Document:

STOCK PURCHASE AGREEMENT AND SHARE EXCHANGE

 

 

by and among

 

ASAH CORP.

 

a Delaware Corporation

 

and

 

AMERICAN SURGICAL ASSISTANTS, INC.

 

a Texas Corporation

 

 

 

 

 

 

 

 

 

 

effective as of October 10, 2005

 

 

 

 

 

 

	
             
 	
            STOCK PURCHASE AGREEMENT AND SHARE EXCHANGE
 

 

THIS STOCK PURCHASE AGREEMENT AND SHARE EXCHANGE, made and entered into this       10th day of October, 2005, by and among ASAH Corp., a Delaware corporation with its principal place of business located at 10039 Bissonnet, Suite 250, Houston, Texas 77036 (“ASAH”); American Surgical Assistants, Inc., a Texas Corporation with its principal place of business at 10039 Bissonnet, Suite 250, Houston, Texas 77036 (“ASA”) and the shareholders of shareholders of American Surgical Assistants, Inc. (“Shareholders”) (collectively ASA and the ASA shareholders shall be known as the “ASA Group”).

 

Premises

 

A.         This Agreement provides for the acquisition of ASA whereby ASA shall become a wholly owned subsidiary of ASAH and in connection therewith, the issuance of a total of 12,000,000 shares of ASAH to the Shareholders.

 

B.         The boards of directors of ASA and ASAH have determined, subject to the terms and conditions set forth in this Agreement, that the transaction contemplated hereby is desirable and in the best interests of their stockholders, respectively. This Agreement is being entered into for the purpose of setting forth the terms and conditions of the proposed acquisition.

 

Agreement

 

NOW, THEREFORE, on the stated premises and for and in consideration of the mutual covenants and agreements hereinafter set forth and the mutual benefits to the parties to be derived here from, it is hereby agreed as follows:

 

ARTICLE I

REPRESENTATIONS, COVENANTS AND WARRANTIES OF 

ASAH CORP.

 

As an inducement to and to obtain the reliance of ASA, ASAH represents and warrants as follows:

 

Section 1.1     Organization. ASAH is a corporation duly organized, validly existing, and in good standing under the laws of Delaware and has the corporate power and is duly authorized, qualified, franchised and licensed under all applicable laws, regulations, ordinances and orders of public authorities to own all of its properties and assets and to carry on its business in all material respects as it is now being conducted, including qualification to do business as a foreign corporation in the jurisdiction in which the character and location of the assets owned by it or the nature of the business transacted by it requires qualification. Included in the Schedules attached hereto (hereinafter defined) are complete and correct copies of the articles of incorporation, bylaws and amendments
thereto as in effect on the date hereof. The execution and delivery of this Agreement does not and the consummation of the transactions contemplated by this Agreement in accordance with the terms hereof will not violate any provision of Holding’s articles of incorporation or bylaws. ASAH has full power, authority and legal right and has taken all action required by law, its articles of incorporation, its bylaws or otherwise to authorize the execution and delivery of this Agreement.

 

 

 

Section 1.2     Capitalization. The authorized capitalization of ASAH consists of 100,000,000 Common Shares, $0.001 par value per share, and 10,000,000 shares of Preferred Stock, $0.001 par value. As of the date hereof, ASAH has 21,230,700 common shares issued and outstanding. 

 

All issued and outstanding shares are legally issued, fully paid and nonassessable and are not issued in violation of the preemptive or other rights of any person. ASAH has no securities, warrants or options authorized or issued.

 

	
             
 	
            Section 1.3
 	
            Subsidiaries.
 	
            ASAH has no subsidiaries.
 

 

	
             
 	
            Section 1.4
 	
            Tax Matters: Books and Records.
 

 

(a)   The books and records, financial and others, of ASAH are in all material respects complete and correct and have been maintained in accordance with good business accounting practices; and

 

(b)   ASAH has no liabilities with respect to the payment of any country, federal, state, county, or local taxes (including any deficiencies, interest or penalties).

 

(c)   ASAH shall remain responsible for all debts incurred by ASAH prior to the date of closing.

 

Section 1.5     Litigation and Proceedings. There are no actions, suits, proceedings or investigations pending or threatened by or against or affecting ASAH or its properties, at law or in equity, before any court or other governmental agency or instrumentality, domestic or foreign or before any arbitrator of any kind that would have a material adverse affect on the business, operations, financial condition or income of ASAH. ASAH is not in default with respect to any judgment, order, writ, injunction, decree, award, rule or regulation of any court, arbitrator or governmental agency or instrumentality or of any circumstances which, after reasonable investigation, would result in the discovery of such a default.

 

Section 1.6     Material Contract Defaults.   ASAH is not in default in any material respect under the terms of any outstanding contract, agreement, lease or other commitment which is material to the business, operations, properties, assets or condition of ASAH, and there is no event of default in any material respect under any such contract, agreement, lease or other commitment in respect of which ASAH has not taken adequate steps to prevent such a default from occurring.

 

Section 1.7      Information.  The information concerning ASAH as set forth in this Agreement and in the attached Schedules is complete and accurate in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact required to make the statements made in light of the circumstances under which they were made, not misleading. 

 

Section 1.8       Title and Related Matters. ASAH has good and marketable title to and is the sole and exclusive owner of all of its properties, inventory, interest in properties and assets, real and personal (collectively, the “Assets”) free and clear of all liens, pledges, charges or encumbrances. ASAH owns free and clear of any liens, claims, encumbrances, royalty interests or other restrictions or limitations of any nature whatsoever and all procedures, techniques, marketing plans, business plans, methods of management or other information utilized in connection with ASAH’ business. No third party 

 

 

has any right to, and ASAH has not received any notice of infringement of or conflict with asserted rights of other with respect to any product, technology, data, trade secrets, know-how, proprietary techniques, trademarks, service marks, trade names or copyrights which, singly on in the aggregate, if the subject of an unfavorable decision ruling or finding, would have a materially adverse affect on the business, operations, financial conditions or income of ASAH or any material portion of its properties, assets or rights.

 

	
             
 	
            Section 1.9  
 	
            Contracts  
 	
            On the closing date:
 

 

(a)   There are no material contracts, agreements franchises, license agreements, or  other  commitments to which ASAH is a party or by which it or any of its properties are bound:

 

(b)   ASAH is not a party to any contract, agreement, commitment or instrument or subject to any charter or other corporate restriction or any judgment, order, writ, injunction, decree or award materially and adversely affects, or in the future may (as far as ASAH can now foresee) materially and adversely affect , the business, operations, properties, assets or conditions of ASAH; and

 

(c)   ASAH is not a party to any material oral or written: (I) contract for the employment of any officer or employee; (ii) profit sharing, bonus, deferred compensation, stock option, severance pay, pension benefit or retirement plan, agreement or arrangement covered by Title IV of the Employee Retirement Income Security Act, as amended; (iii)  agreement, contract or indenture relating to the borrowing of money; (iv) guaranty of any obligation for the borrowing of money or otherwise, excluding endorsements made for collection and other guaranties, of obligations, which, in the aggregate exceeds $1,000; (v) consulting or other contract with an unexpired term of more than one year or providing for payments in excess of $10,000 in the aggregate; (vi) collective bargaining agreement; (vii) contract, agreement or other commitment involving payments by it for more than $10,000 in the aggregate.

 

Section  1.10    Compliance With Laws and Regulations.  To the best of ASAH’s knowledge and belief, ASAH has complied with all applicable statutes and regulations of any federal, state or other governmental entity or agency thereof, except to the extent that noncompliance would not materially and adversely affect the business, operations, properties, assets or condition of ASAH or would not result in ASAH incurring material liability.

 

Section 1.11    Insurance.    All of the insurable properties of ASAH are insured for ASAH ‘s benefit under valid and enforceable policy or policies containing substantially equivalent coverage and will be outstanding and in full force at the Closing Date.

 

Section 1.12   Approval of Agreement.  The directors of ASAH have authorized the execution and delivery of the Agreement by and have approved the transactions contemplated hereby.

 

Section 1.13  Material Transactions or Affiliations.  There  are no material contracts or agreements of arrangement between ASAH and any person, who was at the time of such contract, agreement or arrangement an officer, director or person owning of record, or known to beneficially own ten percent (10%) or more of the issued and outstanding Common Shares of ASAH and which is to be performed in whole or in part after the date hereof. ASAH has no commitment, whether written or oral, to lend any funds to, borrow any money from or enter into material transactions with any such affiliated 

 

 

person. 

 

Section 1.14   No Conflict With Other Instruments. The execution of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in the breach of any term or provision of, or constitute an event of default under, any material indenture, mortgage, deed of trust or other material contract, agreement or instrument to which ASAH is a party or to which any of its properties or operations are subject.

 

Section 1.15   Governmental Authorizations.        ASAH has all licenses, franchises, permits or other governmental authorizations legally required to enable it to conduct its business in all material respects as conducted on the date hereof. Except for compliance with federal and state securities and corporation laws, as hereinafter provided, no authorization, approval, consent or order of, or registration, declaration or filing with, any court or other governmental body is required in connection with the execution and delivery by ASAH of this Agreement and the consummation of the transactions contemplated hereby.

 

ARTICLE II

REPRESENTATIONS, COVENANTS AND WARRANTIES

OF AMERICAN SURGICAL ASSISTANTS, INC.

 

As an inducement to, and to obtain the reliance of ASAH, ASA represents and warrants as follows:

 

Section 2.1     Organization.                ASA is a corporation duly organized, validly existing and in good standing under the laws of Texas and has the corporate power and is duly authorized, qualified, franchised and licensed under all applicable laws, regulations, ordinances and orders of public authorities to own all of its properties and assets and to carry on its business in all material respects as it is now being conducted, including qualification to do business as a foreign entity in the country or states in which the character and location of the assets owned by it or the nature of the business transacted by it requires qualification. Included in the Attached Schedules (as
hereinafter defined) are complete and correct copies of the articles of incorporation, bylaws and amendments thereto as in effect on the date hereof. The execution and delivery of this Agreement does not and the consummation of the transactions contemplated by this Agreement in accordance with the terms hereof will not, violate any provision of ASA’s certificate of incorporation or bylaws. ASA has full power, authority and legal right and has taken all action required by law, its articles of incorporation, bylaws or otherwise to authorize the execution and delivery of this Agreement.

 

Section 2.2    Capitalization. The authorized capitalization of ASA consists of 1,000 shares of common stock, no par value and no preferred shares. As of the date hereof, there are 900 shares of common stock issued and outstanding.

 

All issued and outstanding common shares have been legally issued, fully paid, are nonassessable and not issued in violation of the preemptive rights of any other person. ASA has no other securities, warrants or options authorized or issued.

 

	
             
 	
            Section 2.3
 	
            Subsidiaries.
 	
            ASA has no subsidiaries.
 

 

 

 

 

	
             
 	
            Section 2.4
 	
            Tax Matters; Books & Records
 

 

(a)          The books and records, financial and others, of ASA are in all material respects complete and correct and have been maintained in accordance with good business accounting practices; and

 

(b)          ASA has no liabilities with respect to the payment of any country, federal, state, county, local or other taxes (including any deficiencies, interest or penalties). 

 

	
             
 	
            (c)  
 	
            ASA shall remain responsible for all debts incurred prior to the closing.
 

 

Section 2.5     Information. The information concerning ASA as set forth in this Agreement and in the attached Schedules is complete and accurate in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact required to make the statements made, in light of the circumstances under which they were made, not misleading.

 

Section 2.6     Title and Related Matters.      ASA has good and marketable title to and is the sole and exclusive owner of all of its properties, inventory, interests in properties and assets, real and personal (collectively, the “Assets”) free and clear of all liens, pledges, charges or encumbrances. Except as set forth in the Schedules attached hereto, ASA owns free and clear of any liens, claims, encumbrances, royalty interests or other restrictions or limitations of any nature whatsoever and all procedures, techniques, marketing plans, business plans, methods of management or other information utilized in connection with ASA’s business. Except as set forth in the attached Schedules, no third party has any right to, and
ASA has not received any notice of infringement of or conflict with asserted rights of others with respect to any product, technology, data, trade secrets, know-how, proprietary techniques, trademarks, service marks, trade names or copyrights which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a materially adverse affect on the business, operations, financial conditions or income of ASA or any material portion of its properties, assets or rights.

 

Section 2.7     Litigation and Proceedings.         There are no actions, suits or proceedings pending or threatened by or against or affecting ASA, at law or in equity, before any court or other governmental agency or instrumentality, domestic or foreign or before any arbitrator of any kind that would have a material adverse effect on the business, operations, financial condition, income or business prospects of ASA. ASA does not have any knowledge of any default on its part with respect to any judgement, order, writ, injunction, decree, award, rule or regulation of any court, arbitrator or governmental agency or instrumentality.

 

	
             
 	
            Section 2.8
 	
            Contracts.
 	
            On the Closing Date:
 

 

(a) There are no material contracts, agreements, franchises, license agreements, or other commitments to which ASA is a party or by which it or any of its properties are bound;

 

(b) ASA is not a party to any contract, agreement, commitment or instrument or subject to any charter or other corporate restriction or any judgment, order, writ, injunction, decree or award which materially and adversely affects, or in the future may (as far as ASA can now foresee) materially and adversely affect, the business, 

 

 

operations, properties, assets or conditions of ASA; and 

 

(c)  ASA is not a party to any material oral or written:  (i) contract for the employment of any officer or employee;  (ii) profit sharing, bonus, deferred compensation, stock option, severance pay, pension, benefit or retirement plan, agreement or arrangement covered by Title IV of the Employee Retirement Income Security Act, as amended; (iii) agreement, contract or indenture relating to the borrowing of money;  (iv) guaranty of any obligation for the borrowing of money or otherwise, excluding endorsements made for collection and other guaranties of obligations, which, in the aggregate exceeds $1,000;  (v)  consulting or other contract with an unexpired term of more than one year or providing for payments in excess of $10,000 in the aggregate;  (vi)  collective bargaining agreement; (vii)   contract, agreement, or other commitment
involving payments by it for more than $10,000 in the aggregate.

 

Section 2.9     No Conflict With Other Instruments.       The execution of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in the breach of any term or provision of, or constitute an event of default under, any material indenture, mortgage, deed of trust or other material contract, agreement or instrument to which ASA is a party or to which any of its properties or operations are subject.

 

Section 2.10   Material Contract Defaults. To the best of ASA’s knowledge and belief, it is not in default in any material respect under the terms of any outstanding contract, agreement, lease or other commitment which is material to the business, operations, properties, assets or condition of ASA, and there is no event of default in any material respect under any such contract, agreement, lease or other commitment in respect of which ASA has not taken adequate steps to prevent such a default from occurring.

 

Section 2.11  Governmental Authorizations. To the best of ASA’s knowledge, ASA has all licenses, franchises, permits and other governmental authorizations that are legally required to enable it to conduct its business operations in all material respects as conducted on the date hereof. Except for compliance with federal and state securities or corporation laws, no authorization, approval, consent or order of, or registration, declaration or filing with, any court or other governmental body is required in connection with the execution and delivery by ASA of the transactions contemplated hereby.

 

Section 2.12   Compliance With Laws and Regulations. To the best of ASA’s knowledge and belief, ASA has complied with all applicable statutes and regulations of any federal, state or other governmental entity or agency thereof, except to the extent that noncompliance would not materially and adversely affect the business, operations, properties, assets or condition of ASA or would not result in ASA ‘s incurring any material liability.

 

Section 2.13  Insurance. All of the insurable properties of ASA are insured for ASA’s benefit under valid and enforceable policy or policies containing substantially equivalent coverage and will be outstanding and in full force at the Closing Date.

 

Section 2.14   Approval of Agreement.     The directors of ASA have authorized the execution and delivery of the Agreement and have approved the transactions contemplated hereby.

 

 

 

Section 2.15   Material Transactions or Affiliations.        As of the Closing Date, there will exist no material contract, agreement or arrangement between ASA and any person who was at the time of such contract, agreement or arrangement an officer, director or person owning of record, or known by ASA to own beneficially, ten percent (10%) or more of the issued and outstanding Common Shares of ASA and which is to be performed in whole or in part after the date hereof except with regard to an agreement with the ASA shareholders providing for the distribution of cash to provide for payment of federal and state taxes on Subchapter S income. ASA has no commitment, whether written or oral, to lend any funds to, borrow any money from or enter
into any other material transactions with, any such affiliated person.

 

ARTICLE III

	
             
 	
            EXCHANGE PROCEDURE AND OTHER CONSIDERATION
 

 

Section 3.1     Share Exchange/Delivery of ASA Securities.        On the Closing Date, the holders of all of the ASA Common Shares shall deliver to ASAH (i) certificates or other documents evidencing all of the issued and outstanding ASA Common Shares, duly endorsed in blank or with executed power attached thereto in transferrable form. On the Closing Date, all previously issued and outstanding Common Shares of ASA shall be transferred to ASAH, so that ASA shall become a wholly owned subsidiary of ASAH. 

 

Section 3.2     Issuance of ASAH Common Shares. In exchange for all of the ASA Common Shares tendered pursuant to Section 3.1, ASAH shall issue to the ASA shareholders a total of 12,000,000 shares of ASAH common stock in the following manner. Such shares are restricted in accordance with Rule 144 of the 1933 Securities Act. 

 

	
             
 	
            Zak Elgamal-6,000,000 shares
 	
             

	
             
 	
            Jaime Olmo-Rivas-6,000,000 shares
 

 

Section 3.3     Events Prior to Closing. Upon execution hereof or as soon thereafter as practical, management of ASAH and ASA shall execute, acknowledge and deliver (or shall cause to be executed, acknowledged and delivered) any and all certificates, opinions, financial statements, schedules, agreements, resolutions rulings or other instruments required by this Agreement to be so delivered, together with such other items as may be reasonably requested by the parties hereto and their respective legal counsel in order to effectuate or evidence the transactions contemplated hereby, subject only to the conditions to Closing referenced herein below. In addition, prior to Closing, ASA shall provide ASAH with updated audited financial statements to be filed with ASAH’s Form 8-K filing with the
SEC within three (3) days of Closing.

 

Section 3.4     Closing.          The closing (“Closing”) of the transactions contemplated by this Agreement shall be September 20, 2005.

 

	
             
 	
            Section 3.5
 	
            Termination.
 

 

(a)  This Agreement may be terminated by the board of directors or majority interest of Shareholders of either ASAH or ASA, respectively, at any time prior to the Closing Date if:

 

 

 

 

(i)    there shall be any action or proceeding before any court or any governmental body which shall seek to restrain, prohibit or invalidate the transactions contemplated by this Agreement and which, in the judgment of such board of directors, made in good faith and based on the advice of its legal counsel, makes it inadvisable to proceed with the exchange contemplated by this Agreement; or 

 

(ii)   any of the transactions contemplated hereby are disapproved by any regulatory authority whose approval is required to consummate such transactions.

 

In the event of termination pursuant to this paragraph (a) of this Section 3.5, no obligation, right, or liability shall arise hereunder and each party shall bear all of the expenses incurred by it in connection with the negotiation, drafting and execution of this Agreement and the transactions herein contemplated.

 

(b)   This Agreement may be terminated at any time prior to the Closing Date by action of the board of directors of ASAH if ASA shall fail to comply in any material respect with any of its covenants or agreements contained in this Agreement or if any of the representations or warranties of ASA contained herein shall be inaccurate in any material respect, which noncompliance or inaccuracy is not cured after 20 days written notice thereof is given to ASA. If this Agreement is terminated pursuant to this paragraph (b) of this Section 3.5, this Agreement shall be of no further force or effect and no obligation, right or liability shall arise hereunder.

 

(c)  This Agreement may be terminated at any time prior to the Closing Date by action of the board of directors of ASA if ASAH shall fail to comply in any material respect with any of its covenants or agreements contained in this Agreement or if any of the representations or warranties of ASAH contained herein shall be inaccurate in any material respect, which noncompliance or inaccuracy is not cured after 20 days written notice thereof is given to ASAH. If this Agreement is terminated pursuant to this paragraph (d) of this Section 3.5, this Agreement shall be of no further force or effect and no obligation, right or liability shall arise hereunder.

 

In the event of termination pursuant to paragraph (b) and (c) of this Section 3.5, the breaching party shall bear all of the expenses incurred by the other party in connection with the negotiation, drafting and execution of this Agreement and the transactions herein contemplated.

 

Section 3.6     Directors of ASAH After Acquisition. After the Closing Date, Zak Elgamal shall remain the sole member of the Board of Directors of ASAH. Each director shall hold office until his successor shall have been duly elected and shall have qualified or until his earlier death, resignation or removal. 

 

Section 3.7     Officers of ASAH. Upon the closing, the following person shall remain the sole officer of ASAH:

 

	
             
 	
            NAME
 	
            OFFICE
 

 

	
             
 	
            Zak Elgamal
 	
            Chief Executive Officer, Chief Financial Officer, President and Secretary
 

 

 

 

 

ARTICLE IV

SPECIAL COVENANTS

 

Section 4.1    Access to Properties and Records.   Prior to closing, ASAH and ASA will each afford to the officers and authorized representatives of the other full access to the properties, books and records of each other, in order that each may have full opportunity to make such reasonable investigation as it shall desire to make of the affairs of the other and each will furnish the other with such additional financial and operating data and other information as to the business and properties of each other, as the other shall from time to time reasonably request.

 

Section 4.2   Availability of Rule 144. ASAH and ASA shareholders holding “restricted securities, “ as that term is defined in Rule 144 promulgated pursuant to the Securities Act will remain as “restricted securities”. ASAH is under no obligation to register such shares under the Securities Act, or otherwise. The stockholders of ASAH and ASA holding restricted securities of ASAH and ASA as of the date of this Agreement and their respective heirs, administrators, personal representatives, successors and assigns, are intended third party beneficiaries of the provisions set forth herein. The covenants set forth in this Section 4.2 shall survive the Closing and the consummation of the transactions herein contemplated.

 

Section 4.3   Special Covenants and Representations Regarding the ASAH Common Shares to be Issued in the Exchange. The consummation of this Agreement, including the issuance of the ASAH Common Shares to the Shareholders of ASA as contemplated hereby, constitutes the offer and sale of securities under the Securities Act, and applicable state statutes. Such transaction shall be consummated in reliance on exemptions from the registration and prospectus delivery requirements of such statutes which depend, inter alia, upon the circumstances under which the ASA Shareholders acquire such securities. 

 

Section 4.4    Third Party Consents. ASAH and ASA agree to cooperate with each other in order to obtain any required third party consents to this Agreement and the transactions herein contemplated.

 

	
             
 	
            Section 4.5
 	
            Actions Prior and Subsequent to Closing.
 

 

 (a)        From and after the date of this Agreement until the Closing Date, except as permitted or contemplated by this Agreement, ASAH and ASA will each use its best efforts to:

 

(i)   maintain and keep its properties in states of good repair and condition as at present, except for depreciation due to ordinary wear and tear and damage due to casualty;

(ii)  maintain in full force and effect insurance comparable in amount and in scope of coverage to that now maintained by it;

(iii) perform in all material respects all of its obligations under material contracts, leases and instruments relating to or affecting its assets, properties and business;

 

 (b)        From and after the date of this Agreement until the Closing Date, ASAH will not, without the prior consent of ASA:

 

 

 

 (i) except as otherwise specifically set forth herein, make any change in its articles of incorporation or bylaws;

 (ii) declare or pay any dividend on its outstanding Common Shares, except as may otherwise be required by law, or effect any stock split or otherwise change its capitalization, except as provided herein;

 (iii) enter into or amend any employment, severance or agreements or arrangements with any directors or officers;

 (iv) grant, confer or award any options, warrants, conversion rights or other rights not existing on the date hereof to acquire any Common Shares; or 

	
             
 	
            (v) purchase or redeem any Common Shares.
 

 

	
            Section 4.6
 	
            Indemnification.
 

 

(a)  ASAH hereby agrees to indemnify ASA, each of the officers, agents and directors and current shareholders of ASA as of the Closing Date against any loss, liability, claim, damage or expense (including, but not limited to, any and all expense whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened or any claim whatsoever), to which it or they may become subject to or rising out of or based on any inaccuracy appearing in or misrepresentation made in this Agreement. The indemnification provided for in this paragraph shall survive the Closing and consummation of the transactions contemplated hereby and termination of this Agreement; and 

 

(b)  ASA hereby agrees to indemnify ASAH, each of the officers, agents, directors and current shareholders of ASAH as of the Closing Date against any loss, liability, claim, damage or expense (including, but not limited to, any and all expense whatsoever reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened or any claim whatsoever), to which it or they may become subject arising out of or based on any inaccuracy appearing in or misrepresentation made in this Agreement. The indemnification provided for in this paragraph shall survive the Closing and consummation of the transactions contemplated hereby and termination of this Agreement.

 

ARTICLE V

	
             
 	
            CONDITIONS PRECEDENT TO OBLIGATIONS OF ASAH
 

 

The obligations of ASAH under this Agreement are subject to the satisfaction, at or before the Closing Date, of the following conditions:

 

Section 5.1     Accuracy of Representations. The representations and warranties made by ASAH in this Agreement were true when made and shall be true at the Closing Date with the same force and effect as if such representations and warranties were made at the Closing Date (except for changes therein permitted by this Agreement), and ASAH shall have performed or compiled with all covenants and conditions required by this Agreement to be performed or complied with by ASAH prior to or at the Closing. ASA shall be furnished with a certificate, signed by a duly authorized officer of ASAH and dated the Closing Date, to the foregoing effect.

 

 

 

Section 5.2     Director Approval.    The Board of Directors of ASAH shall have approved this Agreement and the transactions contemplated herein.

 

Section 5.3     Officer’s Certificate.   ASA shall have been furnished with a certificate dated the Closing Date and signed by a duly authorized officer of ASAH to the effect that:  (a)  the representations and warranties of ASAH set forth in the Agreement and in all Exhibits, Schedules and other documents furnished in connection herewith are in all material respects true and correct as if made on the Effective Date;  (b)  ASAH has performed all covenants, satisfied all conditions, and complied with all other terms and provisions of this Agreement to be performed, satisfied or complied with by it as of the Effective Date;  (c)  since such date and other than as previously disclosed to  ASA, ASAH has not entered into any material
transaction other than transactions which are usual and  in the ordinary course if its business; and  (d) no litigation, proceeding, investigation or inquiry is pending or, to the best knowledge of ASAH, threatened, which might result in an action to enjoin or prevent the consummation of the transactions contemplated by this Agreement or, to the extent not disclosed in the ASAH Schedules, by or against ASAH which might result in any material adverse change in any of the assets, properties, business or operations of ASAH.

 

Section 5.4     No Material Adverse Change.          Prior to the Closing Date, there shall not have occurred any material adverse change in the financial condition, business or operations of nor shall any event have occurred which, with the lapse of time or the giving of notice, may cause or create any material adverse change in the financial condition, business or operations of ASAH.

 

Section 5.5     Other Items.       ASA shall have received such further documents, certificates or instruments relating to the transactions contemplated hereby as ASA may reasonably request.

 

ARTICLE VI

	
             
 	
            CONDITIONS PRECEDENT TO OBLIGATIONS OF ASA
 

 

The obligations of ASA under this Agreement are subject to the satisfaction, at or before the Closing date (unless otherwise indicated herein), of the following conditions:

 

Section 6.1     Accuracy of Representations.         The representations and warranties made by ASA in this Agreement were true when made and shall be true as of the Closing Date (except for changes therein permitted by this Agreement) with the same force and effect as if such representations and warranties were made at and as of the Closing Date, and ASA shall have performed and complied with all covenants and conditions required by this Agreement to be performed or complied with by ASA prior to or at the Closing. ASAH shall have been furnished with a certificate, signed by a duly authorized executive officer of ASA and dated the Closing Date, to the foregoing effect.

 

Section 6.2     Director Approval. The Board of Directors of ASA shall have approved this Agreement and the transactions contemplated herein.

 

Section 6.3     Officer’s Certificate.   ASAH shall be furnished with a certificate dated the Closing date and signed by a duly authorized officer of ASA to the effect that:  (a) the representations and warranties of ASA set forth in the Agreement and in all Exhibits, Schedules and other documents furnished in connection herewith are in all material respects true and correct as if made on the Effective Date; and (b) ASA had performed all covenants, satisfied all conditions, and complied with all other terms 

 

 

and provisions of the Agreement to be performed, satisfied or complied with by it as of the Effective Date.

 

Section 6.4     No Material Adverse Change. Prior to the Closing Date, there shall not have occurred any material adverse change in the financial condition, business or operations of nor shall any event have occurred which, with the lapse of time or the giving of notice, may cause or create any material adverse change in the financial condition, business or operations of ASA.

 

ARTICLE VII

MISCELLANEOUS

 

Section 7.1     Brokers and Finders.  Each party hereto hereby represents and warrants that it is under no obligation, express or implied, to pay certain finders in connection with the bringing of the parties together in the negotiation, execution, or consummation of this Agreement. The parties each agree to indemnify the other against any claim by any third person for any commission, brokerage or finder’s fee or other payment with respect to this Agreement or the transactions contemplated hereby based on any alleged agreement or understanding between the indemnifying party and such third person, whether express or implied from the actions of the indemnifying party.

 

Section 7.2     Law, Forum and Jurisdiction.  This Agreement shall be construed and interpreted in accordance with the laws of the State of New Jersey, United States of America.

 

Section 7.3    Notices. Any notices or other communications required or permitted hereunder shall be sufficiently given if personally delivered to it or sent by registered mail or certified mail, postage prepaid, or by prepaid telegram addressed as follows:

 

 

	
             
 	
            If to ASAH :
 	
            10039 Bissonnet
 

Suite 250

Houston, Texas 77036

 

	
             
 	
            If to ASA:
 	
            10039 Bissonnet
 

Suite 250

Houston, Texas 77036

 

or such other addresses as shall be furnished in writing by any party in the manner for giving notices hereunder, and any such notice or communication shall be deemed to have been given as of  the date so delivered, mailed or telegraphed.

 

Section 7.4     Attorneys’ Fees.      In the event that any party institutes any action or suit to enforce this Agreement or to secure relief from any default hereunder or breach hereof, the breaching party or parties shall reimburse the non-breaching party or parties for all costs, including reasonable attorneys’ fees, incurred in connection therewith and in enforcing or collecting any judgment rendered therein.

 

Section 7.5     Confidentiality.          Each party hereto agrees with the other party that, unless and until the transactions contemplated by this Agreement have been consummated, they and their representatives will hold in strict confidence all data and information obtained with respect to another 

 

 

party or any subsidiary thereof from any representative, officer, director or employee, or from any books or records or from personal inspection, of such other party, and shall not use such data or information or disclose the same to others, except:  (i)  to the extent such data is a matter of public knowledge or is required by law to be published; and (ii)  to the extent that such data or information must be used or disclosed in order to consummate the transactions contemplated by this Agreement.

 

Section 7.6     Schedules; Knowledge.       Each party is presumed to have full knowledge of all information set forth in the other party’s schedules delivered pursuant to this Agreement.

 

Section 7.7     Third Party Beneficiaries.    This contract is solely between ASAH and ASA and except as specifically provided, no director, officer, stockholder, employee, agent, independent contractor or any other person or entity shall be deemed to be a third party beneficiary of this Agreement.

 

Section 7.8     Entire Agreement.     This Agreement represents the entire agreement between the parties relating to the subject matter hereof. This Agreement alone fully and completely expresses the agreement of the parties relating to the subject matter hereof. There are no other courses of dealing, understanding, agreements, representations or warranties, written or oral, except as set forth herein. This Agreement may not be amended or modified, except by a written agreement signed by all parties hereto.

 

Section 7.9     Survival; Termination. The representations, warranties and covenants of the respective parties shall survive the Closing Date and the consummation of the transactions herein contemplated for 18 months.

 

Section 7.10   Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original and all of which taken together shall be but a single instrument.

 

Section 7.11    Amendment or Waiver.       Every right and remedy provided herein shall be cumulative with every other right and remedy, whether conferred herein, at law, or in equity, and may be enforced concurrently herewith, and no waiver by any party of the performance of any obligation by the other shall be construed as a waiver of the same or any other default then, theretofore, or thereafter occurring or existing. At any time prior to the Closing Date, this Agreement may be amended by a writing ASAned by all parties hereto, with respect to any of the terms contained herein, and any term or condition of this Agreement may be waived or the time for performance hereof may be extended by a writing ASAned by the party or parties for whose
benefit the provision is intended.

 

Section 7.12   Expenses.      Each party herein shall bear all of their respective cost s and expenses incurred in connection with the negotiation of this Agreement and in the consummation of the transactions provided for herein and the preparation thereof.

 

Section 7.13   Headings; Context.  The headings of the sections and paragraphs contained in this Agreement are for convenience of reference only and do not form a part hereof and in no way modify, interpret or construe the meaning of this Agreement.

 

Section 7.14   Benefit.           This Agreement shall be binding upon and shall inure only to the benefit of the parties hereto, and their permitted assigns hereunder. This Agreement shall not be assigned by any party without the prior written consent of the other party. 

 

 

 

 

Section 7.15   Public Announcements.      Except as may be required by law, neither party shall make any public announcement or filing with respect to the transactions provided for herein without the prior consent of the other party hereto.

 

Section 7.16   Severability.  In the event that any particular provision or provisions of this Agreement or the other agreements contained herein shall for any reason hereafter be determined to be unenforceable, or in violation of any law, governmental order or regulation, such unenforceability or violation shall not affect the remaining provisions of such agreements, which shall continue in full force and effect and be binding upon the respective parties hereto.

 

Section 7.17   Failure of Conditions; Termination.            In the event of any of the conditions specified in this Agreement shall not be fulfilled on or before the Closing Date, either of the parties have the right either to proceed or, upon prompt written notice to the other, to terminate and rescind this Agreement. In such event, the party that has failed to fulfill the conditions specified in this Agreement will liable for the other parties legal fees. The election to proceed shall not affect the right of such electing party reasonably to require the other party to continue to use its efforts to fulfill the unmet conditions.

 

Section 7.18   No Strict Construction.        The language of this Agreement shall be construed as a whole, according to its fair meaning and intendment, and not strictly for or against either party hereto, regardless of who drafted or was principally responsible for drafting the Agreement or terms or conditions hereof.

 

Section 7.19   Execution Knowing and Voluntary.          In executing this Agreement, the parties severally acknowledge and represent that each:  (a) has fully and carefully read and considered this Agreement;  (b) has been or has had the opportunity to be fully apprized by its attorneys of the legal effect and meaning of this document and all terms and conditions hereof;  (c) is executing this Agreement voluntarily, free from any influence, coercion or duress of any kind.

 

Section 7.20   Amendment. At any time after the Closing Date, this Agreement may be amended by a writing assigned by both parties, with respect to any of the terms contained herein, and any term or condition of this Agreement may be waived or the time for performance hereof may be extended by a writing assigned by the party or parties for whose benefit the provision is intended.

 

Section 7.21  Conflict of Interest. Both ASA and ASAH understand that Anslow & Jaclin, LLP is representing both parties in this transaction which represents a conflict of interest. Both ASA and ASAH have the right to different counsel due to this conflict of interest. Notwithstanding the above, both ASA and ASAH agree to waive this conflict and have Anslow & Jaclin, LLP represent both parties in the above-referenced transaction. Both ASA and ASAH agree to hold this law firm harmless from any and all liabilities that may occur or arise due to this conflict.

 

 

 

IN WITNESS WHEREOF, the corporate parties hereto have caused this Agreement to be executed by their respective officers, hereunto duly authorized, and entered into as of the date first above written.

 

	
            ATTEST:
 	
            ASAH CORP.
 

 

	
            ______________________________
 	
            By:
 	
            /s/  Zak Elgamal  
 
	
             
 	
            Zak Elgamal
 	
             

	
             
 	
            President
 	
             

					

 

	
            ATTEST:
 	
            AMERICAN SURGICAL ASSISTANTS, INC.
 

 

	
            ______________________________
 	
            By:
 	
            /s/  Zak Elgamal  
 
	
             
 	
            Zak Elgamal
 	
             

	
             
 	
            PresidentEX101

    *
      Certain
      portions of this exhibit have been omitted pursuant to a request for
      confidential treatment and those portions have been filed separately with the
      Securities and Exchange Commission. 

    

    MASTER
      SALES, COLLABORATION AND DISTRIBUTION AGREEMENT

    

    THIS
      MASTER SALES COLLABORATION AND DISTRIBUTION AGREEMENT ("Agreement") is made
      effective as of October 6, 2005 by and among Skinvisible Pharmaceuticals, Inc.
      a
      corporation organized and existing under the laws of the State of Nevada,
      ("SKVI") and EMD Chemicals Inc., a corporation organized and existing under
      the
      laws of the State of New York ("EMD").

    

    WHEREAS,
      SKVI is engaged in the business of, among other things, developing and selling
      polymer and polymer delivery systems sold under the brand name
      Invisicare®;
      

    and

    

    WHEREAS,
      Invisicare® is a patented product belonging to SKVI; and 

    

    WHEREAS,
      EMD is engaged in the business of selling cosmetic pigments and chemicals to
      the
      end users thereof; and

    

    WHEREAS,
      EMD is willing to become the exclusive, world-wide seller and distributor of
      Product (defined below) in the Field (defined below); and

    

    WHEREAS,
      EMD will market the Product to prospective customers in the Field, SKVI and
      EMD
      will collaborate to develop Product formulations for such prospective

    customers;
      and 

    

    WHEREAS,
      SKVI possesses the technical and scientific resources and competencies to
      develop Product for individual prospective customers application;
      and

    

    WHEREAS,
      SKVI and EMD intend that they shall share compensation from customers for
      Product which may include: payment for Product, a license fee and royalty on
      

    Product
      sales by EMD customers; and 

    

    WHEREAS,
      EMD and SKVI are willing to extend such licenses as necessary to support such
      consideration, including exclusivity as may be needed; and 

    

    WHEREAS,
      SKVI and EMD intend that this Agreement serve as a master or base form of supply
      agreement and that SKVI and EMD shall agree upon and enter into customer

    specific
      supply agreements with each other, as needed, for the supply of Product to
      EMD’s
      customers; and 

    

    NOW
      THEREFORE, in consideration of the foregoing promises and the mutual covenants
      hereinafter expressed, the parties hereto agree as follows:

    

    1.
      DEFINITIONS

    

    For
      purposes of this Agreement, the following words and terms shall have the meaning
      set forth below:

    

    1.1 "Area"
      shall
      mean the entire world.

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    1.2 "Effective
      Date"
      shall
      mean the date set forth in the first paragraph of this Agreement.

    

    1.3 “Field”
      shall
      mean the cosmetics and personal care markets, but excluding the
      antimicrobial/barrier market, the prescription drug market, the over-the-counter
      drug market, and the market for sunless tanning sprays with viscosities of
      less
      than 200 cts. In addition, the Field shall exclude the following existing
      clients of SKVI: Dermal Defense, Inc., Safe4Hours, Inc., JD Nelson &
      Associates, Inc., Cross Global, Inc. dba Sunless Beauty, and Natural Body Care,
      Inc. dba Sensaria.

    

    1.4 Product"
      shall
      mean Invisicare®
      conforming to the Specifications (defined below).

    

    1.5 "Termination
      Date"
      shall
      mean the date upon which this Agreement is cancelled or terminated, as provided
      in §§13 and 14 herein.

    

    1.6 “Specifications”
      shall
      mean the specifications for Invisicare®
      set
      forth in Schedule A which is attached hereto and incorporated into this
      Agreement.

    

    2.
      GRANT
      OF DISTRIBUTORSHIP

    

    2.1 Exclusive
      Distributorship.
      Upon
      the terms and conditions set forth herein, SKVI appoints EMD as the exclusive
      distributor for the sale and promotion of the Product (including the
      sub-licensing to EMD’s customers of any licenses necessary to utilize the
      Product) to the Field throughout the Area. EMD may appoint other
      sub-distributors or agents hereunder, including any of its affiliated companies,
      including any of the Merck KGaA group companies. EMD may only appoint
      non-affiliated companies after providing written notification to SKVI. EMD
      shall
      be entirely responsible for the performance of its sub-distributors and/or
      agents and nothing in this Agreement shall be deemed to create the relationship
      of principal and agent, or any similar relationship, between SKVI and EMD and/or
      any sub-distributor or agent of EMD.

    

    2.1.1
      SKVI will use its best efforts to ensure that EMD’s exclusive distributorship of
      Product to the Field is respected throughout the Area. 

    

    2.1.2
      EMD
      will maintain staff, equip and facilities (which SKVI may inspect from time
      to
      time during regular business hours and upon reasonable written notice) for
      the
      marketing and sale of the Product in the Area. Such facilities shall be
      sufficient to enable EMD to satisfy properly its marketing and sales
      responsibilities under this Agreement.

    

    2.2 Minimum
      Revenue Milestones.
      EMD
      shall use reasonable, commercial efforts to market and sell the Product within
      the Area, which efforts shall include but not be limited to prompt performance
      of all of its obligations under this Agreement. In this regard, EMD will use
      reasonable, commercial efforts to achieve the minimum revenue milestones as
      set
      forth in Schedule “D” attached hereto. In the event that EMD fails to meet the
      minimum revenue milestones (excluding revenues lost due to causes beyond EMD’s
      control) in any of the purchase periods as noted in the schedule, EMD shall
      develop a revised marketing plan intended to achieve the minimum revenue
      milestones

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    (“Revised
      Plan”) and will provide SKVI a written summary of the Revised Plan within 30
      days after the end of the prior purchase period. SKVI shall have the right,
      at
      its reasonable discretion, to accept or reject the Revised Plan. Once SKVI
      gives
      notice of its acceptance of the Revised Plan, EMD shall have an additional
      six-months from notification to make up the balance of the minimum revenue
      milestones for such prior purchase period. If after such six-months EMD is
      unable to make up such prior minimum revenue milestones, SKVI shall have the
      right to terminate the exclusivity of the distribution rights hereunder and
      shall be entitled to seek other customers or distributors for the Products
      in
      the Field within the Area. EMD shall retain the rights to continue to distribute
      and promote the Products in the Area on a non-exclusive basis under all the
      other terms of this Agreement. In the event that EMD is unable to meet its
      target minimum purchase obligations for two consecutive years, SKVI shall also
      have the right to terminate the exclusivity of the EMD distribution rights
      hereunder. 

    

    2.3     
      * 

     

    * Certain
      portions of this
      exhibit have been omitted pursuant to a request for confidential treatment
      and
      those portions have been filed separately with the Securities and Exchange
      Commission

    

    3.
      PRICE
      OF PRODUCT_/ EMD COMPENSATION

    

    3.1 Determination
      of Price.
      Unless
      otherwise agreed upon by the parties, Product shall be sold to EMD by SKVI
      at
      prices as are based those in the column noted “List Price” in Schedule “B” which
      is linked to the Revenue milestones in Schedule “C”, as may be amended by the
      parties from time to time. Prices shall not include taxes, if any, which shall
      be payable by EMD. The parties agree to regularly meet and discuss current
      market conditions and opportunities where volume price discounts might be
      desirable or necessary to achieve additional Product sales.

    

    3.2 Commission
      / Compensation to EMD.
      As set
      forth in Schedule “C”, EMD’ shall be entitled to the specified percentage on the
      gross revenues generated from sales and / or licensing of Product made by EMD
      and SKVI to customers in the Field pursuant to this Agreement. 

    

    3.3 Customer
      Supply Commitment.
      For each
      customer, EMD and SKVI shall agree upon firm pricing regarding customer specific
      supply, such Customer Specific Supply Agreements shall be in writing and shall
      further prescribe, inter alia,
      the
      customer, product, product specification, quantities, term, intellectual
      property licenses, and all other terms particular to the circumstance and as
      agreed upon by EMD and SKVI (hereinafter “Customer Specific Supply Agreements”).
      Such Customer Specific Supply Agreements shall incorporate all rights and
      obligations stated herein and shall control over the terms of this Agreement.
      

    

    3.4 Current
      Price.
      Except
      as otherwise agreed by the parties under Section 3.3, and 3.1 for orders
      accepted by SKVI under Section 5.1, SKVI reserves the right to revise prices
      as
      soon as notified by any of its raw ingredient suppliers and shall provide
      written notice of any such price revision immediately. Any price revision shall
      be limited to documented changes in the costs of raw materials, labor and/or
      energy.

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    4.
      PAYMENT
      FOR PRODUCTS

    

    4.1 Terms
      of Payment.
      Unless
      otherwise agreed, all payments due SKVI shall be made within forty five (45)
      days following the date of the invoice for the Product shipped.

    

     

    5.
      ACCEPTANCE
      OF ORDERS AND SHIPMENT OF PRODUCTS

    

    5.1 Acceptance
      of Orders.
      Except
      as otherwise agreed by the parties in any Customer Specific Supply Agreement
      under Section 3.3, SKVI will not be bound by any order placed by EMD for the
      Product until such order has been accepted by SKVI in writing at its offices
      in
      Las Vegas, Nevada. SKVI shall use all commercially reasonable efforts to accept
      all orders from EMD. 

    

    5.2 Inconsistent
      Terms in an Order.
      This
      Agreement shall supersede any and all pre-printed terms on any purchase orders,
      invoices, order acknowledgments and other related documents exchanged by the
      parties, excluding Customer Specific Supply Agreements entered into under
      Section 3.3. 

    

    5.3 Forecasts.
      EMD
      shall provide SKVI with such projections of its requirements for Product as
      is
      reasonable and agreed upon from time to time, so that SKVI can ensure that
      the
      necessary raw materials are procured. Should the quantity of
      Invisicare®
      be
      smaller than EMD's annual projection of its requirement for the respective
      year,
      SKVI will endeavor to make alternative supply arrangements.

    

    5.4 Shipping
      of the Product.
      SKVI
      shall ship to EMD Product set forth in an order accepted by SKVI within the
      time
      specified in such order. Delivery of all Product sold by SKVI to Distributor
      shall be f.o.b., place of manufacture. The method and route of shipment, unless
      specified by EMD, shall be at the discretion of SKVI. 

    

    5.5 Return
      of Product.

    

    5.5.1 Non-defective
      Product.
      EMD
      shall not return non-defective Product without prior written authorization
      of
      SKVI for such return. EMD shall bear all costs and expenses of returning Product
      and all risk of loss until returned Product are received at the address of
      SKVI
      set forth above, or at such other location as SKVI shall have designated for
      return. All returned Product must be received by SKVI in their original,
      unopened and completely resaleable containers. Product without original markings
      and/or labels will not be accepted for return.

    

    5.5.2 Defective
      Product.
      EMD or
      its customers may return defective Product to SKVI, at the expense of
      SKVI.

    

    5.6 Quality
      Control.
      SKVI
      will adhere to good manufacturing practice (GMP) requirements and procedures,
      including without limitation those relating to quality control to assure Product
      conforms to the quality and Specifications as set out under this Agreement.
      

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

    6.
      UNDERTAKINGS
      OF THE PARTIES

    

    6.1 Sale
      of Product.
      EMD,
      its representatives and employees, shall conduct all marketing and sales
      activities in connection with Product in a manner, consistent with applicable
      laws and standards of fair trade, fair competition and business
      ethics.

    

    6.2 Marketing
      Efforts.
      EMD
      will use reasonable, commercial efforts to diligently and faithfully develop
      demand for Product and to solicit purchases of Product. At all times hereunder,
      EMD shall maintain adequate facilities and personnel to accomplish this purpose.
      

    

    6.3 Technical
      Support.
      EMD and
      SKVI shall collaborate to develop customer specific Product applications as
      desired by customers in the Field. SKVI represents and warrants that it
      possesses and will maintain adequate facilities and technical and scientific
      resources to fulfill customer needs related to Product for application in the
      Field. 

    

    6.4 Technical
      Data.
      SKVI
      represents and warrants that it has provided EMD with true and complete copies
      of all relevant literature, toxicological studies and efficacy studies and
      similar technical information (collectively, “Technical Information”), either in
      its possession or known to it, and SKVI will continue to provide EMD and its
      customers such additional Technical Information as SKVI becomes aware of it
      and
      as is necessary to serve the purposes of this Agreement.

    

    6.5 Regulatory
      Matters.
      

    

    6.5.1 SKVI
      shall develop and maintain an adequate quality system, including Product lot
      tracking data base, sufficient to satisfy applicable legal requirements and
      Product Specification requirements set forth in Schedule A, and shall make
      such
      systems and data available to EMD and its customers.

    

    6.5.2 Each
      party shall keep the other informed of any formal or informal inquiry relating
      to any Product sold hereunder by any regulatory agency of any state or national
      government.

    

    6.5.3 Should
      any Product defect or any governmental action require the recall, destruction
      or
      withholding from market (hereafter collectively "recall") of any Product sold
      by
      SKVI to EMD, EMD shall bear the costs and expenses of such recall only if such
      recall is the direct result of any fault or omission attributable to EMD; SKVI
      shall bear the costs and expenses of such recall if such recall is the direct
      result of any fault or omission attributable to SKVI, including without
      limitation failure of the Product to meet Specification or as a result of a
      breach of any term contained herein . 

    

    6.5.4 SKVI
      shall notify EMD in writing of any proposed changes in its supplier’s
      manufacturing process which affect dose, form, or function of Product or any
      components of Product, including but not limited to any changes that affect
      written quality plans for production or written quality procedures respecting
      same, as well as any changes outside the validated process, in manufacturing
      procedures, component part or raw materials vendors, manufacturing sites or
      batch sizes. Upon such notice, the parties shall confer and agree upon a
      reasonable time frame within which EMD may 

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    evaluate
      and communicate to SKVI its approval or disapproval of any such change provided,
      however, that EMD shall not unreasonably withhold its approval of any such
      change. 

    

    6.5.5 Upon
      reasonable prior notice, SKVI shall, from time to time during the term of this
      Agreement, allow representatives of EMD to tour and inspect all facilities
      utilized by SKVI with regard to Product sold to EMD under this Agreement, and
      shall cooperate with such representatives in every reasonable
      manner.

    

    6.5.6 Each
      party will comply with all applicable foreign, and domestic federal, state
      and
      local laws in the performance of its obligations hereunder, including, but
      not
      limited to, laws and regulations governing the sale or offering for sale of
      Product, and restrictions or regulations with respect to packaging, labeling,
      promoting, export, health and safety, tax or licensure of
      purchasers.

    

    6.6 SKVI
      Inventory.
      SKVI
      will maintain such inventories as required by any Customer Specific Supply
      Agreements, and in the absence of such commitment such amounts as is
      commercially reasonable. 

    

    6.7 SKVI
      Rights.
      SKVI
      hereby represents and warrants to EMD that SKVI is the owner of, or otherwise
      has all necessary and sufficient rights (including, without limitation,
      intellectual property rights) to manufacture, use, market, distribute and grant
      to EMD the rights set forth herein with respect to, the Product.

    

    6.8 Mutual
      Representations.
      Each
      party represents and warrants to the other party that:

    

    6.8.1 Such
      party has the full corporate right, power and authority to enter into this
      Agreement and to perform the acts required of it hereunder;

    

    6.8.2 The
      execution of this Agreement by such party and the performance by such party
      of
      its obligations and duties hereunder do not and shall not violate any agreement
      by which such party is bound; and

    

    6.8.3 When
      executed and delivered by such party, this Agreement shall constitute the legal,
      valid and binding obligation of such party, enforceable against such party
      in
      accordance with its terms.

    

    6.9
       Other
      Obligations.
      EMD and
      SKVI shall further adhere to any and all obligations and undertakings agreed
      upon in relation to each Customer Specific Supply Agreements under Section
      3.3.

    

    

    7.
      LIMITED
      WARRANTY AND EXCLUSIVE REMEDY

    

    7.1 Warranty.
      SKVI
      warrants that the Product shall conform to the Specifications, shall be
      manufactured in strict compliance to all relevant current good manufacturing
      practice (cGMP) requirements and procedures, and that no Product delivered
      to
      EMD under this Agreement will be adulterated or misbranded within the meaning
      of
      the Federal Food, Drug and Cosmetic Act, or within the meaning of any other
      applicable law 

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    in
      which
      the definition of adulteration or misbranding are substantially the same as
      those contained in the Food, Drug and Cosmetic Act, as such laws are constituted
      and effective at the time of such shipment or delivery, or as an article which
      may not, under the provisions of Section 601 and 602 of such Act, be introduced
      into interstate commerce.

    

    EXCEPT
      FOR THE WARRANTY SET FORTH IN THIS SECTION 7.1, SKVI MAKES NO OTHER WARRANTY
      OF
      ANY KIND WITH REGARD TO PRODUCT WHETHER EXPRESS, ARISING BY OPERATION OF LAW,
      OR
      IMPLIED BY COURSE OF DEALING, USAGE OR TRADE OR OTHERWISE, INCLUDING WITHOUT
      LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
      PARTICULAR PURPOSE. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN SKVI SHALL
      NOT
      IN ANY CIRCUMSTANCE BE LIABLE TO EMD FOR SPECIAL OR CONSEQUENTIAL
      DAMAGES.

    

    SKVI
      agrees that EMD may grant to its Product customers the same warranty granted
      to
      it by SKVI and SKVI shall honor and be obligated to the Product customers under
      the warranty as though SKVI had granted the same directly to the customers.
      EMD
      shall inform SKVI within a reasonable time (no longer than 10 business days)
      after EMD becomes aware of any liability claim by a third party.

    

    7.2 EMD
      is
      familiar with the SKVI Product and will become familiar with the requirements
      of
      the safety codes and laws of the states and nations in which it sells and
      delivers Product under this Agreement; provided
      however,
      that
      such familiarity will be limited to applications of the Product in the Field.
      Whenever EMD learns of any changes in any such code or law which would require
      changes in the Product as it is used in the Field, EMD will advise and consult
      with SKVI about such changes. 

    

    7.3
      The
      foregoing warranty may be modified by the parties by way of a subsequent written
      agreement, including Customer Specific Supply Agreements entered into under
      Section 3.3.

    

    

    8.
      PATENT
      CLAIMS

    

    8.1 Covenant
      Not to Sue.
      SKVI
      hereby grants a license to EMD, any of its sub-distributors under Section 2.1
      and any of their collective customers for the use, application and resale of
      Product in the Area and in the Field under any patent rights which SKVI now
      holds, or which SKVI may acquire hereafter under any patent encompassing the
      Product, for so long as said Product remains subject to the terms of this
      Agreement (and with respect to said customers for so long as the customers
      utilize Product purchased from EMD prior to the termination of this Agreement).
      SKVI hereby further covenants that SKVI shall not sue nor otherwise attempt
      to
      enforce against EMD, any of its sub-distributors under Section 2.1 or any of
      their collective customers any patent rights which SKVI now holds, or which
      SKVI
      may acquire hereafter under any patent encompassing the Product, for so long
      as
      said Product remains subject to the terms of this Agreement (and with respect
      to
      said customers for so long as the customers utilize Product purchased from
      EMD
      prior to the termination of this Agreement).

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    8.2 Non-Infringement.
      SKVI
      shall make reasonable and diligent commercial efforts to formulate, produce
      and
      package the Product in a manner which shall not infringe the intellectual
      property rights, including patent rights, of any third party. SKVI represents
      that, to the best of SKVI’s knowledge, the performance by EMD, and any of its
      sub-distributors under Section 2.1, of any of the activities contemplated by
      this Agreement shall not infringe the intellectual property rights, including
      patent rights, of any third party. SKVI shall, at its expense, defend any claim
      or action brought against EMD, and EMD’s subsidiaries, affiliates, directors,
      officers, employees, agents and independent contractors (collectively, the
      “Indemnitees”), that the Products as provided and used under this Agreement
      infringe or violate any patent, copyright, trademark, trade secret or other
      proprietary right of a third party. 

    

    8.3 EMD’s
      Activities.
      EMD
      shall not, at any time, do or cause to be done any act or thing contesting
      or in
      any way impairing or damaging or tending to impair or damage any part of SKVI’s
      patent rights or other intellectual property rights, or SKVI’s rights therein,
      or the value or goodwill inherent therein. During the term of this Agreement,
      as
      long as SKVI’s patent rights are enforced and are not impaired, EMD will not
      manufacture, market, distribute or sell any Product not acquired through this
      Agreement. 

    

    8.4 Joint
      Development.
      EMD may
      file patent applications for the results of any EMD customer Product application
      work and/or claim substantiation efforts. SKVI will provide any information
      reasonably requested by EMD to enable EMD to prosecute any such patent
      applications. Any such issued patents shall be owned jointly by SKVI and EMD,
      except that SKVI agrees to assign to EMD exclusivity within the Field

    

    8.5 Notification
      of Infringement.
      EMD
      shall promptly notify SKVI in writing in the event EMD is informed or has reason
      to believe that any non-customer, third party is infringing a SKVI patent
      covering Product, or any parts or components thereof, or otherwise copying,
      imitating or reproducing Product or any parts or components
      thereof.

    

    8.6
       Trademark.
      SKVI
      grants to EMD, any of its sub-distributors under Section 2.1 and any of their
      collective customers the right to use the trademark Invisicare® in
      relation to the use, application and resale of Product in the Area and in the
      Field for so long as said Product remains subject to the terms of this Agreement
      (and with respect to said customers for so long as the customers utilize Product
      purchased from EMD prior to the termination of this Agreement). 

    

    

    9.
      PRODUCT
      LIABILITY CLAIMS

    

    Each
      party shall notify the other promptly of any product liability claim or action
      brought with respect to Product, and shall reasonably cooperate with the other
      in the investigation and resolution of any such claim or action. Each party
      shall indemnify and hold harmless the other and its shareholders, officers,
      directors, employees and representatives against, and in respect of, any and
      all
      losses, suits, claims, actions, liabilities, expenses (including, without
      limitation, fees and disbursements of legal counsel and expenses of litigation)
      and damages of every kind for injury to or death of any person or persons and
      for damage to or loss of property, arising out of or
      attributed,

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    directly
      or indirectly, to the negligence, recklessness or intentional misconduct of
      the
      indemnifying party.

    

    

    10.
      CONFIDENTIAL
      INFORMATION

    

    Neither
      party shall use or disclose to any third party any confidential information
      concerning the business or Product of the other party which a party may acquire
      while fulfilling its obligations under this Agreement (or under any prior
      agreements between SKVI and EMD ). Each party shall take all necessary
      precautions to prevent any such disclosure by its employees, officers, directors
      and representatives. Each party acknowledges that all right, title and interest
      in and to the aforesaid confidential information of the other party is vested
      in
      that party and that such information is the sole property of that party. For
      purposes of this Agreement, the term "confidential information" shall include,
      but not be limited to, trade secrets and unpatentable intellectual
      property.

    

    

    11.
      INSURANCE

    

    Insurance
      SKVI.
      SKVI
      agrees to maintain products liability insurance containing a vendor's
      endorsement covering all Products sold pursuant to the terms of this Agreement
      with minimum limits of $2,000,000 for combined bodily injury and property damage
      providing that such insurance shall not be cancelled without at least thirty
      (30) days prior written notice to EMD .

    

    

    12.
      INDEPENDENT
      CONTRACTOR RELATIONSHIP

    

    EMD
      shall
      be deemed to be an independent contractor with respect to all matters relating
      to this Agreement and shall bear all of its own expenses in connection with
      this
      Agreement. Except as provided in Section 7, EMD shall have no authority, whether
      express or implied, to assume or create any obligation on behalf of SKVI nor
      shall EMD issue or cause to be issued any price quotations or draft any letters
      or documents under the name of SKVI, but rather shall use its own name for
      such
      purposes.

    

    

    13.
      TERM
      AND CANCELLATION

    

    13.1
       Initial
      Term / Renewal Terms.
      The
      initial term of this Agreement shall commence on the Effective Date and shall
      continue in full force and effect until December 31_, 2008 and shall
      automatically renew for successive terms of three (3) years each unless EMD
      provides fourteen (14) months or SKVI provides fourteen (14) months prior
      written notice to the other party of its intention to terminate or not renew
      this Agreement at the end of the initial or any renewal term.

    

    13.2 Expiration
      Rights of EMD.
      In the
      event of the expiration of this Agreement due to non-renewal by SKVI, and the
      absence of a controlling provision within a Customer Specific Supply Agreement,
      should SKVI continue to supply a customer originally obtained by EMD under
      this
      Agreement, EMD shall be entitled to receive compensation 

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    from
      SKVI
      as provided under Section 3.2 for a period of three (3)) years following the
      expiration date. In the event of the expiration of this Agreement due to
      non-renewal by SKVI, and the absence of a controlling provision within a
      Customer Specific Supply Agreement, should SKVI elect to no longer supply
      material to EMD’s customers in the Field, SKVI shall grant to EMD a
      non-exclusive, royalty free, fully paid up, world wide license, with the right
      to grant sub-licenses, to make, have made, use and sell Product, to EMD’s
      customers in the Field.

    

    14.
      TERMINATION

    

    This
      Agreement shall be terminable or shall terminate if and when any of the
      following events occur:

    

    14.1 Breach
      of Agreement by EMD.
      SKVI
      may terminate this Agreement immediately upon written notice to EMD if EMD
      fails
      to cure any and all breaches of its obligations hereunder within thirty (30)
      days after delivery by SKVI to EMD of written notice of such breach or breaches,
      provided that it is possible through commercially reasonable means to cure
      such
      breach within such time.

    

    14.2 Breach
      of Agreement by SKVI.
      EMD may
      terminate this Agreement immediately upon written notice to SKVI if SKVI fails
      to cure any and all breaches of its obligations hereunder within thirty (30)
      days after delivery by EMD to SKVI of written notice of such breach or breaches,
      provided that it is possible through commercially reasonable means to cure
      such
      breach within such time.

    

    14.3 Bankruptcy
      or Cessation of Business.
      This
      Agreement shall terminate automatically upon cessation of business, election
      to
      dissolve, dissolution, failure in business, commission of an act of bankruptcy,
      general assignment for the benefit of creditors, or filing of any petition
      in
      bankruptcy or for relief under the provisions of the bankruptcy laws, by or
      of
      EMD or SKVI.

    

    14.4 Interference
      with Distribution Rights.
      In
      addition to other remedies provided for hereunder and in law and equity, EMD
      may
      terminate this Agreement immediately upon written notice to SKVI if its
      exclusive Product distribution rights are impaired, abridged, disrupted or
      otherwise limited in any manner, directly or indirectly, by the actions of
      SKVI.

    

    14.5 Termination
      Rights of EMD.
      In the
      event of the termination of this Agreement under Section 14.1 above, EMD shall
      be entitled to receive compensation from SKVI as provided under Section 3.2
      for
      a period of two (2) years following the termination date. In the event of the
      termination of this Agreement under Sections 14.2, 14.3 (for SKVI’s cessation of
      business, election to dissolve, etc.), or 14.4, SKVI shall grant to EMD a world
      wide, royalty free, fully paid up license, with the right to grant sub-licenses,
      to make, have made, use and sell Product, within the Field. 

     

    

    15.
      RIGHTS
      AND OBLIGATIONS UPON TERMINATION OR CANCELLATION

    

    Upon
      the
      termination, non-renewal or cancellation of this Agreement:

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

    15.1 Obligations
      of EMD.
      EMD
      agrees to return to SKVI any unused sales literature, Technical Information
      (as
      such term is defined in §6.3 above) and other such materials supplied to it by
      SKVI as well as any and all other supporting documents made available by SKVI
      to
      EMD.

    

    15.2 Disposal
      of Product.
      EMD
      shall follow any reasonable instructions from SKVI regarding the disposal of
      any
      remaining Product; provided,
      however,
      SKVI
      may, within a period of sixty (60) days following the Termination Date
      repurchase from EMD any or all remaining salable products as described under
      Return of Non-defective Product, §5.5.1.

    

    15.3 Continuing
      Obligations.
      Each
      party shall abide by and uphold any and all rights or obligations of the other
      accrued or existing as of the Termination Date, including, but not limited
      to,
      any obligation of EMD to pay any amount which may then be owing to SKVI for
      any
      Product which may have been delivered to EMD prior to such termination, and
      any
      obligation of SKVI to fulfill unshipped orders for Product which is shown to
      SKVI's satisfaction to have been sold by EMD pursuant to a valid and binding
      obligation prior to such termination. The acceptance of orders from EMD after
      termination of this Agreement or the continued sale of Product to EMD or any
      other act after termination of this Agreement shall not be construed as a
      renewal of this Agreement for any further term nor as a waiver of the
      termination.

    

    16.
      MISCELLANEOUS

    

    16.1 Force
      Majeure.
      Neither
      party shall be liable for any loss, damage, detention, delay or failure to
      perform in whole or in part, resulting from causes beyond control of the party,
      including, but not limited to, fires, strikes, insurrections, riots, embargoes,
      shortages of motor vehicles, delays in transportation, inability to obtain
      supplies of raw materials, or requirements or regulations of the United States
      government or any other civil, governmental or military authority. In no event
      shall either party be liable for consequential damages. In the event of a force
      majeure, which impairs SKVI’s ability to supply Product, the parties shall use
      all commercially reasonable efforts to avoid disruption of supply of Product
      to
      EMD’s customers, including if necessary, the use of a third party manufacturer
      or the licensing of EMD or its customers to make, have made, use and sell
      Product for so long as the force majeure event is reasonably expected to last
      and some reasonable length of time thereafter. 

    

    16.2 Entire
      Agreement; Modification; Waiver.
      This
      Agreement constitutes the entire agreement between the parties with respect
      to
      the subject matter hereof and supersedes all prior and contemporaneous
      agreements and understandings between them. No supplement, modification or
      amendment of this Agreement shall be binding unless executed in writing by
      all
      the parties. No waiver of any of the provisions of this Agreement shall be
      deemed, or shall constitute, a waiver of any other provision, whether or not
      similar, nor shall any waiver constitute a continuing waiver. No waiver shall
      be
      binding unless executed in writing by the party making the waiver.

    

    16.3 Construction.
      The
      language of this Agreement and of each and every paragraph, term and/or
      provision of this Agreement shall, in all cases, for any and all purposes,
      and
      in any and all circumstances be construed as a whole, according to its meaning,
      not strictly for or against EMD or SKVI and with no regard whatsoever to the
      

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    identity
      or status of any person or persons who drafted all or any portion of this
      Agreement.

    

    16.4 Notices.
      All
      notices, requests, demands and other communications under this Agreement shall
      be in writing and shall be deemed to have been duly given on the date of
      delivery if delivered personally to the party to whom or which notice is to
      be
      given, or on the seventh (7th) day after mailing if mailed to the party to
      whom
      or which notice is to be given, by first class mail, registered or certified,
      postage prepaid, properly addressed to the party to receive the notice at the
      following address or at any other address given to the other party in the manner
      provided by this §16.4.

    

                
      If to EMD:     
EMD
      Chemicals Inc.

    7
      Skyline
      Drive

    Hawthorne,
      NY 10532

    Attn.:
      Vice President, Pigments

                     
      

              
      With a copy to:   EMD
      Chemicals Inc.

         
      480 S. Democrat Road

         
      Gibbstown, NJ 08027

         
      Attn.: Legal Department

    

               
      If to
      SKVI:                         
      Skinvisible Pharmaceuticals, Inc.

                       
      6320 S. Sandhill
      Rd.

    Suite
      10,

    Las
      Vegas, NV 89120

    Attn:
      Mr.
      Terry Howlett, Pres.    

    

    

    

    If
      notice
      shall be sent by telefax or cable, a confirming copy of such telefax or cable
      shall be sent by mail to the addressee. Nothing contained herein shall justify
      or excuse failure to give oral notice for the purpose of informing the other
      party hereto when prompt notification is required, but, it is understood that
      such oral notice shall in no way satisfy the requirement of a written
      notice.

    

    16.5 Severability.
      If any
      provision of this Agreement is determined to be invalid or unenforceable, the
      provision shall be deemed to be severable from the remainder of this Agreement
      and shall not cause the invalidity or unenforceability of the remainder of
      this
      Agreement.

    

    16.6 Assignment.
      This
      Agreement constitutes a personal contract among the parties. Neither party
      may
      transfer or assign this Agreement or any part thereof without the prior written
      approval of the other, which approval shall not be unreasonably withheld.
      Provided, however, either party hereto may without such consent, assign this
      Agreement in connection with the sale or transfer of all or substantially all
      of
      its business or in connection with a merger or other consolidation with another
      entity.

    

    16.7 Arbitration.
      Any
      controversy or claim arising out of or relating to this Agreement shall be
      submitted to arbitration in accordance with the Commercial Rules of the American
      Arbitration Association; provided,
      however,
      that
      this clause shall not be 

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    construed
      to limit or to preclude either party from bringing any action in any court
      of
      competent jurisdiction for injunctive or other provisional relief as necessary
      or appropriate. The arbitration shall be conducted either in White Plains,
      NY or
      Las Vegas, Nevada at the option of the claimant. Any award or determination
      of
      the arbitration tribunal shall be final, nonappealable, and conclusive upon
      the
      parties, and judgment thereon may be entered by any court of competent
      jurisdiction.

    

    16.8 
      Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the laws the
      State of New York, without regard to New York choice-of-law
      principles.

    

    16.9 Counterparts.
      This
      Agreement may be executed in one or more counterparts, each of which shall
      be
      deemed an original, but all of which together shall constitute one and the
      same
      instrument.

    

    16.10 Captions.
      The
      captions of the sections and subsidiary sections of this Agreement are included
      for reference purposes only and are not intended to be a part of the Agreement
      or in any way to define, limit or describe the scope or intent of the particular
      provision to which they refer.

    

    INTENDING
      TO BE LEGALLY BOUND, SKVI and EMD have executed this Agreement as of the date
      first written above.

    

    

    Skinvisible
      Pharmaceuticals, Inc.  EMD
      CHEMICALS INC.

    

       

    By:
      /s/ Terry Howlett          By:  /s/
      Douglas S. Brown

    

    Name:
      Terry Howlett   
Name:
      Douglas S. Brown

    

    Title:
      President    
Title:
      President & CEO 

    

    Date:
      October 7, 2005    
Date:
      October 6, 2005

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    SCHEDULE
      “A”

    

    PRODUCT
      SPECIFICATIONS

    

    Each
      Invisicare®
      customer
      of EMD will be provided with a customized polymer complex formulation designed
      to optimize the delivery of the customer’s active ingredient. EMD will analyze
      the first three batches of Product produced by SKVI for a particular
      customer/order after which EMD and its customer will choose the final Product
      formulation for said customer/order and document the same for SKVI. After the
      choice of the final formulation as been documented, SKVI shall deliver Product
      for said customer/order which shall conform to said final formulation.

    

    Each
      Product delivery shall include the following:

    

    Certificate
      of GMP compliance from producer

    

    Certificate
      of BSE-free origin

    

    Certificate
      of pesticide-free origin

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    SCHEDULE
      “B”

    

    PRODUCT
      PRICING

    

    
      	
              Product
                Description*

            	 
	 	 
	
              Skinvisible
                Trade Name

            	
              INCI
                Name

            	
              List
                Price per lb, f.o.b. Las Vegas, NV

            
	
              Invisicare©
                Polymer Base M-1

            	
              PVM/MA
                Copolymer - VP / Hexadecene Copolymer - VP / Eicosene
                Copolymer

            	
               

              *

            
	
              Invisicare©
                Polymer Base C-5

            	
              Cellulose
                Gum - VP / Hexadecene Copolymer - VP / Eicosene Copolymer

            	
               

              *

            
	
              Invisicare©
                Polymer Base D-1

            	
              Dextran
                - VP / Hexadecene Copolymer - VP / Eicosene Copolymer

            	
               

              *

            
	
              Invisicare©
                Polymer Base P-8

            	
              PVP
                - VP / Hexadecene Copolymer - VP/ Eicosene Copolymer

            	
               

              *

            
	
              Invisicare©
                Polymer Base S-3

            	
              Zea
                Mays (Corn) Starch - VP / Hexadecene Copolymer - VP / Eicosene
                Copolymer

            	
               

              *

            
	
              *
                The confidential portion has been omitted and filed separately with
                the
                Securities and Exchange
                Commission

               

               

               

            
	 	 
	 	 
	 	 

    

    *
      Additional Product variations shall be added as required.

    

    

    EMD
      Pricing

    

    EMD
      pricing shall be on a list less basis which is consistent with the revenue
      sharing model contained in Schedule “C.

    

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    SCHEDULE
      “C”

    

    COMMISSION
      / COMPENSATION TO EMD.

    

    As
      set
      forth below, EMD shall be entitled to receive the specified percentage on the
      gross revenues generated from sales and / or licensing of Product by EMD and
      SKVI to customers in the Field pursuant to this Agreement. Revenue amounts
      used
      in calculating the % of commission to be earned shall be cumulative starting
      from the Effective Date of this Agreement. 

    

    Revenue
      Amounts

    

    *

    

    

    *
       The
      confidential portion has been omitted and filed separately with the Securities
      and Exchange
      Commission

    

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

    

    SCHEDULE
      “D”

    

    TARGET
      MINIMUM REVENUE MILESTONES

    

    

    Revenues
      shall mean all income derived in any fashion by EMD and/or SKVI on the sale
      of
      Product pursuant to the Agreement, including: 1) income from license fees from
      customers for Product 2) income to SKVI on the sale of polymers to EMD or its
      Customers and 3) any royalty income related to Products sold to EMD or its
      customers.. 

    

    Minimum
      Revenue Milestones:

     

    Year
      1 -
      *

    Year
      2 -
      *

    Year
      3 -
      *

    

    *
      

    

    *
       The
      confidential portion has been omitted and filed separately with the Securities
      and Exchange
      Commission

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