Document:

Exhibit 4.12

EXHIBIT 4.12

RAPTOR PHARMACEUTICALS
CORP.

SECURITIES PURCHASE AGREEMENT

This Securities Purchase
Agreement (this “Agreement”) is made as of
August 21, 2009 (the “Effective Date”), by and
among Raptor Pharmaceuticals
Corp., a Delaware corporation (the Company”),
and the individuals and entities identified on the signature pages hereto
(each, a “Purchaser” and, collectively, the
“Purchasers”).

Introduction

The Company and the
Purchasers are executing and delivering this Agreement in reliance upon the
exemption from securities registration afforded by Section 4(2) of the
Securities Act and Rule 506 promulgated thereunder.

The Purchasers
desire to purchase from the Company, and the Company desires to sell to the
Purchasers, upon the terms and conditions stated in this Agreement, up to a
maximum of $2.4 million of the Company’s common stock, par value
$0.001 per share (the “Common Stock”), and warrants
to purchase Common Stock of the Company.

The capitalized
terms used herein and not otherwise defined herein have the meanings given them
in Article 7.

In consideration of
the premises and the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Company and the Purchasers (severally and not jointly) hereby
agree as follows:

ARTICLE 1

Purchase and Sale of
Securities

Section 1.1
Purchase and Sale of Securities. At the Closing, upon the terms and
subject to the conditions herein, the Company will issue and sell to each
Purchaser, and each Purchaser will, severally and not jointly, purchase from
the Company the number of shares of Common Stock and the number of warrants to
purchase shares of Common Stock, pursuant to a Warrant substantially in the
form of Exhibit B
attached hereto, as set forth opposite such Purchaser’s name under the
heading “Shares” and “Warrants,” respectively, on Exhibit A attached hereto,
as the same may be amended from time to time after each Subsequent Closing or
otherwise, as appropriate. The purchase price for each Share and related
Warrant (together, a unit) will be $0.32, subject to change at the discretion
of those officers so authorized by the Company’s Board of Directors (the
“Purchase Price”). The Shares (as defined below) and
Warrants (as defined below) are being sold hereunder as units, each unit
consisting of one Share and a Warrant to purchase one-half of a share of Common
Stock.

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Section 1.2
Payment. Upon the Closing Date, each Purchaser shall deliver such
Purchaser’s aggregate Purchase Price set forth opposite its name on Exhibit A attached hereto,
by wire transfer of immediately available funds in accordance with wire
instructions provided to it by the Company at least two Business Days prior to
the Closing. At or promptly following the Closing, and after receiving the
aggregate Purchase Price set forth opposite each Purchaser’s name on
Exhibit A attached
hereto, by wire transfer of immediately available funds, the Company will
instruct its transfer agent to credit and deliver to each Purchaser
certificate(s) representing the number of Shares set forth on Exhibit A attached hereto
and will deliver Warrants to purchase the Warrant Shares (as defined below).

Section 1.3
Closing Date. The closing of the transactions contemplated by this
Agreement (the “Closing”) will take place at 5 p.m.
(Pacific Time) on the first Business Day after the satisfaction or waiver of
the conditions set forth in Article 5 (excluding conditions that, by their
nature, cannot be satisfied until the Closing), the actual time and date of the
Closing being referred to herein as the “Closing
Date”. The anticipated Closing Date is August 2009. The Closing
will be held at the offices of Paul, Hastings, Janofsky & Walker, LLP, 515
South Flower Street, Floor 25, Los Angeles, California 90071, or at such other
time and place as shall be agreed upon by the Company and the Majority
Purchasers.

Section 1.4
Subsequent Closings. After the Closing, additional Shares (which,
together with the Shares issued at the Closing, shall not exceed
7.5 million shares in the aggregate), and additional Warrants (which,
together with the Warrants issued at the Closing, shall not represent the right
to acquire more than 3.75 million shares of Warrant Shares in the
aggregate) may be issued at the discretion of the Company at one or more
subsequent closings (each a “Subsequent Closing”)
which are held on or before August 21, 2009. Each Subsequent Closing shall
be effective upon the date (a “Subsequent Closing
Date”) of the Company’s receipt from a Purchaser of a wire
transfer of funds in the amount of the Purchase Price for the Securities being
purchased by such Purchaser at such Subsequent Closing. Effective upon each
such Subsequent Closing, the applicable Purchaser shall also enter into and
become a party to this Agreement as if such Purchaser had executed such
agreement at the Closing. At the Closing, the Company shall prepare Exhibit A with respect to
the Purchasers purchasing the Shares and Warrants at the Closing. Promptly
after each Subsequent Closing, the Company shall amend Exhibit A as appropriate.
The shares of Common Stock, the warrants to purchase shares of Common Stock,
and the Common Stock underlying such warrants, that are sold pursuant to and in
accordance with Section 1.1 and this Section 1.4 are
referred to herein as the “Shares,” the
“Warrants,” and the
“Warrant Shares,” respectively, and are referred to
herein collectively as the “Securities.”

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ARTICLE 2

Representations and Warranties of the
Company

The Company hereby
represents and warrants to the Purchasers that, as of the date hereof, except
as set forth in the Public Filings or the corresponding section of the
disclosure schedules delivered to the Purchasers herewith:

Section 2.1
Organization and Qualification. The Company is duly incorporated,
validly existing and in good standing under the laws of the State of Delaware,
with corporate power and authority to conduct its business as currently
conducted as disclosed in the Public Filings. The Company is duly qualified to
do business and is in good standing in every jurisdiction in which the nature
of the business conducted by it or property owned by it makes such
qualification necessary, except where the failure to be so qualified or in good
standing, as the case may be, would not reasonably be expected to have a
Material Adverse Effect.

Section 2.2
Authorization; Enforcement. The Company has all requisite corporate
power and authority to enter into and to perform its obligations under the
Transaction Agreements, to consummate the transactions contemplated hereby and
thereby and to issue the Securities in accordance with the terms hereof. The
execution, delivery and performance of the Transaction Agreements by the
Company and the consummation by it of the transactions contemplated hereby and
thereby (including the issuance of the Securities) have been duly authorized by
the Company’s Board of Directors and no further consent or authorization
of the Company, its Board of Directors, or its stockholders is required. Each
Transaction Agreement has been duly executed by the Company and, assuming the
due authorization, execution and delivery of the Transaction Agreements by each
Purchaser a party thereto, constitutes a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, or moratorium or similar laws affecting creditors’ and
contracting parties’ rights generally and except as enforceability may be
subject to general principles of equity and except as rights to indemnity and
contribution may be limited by state, federal, or other securities laws or
public policy underlying such laws.

Section 2.3
Capitalization. As of June 18, 2009, the authorized capital stock
of the Company consisted of 100,000,000 shares of Common Stock and 10,000,000
shares of preferred stock, par value $0.001 per share, of which 60,430,047
shares of Common Stock were issued and outstanding and no shares of preferred
stock were issued and outstanding. All of the issued and outstanding shares of
Common Stock have been duly authorized, validly issued and are fully paid and
nonassessable. Options and warrants to purchase an aggregate of 17,501,503
shares of Common Stock were outstanding as of June 18, 2009. Except as
disclosed in or contemplated by the Public Filings, the Company does not have
outstanding any options to purchase, or any preemptive rights or other rights
to subscribe for or to purchase, any securities or obligations convertible
into, or any contracts or commitments to issue or sell, shares of its capital
stock or any such options, rights, convertible securities or obligations other
than options granted under the Company’s stock option plans.

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Section 2.4
Issuance of Securities. The Shares and the Warrant Shares have been duly
authorized and, upon issuance in accordance with the terms of this Agreement
(and in case of the Warrant Shares, the Warrants), will be validly issued,
fully paid and non-assessable and will not be subject to preemptive rights or
other similar rights of stockholders of the Company.

Section 2.5
No Conflicts; Government Consents and Permits.

(a) The
execution, delivery and performance of each Transaction Agreement by the
Company and the consummation by the Company of the transactions contemplated
hereby and thereby (including the issuance of the Securities) will not:
(i) conflict with or result in a violation of any provision of its
Certificate of Incorporation or Bylaws; (ii) violate or conflict with, or
result in a breach of any provision of, or constitute a default under, any
material agreement to which the Company is a party; or (iii) result in a
violation of any law, rule, regulation, order, judgment or decree of any
governmental authority applicable to the Company, except for such conflicts,
breaches, defaults, and violations as would not reasonably be expected to have
a Material Adverse Effect.

(b) The
Company is not required to obtain any consent, authorization or order of, or
make any filing or registration with, any court or governmental agency or any
regulatory or self regulatory agency in order for it to execute, deliver or
perform any of its obligations under this Agreement in accordance with the
terms hereof, or to issue and sell the Securities in accordance with the terms
hereof other than such as have been made or obtained or any filings required to
be made under federal, state or other securities laws.

(c) The
Company has all franchises, permits, licenses, and any similar authority
necessary for the conduct of its business as now being conducted by it, except
for such franchise, permit, license or similar authority, the lack of which
would not reasonably be expected to have a Material Adverse Effect. The Company
has not received any written notice of any proceeding relating to revocation or
modification of any such franchise, permit, license, or similar authority
except where such revocation or modification would not reasonably be expected
to have a Material Adverse Effect.

Section 2.6
Public Filings, Financial Statements.

(a) The
Company has timely filed all reports, schedules, forms, statements and other
documents required to be filed by it with the U.S. Securities and Exchange
Commission (the “SEC”) since January 1, 2009,
pursuant to the reporting requirements of the Exchange Act, except for those
filings not timely filed as would not reasonably be expected to have a Material
Adverse Effect.

(b) As of
their respective dates, the Public Filings complied as to form in all material
respects with the requirements of the Exchange Act or the Securities Act, as
the case may be, and the rules and regulations of the SEC promulgated
thereunder applicable to the Public Filings, and none of the Public Filings, at
the time they were filed with the SEC, contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances

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under which they were made, not
misleading. The Financial Statements have been prepared in accordance with
accounting principles generally accepted in the United States, consistently
applied, during the periods involved (except (i) as may be otherwise
indicated in the Financial Statements or the notes thereto, or (ii) in the
case of unaudited interim statements, to the extent they may not include
footnotes, may be condensed or summary statements or may conform to the
SEC’s rules and instructions for Reports on Form 10-Q or 10-QSB) and
fairly present in all material respects the consolidated financial position of
the Company as of the dates thereof and the consolidated results of its
operations and cash flows for the periods then ended (subject, in the case of
unaudited statements, to normal and recurring year-end audit adjustments).

Section 2.7
Absence of Litigation. As of the date hereof, there is no action, suit,
proceeding or investigation before or by any court, public board, government
agency, self-regulatory organization or body pending or, to the Company’s
knowledge, threatened against the Company that if determined adversely to the
Company would reasonably be expected to have a Material Adverse Effect. To the
knowledge of the Company, there is not pending, any investigation by the SEC
involving the Company or any current or former director or officer of the
Company. The Company has not received any stop order or other order suspending
the effectiveness of any registration statement filed by the Company under the
Exchange Act or Securities Act and, to the Company’s knowledge, the SEC
has not issued any such order.

Section 2.8
Intellectual Property Rights. To the Company’s knowledge, the
Company owns or possesses, or believes it can obtain on reasonable terms,
licenses or sufficient rights to use all patents, patent applications, patent
rights, inventions, know-how, trade secrets, trademarks, trademark
applications, service marks, service names, trade names and copyrights
necessary to enable it to conduct its business as conducted as of the date
hereof (the “Intellectual Property”). To the
Company’s knowledge, the Company has not infringed the intellectual
property rights of third parties and no third party, to the Company’s
knowledge, is infringing the Intellectual Property, in each case, which could
reasonably be expected to result in a Material Adverse Effect. Except as
disclosed in the Public Filings, there are no material options, licenses or
agreements relating to the Intellectual Property, nor is the Company bound by
or a party to any material options, licenses or agreements relating to the
patents, patent applications, patent rights, inventions, know-how, trade
secrets, trademarks, trademark applications, service marks, service names,
trade names or copyrights of any other Person. As of the date hereof, there is
no material claim or action or proceeding pending or, to the Company’s
knowledge, threatened, that challenges the right of the Company with respect to
any Intellectual Property.

Section 2.9
Placement Agents. The Company has taken no action that would give rise
to any claim by any Person for brokerage commissions, placement agent’s
fees or similar payments relating to this Agreement or the transactions
contemplated hereby, except for dealings with the Placement Agents, whose
commissions and fees will be paid by the Company.

Section 2.10
No Material Adverse Change. Since January 1, 2008, except as
described in the Public Filings and except for cash expenditures in the
ordinary course of business, there has not been a material adverse change in
the business, financial condition, assets or results of operations of the
Company other than its continuing losses from operations. Since January 1,
2008: (i) there has not been any dividend or distribution of any kind
declared, set aside for payment, paid or made by the Company on any class of
capital stock; and (ii) the Company has

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not sustained any material loss or
interference with the Company’s business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
disturbance or dispute or any action, order or decree of any court or
arbitrator or governmental or regulatory authority.

Section 2.11
Taxes. The Company has filed (or has obtained an extension of time
within which to file) all necessary federal, state and foreign income and
franchise tax returns and has paid all taxes shown as due on such tax returns,
except where the failure to so file or the failure to so pay would not
reasonably be expected to have a Material Adverse Effect and except those taxes
being contested in good faith and for which adequate reserves have been
provided.

Section 2.12
No Manipulation of Stock. The Company has not taken, nor will it take,
directly or indirectly any action designed to stabilize or manipulate the price
of the Common Stock or any security of the Company to facilitate the sale or
resale of any of the Shares.

ARTICLE 3

Purchaser’s Representations and
Warranties

Each Purchaser
represents and warrants to the Company, severally and not jointly, with respect
to itself and its purchase hereunder, that:

Section 3.1
Investment Purpose. The Purchaser is purchasing the Securities for its
own account and not with a present view toward the public sale or distribution
thereof and has no intention of selling or distributing any of such Securities
or any arrangement or understanding with any other Persons regarding the sale
or distribution of such Securities except in accordance with the provisions of
Article 6 and except as would not result in a violation of the
Securities Act. The Purchaser will not, directly or indirectly, offer, sell,
pledge, transfer or otherwise dispose of (or solicit any offers to buy,
purchase or otherwise acquire or take a pledge of) any of the Securities except
in accordance with the provisions of Article 6 or pursuant to and
in accordance with the Securities Act.

Section 3.2
Questionnaires. The Purchaser has completed the Accredited Purchaser
Qualification Questionnaire, in the form of Exhibit C attached hereto,
and has submitted such Accredited Purchaser Qualification Questionnaire to the
Company in connection with its purchase of the Securities. The Accredited
Purchaser Qualification Questionnaire was accurate and correct when delivered
and is accurate and correct as of the date hereof and the representations,
warranties and covenants contained herein and in the applicable schedules
attached hereto will be true and correct both as of the date of execution of
this Subscription Agreement and on the Closing Date. In addition to completing
and delivering the aforementioned, the Purchaser agrees to provide any
additional information that is requested by the Company in order to confirm
that such Purchaser has complied with any applicable securities laws to which
it is subject.

Section 3.3
Reliance on Exemptions. The Purchaser understands that the Securities
are being offered and sold to it in reliance upon specific exemptions from the

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prospectus and registration
requirements of federal, state, and other securities laws, as applicable, and
that the Company is relying upon the truth and accuracy of, and the
Purchaser’s compliance with, the representations, warranties, agreements,
acknowledgments and understandings of the Purchaser set forth herein in order
to determine the availability of such exemptions and the eligibility of the
Purchaser to acquire the Securities.

Section 3.4
Information. The Purchaser has been furnished with all relevant
materials relating to the business, finances and operations of the Company
necessary to make an investment decision, and materials relating to the offer
and sale of the Securities, that have been requested by the Purchaser,
including, without limitation, the Company’s Public Filings, and the
Purchaser has had the opportunity to review the Public Filings. The Purchaser
has been afforded the opportunity to ask questions of the Company. Neither such
inquiries nor any other investigation conducted by or on behalf of such
Purchaser or its representatives or counsel shall modify, amend or affect such
Purchaser’s right to rely on the truth, accuracy and completeness of the
Public Filings and the Company’s representations and warranties contained
herein.

Section 3.5
Acknowledgement of Risk.

(a) The
Purchaser acknowledges and understands that its investment in the Securities
involves a significant degree of risk, including, without limitation:
(i) the Company remains a development stage business with limited
operating history and requires substantial funds in addition to the proceeds
from the sale of the Securities; (ii) an investment in the Company is
speculative, and only Purchasers who can afford the loss of their entire
investment should consider investing in the Company and the Securities;
(iii) the Purchaser may not be able to liquidate its investment;
(iv) transferability of the Securities is extremely limited; (v) in
the event of a disposition of the Securities, the Purchaser could sustain the
loss of its entire investment; and (vi) the Company has not paid any
dividends on its Common Stock since inception and does not anticipate the
payment of dividends in the foreseeable future. Such risks are more fully set
forth in the Public Filings;

(b) The
Purchaser is able to bear the economic risk of holding the Securities for an
indefinite period, and has knowledge and experience in financial and business
matters such that it is capable of evaluating the risks of the investment in
the Securities; and

(c) The
Purchaser has, in connection with the Purchaser’s decision to purchase
Securities, not relied upon any representations or other information (whether
oral or written) other than as set forth in the representations and warranties
of the Company contained herein, and the Purchaser has, with respect to all
matters relating to the Transaction Agreements and the offer and sale of the
Securities, relied solely upon the advice of such Purchaser’s own counsel
and has not relied upon or consulted any counsel to any placement agent or
counsel to the Company.

Section 3.6
Governmental Review. The Purchaser understands that no federal or state
agency or any other government or governmental agency has passed upon or made
any recommendation or endorsement of the Securities or an investment therein.

Section 3.7
Transfer or Resale. The Purchaser understands that:

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(a) the
Securities have not been and are not being registered under the Securities Act
(other than as contemplated in Article 6), or any applicable
federal, state, or other securities laws and, consequently, the Purchaser may
have to bear the risk of owning the Securities for an indefinite period of time
because the Securities may not be transferred unless: (i) the resale of
the Securities is registered pursuant to an effective registration statement
under the Securities Act, as contemplated in Article 6;
(ii) the Purchaser has delivered to the Company an opinion of counsel (in
form, substance and scope reasonably satisfactory to the Company) to the effect
that the Securities to be sold or transferred may be sold or transferred
pursuant to an exemption from such registration; or (iii) the Securities
are sold or transferred pursuant to Rule 144;

(b) any sale
of the Securities made in reliance on Rule 144 may be made only in
accordance with the terms of Rule 144 and, if Rule 144 is not
applicable, any resale of the Securities under circumstances in which the
seller (or the person through whom the sale is made) may be deemed to be an
underwriter (as that term is defined in the Securities Act) may require
compliance with some other exemption under the Securities Act or the rules and
regulations of the SEC thereunder; and

(c) except as
set forth in Article 6, neither the Company nor any other Person is
under any obligation to register the resale of the Shares or the Warrant Shares
under the Securities Act, or any applicable federal, state or other securities
laws or to comply with the terms and conditions of any exemption thereunder.

Section 3.8
Legends. The Purchaser understands the certificates representing the
Securities will bear restrictive legends in the following forms (and a
stop-transfer order may be placed against transfer of the certificates for such
Securities):

“THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER JURISDICTION. THE SECURITIES MAY NOT BE SOLD,
OFFERED FOR SALE, PLEDGED, HYPOTHECATED, TRANSFERRED OR ASSIGNED IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE
SECURITIES LAWS, OR UNLESS OFFERED, SOLD, PLEDGED, HYPOTHECATED OR TRANSFERRED
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THOSE
LAWS. THE COMPANY SHALL BE ENTITLED TO REQUIRE AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED TO THE
EXTENT THAT SUCH OPINION IS REQUIRED PURSUANT TO THAT CERTAIN SECURITIES
PURCHASE AGREEMENT UNDER WHICH THE SECURITIES WERE ISSUED.

“UNTIL THE
DISTRIBUTION DATE (AS DEFINED IN THE RIGHTS AGREEMENT REFERRED TO BELOW), THIS
CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN

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RIGHTS AS SET FORTH
IN A STOCKHOLDER RIGHTS AGREEMENT, DATED AS OF DECEMBER 5, 2008 (AS SUCH MAY BE
AMENDED FROM TIME TO TIME, THE “RIGHTS AGREEMENT”), BETWEEN RAPTOR
PHARMACEUTICALS CORP. (THE “COMPANY”) AND NEVADA AGENCY & TRUST
COMPANY, AS RIGHTS AGENT, THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
THE COMPANY. UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT,
SUCH RIGHTS MAY BE EVIDENCED BY SEPARATE CERTIFICATES AND MAY NO LONGER BE
EVIDENCED BY THIS CERTIFICATE. THE COMPANY WILL MAIL OR ARRANGE FOR THE MAILING
OF A COPY OF THE RIGHTS AGREEMENT TO THE HOLDER OF THIS CERTIFICATE WITHOUT
CHARGE AFTER THE RECEIPT OF A WRITTEN REQUEST THEREFOR. AS DESCRIBED IN THE
RIGHTS AGREEMENT, RIGHTS ISSUED TO ANY PERSON WHO BECOMES AN “ACQUIRING
PERSON” OR ITS “AFFILIATES” OR “ASSOCIATES” (AS
DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN RELATED PERSONS, WHETHER CURRENTLY
HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER, SHALL BECOME
NULL AND VOID.”

Notwithstanding
anything herein to the contrary, the Purchaser understands the certificates
representing the Securities will bear any other restrictive legends (and a
stop-transfer order may be placed against transfer of the certificates for such
Securities with respect thereof) that the Company deems necessary or that are
otherwise required pursuant to applicable securities laws.

Section 3.9
Authorization; Enforcement. The Purchaser has the requisite power and
authority to enter into the Transaction Agreements and to consummate the
transactions contemplated hereby and thereby. The Purchaser has taken all
necessary action to authorize the execution, delivery and performance of the
Transaction Agreements. Each Transaction Agreement has been duly executed by
the Purchaser and, assuming the due authorization, execution and delivery of
the Transaction Agreements by the Company, constitutes a legal, valid and
binding obligation of the Purchaser enforceable against the Purchaser in
accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors’ and contracting parties’ rights generally and
except as enforceability may be subject to general principles of equity and
except as rights to indemnity and contribution may be limited by federal, state
or other securities laws or public policy underlying such laws.

Section 3.10
Residency. The Purchaser certifies that it is a resident of the
jurisdiction set forth immediately below such Purchaser’s name on the
signature pages hereto.

Section 3.11
No Net Short Position. Between the time the Purchaser learned about the
Offering (or was first contacted regarding an investment in the Company) and
the first public announcement of the Offering by the Company, neither the
Purchaser nor any Person acting on its behalf or pursuant to any understanding
with it, has engaged, nor has, nor will, the

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Purchaser, directly or indirectly,
cause any Person to (but shall cause such Persons not to) engage in any short
sales or similar transactions with respect to the Common Stock. Additionally,
the Purchaser understands and acknowledges, severally and not jointly with any
other Purchaser, that the SEC currently takes the position that coverage of
short sales of the Common Stock “against the box” prior to the date
such shares are registered is a violation of Section 5 of the Securities
Act, as set forth in Item 65, Section 5 under Section A, of the
Manual of Publicly Available Telephone Interpretations, dated July 1997,
compiled by the Office of Chief Counsel, Division of Corporation Finance.

Section 3.12
Acknowledgements Regarding Placement Agents.

(a) The
Purchaser acknowledges that the Placement Agents are acting as the
non-exclusive placement agents on a “best efforts” basis for the
Securities being offered hereby and will be compensated by the Company for
acting in such capacity. The Purchaser represents that (i) (x) the
Purchaser was contacted regarding the sale of the Securities by one of the
Placement Agents (or an authorized agent or representative thereof) or
(y) the Purchaser contacted the Company directly or the Company contacted
the Purchaser directly regarding the sale of the Securities and (ii) no
Securities were offered or sold to it by means of any form of general
solicitation or general advertising.

(b) The
Purchaser acknowledges that (i) the Company and each Placement Agent have
entered into a Placement Agency Agreement under which each Placement Agent will
introduce to the Company accredited investors, (ii) in consideration for
such services, the Company will pay each Placement Agent a placement fee equal
to 7% of the gross proceeds of Securities sold to investors introduced by such
Placement Agent in the Offering and the Company will issue to each Placement
Agent a warrant to purchase a number of shares of Common Stock equal to 7% of
the number of units issued to investors (inclusive of the Shares and Warrant
Shares) introduced by such Placement Agent in the Offering, (iii) Limetree
Capital, one of the Placement Agents, is an affiliate of the Company,
(iv) the Company will pay to each Placement Agent expenses incurred by it
in connection with the Offering that are pre-approved by the Company, and (v)
Erich Sager, a partner of Limetree Capital, is a member of our Board of
Directors and a stockholder of the Company.

Section 3.13
Anti-Money Laundering Laws. The Purchaser represents and warrants to,
and covenants with, the Company that: (i) the Purchaser is in compliance
with Executive Order 13224 and the regulations administered by the U.S.
Department of the Treasury (“Treasury”) Office of
Foreign Assets Control; (ii) the Purchaser, its parents, subsidiaries,
affiliated companies, officers, directors and partners, and to the
Purchaser’s knowledge, its shareholders, owners, employees, and agents,
are not on the List of Specially Designated Nationals and Blocked Persons
(“SDN List”) maintained by Treasury and have not been
designated by Treasury as a financial institution of primary money laundering
concern; (iii) to the Purchaser’s knowledge after reasonable
investigation, all of the funds to be used to acquire the Securities are
derived from legitimate sources and are not the product of illegal activities;
(iv) the Purchaser is in compliance with all other applicable anti-money
laundering laws and regulations and has implemented, if applicable, an
anti-money laundering compliance program in accordance

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with the requirements of the Bank
Secrecy Act, as amended by the USA PATRIOT Act, Pub. L. 107-56; (v) none
of the funds being used to purchase the Securities are to the Purchaser’s
knowledge proceeds obtained or derived directly or indirectly as a result of
illegal activities; and (vi) to the best of its knowledge (A) none of
the funds to be provided by the Purchaser are being tendered on behalf of a
person or entity who has not been identified to the Purchaser, and (B) it
shall promptly notify the Company if the Purchaser discovers that any of such
representations cease to be true, and to provide the Company with appropriate
information in connection therewith.

ARTICLE 4

Covenants

Section 4.1
Expenses. The Company and each Purchaser shall be severally and not
jointly liable for, and each shall pay, its own expenses incurred in connection
with the negotiation, preparation, execution and delivery of this Agreement,
including, without limitation, attorneys’ and consultants’ fees and
expenses.

Section 4.2
Publicity. No Purchaser shall originate any press release or other
public announcement, written or oral, relating to this Agreement, or to
performance hereunder or the existence of any arrangement among the parties
hereto without the prior approval of the Company, except to the extent that
such press release or announcement is required by applicable law. The
Purchasers acknowledge that the Company will be required to file a copy of this
Agreement, and the other agreements and instruments contemplated hereby, with
the SEC and to describe these transactions in its public filings and public
announcements.

Section 4.3
Sales by Purchasers. Each Purchaser will sell any Securities held by it
in compliance with the requirements for an exemption from the prospectus
requirement and registration under the Securities Act, any applicable federal,
state or other securities laws and the rules and regulations promulgated
thereunder. No Purchaser will make any sale, transfer or other disposition of
the Securities in violation of federal, state or other securities laws.

Section 4.4
Reservation of Common Stock. The Company shall reserve and keep
available at all times during which the Warrants are exercisable, free of
preemptive rights, a sufficient number of shares of Common Stock for the
purpose of enabling the Company to issue Warrant Shares pursuant to this
Agreement.

Section 4.5
Reports. If required by applicable securities legislation, regulations,
rules, instruments, policies or orders or by any securities commission or other
regulatory authority, the Purchaser will execute, deliver and file such
reports, undertakings and other documents with respect to the issue of the
Securities as may be required.

ARTICLE 5

Conditions to Closing

Section 5.1
Conditions to Obligations of the Company. The Company’s obligation
to complete the sale and issuance of the Securities and deliver such stock
certificate(s)

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representing the Shares and Warrants
to each Purchaser is subject to the fulfillment, or waiver by the Company, as
of the Closing Date (or, if applicable, the Subsequent Closing Date) of the
following conditions:

(a) Receipt
of Funds. The Company shall have received immediately available funds in
the full amount of the purchase price for the Shares and Warrants being
purchased hereunder as set forth opposite such Purchaser’s name on Exhibit A attached hereto.

(b) Minimum
Aggregate Investment. The Company shall have received at the Closing at
least $2.24 million of aggregate proceeds from the sale of the Shares and
Warrants hereunder.

(c) Representations and Warranties. The
representations and warranties made by each Purchaser in Article 3 shall
be true and correct in all material respects as of the Closing Date or, if
applicable, the Subsequent Closing Date (except for representations and
warranties that speak as of a specific date, which shall be true and correct in
all material respects as of such date).

(d) Covenants. All covenants, agreements and
conditions contained in this Agreement to be performed by the Purchasers on or
prior to the Closing Date (or, if applicable, the Subsequent Closing Date)
shall have been performed or complied with in all material respects.

(e) Qualifications. The Company shall have obtained
all necessary permits and qualifications, including all blue sky permits and
qualifications, or secured exemptions therefrom, required by any state for the
offer and sale of the Securities.

(f) Absence
of Litigation. No proceeding challenging this Agreement or the transactions
contemplated hereby, or seeking to prohibit, alter, prevent or materially delay
the Closing, shall have been instituted or be pending before any court,
arbitrator, governmental body, agency or official.

(g) No
Governmental Prohibition. The sale of the Securities by the Company shall
not be prohibited by any law or governmental order or regulation.

(h) No Stop
Order. No stop order or suspension of trading shall have been imposed by
the SEC or any other governmental or regulatory body with respect to public
trading in the Common Stock after the date of the Agreement.

Section 5.2
Conditions to Purchasers’ Obligations at the Closing. Each
Purchaser’s obligation to complete the purchase of the Shares and
Warrants is subject to the fulfillment, or waiver by the Majority Purchasers,
as of the Closing Date of the following conditions:

(a) Representations and Warranties. The
representations and warranties made by the Company in Article 2 shall be
true and correct in all material respects as of the Closing Date or, if
applicable, the Subsequent Closing Date (except for representations and
warranties

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that speak as of a specific date,
which shall be true and correct in all material respects as of such date).

(b) Covenants. All covenants, agreements and
conditions contained in this Agreement to be performed by the Company on or
prior to the Closing Date (or, if applicable, the Subsequent Closing Date)
shall have been performed or complied with in all material respects.

(c) Qualifications. The Company shall have obtained
all necessary permits and qualifications, including all blue sky permits and
qualifications, or secured exemptions therefrom, required by any state for the
offer and sale of the Securities.

(d) Transfer Agent Instructions. The Company shall
have delivered to its transfer agent irrevocable instructions to issue to such
Purchaser or in such nominee name(s) as designated by such Purchaser in writing
certificates representing such number of Shares set forth opposite such
Purchaser’s name on Exhibit A attached hereto.

(e) Absence
of Litigation. No proceeding challenging this Agreement or the transactions
contemplated hereby, or seeking to prohibit, alter, prevent or materially delay
the Closing, shall have been instituted or be pending before any court,
arbitrator, governmental body, agency or official.

(f) No
Governmental Prohibition. The sale of the Securities by the Company shall
not be prohibited by any law or governmental order or regulation.

(g) No Stop
Order. No stop order or suspension of trading shall have been imposed by
the SEC or any other governmental or regulatory body with respect to public
trading in the Common Stock after the date of the Agreement.

ARTICLE 6

Registration Rights

Section 6.1
Required Registration.

(a) Subject to
Section 6.1(b), the Company shall no later than 75 days after
the Closing Date, subject to receipt of necessary information from the
Purchasers, prepare and file with the SEC a registration statement covering the
resale of all of the Registrable Securities (the “Registration
Statement”).

(b) Notwithstanding anything herein to the contrary, in
the event that the Company, in its sole discretion, decides to limit the amount
of shares of Common Stock that may be included in the Registration Statement
(such number of shares of Common Stock which the Company decides to include in
the Registration Statement, the “Allowable Maximum”),
the number of Registrable Securities sought to be included in the Registration
Statement shall be cutback and removed from the Registration Statement until
the aggregate number of such Registrable Securities to be included in the
Registration Statement equals the Allowable Maximum. Such cutbacks will be in
the following order:

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(i) first
there shall be excluded any securities of the Company included or to be
included in the Registration Statement, whether pursuant to piggyback or demand
registration rights or otherwise requested to be included, other than the
Registrable Securities, the shares of Common Stock to be issued to the
Placement Agents (the “Placement Agents Shares”), and
the shares of Common Stock underlying the warrant(s) to be issued to the
Placement Agents (the “Placement Agents Warrant
Shares”); next

(ii) the Placement Agents Warrant Shares shall be excluded; next

(iii) the Placement Agents Shares shall be excluded; next

(iv) the Warrant Shares shall be excluded; and next

(v) the Shares
shall be excluded, until the Allowable Maximum is not exceeded.

Except as
specified in the preceding sentence, any required cutbacks within each of
Sections 6.1(b)(iv) and 6.1(b)(v) shall be applied to such
Holders pro rata in accordance with the number of Warrant Shares or Shares,
respectively, then-held by such Holders and sought to be included in such
Registration Statement.

Section 6.2
Registration Expenses and Selling Expenses. All Registration Expenses
incurred in connection with any registration, qualification, exemption or
compliance pursuant to Section 6.1 shall be borne by the Company.
All Selling Expenses incurred in connection with any registrations under this
Agreement shall be borne by the Holders of the securities so registered pro
rata on the basis of the number of shares so registered and all Selling
Expenses relating to the sale of securities registered or by or on behalf of
any Holder shall be borne by such Holders.

Section 6.3
Registration Period Covenants. At its expense, during the period that
the Company keeps the Registration Statement effective, in its discretion (the
“Registration Period”), the Company shall:

(a) advise the
Holders:

(i) within
five Business Days of when the Registration Statement or any amendment thereto
has been filed with the SEC and within five Business Days of receiving notice
or obtaining knowledge of the effectiveness of the Registration Statement or
any post-effective amendment thereto;

(ii) within
five Business Days of any request by the SEC for amendments or supplements to
the Registration Statement or the prospectus included therein or for additional
information;

(iii) within
five Business Days of receiving notice or obtaining knowledge of the issuance
by the SEC of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for such purpose; and

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(iv) within
five Business Days of the occurrence of any event that requires the making of
any changes in the Registration Statement or the prospectus so that, as of such
date, the statements therein are not misleading and do not omit to state a
material fact required to be stated therein or necessary to make the statements
therein (in the case of the prospectus, in light of the circumstances under
which they were made) not misleading;

(b) use its
commercially reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement as soon as
reasonably practicable;

(c) promptly
deliver to each such Holder, without charge, as many copies of the prospectus
included in such Registration Statement and any amendment or supplement thereto
as such Holder may reasonably request in writing; and the Company consents to
the use, consistent with the provisions hereof, of the prospectus or any
amendment or supplement thereto by each of the selling Holders of Registrable
Securities in connection with the offering and sale of the Registrable
Securities covered by the prospectus or any amendment or supplement thereto;

(d) if a
Holder so requests in writing, deliver to each Holder, without charge,
(i) one copy of the following documents, other than those documents
available via the Electronic Data Gathering, Analysis, and Retrieval (EDGAR)
system: (A) its annual report to its stockholders, if any (which annual
report shall contain financial statements audited in accordance with generally
accepted accounting principles in the United States of America by a firm of
certified public accountants of recognized standing); (B) if not included
in substance in its annual report to stockholders, its annual report on Form
10-K (or similar form); (C) its definitive proxy statement (or similar
form) with respect to its most recent annual meeting of stockholders;
(D) each of its quarterly reports to its stockholders, and, if not
included in substance in its quarterly reports to stockholders, its quarterly
report on Form 10-Q (or similar form); and (E) a copy of the full
Registration Statement (the foregoing, in each case, excluding exhibits); and
(ii) if explicitly requested, all exhibits excluded by the parenthetical
to the immediately preceding clause (E);

(e) prior to
any public offering of Registrable Securities pursuant to the Registration
Statement, promptly take such actions as may be necessary to register or
qualify or obtain an exemption for offer and sale under the securities or blue
sky laws of such United States jurisdictions as any such Holders reasonably
request in writing, provided that the Company shall not for any such
purpose be required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified, consent to
general service of process in any such jurisdiction, or subject itself to any
material tax in any such jurisdiction where it is not so then subject; and

(f) upon the
occurrence of any event contemplated by Section 6.3(a)(iv) above,
except for such times as the Company is permitted hereunder to suspend the use
of the prospectus forming part of the Registration Statement, the Company shall
use its commercially reasonable efforts to as soon as reasonably practicable
prepare a post-effective amendment to the Registration Statement or a
supplement to the related prospectus, or file any other required document so
that, as thereafter delivered to purchasers of the Registrable Securities
included therein, the prospectus will not include any untrue statement of a
material fact or omit to state

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any material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.

Section 6.4
Certain Limitations. The Holders shall have no right to take any action
to restrain, enjoin or otherwise delay any registration pursuant to
Section 6.1 as a result of any controversy that may arise with
respect to the interpretation or implementation of this Agreement.

Section 6.5
Indemnity.

(a) To the
extent permitted by law, the Company shall indemnify each Holder and each
person controlling such Holder within the meaning of Section 15 of the
Securities Act, with respect to which the Registration Statement that has been
effected pursuant to this Agreement, against all claims, losses, damages and
liabilities (or action in respect thereof), including any of the foregoing
incurred in settlement of any litigation, commenced or threatened (subject to
Section 6.5(c)), arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in the Registration
Statement, prospectus, any amendment or supplement thereof, 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 not misleading, in
light of the circumstances in which they were made, or any violation by the
Company of any rule or regulation promulgated by the Securities Act applicable
to the Company and relating to any action or inaction required of the Company
in connection with any such registration, qualification or compliance, and will
reimburse each Holder and each person controlling such Holder, for reasonable
legal and other out-of-pocket expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action as
incurred; provided that the Company will not be liable in any such case
to the extent that any untrue statement or omission or allegation thereof is
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of such Holder for use in preparation of the
Registration Statement, prospectus, amendment or supplement; provided
further that the Company will not be liable in any such case where the
claim, loss, damage or liability arises out of or is related to the failure of
such Holder to comply with the covenants and agreements contained in this
Agreement respecting sales of Registrable Securities, and except that the
foregoing indemnity agreement is subject to the condition that, insofar as it
relates to any such untrue statement or alleged untrue statement or omission or
alleged omission made in the preliminary prospectus but eliminated or remedied
in the amended prospectus on file with the SEC at the time the Registration
Statement becomes effective or in the amended prospectus filed with the SEC
pursuant to Rule 424(b) or in the prospectus subject to completion under
Rule 434 of the Securities Act, which together meet the requirements of
Section 10(a) of the Securities Act (the “Final
Prospectus”), such indemnity shall not inure to the benefit of
any such Holder or any such controlling person, if a copy of the Final
Prospectus furnished by the Company to the Holder for delivery was not
furnished to the person or entity asserting the loss, liability, claim or
damage at or prior to the time such furnishing is required by the Securities
Act and the Final Prospectus would have cured the defect giving rise to such
loss, liability, claim or damage.

(b) Each
Holder will severally, and not jointly, indemnify the Company, each of its
directors and officers, and each person who controls the Company within the
meaning of Section 15 of the Securities Act, against all claims, losses,
damages and liabilities (or actions in

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respect thereof), including any of
the foregoing incurred in settlement of any litigation, commenced or threatened
(subject to Section 6.5(c) below), arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
the Registration Statement, prospectus, or any amendment or supplement thereof,
incident to any such registration, 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 not misleading, in light of the
circumstances in which they were made, and will reimburse the Company, such
directors and officers, and each person controlling the Company for reasonable
legal and other out-of-pocket expenses reasonably incurred in connection with
investigating or defending any such claim, loss, damage, liability or action as
incurred, in each case to the extent, but only to the extent, that such untrue
statement or omission or allegation thereof is made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
the Holder for use in preparation of the Registration Statement, prospectus,
amendment or supplement. Notwithstanding the foregoing, a Holder’s
aggregate liability pursuant to this subsection (b) shall be limited to
the net amount received by the Holder from the sale of the Registrable
Securities giving rise to such claims, losses, damages and liabilities (and
actions in respect thereof).

(c) Each party
entitled to indemnification under this Section 6.5 (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 (at its expense) to assume the defense of any such claim
or any litigation resulting therefrom; provided that the Indemnified
Party may participate in such defense at such Indemnified Party’s
expense; 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 Agreement, unless such failure is materially prejudicial
to the Indemnifying Party in defending such claim or litigation. An
Indemnifying Party shall not be liable for any settlement of an action or claim
effected without its written consent (which consent will not be unreasonably
withheld, conditioned or delayed). No Indemnifying Party, in its defense of any
such claim or litigation, shall, except with the consent (such consent not to
be unreasonably withheld, conditioned or delayed) of the 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.

(d) If the
indemnification provided for in this Section 6.5 is held by a court
of competent jurisdiction to be unavailable to an Indemnified Party or is
insufficient to hold such Indemnified Party harmless with respect to any loss,
liability, claim, damage or expense referred to therein, then the Indemnifying
Party shall contribute to the amount paid or payable by such Indemnified Party
as a result of such loss, liability, claim, damage or expense in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and of the Indemnified Party on the other in connection
with the statements or omissions which resulted in such loss, liability, claim,
damage or expense as well as any other relevant equitable considerations. The
relative fault of the Indemnifying Party and of the Indemnified Party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the Indemnifying Party or by the Indemnified
Party and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

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Notwithstanding the foregoing, a
Holder’s aggregate liability pursuant to this subsection (d) shall
be limited to the net amount received by the Holder from the sale of
Registrable Securities giving rise to such loss, liability, claim, damage or
expense (or actions in respect thereof).

Section 6.6
Additional Covenants and Agreements of the Holders.

(a) Each
Holder agrees that, upon receipt of any notice from the Company of the
happening of any event requiring the preparation of a supplement or amendment
to a prospectus relating to Registrable Securities so that, as thereafter
delivered to the Holders, such prospectus shall not contain an untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, each Holder
will immediately discontinue disposition of Registrable Securities pursuant to
the Registration Statement and prospectus contemplated by this Agreement until
its receipt of copies of the supplemented or amended prospectus from the
Company and, if so directed by the Company, each Holder shall deliver to the
Company all copies, other than permanent file copies then in such
Holder’s possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice.

(b) Each
Holder shall suspend, upon request of the Company, any disposition of
Registrable Securities pursuant to the Registration Statement and prospectus
contemplated by Section 6.1 during no more than two periods of no
more than 45 calendar days each during any 12-month period to the extent that
the Board of Directors of the Company determines in good faith that the Company
may be required to disclose any material corporate development which disclosure
may have a Material Adverse Effect on the Company.

(c) As a
condition to the inclusion of its Registrable Securities, each Holder shall
furnish to the Company such information regarding such Holder and the
distribution proposed by such Holder as the Company may request in writing,
including completing one or more registration statement questionnaires in the
form(s) provided by the Company or as shall be required in connection with any
registration referred to in this Article 6, duly executed by the
Holder, in each case within three Business Days after such information is
requested by the Company. The Holder covenants that upon the Company’s
request, such Holder will promptly notify the Company of any changes in such
information or other information, under signature of the Holder, as the Company
may request in connection with any registration referred to in this
Article 6.

(d) Each
Holder hereby covenants with the Company: (i) not to make any sale of the
Registrable Securities without effectively causing the prospectus delivery
requirements under the Securities Act to be satisfied; and (ii) if such
Registrable Securities are to be sold by any method or in any transaction other
than on a national securities exchange or in the over-the-counter market, in
privately negotiated transactions, or in a combination of such methods, to
notify the Company at least five Business Days prior to the date on which the
Holder first offers to sell any such Registrable Securities.

(e) Each
Holder acknowledges and agrees that the Registrable Securities sold pursuant to
the Registration Statement are not transferable on the books of the Company
unless the stock certificate submitted to the transfer agent evidencing such
Registrable Securities is

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accompanied by a certificate
reasonably satisfactory to the Company to the effect that: (i) the
Registrable Securities have been sold in accordance with such Registration
Statement; and (ii) the requirement of delivering a current prospectus has
been satisfied, together with any other documentation required by the transfer
agent.

(f) Each
Holder agrees not to take any action with respect to any distribution deemed to
be made pursuant to such Registration Statement which would constitute a
violation of Regulation M under the Exchange Act or any other applicable
rule, regulation or law.

(g) At the end
of the Registration Period, the Holders shall discontinue sales of shares
pursuant to the Registration Statement upon receipt of notice from the Company
of its intention to remove from registration the shares covered by the
Registration Statement which remain unsold, and such Holders shall notify the
Company of the number of shares registered which remain unsold immediately, but
in any event no later than three Business Days, following receipt of such
notice from the Company.

Section 6.7
Additional Covenants and Agreements of the Company. With a view to
making available to the Holders the benefits of certain rules and regulations
of the SEC which at any time permit the sale of the Registrable Securities to
the public without registration, so long as the Holders own Registrable
Securities, the Company shall use its commercially reasonable 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;

(b) file with
the SEC in a timely manner all reports and other documents required of the
Company under the Exchange Act; and

(c) so long as
a Holder owns any Registrable Securities, furnish to such Holder, upon any
reasonable request, a written statement by the Company as to its compliance
with Rule 144 under the Securities Act, and of 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 as such Holder may reasonably request in
writing in availing itself of any rule or regulation of the SEC allowing a
Holder to sell any such securities without registration.

Section 6.8
Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities granted to the Holders by the Company under
Section 6.1 may not be assigned or transferred to any other Person
under any circumstances.

ARTICLE 7

Definitions

Section 7.1
Definitions. The following capitalized terms have the following meanings
in this Agreement:

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“Affiliate” means, with respect to
any Person, any other Person controlling, controlled by or under direct or
indirect common control with such Person (for the purposes of this definition
“control,” when used with respect to any specified
Person, shall mean the power to direct the management and policies of such
person, directly or indirectly, whether through ownership of voting securities,
by contract or otherwise; and the terms “controlling”
and “controlled” shall have meanings
correlative to the foregoing).

“Business Day” means a day Monday
through Friday on which banks are generally open for business in Novato,
California.

“Closing” has the meaning set forth
in Section 1.3.

“Closing Date” has the meaning set
forth in Section 1.3.

“Exchange Act” means the Securities
Exchange Act of 1934, as amended.

“Filing
Date” has the meaning set forth in Section 6.1.

“Final
Prospectus” has the meaning set forth in Section 6.6(a).

“Financial Statements” means the
financial statements of the Company included in the Public Filings.

“Holder” means any person holding
Registrable Securities.

“Indemnified Party” has the meaning
set forth in Section 6.5(c).

“Indemnifying Party” has the meaning
set forth in Section 6.5(c).

“Intellectual Property” has the
meaning set forth in Section 2.8.

“Majority Purchasers” means, as of
the Closing Date or a Subsequent Closing Date, the Purchasers who have
purchased prior to such date or are then purchasing as of such date a majority
of the Shares, as set forth on Exhibit A attached hereto.

“Material Adverse Effect” means a
material adverse effect on the business, operations, assets, financial
condition, market capitalization or results of operations of the Company and
its subsidiaries, taken as a whole.

“Offering” means the private
placement of the Securities contemplated by this Agreement.

“Person” means any person,
individual, corporation, limited liability company, partnership, trust or other
nongovernmental entity or any governmental agency, court, authority or other
body (whether foreign, federal, state, local or otherwise).

“Placement Agents” means,
collectively, Limetree Capital and any other firm serving as a placement agent
in connection with this Offering.

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“Placement Agents Shares has the meaning
set forth in Section 6.1(b)(i).

“Placement Agents Warrant Shares” has
the meaning set forth in Section 6.1(b)(i).

“Public
Filings” means the Company’s Annual Report filed with the
SEC on Form 10-K/A on December 23, 2008 for the fiscal year ended
August 31, 2008, and Quarterly Report filed with the SEC on Form 10-Q on
April 13, 2009 for the quarterly period ended February 28, 2009.

“Purchasers” mean the Purchasers
whose names are set forth on the signature pages of this Agreement, and their
permitted transferees.

“Purchase Price” has the meaning set
forth in Section 1.1.

“register,” “registered”
and “registration” refer to the 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.

“Registrable Securities” means
(i) the Shares and (ii) the Warrant Shares; provided, however,
that securities shall only be treated as Registrable Securities if and only for
so long as they (A) have not been disposed of pursuant to a registration
statement declared effective by the SEC; or (B) have not been sold in a
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.

“Registration Expenses” means all
expenses incurred by the Company in complying with Section 6.1,
including, without limitation, all registration, qualification and filing fees,
printing expenses, escrow fees, fees and expenses of counsel for the Company,
blue sky fees and expenses and the expense of any special audits incident to or
required by any such registration (but excluding any Selling Expenses and the
costs and fees of legal counsel for any Holder).

“Registration Period” has the meaning
set forth in Section 6.3(a).

“Registration Statement” has the
meaning set forth in Section 6.1.

“Rule 144” means Rule 144
promulgated under the Securities Act, or any successor rule.

“SEC” means the United States
Securities and Exchange Commission.

“Securities” has the meaning set
forth in Section 1.4.

“Securities Act” means the Securities
Act of 1933, as amended, and the rules and regulations thereunder, or any
similar successor statute.

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“Selling Expenses” means all selling
commissions and underwriting discounts applicable to the sale of Registrable
Securities and all fees and expenses of legal counsel for any Holder.

“Shares” has the meaning set forth in
Section 1.1.

“Subsequent Closing” has the meaning
set forth in Section 1.4.

“Subsequent Closing Date” has the
meaning set forth in Section 1.4.

“Warrant Shares” has the meaning set
forth in Section 1.1.

“Warrants” has the meaning set forth
in Section 1.1.

“Transaction Agreements” means,
collectively, this Agreement and the Warrants.

Section 7.2
Certain Interpretations. Except where expressly stated otherwise in this
Agreement, the following rules of interpretation apply to this Agreement: (i)
“or” is not exclusive and
“include”, “includes” and
“including” are not limiting; (ii) definitions
contained in this Agreement are applicable to the singular as well as the
plural forms of such terms; (iii) references to an agreement or instrument
mean such agreement or instrument as from time to time amended, modified or
supplemented; (iv) references to a Person are also to its successors and
permitted assigns; (v) references to an
“Article”, “Section”,
“Exhibit”, or “Schedules”
refer to an Article of, a Section of, an Exhibit to, or a Schedule to,
this Agreement, respectively; and (vi) words importing the masculine
gender include the feminine or neuter and, in each case, vice versa.

ARTICLE 8

Governing Law;
Miscellaneous

Section 8.1
Governing Law; Jurisdiction; Waiver of Jury Trial. This Agreement will
be governed by and interpreted in accordance with the laws of the State of
Delaware without regard to the principles of conflict of laws. Each of the
parties hereto irrevocably submits and consents to the exclusive jurisdiction
of the courts of the State of California located in Marin County and the United
States District Court for the Northern District of California for the purpose
of any suit, action, proceeding or judgment relating to or arising out of this
Agreement and the transactions contemplated hereby. Each party hereto
irrevocably waives any objection to the laying of venue of any such suit,
action or proceeding brought in such courts and irrevocably waives any claim
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT
TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND
REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.

Section 8.2
Rights of Purchasers Inter Se. Each Purchaser shall have the absolute
right to exercise or refrain from exercising any right or rights which such
Purchaser may

22

22

 

have by reason of this Agreement or
any of the Securities, including, without limitation, the right to consent to
the waiver of any obligation of the Company under this Agreement and to enter
into an agreement with the Company for the purpose of modifying this Agreement
or any agreement effecting any such modification, and such Purchaser shall not
incur any liability to any other Purchaser or Purchasers with respect to
exercising or refraining from exercising any such right or rights.

Section 8.3
Exculpation Among Purchasers. Each Purchaser acknowledges that it is not
relying upon any other Purchaser, or any officer, director, employee, agent,
partner, member or affiliate of any such other Purchaser, in making its
investment or decision to invest in the Company or in monitoring such
investment. Each Purchaser agrees that no Purchaser nor any Affiliate or
controlling person, officer, director, stockholder, partner, member, agent or
employee of any Purchaser shall be liable for any action heretofore or
hereafter taken or omitted to be taken by any of them relating to or in
connection with the Company or the Securities, or both. Without limiting the
generality of the foregoing, no Purchaser (nor any of its Affiliates, officers,
directors, stockholders, partners, members, agents or employees) shall have any
obligation, liability or responsibility whatsoever for the accuracy,
completeness or fairness of any or all information about the Company or its
properties, business or financial and other affairs, acquired by such Purchaser
from the Company or its officers, directors, employees, agents,
representatives, counsel or auditors, and in turn provided to another
Purchaser, nor shall any such Purchaser (or such other Person) have any
obligation or responsibility whatsoever to provide any such information to any
other Purchaser (or such other Person) or to continue to provide any such
information if any information is provided.

Section 8.4
Counterparts; Signatures by Facsimile. This Agreement may be executed in
two or more counterparts, all of which are considered one and the same
agreement and will become effective when counterparts have been signed by each
party and delivered to the other parties. This Agreement, once executed by a
party, may be delivered to the other parties hereto by facsimile transmission
of a copy of this Agreement bearing the signature of the party so delivering
this Agreement.

Section 8.5
Headings. The headings of this Agreement are for convenience of
reference only, are not part of this Agreement and do not affect its
interpretation.

Section 8.6
Severability. If any immaterial provision of this Agreement is invalid
or unenforceable under any applicable statute or rule of law, then such
provision will be deemed modified in order to conform with such statute or rule
of law. Any provision hereof that may prove invalid or unenforceable under any
law will not affect the validity or enforceability of any other provision
hereof.

Section 8.7
Entire Agreement; Amendments.

(a) This
Agreement (including all schedules and exhibits hereto), each other Transaction
Agreement, and any confidentiality agreement entered into between the Company
and a Purchaser (which confidentiality agreement shall continue to be in full
force and effect) constitute the entire agreement among the parties hereto with
respect to the subject matter hereof and thereof. There are no restrictions,
promises, warranties or undertakings, other than those set

23

23

 

forth or referred to herein or
therein. This Agreement supersedes all prior agreements and understandings
among the parties hereto with respect to the subject matter hereof. No
provision of this Agreement may be waived or amended other than by an
instrument in writing signed by the Company and the Majority Purchasers. Any
amendment or waiver effected in accordance with this Section 8.7
shall be binding upon each holder of any Securities purchased under this
Agreement at the time outstanding (including securities into which such
Securities are convertible and for which such Securities are exercisable), each
future holder of all such Securities, and the Company.

(b) Upon the
effectuation of each such waiver, or amendment, the Company shall promptly give
written notice thereof to the Purchasers who have not previously consented
thereto in writing.

(c) Each
Purchaser acknowledges that by operation of this Section 8.7 the
Majority Purchasers have the right and power to diminish or eliminate certain
rights of such Purchaser under this Agreement.

Section 8.8
Notices. All notices required or permitted hereunder shall be in writing
and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified; (b) when sent by confirmed email or facsimile if
sent during normal business hours of the recipient; if not, then on the next
business day; (c) five days after having been sent by registered or
certified mail, return receipt requested, postage prepaid; or (d) one
business day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. The
addresses for such communications are:

If to the Company:

Raptor
Pharmaceuticals Corp. 

9 Commercial Boulevard, Suite 200 

Novato,
CA 94949 

Attn: Christopher Starr, Ph.D., CEO 

Fax: 415-382-1368

Email: cstarr@raptorpharma.com

With copies to
(which copies shall not constitute notice to the Company):

Paul, Hastings,
Janofsky & Walker, LLP 

515 South Flower Street, 25th Floor 

Los
Angeles, CA 90071-2228 

Attn: Siobhan McBreen Burke 

Fax: 213-627-0705

Email: siobhanburke@paulhastings.com

If to a Purchaser:
To the address set forth immediately below such Purchaser’s name on the
signature pages hereto. Each party will provide ten days’ advance written
notice to the other parties of any change in its address.

24

24

 

Section 8.9
Successors and Assigns. This Agreement is binding upon and inures to the
benefit of the parties and their successors and permitted assigns. No Purchaser
may assign this Agreement or any rights or obligations hereunder without the
prior written consent of the Company.

Section 8.10
Third Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto, their respective successors and permitted assigns, and is
not for the benefit of, nor may any provision hereof be enforced by, any other
Person.

Section 8.11
Further Assurances. Each party will do and perform, or cause to be done
and performed, all such further acts and things, and will execute and deliver
all other agreements, certificates, instruments and documents, as another party
may reasonably request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions
contemplated hereby.

Section 8.12
No Strict Construction. The language used in this Agreement is deemed to
be the language chosen by the parties to express their mutual intent, and no
rules of strict construction will be applied against any party.

Section 8.13
Independent Nature of Purchasers’ Obligations and Rights. The
obligations of each Purchaser under this Agreement are several and not joint
with the obligations of any other Purchaser, and no Purchaser shall be
responsible in any way for the performance of the obligations of any other
Purchaser under this Agreement. Each Purchaser shall be entitled to
independently protect and enforce its rights, including without limitation the
rights arising out of this Agreement, and it shall not be necessary for any
other Purchaser to be joined as an additional party in any proceeding for such
purpose.

[Signature Pages Follow]

 

25

25

 

COMPANY:

Raptor Pharmaceuticals Corp. 

By: /s/
Kim R.
Tsuchimoto                                           

Name:
Kim R. Tsuchimoto

Its: Chief Financial Officer

PURCHASERS:

Rune Kjeken 

By: /s/
Rune
Kjeken                                                      

Name: Rune Kjeken

VP Bank (Switzerland) Ltd. 

By: /s/
Daniel Lacher /s/ Andre
Roth                       

Name:
Daniel
Lacher            Andre
Roth

Its: Vice
President            Vice
President

Charles B. Scoville, Jr. Trust,

Daniel B. Scholefield
& Thomas J. Scoville, 

Trustees 

By: /s/
Daniel B.
Scholefield                                        

Name: Daniel B. Scholefield 

Its: Trustee

Aran Asset Management SA. 

By: /s/
Michael C.
Thalmann                                        

Name: Michael C. Thalmann 

Its: Chairman / CEO

26Exhibit 10.19

EXECUTION VERSION

EXHIBIT 10.19

Collaboration and License Agreement

This Agreement is entered into with effect as of the Effective Date (as defined below)

by and between

F. Hoffmann-La Roche Ltd

with an office and place of business at Grenzacherstrasse 124, 4070 Basel, Switzerland (“Roche
Basel”);

and

Hoffmann-La Roche Inc.

with an office and place of business at 340 Kingsland Street, Nutley, New Jersey 07110, U.S.A.
(“Roche Nutley”; Roche Basel and Roche Nutley together referred to as “Roche”)

on the one hand;

and

Raptor Pharmaceutical Inc.

with their office and place of business at 9 Commercial Blvd., Suite 200, Novato, California 94949.
(“Raptor”)

on the other hand.

WHEREAS, Raptor has expertise in the RAP proteins used to deliver therapeutics across the blood
brain barrier and possesses its Nuerotrans, proprietary technology and intellectual property rights
relating thereto; and

WHEREAS, Roche has expertise in the research, development, manufacture and commercialization of
pharmaceutical products; and

 

1/32

 

WHEREAS, Roche wishes to develop and commercialize products containing pharmaceutically active
compounds and RAP proteins as a delivery vehicle, and explore potential applications of such
products in various therapeutic areas; and

WHEREAS, Raptor wishes to work with Roche in generating, selecting and testing RAP proteins for use
with pharmaceutically active compounds in products and is willing to grant to Roche the right to
make, use, offer for sale, sell, import and export such products under certain of its intellectual
property rights, as contemplated herein.

NOW, THEREFORE, in consideration of the mutual covenants and promises contained in this
Agreement and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereto, intending to be legally bound, do hereby agree as follows:

1. Definitions

As used in this Agreement, the following terms, whether used in the singular or plural, shall have
the following meanings:

1.1 Affiliate

The term “Affiliate” shall mean, as to a Party:

	 	a)	 	An entity that owns directly or indirectly, a controlling interest in such Party, by
stock ownership or otherwise;

	 	b)	 	any entity in which such Party owns a controlling interest, by stock ownership or
otherwise, or;

	 
	 	c)	 	any entity under common control with such Party, directly or indirectly.

For purposes of this paragraph, “controlling interest” and “control” mean ownership of more than
fifty percent (50%) of the voting stock permitted to vote for the election of the board of
directors or any other arrangement resulting in control of or the right to control the management
and the affairs of the entity or Party in question. Anything to the contrary in this paragraph
notwithstanding, Chugai Pharmaceutical Co., Ltd, a Japanese corporation, (“Chugai”) shall not be
deemed an Affiliate of Roche unless Roche provides written notice to Raptor of its desire to
include Chugai as an Affiliate of Roche.

1.2 Agreement

The term “Agreement” shall mean this document including any and all appendices and amendments to it
as may be added and/or amended from time to time in accordance with the provisions of this
Agreement.

1.3 Agreement Term

The term “Agreement Term” shall mean the term of this Agreement as set forth in Section 14.1.

 

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1.4 Business Day

The term “Business Day” shall mean 9.00 a.m. to 5.00 p.m. local time on a day other than a
Saturday, Sunday or bank or other public or federal holiday in Switzerland or the State of New
Jersey in the US.

1.5 Calendar Quarter

The term “Calendar Quarter” shall mean each period of three (3) consecutive calendar months, ending
March 31, June 30, September 30, and December 31.

1.6 Calendar Year

The term “Calendar Year” shall mean each twelve (12) month period ending on December 31.

1.7 Change of Control

The term “Change of Control” shall mean, with respect to Raptor: (a) the acquisition by any Third
Party of beneficial ownership of more than [*****] of the then-outstanding common shares or voting
power of Raptor, other than acquisitions by employee benefit plans sponsored or maintained by
Raptor or by existing shareholders of Raptor; or (b) the consummation of a business combination
with a Third Party, unless, following such business combination, the stockholders of Raptor
immediately prior to such business combination beneficially own directly or indirectly more than
[*****] of the then-outstanding common shares or voting power of the entity resulting from such
business combination or of the ultimate parent of such resulting entity.

1.8 Clinical Study

The term “Clinical Study” shall mean a Phase I Study, a Phase II Study or a Phase III Study, as
applicable.

1.9 Commercially Reasonable Efforts

The term “Commercially Reasonable Efforts” shall mean [*****].

1.10 Confidential Information

The term “Confidential Information” shall mean any and all information, data or know-how (including
Know-How), whether technical or non-technical, oral or written, that is disclosed by one Party or
its Affiliates (“Disclosing Party”) to the other Party or its Affiliates (“Receiving Party”).
Confidential Information shall not include any information, data or know-how which:

(i) was generally available to the public at the time of disclosure, or information which
becomes available to the public after disclosure by the Disclosing Party other than through
fault (whether by action or inaction) of the Receiving Party,

(ii) can be shown by clear and convincing written records to have been already known to the
Receiving Party prior to its receipt from the Disclosing Party,

(iii) is obtained at any time lawfully from a Third Party rightfully in possession of such
information, data or know-how and under circumstances permitting its use or disclosure,

(iv) is developed independently by the Receiving Party as evidenced by clear and convincing
written records other than through knowledge of Confidential Information, or

(v) is approved in writing by the Disclosing Party for release by the Receiving Party.

The terms of this Agreement shall be considered Confidential Information of both Parties.

 

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1.11 Control

The term “Control” shall mean (as an adjective or as a verb including conjugations and variations
such as “Controls” “Controlled” or “Controlling”) (a) with respect to Patent Rights and/or
Know-How, the possession by a Party of the ability to grant a license or sublicense of such Patent
Rights and/or Know-How without violating the terms of any agreement or arrangement between such
Party and any other party and (b) with respect to proprietary materials, the possession by a Party
of the ability to supply such proprietary materials to the other Party as provided herein without
violating the terms of any agreement or arrangement between such Party and any other party [*****].

1.12 Cover

The term “Cover” shall mean (as an adjective or as a verb including conjugations and variations
such as “Covered,” “Coverage” or “Covering”) that the developing, making, using, offering for sale,
promoting, selling, exporting or importing of a given compound, formulation or product would
infringe a Valid Claim in the absence of a license under the Patent Rights to which such Valid
Claim pertains. The determination of whether a compound, formulation, process or product is Covered
by a particular Valid Claim shall be made on a country-by-country basis.

1.13 Dollars

The term “Dollars” shall mean US dollars.

1.14 Effective Date

The term “Effective Date” shall mean June 3, 2009.

1.15 EU

The term “EU” shall mean the European Union, as it may be constituted from time to time.

Exclusivity Period

The term “Exclusivity Period” shall mean [*****]. The Exclusivity Period can be extended pursuant
to Section 6.1.1.

1.17 FDA

The term “FDA” shall mean the Food and Drug Administration of the United States of America.

1.18 Field

The term “Field” shall mean all human uses for delivery of diagnostic or therapeutic agents across
the blood brain barrier for the diagnosis treatment and/or prevention of any Indication.

1.19 First Commercial Sale

The term “First Commercial Sale” shall mean the first invoiced sale of a Product to a Third Party
by the Roche Group.

 

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1.20 Handle

The term “Handle” shall mean preparing, filing, prosecuting (including interference and opposition
proceedings) and maintaining (including interferences, reissue, re-examination, revocation and
opposition proceedings).

1.21 Indication

The term “Indication” shall mean any human disease or condition, or sign or symptom of a human
disease or condition, in each case determined by reference to the World Health Organization
International Classification of Diseases, version 10, as it may be revised and updated from time to
time.

1.22 Initiation

The term “Initiation” shall mean the date that a human is first dosed with the Product in a
Clinical Study conducted by or on behalf of Roche or any of its Affiliates or Sublicensees and
approved by the respective Regulatory Authority.

1.23 Insolvency Event

The term “Insolvency Event” shall mean circumstances under which a Party (i) has a receiver or
similar officer appointed over all or substantially all of its assets or undertaking; (ii) passes a
resolution for winding-up (other than a winding-up for the purpose of, or in connection with, any
solvent amalgamation, reorganization or restructuring) or a court makes an order to that effect or
a court makes an order for administration (or any equivalent order in any jurisdiction); (iii)
enters into any voluntary composition or arrangement with its creditors (other than relating to a
solvent amalgamation, reorganization or restructuring) relating to all or substantially all of its
assets; or (iv) permanently ceases to carry on business; in the case of each of the foregoing
clauses (i) and (ii), where the event shall have continued for [*****] undismissed, unbonded and
undischarged.

1.24 Inventions

The term “Invention” shall mean an invention that is conceived and/or reduced to practice in the
course of performing an activity pursuant to the Research Plan under this Agreement. Under this
definition, an Invention may be made by employees of Raptor or of its Affiliates solely or jointly
with a Third Party (a “Raptor Invention”), by employees of the Roche Group solely or jointly with a
Third Party (a “Roche Invention”), or jointly by employees of Raptor or its Affiliates and by
employees of a member of the Roche Group with or without a Third Party (a “Joint Invention”).
Notwithstanding the above, all intellectual property related solely to Transport Candidates shall
be deemed to be a Raptor Invention, and all intellectual property related solely to Products
(excluding Transport Candidates included therein) shall be deemed to be a Roche Invention.

1.25 Joint Know-How

The term “Joint Know-How” shall mean Know-How that is made jointly by the Parties or their
Affiliates or their Sublicensees in the course of performing an activity pursuant to this
Agreement.

1.26 Joint Patent Rights

The term “Joint Patent Rights” shall mean Patent Rights claiming a Joint Invention.

 

5/32

 

1.27 Joint Steering Committee

The term “Joint Steering Committee” or “JSC” shall mean the steering committee, otherwise referred
to as the JSC, further described in Article 5.

1.28 Know-How

The term “Know-How” shall mean data, knowledge and information, including materials, samples,
chemical manufacturing data, toxicological data, pharmacological data, preclinical data, assays,
platforms, formulations, specifications, quality control testing data, whether or not patentable.

1.29 Law

The term “Law” shall mean any law, statute, rule, regulation, ordinance or other pronouncement
having the effect of law of any federal, national, multinational, state, provincial, county, city
or other political subdivision, domestic or foreign.

1.30 Major Market Countries

The term “Major Market Countries” shall mean the U.S., Germany, France, United Kingdom, Italy,
Spain and Japan.

1.31 NDA

The term “NDA” shall mean a new drug application or a Biologics License Application, including all
necessary documents, data, and other information concerning a Product, required for Regulatory
Approval of the Product as a pharmaceutical product by the FDA or an equivalent application to the
equivalent agency in any other country or group of countries (e.g. the marketing authorization
application (MAA) in the EU).

1.32 Net Sales

The term “Net Sales” shall mean the amount calculated by subtracting from the amount of Adjusted
Gross Sales (as defined below) a lump sum deduction of [*****] of Adjusted Gross Sales [*****].

For purposes of this definition of “Net Sales”, “Adjusted Gross Sales” shall mean [*****] less
deductions (which deductions shall in all cases be as consistently applied by Roche to its
products) for [*****].

In case of doubt, the “Adjusted Gross Sales” [*****].

1.33 Non-cancellable Obligation

The term “Non-cancellable Obligation” shall mean a Third Party Cost which, in either case, cannot
be canceled without penalty upon termination of this Agreement.

1.34 Party

The term “Party” shall mean Raptor or Roche, as the case may be, and “Parties” shall mean Raptor
and Roche collectively.

1.35 Patent Rights

The term “Patent Rights” shall mean all rights under any patent or patent application, in any
country of the Territory, including any patents issuing on such patent application, and further
including any substitution, extension or supplementary protection certificate, reissue,
reexamination, renewal, division, continuation or continuation-in-part of any of the foregoing.

 

6/32

 

1.36 Person

The term “Person” shall mean any corporation, limited or general partnership, limited liability
company, joint venture, trust, unincorporated association, governmental body, authority, bureau or
agency, any other entity or body, or an individual.

1.37 Phase I Study

The term “Phase I Study” shall mean a human clinical trial in any country that would satisfy the
requirements of 21 C.F.R. § 312.21(a), as amended from time to time.

1.38 Phase II Study

The term “Phase II Study” shall mean a human clinical trial, for which the primary endpoints
include a determination of dose ranges and/or a preliminary determination of efficacy in patients
being studied as described in 21 C.F.R. § 312.21(b).

1.39 Phase III Study

The term “Phase III Study” shall mean a human clinical trial that is prospectively designed to
demonstrate statistically whether a product is safe and effective for use in humans in a manner
sufficient to obtain regulatory approval to market such product in patients having the disease or
condition being studied as described in 21 C.F.R. § 312.21(c).

1.40 Product

The term “Product” shall mean any product comprising (1) a Transport Candidate, and (2) a
pharmaceutically active ingredient or an ingredient for the diagnosis or prognosis of an
Indication.

1.41 Regulatory Approval

The term “Regulatory Approval” shall mean any approvals (including, if applicable, pricing and
reimbursement approvals), licenses, registrations or authorizations by Regulatory Authority,
necessary for the marketing and sale of a Product in the Field in a regulatory jurisdiction in the
Territory.

1.42 Raptor Base Patent Rights

The term “Raptor Base Patent Rights” shall mean any and all Raptor Patent Rights which are
Controlled by Raptor as of the Effective Date, said Patent Rights being listed in Appendix 1.42 of
this Agreement.

1.43 Raptor Know-How

The term “Raptor Know-How” shall mean all Know-How that Raptor Controls as of the Effective Date
and during the Agreement Term that is necessary or useful for the discovery, manufacture,
development or commercialization of Products in the Field.

1.44 Raptor Patent Rights

The term “Raptor Patent Rights” shall mean the Patent Rights that Raptor Controls as of the
Effective Date and during the Agreement Term, necessary or useful for the discovery, manufacture,
development or commercialization of or Covering a Product in the Field. The term Raptor Patent
Rights shall include Raptor Base Patent Rights.

 

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1.45 Research Plan

The term “Research Plan” shall mean the plan of research outlining the work expected to be
performed by each Party, a copy of which initial plan is attached as Appendix 1.45, as such plan is
approved by the JSC and as it may be updated from time to time as provided in this Agreement.

1.46 Research Program

The term “Research Program” shall mean the activities undertaken by the Parties pursuant to the
Research Plan to identify Products, and such other activities with regard to Transport Candidates
and Products as the Parties may agree in writing.

1.47 Research Term

The term “Research Term” shall mean the period of time in which the Research Program shall be
conducted, commencing on the Effective Date and continuing until the completion of Development
Phase 1 or Development Phase 2, unless earlier terminated pursuant to Section 14.2.

1.48 Roche Group

The term “Roche Group” shall mean collectively Roche, its Affiliates and its Sublicensees.

1.49 Roche Patent Rights

The term “Roche Patent Rights” shall mean all Patent Rights Controlled by Roche Covering a Product
or that otherwise claim Roche Inventions.

1.50 Royalty Term

The term “Royalty Term” shall mean, with respect to a Product and for a given country, the period
of time commencing on the date of First Commercial Sale of the Product in such country and ending
on the later of the date that is [*****].

1.51 Sublicensee

The term “Sublicensee” means an entity to which Roche or its Affiliates have licensed rights
pursuant to this Agreement.

1.52 Territory

The term “Territory” shall mean all countries of the world.

1.53 Third Party

The term “Third Party” shall mean a Person other than (i) Raptor or any of its Affiliates or (ii) a
member of the Roche Group.

1.54 Transport Candidate

The term “Transport Candidate” shall mean any receptor associated protein or any derivative or
fragment thereof Covered by Raptor Base Patent Rights or invented or discovered in the conduct of
the research collaboration, and any protein that has seventy-five percent (75%) or greater homology
thereto.

1.55 US

The term “US” shall mean the United States of America and its territories and possessions.

 

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1.56 Valid Claim

The term “Valid Claim” shall mean, as applicable, a claim in any (i) unexpired and issued Raptor
Patent Rights or Joint Patent Rights that have not been disclaimed, revoked or held invalid by a
final nonappealable decision of a court of competent jurisdiction or government agency or (ii)
pending patent application of any Raptor Patent Rights or Joint Patent Rights in any country of the
Territory that has been on file with the applicable patent office for [*****] from the earliest
date to which the patent application claims its earliest priority.

1.57 Additional Definitions

Each of the following definitions is set forth in the Section of this Agreement indicated below:

	 	 	 	 	 
	Definition	 	Section
	“Accounting Period”

	 	 	7.1	 
	“Adjusted Gross Sales”

	 	 	1.32	 
	“Alliance Director”

	 	 	5.6	 
	“Bankruptcy Code”

	 	 	15	 
	[*****]
	 	 	 	 
	“Breaching Party”

	 	 	14.2.1	 
	“Chairperson”

	 	 	5.2	 
	“Chugai”

	 	 	1.1	 
	“Development Phase 1”

	 	 	3.1.1	 
	“Development Phase 2”

	 	 	3.1.1	 
	“Disclosing Party”

	 	 	1.10	 
	“Genentech”

	 	 	1.1	 
	[*****]
	 	 	 	 
	“Indemnified Party”

	 	 	12.3	 
	“Indemnifying Party”

	 	 	12.3	 
	“Joint Invention”

	 	 	1.24	 
	“Material(s)”

	 	 	13.7	 
	“Member(s)”

	 	 	5.2	 
	“Non-Breaching Party”

	 	 	14.2.1	 
	“Notice of Comments”

	 	 	13.4	(b)
	“Payment Breach”

	 	 	14.2.1	 
	“Peremptory Notice Period”

	 	 	14.2.1	 
	“Publishing Party”

	 	 	13.4	(b)
	“Raptor”

	 	Preamble

	“Raptor Invention”

	 	 	1.24	 
	“Receiving Party”

	 	 	1.10	 
	“Roche Basel”

	 	Preamble

	“Roche Entity”

	 	 	1.1	 
	“Roche Invention”

	 	 	1.24	 
	“Roche Nutley”

	 	Preamble

	“SEC”

	 	 	11.4	 
	“Subject Disclosure”

	 	 	13.3.1	 

 

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2. Grant of License

2.1 Licenses

2.1.1 Commercial Licenses

Subject to the terms and conditions of this Agreement, Raptor grants to Roche and its Affiliates an
exclusive (even as to Raptor except as provided below), non-transferable (except as permitted under
Section 16.4) right and license under Raptor’s interest in the Raptor Patent Rights and Raptor
Know-How and Raptor’s interest in the Joint Patent Rights and Joint Know-How to use, make, have
made, import, offer to sell, sell and have sold Transport Candidates and Products in the Field in
the Territory.

2.1.2 Research Cross Licenses

Each Party grants to the other Party and its Affiliates during the Research Term a non-exclusive
right and license under Know-How and Patent Rights Controlled by such Party and that are necessary
or useful for the discovery, manufacture or development of Products solely to enable the other
Party and its Affiliates to perform the activities contemplated under the Research Plan under this
Agreement.

Notwithstanding the exclusive license grant to Roche and its Affiliates in Section 2.1.1, Raptor
reserves the rights under the Raptor Patent Rights, Raptor Know-How, Joint Patent Rights and Joint
Know-How to use, make, have made, and transfer Transport Candidates and Products in the Field in
the Territory solely for performing the Research Project.

2.2 Sublicense

The rights and licenses granted to Roche and its Affiliates shall include the right of Roche to
grant written sublicenses to Affiliates and Third Parties under such rights and licenses, in whole
or in part, solely to the extent necessary to make, use, offer for sale, sell or import Transport
Candidates or Products in the Territory for use in the Field, provided that Roche will be
responsible for the sublicensees’ compliance to the applicable terms and conditions of this
Agreement.

2.3 Exclusivity

During the Exclusivity Period, Raptor shall work exclusively with Roche on the use of Transport
Candidates to cross the blood brain barrier. The Exclusivity Period can be extended if Roche makes
the payments set forth in Section 6.1.1.

2.4 No Other Rights

Except for the rights expressly granted under this Article 2, no license, right, title or interest
of any nature whatsoever is granted hereunder by implication, estoppel, reliance or otherwise, by
Raptor to Roche or any of Roche’s Affiliates, and any of Raptor’s rights to Raptor Patent Rights,
Raptor Know-How, Joint Patent Rights and Joint Know-How not specifically licensed to Roche under
this Article 2 shall be retained by Raptor.

3. Research Collaboration

 

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3.1 Conduct of the Research Program

3.1.1 Scope

Initially, Roche and Raptor shall conduct a mutually agreed-upon Research Program pursuant to the
Research Plan attached as Appendix 1.45 with the objective of performing the initial feasibility
study with full RAP protein and existing fragments (“Development Phase 1”). Upon successful
completion of the Development Phase 1, Roche will have the option to retain Raptor to perform an
additional Research Plan to expand the NeuroTransTM platform to develop neurobiologicals
for delivery to the brain (“Development Phase 2”) subject to mutual agreement on the scope of
Development Phase 2 and payment of prospective fees based on FTEs. The activities conducted in
connection with the Research Program will be overseen by the JSC.

3.1.2 Commercially Reasonable Efforts

Roche and Raptor shall each use Commercially Reasonable Efforts to perform their respective tasks
and obligations in conducting the activities assigned to it in the then-current Research Plan.

3.1.3 Research Plan

The Parties will conduct the Research Program in accordance with the Research Plan. The Research
Plan will set forth (i) the scope of the Research Program and the resources that are expected to be
dedicated to the activities contemplated within the scope of the Research Program, including the
responsibilities of each Party and (ii) specific objectives for each year, which objectives will be
updated or amended, as appropriate, by the JSC as research progresses. The initial Research Plan
for activities is attached hereto as Appendix 1.45. The JSC shall review the Research Plan on an
ongoing basis and may amend the Research Plan, subject to Section 5.7. Any such changes shall be
reflected in written amendments to the Research Plan.

3.1.4 Duration

The Research Program shall commence on the Effective Date and shall continue until the end of the
Research Term.

4. Diligence and Third Party Obligations

4.1 Diligence

Roche and Raptor shall each use Commercially Reasonable Efforts to perform their other respective
activities contemplated by this Agreement or as may be agreed upon in any subsequent written
agreements with respect to the subject matter hereof. [*****]

[*****]

5. Governance

5.1 Joint Steering Committee

Within sixty (60) days after the Effective Date of this Agreement, the Parties shall establish a
Joint Steering Committee to oversee the Research Program activities under this Agreement.

 

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5.2 Members

The JSC shall be composed of four (4) persons (each a “Member”). Roche and Raptor each shall be
entitled to appoint two (2) Members with appropriate seniority and expertise. Each Party may
replace any of its Members and appoint a person to fill the vacancy arising from each such
replacement. A Party that replaces a Member shall notify the other Party at least ten (10) days
prior to the next scheduled meeting of the JSC. Both Parties shall use Commercially Reasonable
Efforts to keep an appropriate level of continuity in representation. Both Parties may invite a
reasonable number of additional experts and/or advisors who are subject to confidentiality
obligations at least as restrictive as those set forth in Article 13 to attend part or the whole
JSC meeting with prior notification to the JSC. Members may be represented at any meeting by
another person designated by the absent Member. The JSC shall be chaired by a Roche Member
(“Chairperson”).

5.3 Meetings

The Chairperson or his/her delegate is responsible for sending invitations and agendas for all JSC
meetings to all Members at least ten (10) days before the next scheduled meeting of the JSC. The
venue for the meetings shall be agreed by the JSC. The JSC shall hold meetings at least twice per
Calendar Year, either in person or by tele-/video-conference, and in any case as frequently as the
Members of the JSC may agree shall be necessary, but not more than four (4) times a year. The
Alliance Director of each Party shall attend the JSC meetings as permanent participant.

5.4 Minutes

The Chairperson is responsible for designating a Member to record in reasonable detail and
circulate draft minutes of JSC meetings to all members of the JSC for comment and review within
twenty (20) days after the relevant meeting. The Members of the JSC shall have thirty (30) days to
provide comments. The Party preparing the minutes shall incorporate timely received comments and
distribute finalized minutes to all Members of the JSC within sixty (60) days of the relevant
meeting. Both Parties shall approve the final version of the minutes before its distribution.

5.5 Decisions

5.5.1 Decision Making Authority

Subject to Section 5.7, the JSC shall decide matters related to the Research Program, as well as
approve and amend the Research Plan.

5.5.2 Consensus; Good Faith

The Members of the JSC shall act in good faith to cooperate with one another and seek agreement
with respect to issues to be decided by the JSC. The Parties shall endeavor to make decisions by
consensus.

5.5.3 Failure to Reach Consensus

If the JSC is unable to decide a matter by consensus, then Roche shall have the final decision
authority on any matter.

5.6 Alliance Director

Each Party shall appoint an Alliance Director (“Alliance Director”). The Alliance Directors shall
be the point of contact within each Party with responsibility for facilitating communication and
collaboration between the Parties. They are permanent participants of the JSC meetings (but not
members of the JSC) and may attend JSC meetings as appropriate. The Alliance Directors shall
seek to facilitate resolution of potential and pending issues and potential disputes to enable the
JSC to reach consensus and avert escalation of such issues or potential disputes.

 

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5.7 Limitations of Authority

Neither the JSC, nor Roche unilaterally, shall have the authority to amend or waive any terms of
this Agreement or impose additional obligations on Raptor without Raptor’s prior written consent.

5.8 Expenses

Each Party shall be responsible for its own expenses including travel and accommodation costs
incurred in connection with the JSC.

5.9 Lifetime

The JSC shall exist during the Research Term and for six (6) months thereafter.

6. Payment

6.1 Signing Fee

Within thirty (30) days after the Effective Date and receipt of an invoice from Raptor, Roche shall
pay to Raptor a fee of [*****].

6.1.1 Extension of Exclusivity Period

Roche can extend the Exclusivity Period for an additional twelve (12) months by notifying Raptor in
writing on or before the end of the Exclusivity Period. Roche shall also pay Raptor [*****] within
thirty (30) days after such notice has been provided, and Roche has received an invoice for such
amount from Raptor.

6.2 Events

Roche shall pay to Raptor up to a total of [*****] in relation to the achievement of events with
respect to each Product. The event payments under this Section 6.2 shall be paid by Roche according
to the following schedule of development events:

	 	 	 
	[*****]

	 	[*****]

Each event payment for a given Product shall be paid only once for a given Product, the first time
a Product reaches such event, regardless of the number of times such events are reached for the
given Product.

Upon achievement by Roche, its Affiliates and/or Sublicensees of any of the foregoing events, Roche
shall promptly (and in no event more than thirty (30) days following achievement thereof) notify
Raptor and event payments shall be paid by Roche to Raptor within thirty (30) days after occurrence
of the applicable event and receipt of an invoice from Raptor.

 

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6.3 Royalty Payments

6.3.1 Royalty Term

Royalties shall be payable by Roche on Net Sales of Products on a Product-by Product and
country-by-country basis until the expiry of the Royalty Term for a Product in a given country.
Thereafter, the licenses shall be fully paid up and royalty-free with respect to such Product in
such country, on a Product-by-Product and country-by-country basis.

Subject to the remainder of this Section 6.3, the following royalty rates shall apply to the
respective tiers of worldwide, aggregate Calendar Year Net Sales of a Product in the Territory, on
an incremental basis, as follows:

[*****]

For the purpose of calculating royalties payable with respect to a Product, royalties on Calendar
Year Net Sales shall be subject to [*****]

7. Accounting and reporting

7.1 Timing of Payments

Roche shall calculate royalties on Net Sales quarterly as of March 31, June 30, September 30 and
December 31 (each being the last day of an “Accounting Period”) and shall pay royalties on Net
Sales within sixty (60) days after the end of each Accounting Period in which such Net Sales occur.

7.2 Late Payment

Any payment under this Agreement that is not paid on or before the date such payment is due shall
bear interest, to the extent permitted by applicable law [*****] calculated on the number of days
such payment is overdue. [*****]

7.3 Method of Payment

Royalties on Net Sales and all other amounts payable by Roche hereunder shall be paid by or on
behalf of Roche in U.S. Dollars. All payments due to Raptor hereunder shall be made directly from
an account located in either (at Roche’s option) the United States or Switzerland to account(s)
designated by Raptor.

7.4 Currency Conversion

Whenever calculating royalties requires conversion from any currency, Roche shall make such
conversion as follows:
When calculating the Net Sales for countries other than the United States of America, Roche shall
convert the amount of such sales in currencies other than Swiss Francs into Swiss Francs using for
internal foreign currency translation Roche’s then current standard practices actually used on a
consistent basis in preparing its audited financial statements.

Upon converting the amount of Adjusted Gross Sales into Swiss Francs, Roche shall convert into US
Dollars (or other currency) [*****].

 

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7.5 Reporting

With each payment Roche shall provide Raptor in writing for the relevant Calendar Quarter on a
Product-by-Product basis the following information with respect to each of the following
territories: (1) the United States, (2) the Major Market Countries (other than the United States)
and Canada, and (3) all territories other than those set forth in the foregoing clause (1) and (2):

a) Net Sales and Adjusted Gross Sales;

b) taxes withheld, if applicable;

; and

d) Total royalty payable to Raptor.

7.6 United States Dollars

All dollar ($) amounts specified in this Agreement are United States dollar amounts.

7.7 Nonrefundable

All payments made by Roche to Raptor under this Agreement shall be non-refundable and
non-creditable, except for those set forth in Section 6.3 or as set forth in 6.2 or 9.3.

8. Taxes

Raptor shall pay all sales, turnover, income, revenue, value added, and other taxes levied on
account of any payments accruing or made to Raptor under this Agreement. If provision is made in
law or regulation of any country for withholding of taxes of any type, levies or other charges with
respect to any royalty payable under this Agreement to Raptor, then Roche shall promptly pay such
tax, levy or charge for and on behalf of Raptor to the proper governmental authority, and shall
promptly furnish Raptor with receipt of payment. Roche shall be entitled to deduct any such tax,
levy or charge actually paid from royalty due Raptor or be promptly reimbursed by Raptor if no
further payments are due Raptor. Each Party agrees to reasonably assist the other Party in claiming
exemption from such deductions or withholdings under double taxation or similar agreement or treaty
from time to time in force and in minimizing the amount required to be so withheld or deducted.

9. Auditing

9.1 Raptor Right to Audit

9.1.1 Roche shall keep, and shall require its and its Affiliates and Sub-licensees to keep, for
three (3) years, full, true and accurate books of account containing all particulars that may be
necessary for the purpose of calculating all royalties and all other amounts payable under this
Agreement. Such books of accounts shall be kept at Roche’s or the relevant Affiliate’s or
Sublicensee’s principal place of business. At the expense of Raptor, Raptor has the right to engage
an independent public accountant to perform, on behalf of Raptor an audit of such books and records
of Roche and its Affiliates and Sub-licensees, that are deemed necessary by Raptor’s independent
public accountant to report on Net Sales of Products for the period or periods requested by Raptor
and the correctness of any report or payments made under this Agreement.

 

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9.1.2 Upon timely request and at least thirty (30) Business Days prior written notice from Raptor,
such audit shall be conducted in the countries specifically requested by Raptor, during regular
business hours in such a manner as to not unnecessarily interfere with Roche’s normal business
activities, and shall be limited to results in the three (3) Calendar Years prior to audit
notification.

9.1.3 Such audit shall not be performed more frequently than once per Calendar Year nor more
frequently than once with respect to records covering any specific period of time. The auditors
shall not interpret the agreement.

9.1.4 All information, data documents and abstracts herein referred to shall be used only for the
purpose of verifying royalty statements, shall be treated as Roche Confidential Information subject
to the obligations of this Agreement and need neither be retained more than the longer of one (1)
year after completion of an audit hereof, if an audit has been requested; nor more than three (3)
years from the end of the Calendar Year to which each shall pertain; nor more than one (1) year
after the date of termination of this Agreement.

9.2 Sharing of reports

The final audit report shall be shared by Roche and Raptor.

9.3 Over- or Underpayment

If the audit reveals an underpayment, Roche shall reimburse Raptor for the amount of the
underpayment within thirty (30) days with interest as set forth in Section 7.2. If the audit
reveals an overpayment, Roche shall have the right to credit the amount of such overpayment against
the next royalty payment payable to Raptor hereunder. [*****] Section 16.2 shall apply to this
Section 9.3.

9.4 Duration of Audit Rights

The failure of Raptor to request verification of any royalty calculation within the period during
which corresponding records must be maintained under this Section 10 will be deemed to be
acceptance of the royalty payments and reports.

10. Intellectual Property

10.1 Ownership of Inventions

Raptor shall own all Raptor Inventions, Roche shall own all Roche Inventions, and Raptor and Roche
shall jointly own all Joint Inventions. Each Party shall require all of its employees, and shall
cause its Affiliates performing under this Agreement to require all of such Affiliates’ employees,
to assign all Inventions made by them to such Party or such Party’s Affiliates, as the case may be.

The determination of inventorship for Inventions shall be in accordance with US inventorship laws.

Except as specifically set forth herein, this Agreement shall not be construed as (i) granting any
license or right under any intellectual property rights; or (ii) representing any commitment by
either party to enter into any additional agreement, by implication or otherwise.

 

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10.2 Prosecution of Patent Rights Claiming Raptor Inventions

Raptor shall, at its expense discretion, (i) Handle all Raptor Patent Rights, (ii) consult with
Roche as to the Handling of such Raptor Patent Rights, (iii) apprise Roche of significant events
(such as issuance, reissuance, reexamination, interference, revocation or opposition proceedings)
encountered in such Handling, and (iv) provide to Roche an annual report identifying all Raptor
Patent Rights and their status. At Raptor’s reasonable request, Roche shall cooperate with the
Handling of all Raptor Patent Rights. Raptor will not abandon any Raptor Patent Rights without the
prior consent of Roche. Roche acknowledges that if Raptor (based on consultation with Roche) elects
not to Handle, or (with prior consent of Roche) elects to abandon, any Raptor Patent Rights that
Cover a Product to which Roche retains a license under Section 2.1, BioMarin has the right to take
over the prosecution of such Raptor Patent Rights pursuant to the Asset Purchase Agreement.

10.3 Prosecution of Patent Rights Claiming Roche Inventions

Roche shall, at its own expense and discretion, (i) Handle all Roche Patent Rights that claim Roche
Inventions, (ii) consult with Raptor as to the Handling of such Roche Patent Rights, (iii) apprise
Raptor of significant events (such as issuance, reissuance, reexamination, interference, revocation
or opposition proceedings) encountered in such Handling, and (iv) provide to Raptor an annual
report identifying all Roche Patent Rights and their status. At Roche’s expense and reasonable
request, Raptor shall cooperate with the Handling of all such Roche Patent Rights.

10.4 Prosecution of Patent Rights Claiming Joint Inventions

10.4.1 Roche shall (i) Handle all Patent Rights that claim Joint Inventions, (ii) consult with
Raptor as to the Handling of such Patent Rights, and (iii) furnish to Raptor copies of all
documents relevant to any such Handling. Roche shall furnish such documents and consult with
Raptor in sufficient time before any action by Roche is due to allow Raptor to provide comments
thereon, which comments Roche must consider. Raptor shall reasonably cooperate, with the Handling
of all such Patent Rights. If Roche wishes to abandon any of such Patent Rights, then sufficiently
in advance to permit Raptor to undertake Handling of such Patent Rights without a loss of rights,
Roche shall offer to assign its interest in such Patent Rights to Raptor and, upon Raptor’s
request, shall promptly assign its interest in such Patent Rights to Raptor.

10.4.2 The Parties shall equally share all reasonable and documented external costs incurred in
Handling Patent Rights claiming Joint Inventions. Each Party shall have the right, exercisable by
written notice, to terminate its obligation to share such costs. If Roche exercises such right,
then from and after the date thereof Roche shall assign its interest in such Patent Right to
Raptor, which Patent Right shall be deemed to be a Raptor Patent Right for purposes of this
Agreement. If Raptor exercises such right, then from and after the date thereof Raptor shall assign
its interest in such Patent Right to Roche, which Patent Right shall be deemed to be a Roche Patent
Right for purposes of this Agreement. If neither Party Handles any such Patent Right, then the
underlying Invention shall be deemed Joint Know-How.

11. Representations and Warranties

Except as expressly set forth in a letter dated as of even date herewith from Raptor to Roche,
Raptor represents and warrants to Roche as of the Effective Date as follows:

 

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11.1 Ownership of Patent Rights

Raptor is the exclusive owner of all right, title and interest in, or is the exclusive licensee of,
the Raptor Base Patent Rights. Appendix 1.42 contains a complete and accurate list of all patents
and patent applications included in the Raptor Base Patent Rights as of the Effective Date. The
Raptor Base Patent Rights are free and clear of all liens, claims, security interests and other
encumbrances of any kind or nature [*****]. Raptor has not granted any licenses to the Raptor
Patent Rights to any Third Party, nor has Raptor effectuated any prior transfer, sale or assignment
of any part of the Raptor Patent Rights to a Third Party, that conflicts in any material respect
with any of the terms of this Agreement or the licenses granted to Roche hereunder.

11.2 Inventors

All of Raptor’s employees, officers and consultants performing work on behalf of Raptor under this
Agreement have executed agreements with Raptor requiring assignment to Raptor of all Inventions
made by such individuals during the course of their employment or consulting relationship with
Raptor.

11.3 Grants

Raptor has the right to grant Roche and its Affiliates the rights and licenses described in this
Agreement.

11.4 Authorization

The execution, delivery and performance of this Agreement by Raptor: (i) are within the corporate
power of Raptor; (ii) have been duly authorized by all necessary corporate action; (iii) are not
in contravention of any provision of the certificate of incorporation of Raptor; (iv) to the
knowledge of Raptor, will not violate any Law or regulation or any order or decree of any court of
governmental instrumentality; (v) will not violate the terms of any indenture, mortgage, deed of
trust, lease, agreement, or other instrument to which Raptor is a party or by which Raptor or any
of its property is bound, which violation would have a material adverse effect on the financial
condition of Raptor or on the ability of Raptor to perform its obligations hereunder; and (vi) do
not require any filing or registration with, or the consent or approval of, any governmental body,
agency, authority or any other Person, which has not been made or obtained previously, except for
any filing required to comply with the laws and regulations of the Securities and Exchange
Commission (“SEC”) as permitted under Section 13.3.3.

11.5 Validity of Patent Rights

To the best of Raptor’s knowledge, the claims in any issued patent included in the Raptor Base
Patent Rights licensed to Roche pursuant to this Agreement are valid and enforceable. To Raptor’s
knowledge, there is no dispute concerning inventorship of any Raptor Base Patent Rights.

11.6 Ownership and Validity of Know-How

To the best of Raptor’s knowledge, the Raptor Know-How has not been misappropriated from any Third
Party. Raptor has taken reasonable measures to protect the confidentiality of the Raptor Know-How.

11.7 No Claims

There are no claims or investigations pending or, to the best of Raptor’s knowledge, threatened
against Raptor or any of its Affiliates, at Law or in equity, or before or by any governmental
authority relating to the subject matter of this Agreement or that would materially adversely
affect Raptor’s ability to perform its obligations hereunder.

 

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11.8 No Conflict

Raptor is not under any obligation to any Person, contractual or otherwise, that conflicts in any
material respect with the terms of this Agreement.

11.9 Roche Representations and Warranties

Roche represents and warrants to Raptor as of the Effective Date as follows:

(a) The execution, delivery and performance of this Agreement by Roche: (i) are within the
corporate power of Roche; (ii) have been duly authorized by all necessary corporate action; (iii)
are not in contravention of any provision of the certificate of incorporation of Roche; (iv) to the
knowledge of Roche, will not violate any Law or regulation or any order or decree of any court of
governmental instrumentality; (v) will not violate the terms of any indenture, mortgage, deed of
trust, lease, agreement, or other instrument to which Roche is a party or by which Roche or any of
its property is bound, which violation would have a material adverse effect on the financial
condition of Roche or on the ability of Roche to perform its obligations hereunder; and (vi) do not
require any filing or registration with, or the consent or approval of, any governmental body,
agency, authority or any other Person, which has not been made or obtained previously.

(b) There are no claims or investigations pending or, to Roche’s knowledge, threatened against
Roche or any of its Affiliates, at Law or in equity, or before or by any governmental authority
relating to the subject matter of this Agreement or that would materially adversely affect Roche’s
ability to perform its obligations hereunder.

(c) Roche is not under any obligation to any Person, contractual or otherwise, that conflicts in
any material respect with the terms of this Agreement.

11.10 No Other Representations; Disclaimer

EXCEPT AS OTHERWISE EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATIONS
OR EXTENDS ANY WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OF RIGHTS OF
THIRD PARTIES, WITH RESPECT TO ANY PRODUCT, TRANSPORT CANDIDATE, KNOW-HOW, MATERIALS OR PATENT
RIGHTS.

12. Indemnification

12.1 Indemnification by Roche

Roche shall indemnify, hold harmless and defend Raptor, its Affiliates and their respective
directors, officers, employees and agents from and against any and all losses, expenses, cost of
defense (including without limitation reasonable attorneys’ fees, witness fees, damages, judgments,
fines and amounts paid in settlement) and any amounts Raptor becomes legally obligated to pay
because of any claim or claims against it to the extent that such claim or claims arise out of (a)
activities related to Products (including, without limitation, product liability claims) conducted
by or on behalf of Roche, its Affiliates or Sublicensees, (b) the breach of any of Roche’s
representations or warranties hereunder, or (c) any infringement of any Third Party Patent Rights
or
misappropriation of any Third Party Know-How in connection with the manufacture, use, offer for
sale, sale, import or export of any Products, in all cases except to the extent such losses,
expenses, costs and amounts are due to the gross negligence or willful misconduct of Raptor or
breach of any of Raptor’s representations and warranties hereunder.

 

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12.2 Indemnification by Raptor

Raptor shall indemnify, hold harmless and defend Roche, its Affiliates and their respective
directors, officers, employees and agents from and against any and all losses, expenses, cost of
defense (including without limitation reasonable attorneys’ fees, witness fees, damages, judgments,
fines and amounts paid in settlement) and any amounts Roche becomes legally obligated to pay
because of any claim or claims against it to the extent that such claim or claims arise out of the
breach of any of Raptor’s representations or warranties hereunder, in all cases except to the
extent such losses, expenses, costs and amounts are due to the gross negligence or willful
misconduct of Roche or breach of any of Roche’s representations and warranties hereunder.

12.3 Procedure

In the event of a claim by a Third Party against any indemnitee entitled to indemnification under
this Agreement (in such capacity, the “Indemnified Party”), the Indemnified Party shall promptly
notify the other Party (in such capacity, the “Indemnifying Party”) in writing of the claim (it
being understood that the failure by the Indemnified Party to give prompt notice of a Third Party
claim as provided in this Section 12.3 shall not relieve the Indemnifying Party of its
indemnification obligation under this Agreement except and only to the extent that such
Indemnifying Party is actually prejudiced as a result of such failure to give prompt notice).
Within thirty (30) days after delivery of such notification, the Indemnifying Party may, upon
written notice thereof to the Indemnified Party, undertake and solely manage and control, at its
sole expense and with counsel reasonably satisfactory to the Indemnified Party, the defense of the
claim. If the Indemnifying Party does not undertake such defense, the Indemnified Party shall
control such defense. The Party not controlling such defense shall cooperate with the other Party
and may, at its option and expense, participate in such defense; provided that, if the Indemnifying
Party assumes control of such defense and the Indemnified Party in good faith concludes, based on
advice from counsel, that the Indemnifying Party and the Indemnified Party have conflicting
interests with respect to such action, suit, proceeding or claim, the Indemnifying Party shall be
responsible for the reasonable fees and expenses of counsel to the Indemnified Party solely in
connection therewith. The Party controlling such defense shall keep the other Party advised of the
status of such action, suit, proceeding or claim and the defense thereof and shall consider
recommendations made by the other Party with respect thereto. The Indemnifying Party shall not be
liable for any litigation costs or expenses incurred by the Indemnified Party without the
Indemnifying Party’s written consent. The Indemnified Party shall not settle any such action, suit,
proceeding or claim without the prior written consent of the Indemnifying Party, which shall not be
unreasonably withheld, delayed or conditioned. The Indemnifying Party shall not settle any such
action, suit, proceeding or claim, or consent to any judgment in respect thereof, that does not
include a complete and unconditional release of the Indemnified Party from all liability with
respect thereto, that imposes any liability or obligation on the Indemnified Party or that
acknowledges fault by the Indemnified Party without the prior written consent of the Indemnified
Party.

12.4 No Consequential Damages

IN NO EVENT SHALL EITHER RAPTOR OR ROCHE BE LIABLE FOR SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY,
MULTIPLE OR CONSEQUENTIAL DAMAGES ARISING OUT OF
THIS AGREEMENT BASED ON CONTRACT, TORT OR ANY OTHER LEGAL THEORY. NOTHING IN THIS SECTION 12.4 IS
INTENDED TO LIMIT OR RESTRICT (A) THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF EITHER PARTY UNDER
ARTICLE 12 OR (B) REMEDIES AVAILABLE TO EITHER PARTY WITH RESPECT TO A BREACH OF ARTICLE 13.

 

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13. Obligation Not to Disclose Confidential Information

13.1 Non-Use and Non-Disclosure

During the Agreement Term and for five (5) years thereafter, the Receiving Party shall (i) treat
Confidential Information provided by the Disclosing Party as it would treat its own information of
a similar nature (but with no less than reasonable care), (ii) take reasonable precautions not to
disclose such Confidential Information to Third Parties, without the Disclosing Party’s prior
written consent, (iii) not use such Confidential Information other than for fulfilling its
obligations under this Agreement and (iv) shall disclose such Confidentiality Information only to
the Receiving Party’s employees, consultants, advisors and contractors who have a need-to-know such
Confidential Information to perform their obligations in connection herewith, solely under
conditions of confidentiality and non-use that are at least as restrictive as those set forth in
this Article 13.

13.2 Permitted Disclosure

Notwithstanding the obligation of non-use and non-disclosure set forth in Section 13.1, the Parties
recognize the need for certain exceptions to this obligation, specifically set forth below, with
respect to press releases, patent rights, publications, and certain commercial considerations.

13.3 Press Releases; Disclosure of Terms

13.3.1 During the Agreement Term, the content of any press release or public disclosure relating to
this Agreement or the Parties’ activities hereunder (each such press release or public disclosure,
a “Subject Disclosure”) shall be mutually agreed by the Parties, which agreement shall not be
unreasonably withheld, delayed or conditioned, except that a Party may, without the other Party’s
agreement, issue or make such Subject Disclosure (a) if the contents of such Subject Disclosure
have previously been made public other than through a breach of this Agreement by the issuing
Party, or (b) if it is advised by counsel that such Subject Disclosure is required by applicable
Law, including without limitation the rules or regulations of the SEC or similar regulatory agency
in a country other than the United States or of any stock exchange or other securities trading
institution.

13.3.2 In light of the foregoing, each Party shall provide the other Party with a draft Subject
Disclosure that requires such other Party’s approval hereunder at least five (5) Business Days
prior to its intended issuance or disclosure for such other Party’s review. During such period, the
reviewing Party shall either (i) approve the draft Subject Disclosure and permit the submitting
Party to issue such Subject Disclosure, (ii) contact the submitting Party to discuss modification
to the draft Subject Disclosure, or (iii) contact the submitting Party and disapprove the Subject
Disclosure, in each case subject to the reviewing Party’s obligation not to unreasonably withhold,
condition or delay any approval which is sought by the submitting Party with respect to such draft
Subject Disclosure. If the reviewing Party asks for modification, then the submitting Party shall
either make such modification or work with the reviewing Party to arrive at a Subject Disclosure
that is agreeable to both Parties.

 

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13.3.3 Notwithstanding anything in this Agreement to the contrary, each Party shall have the right
to disclose the terms of this Agreement [*****] and (b) as required by applicable Law, including
without limitation the rules or regulations of the SEC or similar regulatory agency in a country
other than the United States or of any stock exchange or other securities trading institution. In
the event that this Agreement shall be included in any report, statement or other document filed by
either Party or an Affiliate of either Party with the SEC or similar regulatory agency in a country
other than the United States or any stock exchange or other securities trading institution, such
Party shall use, or shall cause such Party’s Affiliate, as the case may be, to use, reasonable
efforts to obtain confidential treatment from the SEC, similar regulatory agency, stock exchange or
other securities trading institution of any financial information or other information of a
competitive or confidential nature, and shall include in such confidentiality request such
provisions of this Agreement as may be reasonably requested by the other Party.

13.4 Publications

During the Agreement Term, the following restrictions shall apply with respect to disclosure by any
Party of Confidential Information relating to the Product (or any component thereof) in any
publication or presentation:

	 	a)	 	Both Parties acknowledge that it is their policy for the studies and results thereof to
be registered and published in accordance with their internal guidelines. Roche, in
accordance with its internal policies and procedures, shall have the right to publish all
studies and clinical trials conducted under this Agreement, and results thereof, on the
clinical trial registries which are maintained by or on behalf of Roche.

	 	b)	 	A Party (“Publishing Party”) shall provide the other Party with a copy of any proposed
publication or presentation at least sixty (60) days (or at least thirty (30) days in the
case of oral presentations) prior to submission for publication or presentation so as to
provide such other party with an opportunity to recommend any changes it reasonably
believes are necessary to continue to maintain the Confidential Information of the
non-Publishing Party in accordance with the requirements of this Agreement. If such
non-Publishing Party notifies (“Notice of Comments”) the Publishing Party in writing,
within sixty (60) days after receipt of the copy of the proposed publication or
presentation (or at least thirty (30) days in the case of oral presentations) that such
publication or presentation in its reasonable judgment (i) contains an Invention, conceived
and reduced to practice either solely or jointly by the non-Publishing Party, for which
such Party desires to obtain patent protection or (ii) contains Confidential Information of
the Non-Publishing Party or could otherwise be reasonably expected to have a material
adverse effect on the commercial value of any Confidential Information disclosed by the
non-Publishing Party to the Publishing Party, the Publishing Party shall delete such
Confidential Information or other relevant disclosure and prevent such publication or delay
such publication for a mutually agreeable period of time. In the case of Inventions, the
proposed publication or presentation shall be delayed for a period reasonably sufficient to
permit the timely preparation and filing of a patent application(s) on such Invention, and
in no event less than an additional ninety (90) days from the date of the Notice of
Comments.

 

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13.5 Commercial Considerations

Nothing in this Agreement shall prevent Roche or its Affiliates from disclosing Confidential
Information of Raptor to (i) governmental agencies to the extent required or desirable to secure
government approval for the development, manufacture or sale of Product in the Territory, (ii)
Third Parties acting on behalf of Roche and bound by obligations of confidentiality and non-use
which are
at least as restrictive as those set forth in this Article 13, solely to the extent reasonably
necessary for the development, manufacture or sale of Product in the Territory, or (iii) Third
Parties bound by obligations of confidentiality and non-use which are at least as restrictive as
those set forth in this Article 13, solely to the extent reasonably necessary to market the Product
in the Territory. The Receiving Party may disclose Confidential Information of the Disclosing Party
to the extent that such Confidential Information is required to be disclosed by the Receiving Party
(x) to comply with applicable Laws, or (y) to the extent necessary to exercise the rights granted
to or retained by the Receiving Party under this Agreement in connection with the Handling of
Patent Rights or to defend or prosecute litigation, provided that the Receiving Party provides
prior written notice of such disclosure to the Disclosing Party and, to the extent practicable,
takes reasonable and lawful actions to, and reasonably cooperates with the Disclosing Party in the
Disclosing Party’s efforts to, minimize the degree of such disclosure.

13.6 Clinical Trial Registry.

Roche, in accordance with its internal policies and procedures, shall have the right to publish all
studies, clinical trials and results thereof regarding Products on the clinical trial registries
which are maintained by or on behalf of Roche.

13.7 Material Transfer.

Either Party may provide the other Party with sample molecules and other materials (“Material(s)”)
in connection with the Research Plan. The Party supplying the Materials shall provide the other
Party with all safety information and handling instructions pertaining to the Material that it is
aware of. The party receiving any Materials will use the Materials solely for carrying out the
Research Plan and for no other purposes and will not transfer the Materials to any third party. The
Party providing the Materials will retain all rights in and title to the Materials. Under no
circumstances shall the Party receiving the Material use the Material in humans or chemically or
biologically modify the Material, except in accordance with the Research Plan. The Party receiving
the Material shall take no action to determine the chemical structure of the Material or to reverse
engineer the Material.

14. Term and Termination

14.1 Commencement and Term

The term of this Agreement shall commence upon the Effective Date and, unless this Agreement is
terminated sooner as provided in this Article 14, expire on the date when no royalty or other
payment obligations under this Agreement are or will become due (“Agreement Term”). Upon expiration
of this Agreement, all licenses from Raptor to Roche shall be fully paid-up, perpetual and
irrevocable.

14.2 Termination

14.2.1 Termination for Breach

A Party (in such capacity, the “Non-Breaching Party”) shall have the right to terminate this
Agreement in its entirety or on a country-by-country or Product-by Product basis in the event the
other Party (in such capacity, the “Breaching Party”) is in material breach under this Agreement.

The Non-Breaching Party shall provide written notice to the Breaching Party, which notice shall
identify the material breach and the countries in which the Non-Breaching Party intends to have
this Agreement terminate. The Breaching Party shall have a period of sixty (60) days (or thirty
(30) days
with respect to any payment breach (“Payment Breach”)) after such written notice is provided to
cure such material breach (“Peremptory Notice Period”).

 

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If any breach set forth above in this Section 14.2.1 is not cured within the Peremptory Notice
Period, this Agreement shall effectively terminate in its entirety or with respect to specific
country(ies), or Product(s), as applicable, at the end of such Peremptory Notice Period, unless the
Breaching Party provides written notice to Non-Breaching Party during such Peremptory Notice Period
that the Breaching Party disputes in good faith the existence of such breach, in which event this
Agreement shall terminate only upon the issuance by an arbitrator pursuant to Section 16.3 of an
award upholding the basis for termination (or once the Breaching Party is no longer disputing such
basis in good faith, if earlier). Notwithstanding the foregoing, (a) in the case of a Payment
Breach that is so arbitrated but that is upheld in an arbitration award as a basis for termination,
this Agreement shall not terminate if both (x) Roche shall have paid all disputed amounts into a
Third Party escrow within thirty (30) days after the commencement of the arbitration, and (y)
within fifteen (15) days after such arbitration award (or such time as Roche is no longer disputing
such amounts, if earlier), all amounts held to be owed to Raptor (or that Roche is no longer
disputing) are paid to Raptor, and (b) in the case of a material breach by Raptor, this Agreement
shall not terminate unless and until (x) an arbitral tribunal issues a final award pursuant to
Section 16.3 upholding such basis for termination (or unless and until Raptor is no longer
disputing such basis, if earlier) and (y) within twenty (20) days thereafter Raptor fails to cure
the breach(es) on which the arbitral tribunal based such award.

14.2.2 Termination for Insolvency Event

A Party shall have the right to terminate this Agreement upon notice to the other Party, if such
other Party incurs an Insolvency Event.

14.2.3 Termination by Roche without a Cause

Roche shall have the right to terminate this Agreement at any time on a Product-by-Product,
patent-by-patent, and country-by-country basis upon sixty (60) days prior written notice. The
effective date of termination under this Section 14.2.3 shall be the date sixty (60) days after
Roche provides such written notice to Raptor. Upon termination of this Agreement in any country,
Roche will cease manufacturing, marketing, and/or selling the Products in such country, if and only
if the Royalty Term has not yet expired.

14.3 Consequences of Termination

14.3.1 Termination by Raptor for Breach by Roche, or Roche Insolvency Event; Termination by Roche
without Cause

Upon any termination of this Agreement with respect to any patent(s) and/or country(ies) by Roche
without cause pursuant to Section 14.2.3, all rights and licenses granted by Raptor to Roche under
this Agreement with respect to such terminated patent(s) and/or terminated country(ies) shall also
terminate on the effective date of termination.

 

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Upon any termination of this Agreement in its entirety or with respect to any country(ies), or
Product(s) by Raptor for an uncured material breach by Roche pursuant to Section 14.2.1, for a
Roche Insolvency Event pursuant to Section 14.2.2, or any termination of this Agreement in its
entirety or with respect to any Product(s) by Roche without cause pursuant to Section 14.2.3 all
rights and licenses granted by Raptor to Roche under this Agreement, in the terminated country(ies)
and/or with respect to the terminated Product(s), shall also terminate on the effective date of
termination.

14.3.2 Termination by Roche for Breach by Raptor or Raptor Insolvency Event

Upon any termination of this Agreement with respect to any country(ies) or in its entirety by Roche
for an uncured material breach by Raptor pursuant to Section 14.2.1, all rights and obligations of
each Party under this Agreement, with respect to the terminated country(ies) or this Agreement in
its entirety, shall terminate on the effective date of termination (except as set forth in Section
14.4); provided, however, that Roche shall have the right to elect, by
written notice to Raptor, to (i) continue the licenses granted to Roche by Raptor under Section
2.1.1, (and, (ii) solely if and to the extent that the discovery, manufacture and development
activities contemplated under the Research Plan have not been completed with respect to any Product
as of the effective date of termination, continue the licenses granted to Roche by Raptor under
Section 2.1.2 of this Agreement, in each case subject to Roche’s continued compliance with (a)
Roche’s payment obligations under Article 6 (Payments) with respect to Products developed and/or
commercialized by Roche under such licenses, and (b) the terms of Section 2.2 (Sublicense), Article
7 (Accounting and Reporting), and Article 9 (Auditing) .

Upon any termination of this Agreement in its entirety by Roche for a Raptor Insolvency Event
pursuant to Section 14.2.2, all rights and licenses granted to Roche by Raptor under this Agreement
in the terminated country(ies) shall also terminate on the effective date of termination.

14.3.3 Royalty and Payment Obligations

Raptor shall use Commercially Reasonable Efforts to mitigate the cost of Non-cancellable
Obligations, and Roche shall cooperate with Raptor in such efforts, and Raptor shall promptly
notify Roche as to the amount of such mitigation. In the event of termination of this Agreement by
Raptor under Section 14.2.1 or 14.2.2, or by Roche under Section 14.2.3, Roche will reimburse
Raptor for Non-cancellable Obligations, except to the extent any Non-cancellable Obligations have
been or will be mitigated by Raptor.

Termination of this Agreement by a Party, for any reason, shall not release Roche from any
obligation to pay royalties or make any payments to Raptor which are due and payable prior to the
effective date of termination.

Other than as set forth in the first paragraph of this Section 14.3.3, termination of this
Agreement by a Party, for any reason, will release Roche from any obligation to pay royalties or
make any payments to Raptor which would otherwise become due or payable on or after the effective
date of termination.

14.4 Survival

Article 6 (Payment) (solely to the extent that any amounts are due hereunder but not paid as of the
effective date of termination), Article 7 (Accounting and Reporting), Article 8 (Taxes), Article 9
(Auditing), Article 10 (Intellectual Property), , Article 12 (Indemnification), Section 13.1
(Non-Use and Non-Disclosure), Section 13.2 (Permitted Disclosure), Section 14.1 (Commencement and
Term), Section 14.2 (Termination), Section 14.3 (Consequences of Termination), Section 14.4
(Survival), Section 16.1 (Governing Law), Section 16.2 (Disputes), Section 16.3 (Arbitration),
Section 16.4 (Assignment), and Section 16.14 (Actions of Affiliates) shall survive any expiration
or termination of this Agreement for any reason in accordance with their terms.

 

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15. Bankruptcy

All licenses (and to the extent applicable rights) granted under or pursuant to this Agreement by
Raptor to Roche are, and shall otherwise be deemed to be, for purposes of Section 365(n) of Title
11, US Code (the “Bankruptcy Code”) licenses of rights to “intellectual property” as defined under
the Bankruptcy Code. Unless Roche elects to terminate this Agreement, the Parties agree that Roche,
as a licensee or sub-licensee of such rights under this Agreement, shall retain and may fully
exercise all of its rights and elections under the Bankruptcy Code, subject to the continued
performance of its obligations under this Agreement.

16. Miscellaneous

16.1 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of New
Jersey, U.S.A., without reference to its conflict of laws principles, and shall not be governed by
the United Nations Convention of International Contracts on the Sale of Goods (the Vienna
Convention).

16.2 Disputes

Unless otherwise set forth in this Agreement, in the event of any dispute in connection with this
Agreement, such dispute shall be referred to the respective executive officers of the Parties
designated below or their designees, for good faith negotiations attempting to resolve the dispute.
The designated executive officers are as follows:

	 	 	 
	For Raptor:

	 	CEO
	For Roche:

	 	Head of Pharma Partnering

16.3 Arbitration

Should the Parties fail to agree within one (1) month after a dispute is referred to the executive
officers for resolution under Section 16.2, it shall be finally settled by arbitration in
accordance with the commercial arbitration rules of the American Arbitration Association (AAA) as
in force at the time when initiating the arbitration. The tribunal shall consist of a single
arbitrator who shall be appointed in accordance with such rules. The place of arbitration shall be
New York City, New York. The language to be used shall be English. The award through arbitration
shall be final and binding. Either Party may enter any such award in a court having jurisdiction or
may make application to such court for judicial acceptance of the award and an order of
enforcement, as the case may be. Nothing in Section 16.2 or 16.3 shall prevent or limit either
Party from seeking or obtaining injunctive relief from any court of competent jurisdiction.

16.4 Assignment

Neither Party may assign this Agreement or any of its rights or obligations under this Agreement to
a Third Party absent the prior written consent of the other Party, except that either Party may,
without the other Party’s prior written consent, make an assignment to any of its Affiliates or in
connection with the merger or sale of all or substantially all of the assets or business of such
Party to which this Agreement relates. Any permitted assignment shall be binding on the successors
of the assigning Party. Any assignment notwithstanding, the assigning Party in all cases shall
remain primarily liable hereunder for the prompt and punctual payment and performance of all
obligations
of the assignee (i.e., to that extent, no such assignment shall constitute a novation or otherwise
release the assigning Party from liability hereunder).

 

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16.5 Debarment

	 	(a)	 	Raptor hereby certifies that it has not been debarred under the provisions of
the Generic Drug Enforcement Act of 1992, 21 U.S.C. Sec. 335a(a) and (b). In the event
that during the term of this Agreement Raptor or any of its employees (i) becomes
debarred; or (ii) receives notice of an action or threat of an action with respect to
its debarment, Raptor agrees to immediately notify Roche. Raptor also agrees that in
the event that it becomes debarred it shall immediately cease all activities relating
to this Agreement.

	 	(b)	 	In the event that Raptor becomes debarred, this Agreement shall automatically
terminate, without any further action or notice by either party. In the event that
Roche receives notice from Raptor or otherwise becomes aware that (i) a debarment
action has been brought against Raptor or any of its employees; or (ii) Raptor has been
threatened with a debarment action, then Roche shall have the right to terminate this
Agreement immediately.

	 	(c)	 	Raptor hereby certifies that it has not and will not use in any capacity the
services of any individual, corporation, partnership or association which has been
debarred under 21 U.S.C. Sec. 335(a) or (b). In the event that Raptor becomes aware of
the debarment or threatened debarment of any individual, corporation, partnership or
association providing services to Raptor which directly or indirectly relate to the
activities under this Agreement, Raptor shall notify Roche immediately. Upon the
receipt of such notice by Roche or if Roche otherwise becomes aware of such debarment
or threatened debarment, Roche shall have the right to terminate this Agreement
immediately.

16.6 Independent Contractor

No employee or representative of either Party shall have any authority to bind or obligate the
other Party to this Agreement for any sum or in any manner whatsoever or to create or impose any
contractual or other liability on the other Party without said Party’s prior written approval. For
all purposes, and notwithstanding any other provision of this Agreement to the contrary, Raptor’s
legal relationship to Roche under this Agreement shall be that of independent contractor.

16.7 Unenforceable Provisions and Severability

If any of the provisions of this Agreement are held to be void or unenforceable, then such void or
unenforceable provisions shall be replaced by valid and enforceable provisions which will achieve
as far as possible the economic business intentions of the Parties. However, the remainder of this
Agreement will remain in full force and effect, provided that the material interests of the Parties
are not affected, i.e. the Parties would presumably have concluded this Agreement without the
unenforceable provisions.

 

27/32

 

16.8 Waiver

The failure by either Party to require strict performance and/or observance of any obligation,
term, provision or condition under this Agreement will neither constitute a waiver thereof nor
affect in any way the right of the respective Party to require such performance and/or observance.
The waiver by either Party of a breach of any obligation, term, provision or condition hereunder
shall not constitute a waiver of any subsequent breach thereof or of any other obligation, term,
provision or condition.

16.9 Appendices

All Appendices to this Agreement shall form an integral part to this Agreement.

16.10 Entire Understanding

This Agreement contains the entire understanding between the Parties with respect to the within
subject matter and supersedes any and all prior agreements, understandings and arrangements,
whether written or oral.

16.11 Amendments

No amendments of the terms and conditions of this Agreement shall be binding upon either Party
unless in writing and signed by both Parties.

16.12 Notice

All notices which are required or permitted hereunder shall be in writing and sufficient if
delivered personally, sent by facsimile (and promptly confirmed by personal delivery, registered or
certified mail or overnight courier), sent by nationally recognized overnight courier or sent by
registered or certified mail, postage prepaid, return receipt requested, addressed as follows:

	 	 	 
	if to Raptor, to:

	 	Raptor Pharmaceutical Inc.
	 

	 	9 Commercial Blvd., Suite 200
	 

	 	Novato, CA 94949
	 

	 	Attn: Christopher M. Starr, Ph.D., CEO
	 

	 	Facsimile No.: 415-382-1458
	 
	 	 
	And:
	 	 
	 
	 	 
	if to Roche, to:

	 	F. Hoffmann-La Roche Ltd
	 

	 	Grenzacherstrasse 124
	 

	 	4070 Basel
	 

	 	Switzerland
	 

	 	Attn: Legal Department
	 

	 	Facsimile No.: +41 61 688 13 96
	 
	 	 
	And:

	 	Hoffmann-La Roche Inc.
	 

	 	340 Kingsland Street
	 

	 	Nutley, New Jersey 07110
	 

	 	U.S.A.
	 

	 	Attn. Corporate Secretary
	 

	 	Facsimile No.: +1 973 235-3500

 

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or to such other address as the Party to who notice is to be given may have furnished to the other
Party in writing in accordance herewith. The effective date of notice shall be the actual date of
receipt by the Party receiving the same.

16.13 Change of Control

In the event of a Change of Control of Raptor pursuant to which Raptor is acquired by, or
consummates a business combination with, a direct competitor of Roche or such a direct competitor
acquires more than [*****] of the common shares or voting power of Raptor, Roche shall not be
required under to provide any competitively-sensitive information to such Roche competitor. A
direct competitor of Roche is any pharmaceutical or biotechnology company which markets or is
developing one or more products directed to an Indication or target for which Roche or its
Affiliates are developing and/or commercializing products.

16.14 Actions of Affiliates

For purposes of clarity, each Party may perform its obligations hereunder personally or through one
or more Affiliates, provided, that such Party shall nonetheless be primarily liable for the
performance of its Affiliates and for any failure by its Affiliates to comply with the
restrictions, limitations and obligations set forth in this Agreement. To the extent that the
rights granted to a Party hereunder may be and are exercised by an Affiliate of such Party, such
Affiliate shall be bound by the corresponding obligations of such Party. Notwithstanding any of the
foregoing, Roche Nutley and Roche Basel shall be jointly and severally liable under this Agreement.

16.15 Execution in Counterparts

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

* * * * *

[Signature Page to Follow]

 

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EXECUTION VERSION

IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the Effective Date.

Raptor Pharmaceutical Inc.

By: /s/ Kim R. Tsuchimoto

Name: Kim R. Tsuchimoto

Title: Chief Financial Officer

F. Hoffmann-La Roche Ltd

	 	 	 	 	 	 	 
	By:

	 	[Illegible]
	 	By:
	 	/s/ Stefan Arnold
	 
	 	 	 	 	 	 
	Name:

	 	 	 	Name:
	 	Stefan Arnold
	 
	 	 	 	 	 	 
	Title:

	 	 	 	Title:
	 	Head Corporate Law Pharma
	 
	 	 	 	 	 	 
	Hoffmann-La Roche Inc.	 	 	 	 
	 
	 	 	 	 	 	 
	By:

	 	/s/ A. Waseem Malick	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	A. Waseem Malick	 	 	 	 
	 
	 	 	 	 	 	 
	Title:
	 	VP, PARD	 	 	 	 

[*****] Raptor Pharmaceutical Corp. has requested confidential treatment of certain portions of
this agreement which have been omitted and filed separately with the U.S. Securities and Exchange
Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

[Signature Page to Collaboration and License Agreement]

 

 

 

Appendix 1.42

Raptor Base Patent Rights as of the Effective Date

[*****]

[Appendix 1.42-1]

 

 

 

Appendix 1.45

Initial Research Plan

[*****]

[Appendix 1.45]

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