithstanding, no adjustment to the Exercise Price shall be made if the
amount of such adjustment would be less than $.01, but any such amount shall be carried forward and an adjustment with respect thereto shall be made at the time of and together with any subsequent
adjustment which, together with such amount and any other amount or amounts so carried forward, shall aggregate $.01 or more. 

        (b)    Statement
Regarding Adjustments. Whenever any adjustments shall be required as provided in Section 4.1(a), the Company shall
forthwith file, at the Warrant Office and, if different, at the principal office of the Company, a statement showing in detail such adjustments and the facts requiring such adjustment, which statement
shall also be sent to the Holder. 

        (c)    Costs.
The Company shall pay all documentary, stamp, transfer or other transactional taxes attributable to the issuance or delivery of
shares of Common Stock of the Company upon exercise of this Warrant. The Holder shall pay all documentary, stamp, transfer or other transactional taxes attributable to any transfer of this Warrant or
of the Warrant Shares. 

        (d)    Reservation
of Shares. The Company shall reserve at all times so long as this Warrant remains outstanding, free from preemptive rights, out
of its treasury stock or its authorized but unissued shares of Common Stock, or both, solely for the purpose of effecting the exercise of this Warrant, sufficient shares of Common Stock to provide for
the exercise of this Warrant. 

        (e)    Exchange
Act. The Company shall comply with the reporting requirements of Sections 13 and 15(d) of the Exchange Act for so long as and to
the extent that such requirements apply to the Company. 

        (f)    Valid
Issuance. All shares of Common Stock which may be issued upon exercise of this Warrant will upon issuance by the Company be duly and
validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof and the Company shall take no action which will cause a contrary result
(including, without limitation, any action which would cause the Exercise Price to be less than the par value of the Common Stock). 

4

 

 
 

ARTICLE V
  Terms Defined    
  

        As used in this Warrant, unless the context otherwise requires, the following terms have the respective meanings set forth below or in the Section indicated: 

        Act—the
Securities Act of 1933, as amended, or any similar Federal statute, and the rules and regulations of the Commission promulgated
thereunder, all as the same shall be in effect at the time. 

        Commission—the
Securities and Exchange Commission, or any other Federal agency then administering the Act. 

        Common
Stock—the Company's authorized Common Stock, par value $.01 per share, as such class existed on the date hereof, and any other securities
as to which this Warrant becomes exercisable pursuant to Article IV, including stock of the Company of any class thereafter authorized which ranks, or is entitled to a participation, as to
assets or dividends, substantially on a parity with Common Stock. 

        Company—AXS-One Inc.,
a Delaware corporation, and any other corporation assuming or required to assume the obligations
undertaken in connection with this Warrant. 

        Current
Market Price—the price per share of Common Stock on any date as determined by the Company's Board of Directors as provided below. The
Current Market Price shall be the average of the daily closing prices per share of Common Stock for 30 consecutive business days ending no more then 15 business days before the day in question (as
adjusted for any stock dividend, split, combination or reclassification that took effect during such 30 business-day period). The closing price for each day shall be the last reported
sales price regular way or, in the case no such reported sales take place on such day, the average of the last reported bid and asked prices regular way, in either case on the principal national
securities exchange on which the Common Stock is listed or admitted to trading, or if not listed or admitted to trading on any national securities exchange, the average of the highest bid and the
lowest asked prices quoted on the National Association of Securities Dealers Automated Quotation System (NASDAQ), or if not so quoted, as reported by the National Quotation Bureau, Inc.;
provided, however, that if the Common Stock is not traded in such manner that any of the quotations referred to above are available for the period required hereunder, Current Market Price per share of
Common Stock shall be deemed to be the fair value thereof as determined by the Board of Directors in good faith, irrespective of any accounting treatment. 

        Exchange
Act—the Securities Exchange Act of 1934, as amended, or any similar Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect at the time. 

        Exercise
Price—as defined in the Preamble. 

        Exercise
Date—as defined in Section 1.1. 

        Expiration
Date—as defined in Section 1.1. 

        Holder—as
defined in the Preamble. 

        Outstanding—when
used with reference to Common Stock at any date, all issued shares of Common Stock at such date, except shares then held in the
treasury of the Company. 

        Person—any
individual, corporation, partnership, trust, unincorporated organization and any government and any political subdivision,
instrumentality or agency thereof. 

        Warrant
Office—as defined in Section 2.1. 

        Warrant
Shares—the shares of Common Stock purchasable or purchased by the Holder upon the exercise of this Warrant. 

5

 

 
 

ARTICLE VI
  Miscellaneous    
  

        6.1    Entire Agreement. This Warrant contains the entire agreement between the Holder and the Company with respect to the
purchase of the Warrant Shares and the related transactions and supersedes all prior arrangements or understandings with respect thereto. 

        6.2    Governing
Law. This Warrant shall be governed by and construed in accordance with the laws of the State of Delaware without giving effect to
the conflict of laws. 

        6.3    Waiver
and Amendment. At any time, any term or provision of this Warrant may be waived, amended or supplemented only by a writing signed by
the Holder and the Company. A waiver by the Company or the Holder of a breach of any provision of this Warrant shall not operate as or be construed to be a waiver of any other breach of such provision
or of any other provision of this Warrant. The failure of the Holder or the Company to insist upon strict adherence to any term of this Agreement on one or more occasions shall not be considered a
waiver or deprive that party of the right thereafter to insist on strict adherence to that term or any other term of this Agreement. 

        6.4    Assignment
by the Company. The Company may not sell, assign, transfer or otherwise convey any of its rights or delegate any of its duties
under this Warrant except to a corporation succeeding to the Company by merger, consolidation or acquisition of all or substantially all of the Company's business and/or assets, and this Warrant shall
be binding on and inure to the benefit of such successor. 

        6.5    Separability.
If any provision in this Warrant shall be determined to be invalid, illegal or unenforceable in any respect for any reason,
the validity, legality and enforceability of any such provision in any other respect and of the remaining provisions of this Warrant in any respect shall not be in any way impaired. 

        6.6    Notice.
Any notice or other communication required or permitted to be given or delivered hereunder shall be in writing and; if to the
Holder, shall be delivered at, or sent by reputable "overnight" courier to, such Holder at the last address shown on the books of the Company maintained at the Warrant Office or at any more recent
address of which any Holder shall have notified the Company in writing; and if to the Company, shall be delivered at, or sent by reputable "overnight" courier to, the General Counsel of the Company at
301 Route 17 North, Rutherford, NJ 07070, or such other address within the United States of America as shall have been furnished by the Company to the Holder. Any notice or other communication
hereunder shall be deemed given at the time of receipt thereof. 

        6.7    Limitation
of Liability; Not Stockholders. No provisions of this Warrant shall be construed as conferring upon the Holder the right to vote,
consent, receive dividends, or receive notice other than as herein expressly provided, in respect of meetings of stockholders for the election of directors of the Company or any other matter
whatsoever as a stockholder of the Company. No provision hereof, in the absence of affirmative action taken by the Holder to exercise this Warrant and thereby purchase shares of Common Stock, and no
mere enumeration herein of the rights or privileges of the Holder hereof, shall give rise to any liability of the Holder for the purchase price of any Warrant Shares or as a stockholder of the
Company, whether such liability is asserted by the Company or by creditors of the Company. 

        6.8    Loss,
Destruction, Etc. of Warrant. Upon receipt of evidence satisfactory to the Company of the loss, theft, mutilation or destruction of
this Warrant, and in the case of any loss, theft or destruction, upon delivery of a bond indemnity in such form and amount as shall be reasonably satisfactory to the Company, or in the event of such
mutilation upon surrender and cancellation of this Warrant, the Company will make and deliver a new Warrant, of like tenor, in replacement of and substitution for such lost, stolen, destroyed or
mutilated Warrant (which shall thereupon become null and void and of no further effect). 

6

 

        IN
WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer. 

Dated:            ,            

	 	 	AXS-ONE INC.
	

 	
 	
By:	

	 	 	Name:	 
	 	 	Title:	 

7

  

SCHEDULE A  

 
 

SUBSCRIPTION NOTICE    
  

        The undersigned, the holder of the Warrant accompanying this Notice, hereby elects to exercise purchase rights represented by said Warrant for, and to purchase
thereunder,                        shares of the Common Stock covered by such Warrant and herewith makes payment in full therefor
pursuant to Section 1.1 of such Warrant, and requests (a) that
certificates for such aforesaid number of shares (or any other securities or property issuable upon such exercise) be issued in the name of and delivered to the undersigned at the following address:
                                         
       and (b) if such shares shall not include all of the shares issuable as provided in such Warrant, that a new Warrant of like tenor and date for the balance of the shares issuable
thereunder be delivered to the undersigned. 

	 	 	[HAYDEN COMMUNICATIONS, INC.]
	

 	
 	
By:	

 Name:

Title:

Dated:

8

 
SCHEDULE B  

 
 

ASSIGNMENT    
  

        FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto                        , with an address
of                        , the rights to purchase
                        shares of Common Stock, par value $.01 per share, of AXS-One Inc. represented by the Warrant
accompanying this Assignment, and hereby authorizes
AXS-One Inc. to transfer said rights on the books of said corporation and to issue the aforesaid assignee an appropriate Warrant representing the assigned purchase rights. If the
assigned purchase rights shall not include all of the shares issuable as provided in such Warrant, a new Warrant of like tenor and date for the balance of the shares issuable thereunder shall be
delivered to the undersigned. 

	 	 	[HAYDEN COMMUNICATIONS, INC.]
	

 	
 	
By:	

 Name:

Title:

Dated:

9

  

SCHEDULE C  

 
 

REGISTRATION RIGHTS OF HOLDER    
  

 1. Definitions  

        Selling Expenses: All underwriting discounts, selling commissions and stock transfer taxes applicable to the
Warrant Shares registered by the Holder and all fees and disbursements of counsel and other advisors for the Holder. 

        Capitalized
terms used in this Schedule C but not otherwise defined herein shall have the meanings ascribed to such terms in the
body of the Warrant to which this Schedule C is attached. 

 2. Registration Rights  

        (a)
If the Company at any time prior to the first anniversary of the Expiration Date (at which time the rights granted under this Section 2 shall expire) proposes to register any
of its Common Stock under the Act on any form other than Form S-4 or Form S-8 (or any similar or successor form then in effect),
whether or not for sale for its own account, and if the registration form proposed to be used may be used for the registration of the Warrant Shares, then the Company will give prompt written notice
to the Holder of its intention to do so, such notice to specify the proposed numbers of shares to be registered thereby and the date, not less than 10 days thereafter, by which the Company must
receive the Holder's written indication of whether the Holder wishes to include its Warrant Shares in such registration statement. Upon the written request of the Holder made on or before the date
specified in such notice (which request shall specify the number of Warrant Shares intended to be disposed of by the Holder), the Company will, to the extent permitted under Section 7, use all
commercially reasonable efforts to cause all such Warrant Shares, which the Holder has so requested the registration thereof, to be registered under the Act (with the other shares that the Company at
the time proposes to register), to the extent requisite to permit the sale or other disposition by the Holder of the Warrant Shares to be so registered. 

        (b)
Notwithstanding anything to the contrary in this Section 2, the Company shall have the right to discontinue any registration under this Section 2 at any time prior to
the effective date of such registration if the registration of other shares of Common Stock giving rise to such registration under this Section 2 is discontinued. 

        (c)
The obligations of the Company under Section 2(a) hereof shall terminate (a) if the Holder rejects the opportunity to participate in a registration with respect to
which Holder's Warrant Shares would have been included but for said rejection by the Holder and such registration has been declared or ordered effective, or (b) the first registration by
Company, including any of Holder's Warrant Shares, has been declared or ordered effective. 

 3. Registration Procedures  

        If Holder exercises its registration rights under Section 2(a) hereof, the Company will, as expeditiously as possible: 

        (a)
prepare and file with the Commission a registration statement with respect to such Common Stock to be registered (including the Warrant Shares to be registered) and use all
commercially reasonable efforts to cause such registration statement to become and remain effective for a period of at least 180 days (or such shorter period if all Common Stock so registered
have been sold); provided that, before filing a registration statement or prospectus or any amendments or supplements thereto, the Company will furnish to the Holder for review copies of all such
documents proposed to be filed; 

10

 

        (b)
prepare and file with the Commission such amendments and supplements to such registration statement and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for a period of at least 180 days (or such shorter period as shall be necessary to complete the distribution of the Common Stock covered thereby) and to comply
with the provisions of the Act with respect to the sale or other disposition of all shares covered by such registration statement during such period in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration statement; 

        (c)
furnish to the Holder such number of copies of such registration statement and of each such amendment and supplement thereto (in each case including all exhibits), such number of
copies of the prospectus included in such registration statement (including each preliminary prospectus), in conformity with the requirements of the Act, in substantially the form in which they are
proposed to be filed with the Commission, needed by the Holder in order to facilitate the public sale or other disposition of the registered Warrant Shares; 

        (d)
use all commercially reasonable efforts to register or qualify such shares of Common Stock covered by such registration statement under such other securities or blue sky laws of such
United States jurisdictions as the Holder shall reasonably request, and do any and all other acts and things which may be necessary or advisable to enable the Holder to consummate the disposition of
the registered Warrant Shares in such jurisdictions, except that the Company shall not for any such purpose be required to qualify generally to do business as a foreign corporation in any jurisdiction
where, but for the requirements of this clause (d), it would not be obligated to be so qualified, or to subject itself to taxation in any such jurisdiction; 

        (e)
use all commercially reasonable efforts to cause such shares of Common Stock covered by such registration statement to be registered with or approved by such other governmental
agencies or authorities as may be necessary to enable the Holder to consummate the disposition of its registered Warrant Shares in the United States; 

        (f)
notify the Holder, at any time when a prospectus relating to its registered Warrant Shares is required to be delivered under the Act, of the Company's becoming aware that the
prospectus included in the related 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 light of the circumstances then existing, and promptly prepare and furnish to the Holder a reasonable number of copies of a prospectus
supplemented or amended so that, as thereafter delivered to the purchasers of the registered Warrant Shares, 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; 

        (g)
otherwise use all commercially reasonable efforts to comply with all applicable rules and regulations of the Commission; 

        (h)
permit the Holder a reasonable time in which (i) to review and comment on such registration or comparable statement, and (ii) to request the insertion therein of
material, furnished to the Company in writing, which in the reasonable judgment of the Holder should be included; 

        (i)
notify the Holder of any stop order threatened or issued by the Commission and take all actions reasonably necessary to prevent the entry of such stop order or to remove it if
entered. 

        The
Holder hereby agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in subdivision (f) above, the Holder will forthwith
discontinue its disposition of Warrant Shares pursuant to the registration statement covering such Warrant Shares until the Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by said subdivision and, if so directed by the Company, will deliver to the Company all copies, other than permanent file copies, then in the Holder's possession of the prospectus
covering such Warrant Shares prior to such supplementation 

11

 

or amendment. In the event the Company shall give any such notice, the period mentioned in subdivision (b) above shall be extended by the number of days during the period from and including
the date of the giving of such notice to and including the date when the Holder shall have received the copies of the supplemented or amended prospectus contemplated by subdivision (f) above. 

        The
Holder shall promptly furnish to the Company in writing such information and documents regarding it and the distribution of its Warrant Shares as may reasonably be required to be
disclosed in the registration statement in question by the rules and regulations under the Act or under any other applicable securities or blue sky laws of the jurisdictions referred to in subdivision
(d) above. 

 4. Registration Expenses  

        In connection with any registration of Warrant Shares pursuant to Section 2, the Company will, whether or not any such registration shall become effective,
from time to time, pay all expenses (other than Selling Expenses) incident to its performance of or compliance herewith, including, without limitation, all registration, filing and NASD fees, fees and
expenses of compliance with securities or blue sky laws, and fees and disbursements of counsel for the Company and all independent public accountants and other Persons retained by the Company. 

 5. Indemnification  

        (a) The Company will, and hereby does, indemnify and agree to defend, the Holder and each Person, if any, who controls the Holder within the meaning of
Section 15 of the Securities Act (collectively, "Holder Indemnified Parties"), from and against all losses, claims, damages, liabilities and expenses, joint or several, to which any such Holder
Indemnified Party may become subject under the Act, the Exchange Act and all rules and regulations under each such Act, at common law or otherwise, insofar as such losses, claims, damages, liabilities
or expenses (or actions or proceedings, whether commenced or threatened, in respect thereof) arise out of or are based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in any registration statement as contemplated hereby or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or summary prospectus, together with the
documents incorporated by reference therein (as amended or supplemented if the Company shall have filed with the Commission any amendment thereof or supplement thereto), or any omission or alleged
omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not
misleading, or (iii) any violation by the Company of any federal, state or common law rule or regulation applicable to the Company and relating to action of or inaction by the Company in
connection with any such registration; and in each such case, the Company shall reimburse each such Holder Indemnified Party for any reasonable legal or other expenses incurred by any of them in
connection with investigating or defending any such loss, claim, damage, liability, expense, action or proceeding; provided, however, that the Company shall not be liable to any such Holder
Indemnified Party insofar as such losses, claims, damages, liabilities, expenses, actions or proceedings are the result of any untrue statement or alleged untrue statement made in reliance on or in
conformity with any information furnished to the Company by or on behalf of any Holder Indemnified Party, or any omission or alleged omission to state a material fact relating to any information
furnished to the Company by or on behalf of any Holder Indemnified Party required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. 

        In
connection with any registration statement in which the Holder is participating, the Holder will promptly furnish to the Company such information as shall be reasonably requested by
the Company for use in any such registration statement or prospectus and each and every Holder Indemnified Party will, jointly and severally, indemnify, and defend, the Company, its employees,
officers and directors and each 

12

 

Person, if any, who controls the Company within the meaning of Section 15 of the Securities Act, against any losses, claims, damages, liabilities, expenses, actions or proceedings resulting
from any (i) any action taken by any Holder Indemnified Party in connection with the sale of the Warrant Securities, or (ii) untrue statement or alleged untrue statement of a material
fact or any omission or alleged omission of a material fact required to be stated in the registration statement or prospectus or preliminary prospectus or any amendment thereof or supplement thereto,
or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or omission or alleged untrue statement or omission is made in reliance on or in
conformity with any information so furnished by any Holder Indemnified Party. 

        Any
Person entitled to indemnification under the provisions of this Section 5 shall (i) give prompt notice to the indemnifying party of any claim with respect to which it
seeks indemnification, (ii) unless in such indemnified party's reasonable judgment, supported by the written opinion of reputable and experienced counsel to be supplied to the indemnifying
party, a conflict of interest between such indemnified and indemnifying parties may exist in respect of such claim, permit such indemnifying party to assume control over the defense and/or settlement
of such claim, with reputable and experienced counsel; and if such defense is so assumed, such indemnified party shall not enter into any settlement without the consent of the indemnifying party if
such settlement attributes liability to the indemnifying party and such indemnifying party shall not be subject to any liability for any settlement made without its consent (which shall not be
unreasonably withheld); and (iii) provide such reasonably requested assistance to the indemnifying party, at the indemnifying party's expense. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of any indemnified party. 

        (b)
If for any reason the foregoing indemnity is unavailable, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such
losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect not only the relative benefits received by the indemnifying party on the one hand and the indemnified
party on the other but also the relative fault of the indemnifying party and the indemnified party as well as any other relevant equitable considerations. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. 

 6. Certain Limitations on Registration Rights  

        If the Company determines to enter into an underwriting agreement in connection with a registration provided for in this  Schedule C,
all shares of Common Stock to be included in such registration, including all Warrant Shares, shall be subject to such underwriting
agreement and no Person may participate in such registration unless such Person agrees to sell such Person's securities on the basis provided in such underwriting agreement and completes and/or
executes all questionnaires, indemnities, and other reasonable documents which must be executed under the terms of such underwriting agreement. 

 7. Allocation of Securities Included in Registration Statement  

If
the Company's managing underwriter shall advise the Company and the Holder in writing that the inclusion in any registration pursuant hereto of some or all of the Warrant Shares sought to be
registered by the Holder creates a substantial risk that the proceeds or price per unit that will be derived from such registration will be reduced or that the number of securities to be registered is
too large a number to be reasonably sold, (i) first, the number of shares of Common Stock sought to be sold by the Company or
other holders exercising "demand rights" shall be included in such registration, and (ii) next, the number of Warrant Shares and other shares of Common Stock of other holders exercising
"piggyback rights" shall be included in such registration to the extent permitted by the Company's managing underwriter (if the offering is underwritten) to be allocated on a pro rata basis based on
the number of Warrant Shares Holder,and the number of shares of Common Stock each such other holder, desire to have registered; provided, however, that, if the Holder would be required pursuant to the
provisions of this Section 7 to 

13

 

reduce the number of Warrant Shares that it may include in such registration, the Holder may withdraw all of its Warrant Shares from such registration whereupon the provisions of Section 2(c)
hereof shall not apply to said registration. 

 8. Limitations on Sale or Distribution of Securities  

If
a registration hereunder shall be in connection with an underwritten public offering, the Holder agrees not to effect any public sale or distribution, including any sale pursuant to Rule 144
under the Act, of any Warrant Shares and to use its best efforts not to effect any such public sale or distribution of any other equity security of the Company or of any security convertible into or
exchangeable or exercisable for any equity security of the Company (other than as part of such underwritten public offering) within 10 days before or 90 days after the effective date of
such registration statement. In such event, the Holder agrees to sign the customary market stand-off letter with the Company's managing underwriter, and to comply with applicable rules and
regulations of the Commission. 

 9. Rule 144  

The
Company covenants that it will file the reports required to be filed under the Act and the Exchange Act and the rules and regulations adopted by the Commission thereunder (or, in the event that
the Company is not required to file such reports, it will make publicly available information as set forth in Rule 144(c)(2) promulgated under the Act), and it will take, at Holder's expense,
such further action as the Holder may reasonably request, or to the extent required from time to time, to enable the Holder to sell its Warrant Shares without registration under the Act within the
limitation of the exemption provided by (a) Rule 144 under the Act, as such Rule may be amended from time to time, or (b) any similar rule or regulation hereafter adopted by the
Commission (collectively, "Rule 144"). Upon request of the Holder (but not more than twice in any calendar year), the Company will deliver to the Holder a written statement as to whether it has
complied with such requirements. 

 10. Transfer of Registration Rights  

If
and to the extent that the Holder sells or otherwise disposes of Warrant Shares in any transaction that does not require registration under the Act (other than a transaction exempted under
Rule 144), the rights of the Holder hereunder with respect to such Warrant Shares will be assignable to the transferee of such Warrant Shares; provided, however, that (i) such transferee
agrees in writing with the Company to be bound by all of the terms and conditions of this Schedule C and (ii) the Company's aggregate
obligation under this Section 2 hereof with respect to the Holder and all such transferees shall not extend to more than one (1) registration in total. 

14

QuickLinks

ARTICLE I Exercise of Warrant

ARTICLE II Warrant Office; Transfer, Division or Combination of Warrant

ARTICLE III Restrictions on Transfer and Registration Under The Act

ARTICLE IV Antidilution Provisions

ARTICLE V Terms Defined

ARTICLE VI Miscellaneous

SUBSCRIPTION NOTICE

ASSIGNMENT

REGISTRATION RIGHTS OF HOLDER

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