Document:

Confidential
Treatment has been requested for portions of this exhibit. The copy filed
herewith omits the information subject to the confidentiality
request.  Omissions are designated as “***”. A complete version of
this exhibit has been filed separately with the Securities and Exchange
Commission.

      

      
        	
                (1) 

              	
                GENTA
      INCORPORATED

              

      

      

      
        	
                (2) 

              	
                IDIS
      LIMITED

              

      

      

      
        
          

        

      

       

      SUPPLY
AND DISTRIBUTION AGREEMENT
 

        
          
             

          

          
             

            
              

            

          

          
             

          

        

      
        
          
            	
                    DATE

                  	
                    March
      6, 2007

                  	 
      

          

        

      

      

      PARTIES

      

      
        	
                (1)

              	
                GENTA
      INCORPORATED, a company incorporated in the State of Delaware, United
      States of America, whose registered office is at 200 Connell Drive,
      Berkeley Heights, NJ  07922
USA

              

      

      

      (“GENTA”)

      

      
        	
                (2)

              	
                IDIS LIMITED, a company
      incorporated in England (registered number 2143039), whose registered
      office is at IDIS House, Churchfield Road, Weybridge, Surrey, KT13 8DB,
      United Kingdom

              

      

      

      (“IDIS")

      

      INTRODUCTION

      

      
        	
                A)

              	
                GENTA
      wishes to supply the Products in the Territory through an entity with
      experience in the distribution of unlicensed products on a Named Patient
      Supply basis.

              

      

      

      
        	
                B)

              	
                IDIS
      has capability in the distribution of unlicensed products on a Named
      Patient Supply basis, within each country in
      the Territory and wishes to act as GENTA’s distributor of the Products in
      the Territory.

              

      

      

      
        	
                C)

              	
                GENTA
      appoints IDIS as its Exclusive distributor of the Products in the
      Territory on a Named Patient Supply basis on the terms set out in this
      Agreement.

              

      

      

      OPERATIVE
PROVISIONS

      

      
        	
                1.

              	
                Definitions and
      interpretation

              

      

       

      In this
Agreement the following words have the following meanings:

       

      “Business
Day” means any day other than a Saturday or Sunday or a public or bank holiday
in England or USA;

       

      “Commencement
Date” means the date of signature of this Agreement by both
parties;

       

      “Confidential
Agreements” means any and all confidential agreements entered into between the
parties either before or after the Commencement Date relating to the subject
matter of this Agreement; “Confidential Information” means all information which
is commercially sensitive or of a secret nature, or information which is marked
confidential, or which is orally stated to be confidential and confirmed in
writing as confidential within thirty (30) days thereafter, relating to any and
all aspects of the business of either party, including any confidential
information set out in Confidentiality Agreements;

       

      “Contract”
has the meaning set out in clause 7.2;

       

      “Exclusive”
means a right granted under this Agreement which GENTA will not itself exercise
and will not authorise any other person to exercise;

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Fax
Address” means the fax address of the relevant party given in Schedule 4;

       

      “Field”
means the distribution of unlicensed products on a Named Patient Supply
basis.

       

      “FOC
Product” means Product distributed by IDIS to the customer without charge except
for shipping costs, in accordance with clause 5.

       

      “Force
Majeure” means any circumstances beyond the reasonable control of the relevant
party (including, without limitation, any strike, lock-out or other form of
industrial action, acts of God, war or national emergency, an act of terrorism,
riot, civil commotion, malicious damage, compliance with any law or government
order, rule, regulation or direction, accident, fire, flood or storm) which
prevents that party from complying with any or all of its obligations under this
Agreement;

       

      “Indication”
means the symptoms, condition, or disease for which the Product has been
prescribed for a particular Named Patient;

       

      “Intellectual
Property Rights” means all intellectual and industrial property rights including
patents, know-how, registered trade marks, registered designs, utility models,
applications for and rights to apply for any of the foregoing, unregistered
design rights, unregistered trade marks, rights to prevent passing off for
unfair competition and copyright, database rights, topography rights and any
other rights in any invention, discovery or process, in each case in the United
Kingdom and all other countries in the world and together with all renewals and
extensions;

       

      “Marketing
Authorisation” means an authorisation for the sale and placing on the market or
marketing of a Product within the Territory;

       

      “Named
Patient” means the patient for whom the Product(s) have been
prescribed;

       

      “Named
Patient Supply” means the supply of Products which do not have a Marketing
Authorisation for the indication in the country of destination and are supplied
to meet the special needs of a specific patient or patients under the order of a
medical practitioner or other person lawfully permitted to prescribe such
Products to a specific patient or patients in the Territory or relevant part of
it in accordance with all laws and regulatory requirements as they apply to such
supply;

       

      “Orders”
has the meaning set out in clause 7.1;

       

      "Prices"
means the IDIS Buy Price, net of the IDIS Fee/Pack, to be paid by IDIS to GENTA
for the Products as set out in Schedule 1 of this Agreement,
or as varied in accordance with clause 6.1;

       

      "Products"
means the product or products listed in Schedule 1 and additionally
any further products of GENTA offered to be supplied to IDIS by GENTA in writing
from to time to time after the Commencement Date and accepted in writing by
IDIS;

       

      "Service
Address" means the address for service of the relevant party given in Schedule 4 of this
Agreement;

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      “Technical
Agreement” means the Technical Agreement for Distribution Services separately
executed by the parties in connection with this Agreement;

       

      “Term”
means a period of three years.

       

      "Territory"
means those countries set out in Schedule 2 of this Agreement
and additionally any further countries agreed between the parties in writing
from time to time after the Commencement Date;

       

      "Trade
Marks" means the trade marks and trade names of GENTA listed in Schedule 3 and such other
trade marks as GENTA notifies to IDIS in writing from time to time after the
Commencement Date;

       

      "Year"
means the period of 12 months beginning on the Commencement Date and each
subsequent period of 12 months commencing on the anniversary of the Commencement
Date during the continuance of this Agreement.

       

      
        	
                1.1.

              	
                Headings
      to the clauses of and Schedules to this Agreement are for convenience only
      and shall not affect its construction or
  interpretation.

              

      

       

      
        	
                1.2.

              	
                References
      to clauses and Schedules are to the clauses of and Schedules of this
      Agreement.

              

      

       

      
        	
                1.3.

              	
                The
      Schedules are deemed to be incorporated and form part of this Agreement
      and the term "Agreement" shall be construed accordingly.  In the
      event of conflict between any of the terms of this main part of the
      Agreement and the Schedules, the former shall
  prevail.

              

      

       

      
        	
                1.4.

              	
                The
      word “indemnify” in this Agreement will mean to indemnify, keep
      indemnified and hold harmless the indemnified party from and against all
      third party costs (including the cost of enforcement), expenses,
      liabilities (including any tax liability), injuries, damages, claims,
      demands, proceedings or legal costs (on a full indemnity basis) and
      judgements which the indemnified party incurs or suffers and “indemnity”,
      “indemnities” and “indemnifies” have a corresponding
    meaning.

              

      

       

      
        	
                1.5.

              	
                Any
      reference to a “month” is a reference to the period of a calendar
      month.

              

      

       

      
        	
                1.6.

              	
                Any
      reference to “person” means a natural or legal person, firm or
      unincorporated association.

              

      

       

      
        	
                1.7.

              	
                Words
      importing the singular include the plural and vice
  versa.

              

      

       

      
        	
                2.

              	
                Appointment and
      Restrictions

              

      

       

      
        	
                2.1

              	
                Subject
      to the terms and conditions of this Agreement, GENTA hereby grants to IDIS
      the Exclusive right within the Field to distribute on its own account the
      Products in the Territory and IDIS agrees to act in this capacity subject
      to the terms of this Agreement.

              

      

       

      
        	
                2.2

              	
                During
      the continuance of this Agreement, GENTA undertakes not to market or sell
      the Products within the Field directly or indirectly to any other person
      in the Territory without first obtaining IDIS’s express written consent
      (such consent not to be unreasonably withheld or
  delayed).

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                2.3

              	
                During
      the continuance of this Agreement, IDIS undertakes not to seek customers
      or promote sales of the Products outside the Territory, and in any event
      shall not sell or distribute any Product within the United
      States.

              

      

       

      
        	
                2.4

              	
                IDIS
      undertakes that it shall not unless otherwise approved in writing by GENTA
      during the continuance of this
Agreement:

              

      

       

      
        
          	
                	
                  2.4.1

                	
                  Knowingly
      manufacture, sell or distribute any goods that compete with the Products
      in the Territory;

                

        

      

       

      
        
          	
                	
                  2.4.2

                	
                  obtain
      its supplies of the Products for distribution within the Territory other
      than from GENTA; provided that GENTA is able and willing to supply the
      same on the terms of this
Agreement.

                

        

      

       

      
        	
                2.5

              	
                IDIS
      undertakes that while the currently pending MAA for GENASENSE is pending
      and under review by the EMEA, with respect to GENASENSE in any EU member
      state it shall not:

              

      

      

      
        
          	
                	
                  2.5.1

                	
                  commence
      any regulatory action;

                

        

      

      

      
        
          	
                	
                  2.5.2

                	
                  communicate
      with any regulatory
authority;

                

        

      

      

      
        
          	
                	
                  2.5.3

                	
                  distribute
      or cause distribution either for sale or as
      FOC Product;

                

        

      

      

      without
the express prior written consent of GENTA to any of the foregoing activities,
which consent may be withheld in GENTA’s sole discretion.  In giving
any such consent GENTA may, in its sole discretion, impose restrictions and/or
limitations on the permitted activities, and IDIS shall comply in all respects
with such restrictions and/or limitations.

       

      
        
          	
                  3.

                	
                  Term

                

        

      

       

      
        
          	
                  3.1

                	
                  This
      Agreement shall commence on the Commencement Date and subject to early
      termination in accordance with its terms shall continue in force in
      respect of each Product in each country of the Territory until that
      Product has been granted a Marketing Authorisation for an Indication
      within that country of the Territory and GENTA has provided written notice
      of termination, at which time the Agreement shall terminate with respect
      to such Product in such
country.

                

        

      

       

      
        
          	
                  3.2

                	
                  Following
      the Term, this Agreement shall be renewed automatically for additional,
      successive one-year periods unless and until this Agreement is earlier
      terminated as provided for herein or upon *** days written notice by
      either party prior to the expiration of the then current Term, in which
      case this Agreement shall terminate at the end of the then-current
      Term.

                

        

      

       

      
        	
                4.

              	
                Supply of the
      Products

              

      

       

      
        	
                4.1.

              	
                GENTA
      shall supply the Products to IDIS on a consignment basis in accordance
      with the terms and conditions of this Agreement to the exclusion of any
      terms and conditions of sale submitted at any time by either party and
      whether printed or sent with any order form, delivery note, invoice or
      otherwise.  GENTA shall be responsible for insuring the Products
      while in transit to IDIS. IDIS shall be responsible for adequately
      insuring the Products upon receipt thereof. For clarity, title or
      ownership of the Products shall not pass to IDIS but shall pass directly
      to the consumer. IDIS shall indicate to any third parties that its
      inventory of Product is owned by
GENTA.

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                4.2.

              	
                GENTA
      shall not supply IDIS with any Products with a remaining shelf life of
      less than *** months, and GENTA shall replace any Product supplied to IDIS
      that expires prior to distribution.  IDIS will have no
      obligation to pay the IDIS Buy Price for any such expired
      Product.  If GENTA is unable to comply with this clause 4.2 it shall
      notify IDIS immediately providing details of the remaining unexpired shelf
      lives of the available Products and, in such event, GENTA shall not
      proceed with the Order until it has received written confirmation from
      IDIS that the Order may proceed at which time the Contract shall be
      formed.

              

      

       

      
        	
                 
      

              	
                5.

              	
                Distribution of FOC
      Product

              

      

       

      
        	
                5.1

              	
                GENTA
      or IDIS may, from time to time, receive requests from within the Territory
      for FOC Product.  Within 1–2 workings days of receipt of such
      request, IDIS shall forward the request to GENTA to the attention of its
      Drug Safety and Surveillance Department, including all information
      relevant to GENTA’s decision whether or not to approve the
      request.  IDIS shall not distribute Product to the requestor
      until such time as it has received written approval from GENTA, including
      any restrictions or limitations GENTA deems necessary or
      advisable.

              

      

      

      
        	
                5.2

              	
                GENTA
      shall review any requests for FOC Product it receives directly and, if
      approved, shall advise IDIS in writing within 1-2 workings days that FOC
      Product is to be distributed to the requestor and including any
      restrictions or limitations GENTA deems necessary or
      advisable.  Any such written approval shall include any
      requestor contact information in GENTA’s
  possession.

              

      

      

      
        	
                5.3

              	
                Approval
      for distribution of FOC Product is at GENTA’s sole discretion. Upon
      approval by GENTA, IDIS shall distribute FOC Product to the requestor
      according to the terms of this Agreement and in compliance with any
      restrictions or limitations imposed by GENTA.  IDIS shall
      include FOC Product distributions as a separate item in its monthly report
      to GENTA set forth in clause 10.2
      below.

              

      

      

      
        	
                6

              	
                Pricing

              

      

      

      
        	
                6.1

              	
                IDIS
      shall pay GENTA the Prices for all distributed Product that is not FOC
      Product.  The     IDIS Buy Price set
      forth in Schedule 1 shall remain fixed for the duration of the Agreement
      but may be varied by GENTA by giving IDIS not less than *** days notice;
      save that nothing in this clause 6.1 shall give
      GENTA the right to vary the IDIS Buy Price  in respect of Orders
      of Products placed by IDIS with GENTA prior to the date of receipt of any
      notice of price variation.

              

      

      

      
        	
                6.2.

              	
                GENTA
      shall pay IDIS the IDIS Fee/Pack set forth in Schedule 1 for all
      distributed Products including FOC product. The IDIS Buy Price will be
      wiaved For any FOC Product IDIS distributes proved IDIS has obtained
      GENTA’s approval for such distribution in accordance with clause
      5.

              

      

      

      
        	
                6.3

              	
                All
      Prices are inclusive of packaging but exclusive of any applicable value
      added or any other sales tax for which IDIS shall be additionally liable.
      GENTA may recommend in writing to IDIS a sale price for each of the
      Products or impose a maximum selling price at any time; provided that that
      price does not amount to a minimum selling price or retail price
      maintenance.  For the avoidance of
  doubt:

              

      

      

      
        	
              	
                6.3.1

              	
                where
      GENTA has recommended a selling price to IDIS, IDIS shall be free to
      distribute the Products at any price it so chooses;
  and

              

      

       

      
        	
              	
                6.3.2 

              	
                where
      GENTA has set a maximum price, IDIS shall be obliged to distribute the
      Products at no more than that price; provided that does not amount to a
      minimum selling price or retail price maintenance.  GENTA hereby
      sets a maximum price equal to the IDIS Buy Price, as it may be varied from
      time to time in accordance with clause
    6.1.

              

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        	
                6.4

              	
                In
      the event GENTA reduces the IDIS Buy Price to an amount below the IDIS Buy
      Price that is in effect on the Commencement Date, IDIS will continue to
      receive the IDIS Fee/Pack due as of the Commencement Date as set forth in
      Schedule
      1.

              

      

       

      
        	
                6.5

              	
                In
      the event GENTA varies the IDIS Buy Price above the IDIS Buy Price that is
      in effect on the Commencement Date, the IDIS Fee/Pack will be adjusted in
      accordance with the %IDIS Fee/Pack as set forth in Schedule
    1.

              

      

       

      
        	
                6.6

              	
                Without
      prejudice to any other provision of this Agreement, GENTA shall advise
      IDIS immediately if any Price given for Products in an Order is incorrect
      and, in such event where the Price is incorrect GENTA shall not proceed
      with the Order until it has notified IDIS of that fact and received
      written confirmation from IDIS that the Order may proceed, at which time
      the Contract shall be formed.

              

      

       

      
        	
                7. 

              	
                Purchase
      Orders

              

      

       

      
        	
                7.1

              	
                IDIS
      shall submit, from time to time, written purchase orders (“Orders”) to GENTA for
      the supply of the Products.  Each Order shall stipulate the
      Products’ names, the Products’ codes, the quantity required and the total
      price of the Order (excluding VAT).

              

      

       

      
        	
                7.2

              	
                The
      receipt by IDIS of GENTA’s written confirmation that it will accept such
      of an Order during the term of this Agreement shall constitute a contract
      (“Contract”), subject to the
      terms and conditions of this
Agreement.

              

      

       

      
        	
                7.3

              	
                Notwithstanding
      clause 7.2 and
      23.4, no less than *** weeks prior to GENTA’s shipment date IDIS
      may vary, add or omit any or all of the Products in an Order by notice in
      writing to GENTA, provided if such change would have a material impact on
      GENTA’s ability to fulfill the order or cause GENTA to incur an additional
      cost, then IDIS shall first obtain GENTA’s prior approval, not to be
      unreasonably withheld or delayed.  Notwithstanding the
      foregoing, GENTA reserves the right to reject any Order variation or
      addition that it is unable fulfill and will be entitled to recover from
      IDIS any costs it incurs as a result of IDIS’ cancellation of an Order.
      GENTA shall not materially vary, add or omit any of the Products or any
      part of them from an Order without the express consent of
      IDIS. 

              

      

       

      
        	
                7.4

              	
                An
      update of all outstanding Orders placed by IDIS with GENTA shall be
      provided by GENTA as often as reasonably requested by IDIS but no more
      than once per week.

              

      

       

      
        	
                8. 

              	
                Delivery

              

      

       

      
        	
                8.1

              	
                Within
      five (5) Business Days of the receipt of an Order GENTA shall provide IDIS
      with an estimated date for delivery. GENTA will in any event give IDIS
      reasonable notice of the date of
delivery.

              

      

       

      
        	
                8.2

              	
                GENTA
      shall use commercially reasonable endeavours to meet delivery dates and
      shall:

              

      

       

      
        
          	
                	
                  8.2.1

                	
                  notify
      IDIS as soon as reasonably practicable of any anticipated or actual delays
      it experiences or anticipates experiencing in meeting an estimated
      delivery date;

                

        

      

       

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      
        
          	
                	
                  8.2.2

                	
                  provide
      IDIS with such details of the causes of such delays as IDIS reasonably
      requires; and

                

        

      

       

      
        
          	
                	
                  8.2.3

                	
                  update
      IDIS at least once a week until the causes of such delays are rectified or
      lapse.

                

        

      

       

      
        	
                8.3

              	
                IDIS
      may, but is not obliged to, grant such extension of time as it considers
      in its sole opinion is appropriate for GENTA to deliver the Products on
      time without breaching the Contract or this Agreement.  Subject
      to the foregoing and without prejudice to any other rights or remedies
      available to IDIS, failure to meet the estimated delivery date or any
      subsequently agreed date within *** days or notify IDIS of *** shall
      entitle IDIS to terminate the Contract and/or the Agreement
      immediately.

              

      

       

      GENTA
will not be liable for any failure or delay in providing the Products or for any
failure to comply with its obligations under a Contract or this Agreement to the
extent that such failure or delay is attributable to:

      

      any act
or omission of IDIS, its employees, agents or subcontractors which affects
GENTA's ability to provide the Products;

      

      the
provision by IDIS of any inaccurate or incomplete data, information or
documentation including without limitation in relation to any Order for the
Products.

      

      
        	
                8.4

              	
                Unless
      otherwise agreed upon in writing, delivery of the Products shall take
      place at IDIS’ premises at Unit 22, Red Lion Road Business Park, Surbiton,
      Surrey KT6 7AQ (or such other premises within the United Kingdom as IDIS
      may notify to GENTA from time to time) and GENTA shall at its cost arrange
      for suitable transport to IDIS’ premises at Unit 22, Red Lion Road
      Business Park, Surbiton, Surrey KT6 7AQ (or such other premises within the
      United Kingdom as have been notified by IDIS to Genta) and arrange
      insurance therefore until the Products are received by
    IDIS.

              

      

       

      
        	
                8.5

              	
                Where
      the Products are to be delivered in instalments pursuant to this
      Agreement, without prejudice to clause 7.2, each
      instalment shall constitute a separate Contract and without prejudice to
      any other rights or remedies available to IDIS, failure by GENTA to
      deliver any one or more of the instalments within *** days there from in
      accordance with the terms and conditions of the Agreement shall entitle
      IDIS to treat the Contract as a whole as repudiated and terminate the
      Contract as a whole immediately.

              

      

       

      
        	
                8.6

              	
                GENTA
      shall:

              

      

       

      
        
          	
                	
                  8.6.1

                	
                  fax
      to IDIS at its Fax Address a copy of the delivery note for each delivery
      or instalment on the day of delivery and supply a copy of the delivery
      note with the delivered
Products;

                

        

      

       

      
        
          	
                	
                  8.6.2

                	
                  inform
      IDIS if an Order for Products exceeds 30kg by weight when providing IDIS
      with the estimated date for delivery under clause
    8.1.

                

        

      

       

      
        	
                8.7

              	
                On
      delivery the Products shall be marked by IDIS in accordance with IDIS’s
      instructions and properly packed and secured so as to reach their
      destination in an undamaged condition in the ordinary course of
      events.

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    
      	
              9. 

            	
              Rejection

            

    

     

    
      	
              9.1

            	
              Notwithstanding
      any other provision of this Agreement, acceptance of Products shall not
      occur until IDIS or its agent or representative has been given two (2)
      business days to inspect the Products for compliance with the terms and
      conditions of this Agreement following delivery or, if later, within two
      (2) business days after any latent defect in any of the Products has
      become apparent; provided that latent defect has become apparent before
      the expiry of the warranty period set out in clause
      14.1.  Any deficiencies shall be reported to GENTA within
      two business days of discovery.

            

    

     

    
      	
              9.2

            	
              In
      the event of a breach of GENTA’s warranties in clauses 14.1 or 14.2, or where IDIS
      becomes aware of a defect or latent defect pursuant to clause 9.1, IDIS may,
      within one (1) day of becoming aware of such breach or defect, reject such
      Products by notice to GENTA specifying the nature and quantity of the
      defective Products.  Within thirty (30) days of receipt of such
      notice GENTA, shall, collect the defective Products from IDIS at GENTA’s
      expense (including, without limitation, costs of carriage, insurance,
      export/import duties) or request that IDIS destroy the defective Products
      at GENTA’s expense including, without limitation, costs of carriage,
      insurance, export/import duties), and, for Products rejected for breach of
      the warranties in clause
      14.1 or a defect or latent defect pursuant to clause
    9.1:

            

    

     

    
      
        	
              	
                9.2.1

              	
                where
      such Products have not yet been distributed by IDIS, replace the defective
      Products with Products that meet the warranties in clause 14.1 at its own
      expense; or

              

      

    

     

    
      
        	
              	
                9.2.2

              	
                where
      such Products have been distributed by IDIS, at GENTA’s discretion deduct
      the relevant amount from the invoice to be raised for such distribution or
      credit to IDIS’s account the purchase price invoiced and any applicable
      value added or other sales tax (where these have been paid) for such
      defective Products plus costs of carriage, insurance and other fees
      incurred by IDIS (including, without limitation, export/import
      duties).

              

      

    

     

    GENTA’s
entire liability to IDIS for Products rejected for breach of the warranties in
clause 14 or a defect or
latent defect pursuant to clause 9.1 is limited to the
remedies set out in clauses 9.1
is limited to the remedies set out in clauses 9.2.1 and
9.2.2..

     

    
      	
              9.3

            	
              Where
      GENTA fails to collect or request destruction of defective Products
      pursuant to clause
      9.2 within fourteen (14) days, IDIS may store defective Products on
      its premises or with a third party at GENTA’s risk and
      expense.  Where GENTA fails to collect defective Products
      pursuant to clause
      9.2 within thirty (30) days IDIS may destroy the defective Products
      with the consent of GENTA.

            

    

     

    
      	
              9.4.

            	
              Neither party shall under any circumstances be
      liable to the other for any of the types of loss listed below in this
      clause
      9.4, whether arising in tort
      (including negligence) breach of contract, under indemnity or otherwise
      and whether or not foreseeable. Those types of loss are as
      follows:

            

    

     

    9.4.1  loss of business or contracts;

    9.4.2. loss of
profits;

    9.4.3  loss of anticipated savings;

    9.4.4  any losses which arise other than directly and naturally
from a breach of contract or consequential, special or indirect
loss.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      	
              9.5.

            	
              Nothing
      in this Agreement shall operate to exclude or restrict either party’s
      liability for death or personal injury arising from that party's
      negligence or any other liability due to that party’s fraud or any other
      liability which it is not permitted to exclude or limit as a matter of
      law.

            

    

     

    
      	
              10. 

            	
              Payment

            

    

     

    
      	
              10.1

            	
              GENTA
      shall pay IDIS a one-time project start-up fee of *** for each Product to
      be distributed pursuant to this
Agreement.

            

    

     

    
      	
              10.2.

            	
              Within
      the first *** Business Days of each month IDIS shall provide GENTA with a
      monthly sales report for the just concluded month which shall set out the
      product details and quantity of Products sold/supplied FOC by IDIS and
      such other information as GENTA may reasonably
  request.

            

    

     

    
      	
              10.3

            	
              Upon
      receipt of a monthly sales report GENTA may invoice IDIS for the IDIS Buy
      Price of the Products sold by IDIS as stated in the sales report, net of
      the applicable IDIS Fee/Pack for Products
sold.

            

    

     

    
      	
              10.4

            	
              If
      IDIS’ monthly sales report includes FOC Product shipment, IDIS shall
      include an invoice to GENTA for the Fee/Pack amount due.  GENTA
      shall pay IDIS the Fee/Pack amount due within *** days of the date of
      IDIS’ invoice.

            

    

     

    
      	
              10.5

            	
              Unless
      otherwise agreed, IDIS shall pay undisputed invoices within *** days of
      the date of GENTA's invoice (in the currency stated on GENTA's invoice) by
      transfer to such bank account as GENTA may from time to time notify in
      writing to IDIS.

            

    

     

    
      	
              10.6

            	
              If
      an invoice is disputed by IDIS, IDIS shall pay the undisputed amount in
      accordance with clause
      10.5 and the parties shall attempt to settle the disputed part of
      that invoice in accordance with clause
      24.  Once the dispute is resolved, and if payment is due
      by IDIS to GENTA the payment shall be made within *** days of the date of
      resolution.

            

    

     

    
      	
              10.7

            	
              GENTA
      shall provide IDIS’s request provide IDIS with a summary of all
      outstanding  invoices under clause 10.3 on or before
      the *** day of each month.

            

    

     

    
      	
              11

            	
              Risk
      and Property

            

    

     

    
      	
              11.1

            	
              Property
      and risk of damage to or loss of the Products shall pass to IDIS on
      delivery.

            

    

     

    
      	
              12

            	
              Rights and duties of
      IDIS

            

    

     

    
      	
              12.1

            	
              During
      the continuance of this Agreement IDIS
shall:

            

    

     

    
      	
               
      

            	
              12.1.1

            	
              hold
      and maintain all relevant wholesale dealers and import licences and comply
      with all applicable legal and regulatory rules, laws, regulations and
      requirements in relation to each of the Products and its activities
      hereunder and in particular those relating to the storage and distribution
      of the Products in the Territory on a Named Patient Supply
      basis;

            

    

     

    
      	
               
      

            	
              12.1.2

            	
              unless
      otherwise prohibited by the applicable legal and regulatory requirements,
      maintain at all times a minimum stock of Products as it shall reasonably
      require (such minimum to be agreed between the parties from time to
      time);

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              12.1.3

            	
              maintain
      adequate records of all supplies within the
  Territory

            

    

     

    
      	
               
      

            	
              12.1.4

            	
              inform
      GENTA within two (2) business days of customer complaints, requirements
      and suggestions regarding the Products and any information which comes
      into its possession which IDIS reasonably considers may prejudice or
      enhance sales of the Products in the
Territory;

            

    

     

    
      	
               
      

            	
              12.1.5

            	
              inform
      GENTA within two (2) business days of any adverse reaction(s) to the
      Products reported to them by customers or any other
  person;

            

    

     

    
      	
               
      

            	
              12.1.6

            	
              if
      GENTA or a competent regulatory authority recalls a Product, notify all
      customers who have purchased the relevant Product and in such
      circumstances and at GENTA’s expense, unless caused by the act or omission
      of IDIS, including breach of the Agreement, then at IDIS’s expense, IDIS
      shall implement a recall and arrange for the return of the recalled
      Products from all relevant customers and at GENTA’s option either return
      the same to GENTA or destroy them;

            

    

     

    
      	
               
      

            	
              12.1.7

            	
              not
      remove the Products from the packages designed for delivery to customers
      without GENTA's prior written
approval;

            

    

     

    
      	
               
      

            	
              12.1.8

            	
              be
      entitled to describe itself as GENTA's authorised distributor of the
      Products in the Territory but shall not hold itself out as GENTA's
      agent;

            

    

     

    
      	
               
      

            	
              12.1.9

            	
              use
      all commercially reasonable endeavours to control Product shipping costs
      and to deliver Products to customers using standard accepted shipping
      methods and in any event obtain GENTA’s written consent prior to incurring
      any extraordinary or substantial additional shipping
  cost;

            

    

     

    
      
        	
              	
                12.1.10

              	
                promptly
      notify GENTA of any anticipated or actual delay in shipping Product to
      customers.

              

      

    

     

    
      	
              13

            	
              Rights and duties of
      GENTA

            

    

     

    
      	
              13.1 

            	
              During
      the continuance of this Agreement GENTA
shall:

            

    

     

    
      	
               
      

            	
              13.1.1

            	
              hold
      and maintain all relevant licences to manufacture, assemble, package and
      label, export from the country of manufacture (if relevant) and/or supply
      the Products to IDIS pursuant to this Agreement and will comply with all
      relevant legal and regulatory requirements in relation to the manufacture,
      assembly, packaging, packing, labelling, export from the country of
      manufacture (if applicable) and/or supply of each of the
      Products;

            

    

     

    
      	
               
      

            	
              13.1.2

            	
              notify
      and identify to IDIS any Product which becomes the subject of a Marketing
      Authorisation for an Indication after the Commencement Date and that Genta
      intends to launch the Product in that
country;

            

    

     

    
      	
               
      

            	
              13.1.3

            	
              reply
      to reasonable requests for information by IDIS regarding the Products,
      whether related to a technical query or otherwise, as soon as practicable
      but in any event no later than one (1) Business Day after the request was
      received;

            

    

     

    
      	
               
      

            	
              13.1.4

            	
              from
      time to time provide IDIS with such samples, catalogues, brochures and up
      to date information (including Prices) concerning the Products as IDIS may
      reasonably require to assist IDIS with the distribution and sale of the
      Products in the Territory;

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              13.1.5

            	
              shall
      ensure that any price quotation regarding Products shall always contain
      its brand name, generic name, form, strength, pack size, availability and
      any other information reasonably requested by
  IDIS.

            

    

     

    
      	
              13.2

            	
              If
      GENTA wishes to or a competent authority requires the recall of any
      Product, GENTA shall immediately notify IDIS by telephone, fax or email
      (with confirmation in writing) of the recall, its urgency, providing
      details of the specific problem known to it, the batch number of the
      Products concerned and the details of any alternative Products and their
      prices that are available from GENTA, and IDIS shall comply with such
      request.  If IDIS learns of any such request by an authority or
      otherwise has reason to believe that a recall may be required or
      appropriate, it shall immediately notify
GENTA.

            

    

     

    
      	
              13.3

            	
              In
      the event IDIS notifies GENTA of a reported adverse reaction(s) to a
      Product received from a customer or any other person, GENTA will
      henceforth assume responsibility for taking any and all actions relating
      to such adverse reaction(s) including, without limitation, dealing with
      (i) all reporting aspects of pharmacovigilance to the relevant competent
      authority, and (ii) allegations or findings of product and/or strict
      liability that may be required or result from an adverse reaction(s), and
      shall confirm to IDIS in writing that it has done
  so.

            

    

     

    
      	
              13.4

            	
              Provided
      Orders are received from IDIS in accordance with Article 6 above, GENTA
      shall at all times supply IDIS with the minimum stock agreed by the
      parties pursuant to clause 12.1.2 of this
      Agreement.  Notwithstanding the above, GENTA shall use
      commercially reasonable endeavours to supply Products to IDIS in respect
      of orders submitted above that agreed
threshold.

            

    

     

    
      	
              13.5

            	
              GENTA
      shall upon *** days written notice to IDIS be entitled
  to:

            

    

     

    
      
        	
              	
                13.5.1

              	
                discontinue
      or vary the manufacture and assembly and/or supply of any of the Products
      or any substance or ingredient included in the
  Products;

              

      

    

     

    
      
        	
              	
                13.5.2

              	
                make
      changes in the formulation and/or composition of the
    Products,

              

      

    

     

    provided
GENTA is able to supply any Orders of affected Products made by IDIS prior to
the date of receipt by IDIS of the notice of any such discontinuation or
variation, in their unvaried form and prior to discontinuation and, to the
extent such Product is discontinued, GENTA may terminate this Agreement with
respect to such Products.

     

    
      	
              14

            	
              Warranties

            

    

     

    
      	
              14.1

            	
              GENTA
      accepts complete responsibility for the manufacture and assembly of the
      Products and their packaging and labelling, and represents and warrants to
      IDIS that for a period of at least until the expiry date of any Products,
      the Products shall be of merchantable quality, free from defects in
      composition, formulation, material and
  workmanship.

            

    

     

    
      	
              14.2

            	
              GENTA
      represents and warrants that:

            

    

     

    
      	
               
      

            	
              14.2.1

            	
              it
      has title to the Products;

            

    

     

    
      	
               
      

            	
              14.2.2

            	
              the
      Products shall conform to their description, specification and data sheet
      or summary of product characteristics (if
any);

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              14.2.3

            	
              the
      Products, their manufacture, assembly, packaging and labelling, export
      from the country of manufacture (if relevant), use, supply to IDIS and
      sale, supply or distribution of the Products in the Territory by IDIS to
      its knowledge will not infringe the Intellectual Property Rights of any
      third party;

            

    

     

    
      	
               
      

            	
              14.2.4

            	
              it
      is authorised to manufacture, assemble, package and label, export from the
      country of manufacture (if applicable) and supply the Products to IDIS for
      IDIS to distribute on a Named Patient Supply basis within the
      Territory.

            

    

     

    
      	
              14.3

            	
              IDIS
      represents and warrants to GENTA that it is authorised to sell, supply and
      distribute the Products in the Territory on a Named Patient Supply basis,
      where permitted, in each country within the Territory as set out in Schedule
    2.

            

    

     

    
      	
              14.4

            	
              Each
      party represents and warrants to the other that it will comply with its
      obligations set out in the Service Level Agreement and the Technical
      Agreement.

            

    

     

    
      	
              14.5

            	
              EXCEPT
      AS PROVIDED UNDER CLAUSES
      14.1 AND 14.2,
      GENTA SPECIFICALLY DISCLAIMS ANY AND ALL WARRANTIES, EXPRESS OR
      IMPLIED, INCLUDING BUT NOT LIMITED TO ANY WARRANTY OF MERCHANTABILITY,
      NON-INFRINGEMENT, AND FITNESS FOR A PARTICULAR PURPOSE.  GENTA
      MAKES NO REPRESENTATION OR WARRANTY OF COMMERCIAL VIABILITY OR SUCCESS OF
      THE PRODUCTS.

            

    

     

    
      	
              15

            	
              Indemnities

            

    

     

    
      	
              15.1

            	
              GENTA
      shall indemnify IDIS in respect of:

            

    

     

    
      	
               
      

            	
              15.1.1

            	
              the
      manufacture and assembly, packaging and labelling of the
      Products;

            

    

     

    
      
        	
              	
                15.1.2

              	
                failure
      to provide any information required to be provided by GENTA to IDIS under
      the terms of this Agreement within the applicable time
    frame.

              

      

    

     

    
      	
              15.2

            	
              GENTA
      shall indemnify IDIS in respect of any allegation or finding that the sale
      of Products by IDIS in the Territory infringes the Intellectual Property
      Rights of any third party or any rights of any third party unless such
      allegation or finding is attributable to any mark or method of packaging
      or get up of the Product or written material or directions relating to the
      Product applied, used or given by IDIS otherwise than as directed by
      GENTA.

            

    

     

    
      	
              15.3

            	
              Each
      party shall indemnify the other party in respect of any breach by it of
      that party’s representations and warranties given in this
      Agreement.

            

    

     

    
      	
              15.4

            	
              The
      indemnities contained in clauses 15.1, 15.2 and 15.3 above shall be
      conditional in each case upon the indemnified
  party:

            

    

     

    
      	
               
      

            	
              15.4.1

            	
              promptly
      giving written notice of any claim to be indemnified to the indemnifying
      party;

            

    

     

    
      	
               
      

            	
              15.4.2

            	
              providing
      the indemnifying party with the absolute discretion to conduct, take or
      resist any proceedings as it sees fit at its own
  expense;

            

    

     

    
      	
               
      

            	
              15.4.3

            	
              providing
      the indemnifying party on request with such information and assistance in
      relation to such proceedings as it may reasonably require, subject to the
      indemnifying party indemnifying the other party against all costs
      reasonably incurred by it in the provision of such information or
      assistance; and

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              15.4.4

            	
              does
      not make any settlement, compromise or prejudicial admission in relation
      to such claim without the prior consent of the indemnifying party (such
      consent not to be unreasonably withheld or
  delayed).

            

    

     

    
      	
              16

            	
              Intellectual Property
      

            

    

     

    
      	
              16.1

            	
              GENTA
      grants IDIS a royalty free licence to use the Trade Marks in the Territory
      on or in relation to the Products for the purposes only of exercising its
      rights and performing its obligations under this Agreement (including,
      without limitation, distributing and selling the
  Products).

            

    

     

    
      	
              16.2

            	
              IDIS
      shall not without the prior written consent of
  GENTA:

            

    

     

    
      	
               
      

            	
              16.2.1

            	
              make
      any modifications to the Products or their packaging or
      labelling;

            

    

     

    
      	
               
      

            	
              16.2.2

            	
              alter,
      remove or tamper with any Trade Marks, numbers, or other means of
      identification used on or in relation to the
  Products;

            

    

     

    
      	
               
      

            	
              16.2.3

            	
              use
      any of the Trade Marks in any way which might prejudice their
      distinctiveness or validity or the goodwill of GENTA therein;
      or

            

    

     

    
      	
               
      

            	
              16.2.4

            	
              use
      in relation to the Products any trade marks other than the Trade Marks
      without obtaining the prior written consent of
  GENTA.

            

    

     

    
      	
              16.3

            	
              Except
      as provided in this Agreement, IDIS shall have no rights in respect of any
      trade names or Trade Marks used by GENTA in relation to the Products or of
      the goodwill associated therewith, and IDIS hereby acknowledges that,
      except as expressly provided in this agreement, it shall not acquire any
      rights in respect of any trade names or Trade Marks and that all such
      rights and goodwill are, and shall remain, vested in
  GENTA.

            

    

     

    
      	
              16.4

            	
              IDIS
      shall, at the expense of GENTA, take all such steps as GENTA may
      reasonably require to assist GENTA in maintaining the validity and
      enforceability of the Intellectual Property Rights of GENTA during the
      continuance of this Agreement.

            

    

     

    
      	
              16.5

            	
              Without
      prejudice to the rights of IDIS or any third party to challenge the
      validity of any Intellectual Property Rights of GENTA, IDIS shall not
      knowingly do or authorise any third party to do any act which would
      invalidate or be inconsistent with any Intellectual Property Rights of
      GENTA and shall not knowingly omit or authorise any third party to omit to
      do any act which, by its omission, would have that effect or
      character.

            

    

     

    
      	
              16.6

            	
              Without
      prejudice to clause
      15.2, IDIS shall notify GENTA of any actual or threatened
      infringement in the Territory of any Intellectual Property Rights of GENTA
      which comes to IDIS’s notice, and of any claim by any third party so
      coming to its notice that the importation of the Products into the
      Territory, or their sale in the Territory, infringes any rights of any
      other person, and IDIS shall at the request and expense of GENTA do all
      such things as may be reasonably required to assist GENTA in taking or
      resisting any proceedings in relation to any such infringement or
      claim.

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
              17

            	
              Termination

            

    

     

    
      	
              17.1

            	
              GENTA
      may terminate this Agreement in respect of any or all Products in any or
      all countries of the Territory for any reason by giving not less than ***
      days written notice to IDIS to that effect.  The Agreement shall
      continue in effect with respect to any un-terminated Products in any
      un-terminated country.  Upon termination of all Products in all
      countries, this Agreement shall terminate in its
  entirety.

            

    

     

    
      	
              17.2

            	
              Before
      or after the expiry of the Term, as the case may be, either party shall
      have the right to terminate this Agreement immediately by notice to the
      other if the other party:

            

    

     

    
      	
               
      

            	
              17.2.1

            	
              commits
      any material or persistent breach of any of the provisions of this
      Agreement and, in the case of a breach capable of remedy, that party fails
      to remedy such breach within *** days after receipt of a notice giving
      full particulars of the breach and requiring it to be
      remedied;

            

    

     

    
      	
               
      

            	
              17.2.2

            	
              being
      a company, summons a meeting of its creditors, makes a proposal for a
      voluntary arrangement, becomes subject to any voluntary arrangement, is
      unable to pay its debts within the meaning of section 123 Insolvency
      Act 1986, has a receiver, manager or administrative receiver
      appointed over any of its assets, undertakings or income, has passed a
      resolution for its winding-up (save for the purpose of a voluntary
      reconstruction or amalgamation previously approved in writing by the party
      serving notice), is subject to a petition presented to any Court for its
      winding-up (save for the purpose of a voluntary reconstruction or
      amalgamation previously approved in writing by the party serving notice),
      has a provisional liquidator appointed, has a proposal made for a scheme
      of arrangement under section 425 Companies Act 1985, has an administrator
      appointed in respect of it or is the subject of an application for
      administration filed at any court or a notice of appointment of an
      administrator filed at any court or a notice of intention to appoint an
      administrator given by any person or is the subject of a notice to strike
      off the register at Companies House or any of the foregoing
    ;

            

    

     

    
      	
               
      

            	
              17.2.3

            	
              the
      other party has any distrait, execution or other process levied or
      enforced on any of its property;

            

    

     

    
      	
               
      

            	
              17.2.4

            	
              the
      other party ceases, or threatens to cease to carry on
      business;

            

    

     

    
      	
               
      

            	
              17.2.5

            	
              has
      any proceedings analogous to those referred to in clauses 17.2.2 to 17.2.4 occur in relation
      to the other party or its assets in accordance with the jurisdiction to
      which the other party or its assets are
subject;

            

    

     

    
      	
               
      

            	
              17.2.6

            	
              in
      the circumstances contemplated by clause 24.3 where there
      is no agreement reached by the parties within *** days after discussions
      for that purpose began or ought to have
begun.

            

    

     

    
      	
              17.3

            	
              For
      the purposes of clause
      17.2.1 a breach shall be considered capable of remedy if the party
      in breach can comply with the provision in question in all respects save
      as to the time of performance (provided that time of performance is not of
      the essence).

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
              17.4

            	
              The
      rights to terminate this Agreement given by clause 17.2 shall be
      without prejudice to any other right or remedy of either party in respect
      of the breach concerned (if any) or any other
  breach.

            

    

     

    
      	
              18

            	
              Consequences of termination
      

            

    

     

    
      	
              18.1

            	
              Upon
      termination of this Agreement for any
reason:

            

    

     

    
      	
               
      

            	
              18.1.1

            	
              save
      as otherwise agreed, including, without limitation, to effect clause 18.1.2, IDIS
      shall immediately cease to make use of the Trade
  Marks;

            

    

     

    
      	
               
      

            	
              18.1.2

            	
              IDIS
      shall be entitled to complete all Orders placed with and accepted in the
      entirety by GENTA prior to the date of
  termination;

            

    

     

    
      	
               
      

            	
              18.1.3

            	
              at
      the request of a party and at that party’s expense, the other party shall
      return or destroy any Confidential Information provided by the first
      party;

            

    

     

    
      	
               
      

            	
              18.1.4

            	
              IDIS
      shall have no claim against GENTA for loss of distribution rights,
      goodwill or other similar loss;

            

    

     

    
      	
               
      

            	
              18.1.5

            	
              IDIS’s
      rights hereunder shall immediately
end.

            

    

     

    
      	
              18.2

            	
              In
      the event of termination by either party or GENTA under clause 17.1, 17.2.1 or
      17.4:

            

    

     

    
      	
               
      

            	
              18.2.1

            	
              IDIS
      shall, if GENTA so requests, within *** days of the date of termination of
      this Agreement return all or any part of the stocks of the Products then
      held by IDIS to GENTA at GENTA’s cost of transportation and insurance, and
      risk.  IDIS shall be responsible for arranging transportation
      and insurance;

            

    

     

    
      	
               
      

            	
              18.2.2

            	
              IDIS
      shall be entitled to sell all remaining stocks that GENTA does not wish to
      reclaim under clause
      18.2.1 and for those purposes and to that extent, the provisions of
      this Agreement shall continue in full force and
  effect.

            

    

     

    
      	
              18.3

            	
              In
      the event of termination by IDIS under clause 17.2.1 IDIS may
      at its option:

            

    

     

    
      	
               
      

            	
              18.3.1

            	
              within
      *** days of the date of termination of this Agreement require GENTA to
      collect all or any part of the stocks of the Products then held by IDIS at
      GENTA’s cost of transportation and insurance and risk.  IDIS
      shall be responsible for arranging transportation and
      insurance;

            

    

     

    
      	
               
      

            	
              18.3.2

            	
              sell
      all or any remaining stocks GENTA is not required to collect under clause 18.3.1 and for
      those purposes and to that extent, the provisions of this Agreement shall
      continue in full force and effect.

            

    

     

    
      	
              18.4

            	
              In
      the event of termination of this Agreement in its entirety for either
      Ganite or Genasense by GENTA under clause 17.1 prior to
      expiration of the  Term, GENTA shall pay to IDIS a termination
      fee of *** for either drug (or *** for termination of both Ganite and
      Genasense) multiplied by the total number of months remaining in the Term,
      up to a maximum of *** months. For clarity, the maximum payment under this
      clause 18.4 shall
      be *** for termination with respect to one Product or *** for termination
      of the Agreement with respect to both
Products.

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
              18.5

            	
              Clauses 14, 15, 18, 19, 22 and 23 shall survive
      termination of this Agreement.

            

    

     

    
      	
              19

            	
              Confidential
      Information

            

    

     

    
      	
              19.1

            	
              With
      respect to Confidential Information received by a party from the other
      party after the Commencement Date, except as provided by clauses 19.2 and 19.3, each party shall
      at all times during the continuance of this Agreement and for *** years
      after its termination:

            

    

     

    
      	
               
      

            	
              19.1.1

            	
              use
      its best endeavours to keep all Confidential Information of the other
      party secret and confidential and accordingly not disclose any
      Confidential Information of the other party to any other person;
      and

            

    

     

    
      	
               
      

            	
              19.1.2

            	
              not
      use any Confidential Information of the other party for any purpose other
      than for the performance of its obligations under this
      Agreement.

            

    

     

    
      	
              19.2

            	
              Any
      Confidential Information may be disclosed by a party
  to:

            

    

     

    
      	
               
      

            	
              19.2.1

            	
              any
      governmental or relevant competent authority pursuant to a statutory or
      regulatory requirement but then only to the extent of such required
      disclosure;

            

    

     

    
      	
               
      

            	
              19.2.2

            	
              its
      professional advisers, lawyers, auditors and bankers under obligations of
      confidentiality; or

            

    

     

    
      	
               
      

            	
              19.2.3

            	
              any
      of its directors or employees or of any of the aforementioned persons, to
      such extent only as is necessary for the purposes contemplated by this
      Agreement, or as is required by law and subject in each case to that party
      ensuring that the person in question keeps the same confidential and does
      not use the same except for the purposes of this
  Agreement.

            

    

     

    
      	
              19.3

            	
              Any
      Confidential Information may be used by a party for any purpose, or
      disclosed to any other person, to the extent only
  that:

            

    

     

    
      	
               
      

            	
              19.3.1

            	
              it
      is on the Commencement Date, or later becomes, public knowledge through no
      fault of that party;

            

    

     

    
      	
               
      

            	
              19.3.2

            	
              it
      can be shown by that party, to the reasonable satisfaction of the other
      party, to have been known to the first party other than as a result of a
      breach of this clause
      19 prior to the same being disclosed by the other party to the
      first party;

            

    

     

    
      	
               
      

            	
              19.3.3

            	
              the
      information has been lawfully obtained after the Commencement Date from a
      third party free of any duty of
confidentiality;

            

    

     

    
      	
               
      

            	
              19.3.4

            	
              the
      other party has given its prior written consent to such use and/or
      disclosure; or

            

    

     

    
      	
               
      

            	
              19.3.5

            	
              the
      information was independently developed by that
  party.

            

    

     

    
      	
              19.4

            	
              Notwithstanding
      this clause 19,
      GENTA and IDIS shall be free to use for any purpose the general knowledge
      resulting from access to work with or exposure to the other party’s
      Confidential Information, provided that such party shall maintain the
      confidentiality of the Confidential Information as provided herein and
      this provision shall not be deemed a license of either party’s
      Intellectual Property Rights.  The term “general knowledge”
      means information in non-tangible form which may be retained by persons
      who have had access to Confidential Information of the other party,
      including ideas, concepts, know-how or techniques contained
      therein.

            

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      	
              20

            	
              Data
      Protection

            

    

     

    
      	
              20.1

            	
              Each
      Party shall comply at all times with all applicable European and/or
      national data protection Laws including but not limited to the EC
      Directive 94/46EC (collectively, the “Data Protection Laws”) in relation
      to personal information (as defined by Data Protection Laws) that is held
      or processed by the parties in the course of performing their obligations
      under this Agreement.

            

    

     

    
      	
              20.2

            	
              No
      transfers of personal information processed or controlled by either party
      will be made from within the European Economic Area to any country outside
      of the European Economic Area unless such country is a country that has
      been recognized by the European Commission as providing adequate
      protection of personal information or unless the parties have entered into
      the model contract approved by the European Commission found at http://www.europa.eu/justice_home/fsj/privacy/modelcontracts/index-en.htm

            

    

     

    
      21 
Force
Majeure

    

     

    
      	
              21.1

            	
              If
      either party is affected by Force Majeure it shall forthwith notify the
      other party of the nature and extent
thereof.

            

    

     

    
      	
              21.2

            	
              Neither
      party shall be deemed to be in breach of this Agreement, or otherwise be
      liable to the other, by reason of any delay in performance, or
      non-performance, of any of its obligations under this Agreement to the
      extent that such delay or non-performance is due to any Force Majeure of
      which it has notified the other party, and the time for performance of
      that obligation shall be extended
accordingly.

            

    

     

    
      	
              21.3

            	
              If
      the Force Majeure in question prevails for a continuous period in excess
      of three months, the parties shall enter into bona fide discussions with a
      view to alleviating its effects, or to agreeing upon such alternative
      arrangements as may be fair and reasonable in the
      circumstances.

            

    

     

    
      22 
Notice

    

     

    
      	
              22.1

            	
              Any
      notice to be served by one party on the other shall be in writing and
      shall be served by sending it by pre-paid recorded delivery (or by
      pre-paid registered air mail where appropriate) to the Service Address or
      by fax to the Fax Address or to such other address as is notified by that
      party to the other from time to time in accordance with this clause
    22.

            

    

     

    
      	
              22.2

            	
              Notice
      shall be deemed received in the case of pre-paid recorded delivery, two
      (2) days from the date of posting, in the case of registered airmail, five
      (5) days from the date of posting, and in the case of fax, at the time of
      transmission.

            

    

     

    
      	
              22.3

            	
              In
      proving service it shall be sufficient to prove that the envelope
      containing such notice was correctly addressed and delivered or the notice
      was transmitted by fax to the Fax Address and a successful transmission
      sheet exists.

            

    

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    
      23 
General

    

     

    
      	
              23.1

            	
              Neither
      party shall without the prior written consent of the other sub-contract,
      assign or transfer, or purport to sub-contract, assign or transfer to any
      other person any of its rights or obligations under this Agreement without
      the prior written consent of the other party, provided that GENTA may
      assign this Agreement in its entirety without the consent of IDIS to an
      affiliate or to a purchaser of all or substantially all of its assets to
      which this Agreement relates.   save that this Agreement
      will be binding upon and inure to any successor(s) to the business of
      either party.

            

    

     

    
      	
              23.2

            	
              Neither
      party nor its agents or employees shall be deemed to be an agent of the
      other for any purpose whatsoever, and neither party shall have, nor shall
      it represent itself as having, any authority to make contracts or
      obligations in the name of or binding upon the other party, to pledge the
      other party’s credit, or to extend credit to anyone in the other party’s
      name.

            

    

     

    
      	
              23.3

            	
              This
      Agreement and the documents referred to in it, including Confidentiality
      Agreements, contains the entire agreement between the parties in respect
      of the subject matter of the Agreement, and supersede all prior written or
      oral agreements, representations or understandings between the parties in
      respect thereto. The parties acknowledge that this Agreement has not been
      entered into wholly or partly in reliance on, nor has either party been
      given any warranty, statement, promise or representation made by or on
      their behalf other than as expressly set out in this
      Agreement.  To the extent that any such warranties, statements,
      promises or representations have been given the recipient party
      unconditionally and irrevocably waives any claims, rights or remedies
      which it might otherwise have had in relation to them. Nothing in this
      clause 23.3 will
      exclude any liability which one party would otherwise have to the other
      party in respect of any statements made
  fraudulently.

            

    

     

    
      	
              23.4

            	
              This
      Agreement may not be modified except in writing signed by the duly
      authorised representatives of each
party.

            

    

     

    
      	
              23.5

            	
              In
      the event that any of the provisions of this Agreement or the application
      of any such provisions to the parties shall be held by a court of
      competent jurisdiction to be contrary to law, the remaining portions of
      this Agreement shall remain in full force and
  effect.

            

    

     

    
      	
              23.6

            	
              The
      failure or delay by either party to this Agreement in exercising any
      right, power or remedy of that party under this Agreement will not in any
      circumstances impair such right, power or remedy nor operate as a waiver
      of it.  The single or partial exercise by either party to this
      Agreement of any right, power or remedy under this Agreement will not in
      any circumstances preclude any other or further exercise of it or the
      exercise of any other right, power or
remedy.

            

    

     

    
      	
              23.7

            	
              Except
      as expressly provided in this Agreement, the rights, powers and remedies
      provided in this Agreement are cumulative and not exclusive of any rights,
      powers and remedies provided by
law.

            

    

     

    
      	
              23.8

            	
              No
      waiver by either party of any breach of this Agreement by the other shall
      be considered as a waiver of any subsequent breach of the same or any
      other provisions.

            

    

     

    
      	
              23.9

            	
              The
      parties to this Agreement do not intend that any of its terms will be
      enforceable by virtue of the Contracts (Rights of Third Parties) Act 1999
      by any person not a party to it.

            

    

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    
      	
              23.10

            	
              This
      Agreement may be executed in any number of counterparts, each of which
      when executed shall be construed as an original, but together will
      constitute one and the same
instrument.

            

    

     

    23.11      During
the continuance of this Agreement and for *** years after termination of this
Agreement in its entirety, IDIS shall make available to GENTA any financial
records specifically relating to activities under this Agreement that GENTA
reasonably requests to determine whether IDIS has complied with the terms and
provisions of this Agreement.

     

    
      24 
Disputes

    

     

    
      	
              24.1

            	
              Subject
      to clause 25, if
      any dispute arises out of this Agreement, in the first instance, the
      parties’ account managers shall attempt to resolve the dispute amicably
      within *** days.

            

    

     

    
      	
              24.2

            	
              If
      a dispute cannot be resolved by the parties’ account managers, the parties
      shall promptly refer the matter to their respective Chief Executive
      Officers. If either party refuses to make such referral or participate in
      good faith in this dispute resolution procedure and in any event, if the
      dispute is not resolved within *** days of such referral or the date such
      referral could have been made, then either party may commence proceedings
      in accordance with clause
      25.

            

    

     

    
      	
              24.3

            	
              Where
      either party reasonably believes that a dispute relates to a material
      breach or potential breach of this Agreement or a Contract, that party
      shall notify its and the other party’s account managers and each party
      shall then refer the dispute directly to their Chief Executive Officers
      and the provisions of clause 24.2 shall
      apply.

            

    

     

    
      25 
Governing Law and
Jurisdiction

    

     

    
      	
              25.1

            	
              This
      Agreement shall be governed by, and construed in all respects in
      accordance with the laws of
England.

            

    

     

    
      	
              25.2

            	
              Subject
      to clause 24, the
      courts of England will have exclusive jurisdiction to settle any disputes
      which may arise out of or in connection with this
      Agreement.  The parties irrevocably agree to submit to that
      jurisdiction except that either party may seek injunctive relief in any
      court of competent jurisdiction.

            

    

     

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    IN
WITNESS of which the parties have signed this Agreement on the date set out
above.

    

    
      
        
          
            
              
                	
                        SIGNED
      for and on behalf of

                      	 	 
      	 
	
                        GENTA
      INCORPORATED

                      	 	 
      	 
	
                        by
      [RICHARD J. MORAN]

                      	 	 
      	 
	 
      	 	
                        [Chief
      Financial Officer, Secretary & Treasurer]

                      	 

              

            

          

        

      

    

    

    
      
        
          
            
              	
                      SIGNED
      for and on behalf of IDIS

                    	 	 
      	 
	
                      by
      [ Natalie Douglas]

                    	 	 
      	 
	 
      	 	
                      [Managing
      Director ]

                    	 

            

          

        

      

    

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    SCHEDULE
1

    

    Products

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  Fee Structure for Genasense®

                                	 
	
                                  # Packs Sold

                                  by IDIS

                                	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 
	
                                  IDIS
      Buy  Price

                                	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 
	
                                  IDIS
      Fee/Pack

                                	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 
	
                                  IDIS
      %Fee/Pack

                                	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    
      
        
          
            	
                    Fee Structure for Ganite®

                  	 
	 
      	 	
                    Per Pack Sold

                    by IDIS

                  	 
	
                    IDIS
      Buy Price

                  	 	 	
                    ***

                  	 
	
                    IDIS
      Fee/Pack

                  	 	 	
                    ***

                  	 
	
                    IDIS
      %Fee/Pack

                  	 	 	
                    ***

                  	 

          

        

      

    

    

    All
prices are in US Dollars ($)

    

    GENTA
will supply only full packs (containing five vials) to IDIS and IDIS may sell
only full packs containing five vials.  Sale of individual vials or
partial packs is not permitted.

    

    Carriage
to be charged onto end customer in the territory

    

    For
purposes of determining the applicable IDIS Fee/Pack for Genasense, # Packs Sold
by IDIS will be cumulative over the Term.

    

    For
clarity, assuming 1,0,00 packs of Genasense are sold within the Term, the IDIS
fee shall total ***

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    SCHEDULE
2

    

    Territory

    

    Worldwide

    

    With
the exception of

    

    Cuba

    Iran

    Libya

    The
Sudan

    USA

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    

    SCHEDULE
3

    

    Trade
Marks

    

    Ganite®

    

    Genasense®

    

    Genta®

    

    

    

    

    
      
         

      

      
        25

        
          

        

      

      
         

      

    

     SCHEDULE
4

    

    Service

    

    
      
        
          	
                  GENTA’s
      Service Address

                	 	
                  200
      Connell Drive

                  Berkeley
      Heights, NJ  07922

                  USA

                
	 
      	 	 
      
	
                  GENTA’s
      Telephone Number(s)

                	 	
                  +1
      (908) 286-9800

                
	 
      	 	 
      
	
                  GENTA’s
      Fax Address

                   

                	 	
                  +1
      (908) 464-1701

                
	
                  IDIS’s
      Service Address

                	 	
                  IDIS
      House

                  Churchfield
      Road

                  Weybridge

                  Surrey

                  KT13
      8DB

                  United
      Kingdom

                
	 
      	 	 
      
	
                  IDIS’s
      Telephone Number(s)

                	 	
                  [+44
      1932 824100]

                
	 
      	 	 
      
	
                  IDIS’s
      Fax Address

                	 	
                  [+44
      1932 824200]

                

        

      

    

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    SCHEDULE
5

    

    Technical
Agreement

    

    EXECUTED
AS A SEPARATE AGREEMENT BETWEEN IDIS AND GENTA

    
      
         

      

      
        27a611937910-1.htm

    Exhibit
10.1

     

     

    RESTRUCTURING
TRANSACTION

    RETENTION
AGREEMENT

    

    THIS
AGREEMENT is made by and between McDermott International, Inc., a corporation
duly organized under the laws of the Republic of Panama (the “Company”) and John
A. Fees (“Employee”) as of the 10th day
of December, 2009 (this “Agreement”).

     

    In
consideration of the mutual covenants and agreements contained herein, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
expressly acknowledged, the parties hereto agree as follows:

     

    If the
Company, with the prior approval of the Board of Directors of the Company,
engages in a transaction that results in the sale or other disposition of all or
substantially all of the operations of either of its subsidiaries The Babcock
& Wilcox Company or  J. Ray McDermott, S.A. (each an “Operating
Sub” and, together, the “Operating Subs”), whether by sale of the capital stock
or assets of one or both of the Operating Subs, spinoff of one or both of the
Operating Subs or otherwise, with an Effective Date (this term and other terms
that are capitalized (but not otherwise defined herein) are used as defined in
Section XIII of this Agreement) within the 24-month period beginning on the date
of this Agreement (a “Restructuring Transaction”), Employee shall be entitled to
compensation and benefits under the circumstances set out below.  In
addition, if Employee’s employment is terminated under certain circumstances set
out below before a Restructuring Transaction, Employee will be entitled to the
compensation and benefits set out below.  The sale or disposition of
less than 100% of the assets or stock of an Operating Sub shall not be
considered a sale or other disposition of substantially all of the operations of
such Operating Sub unless it is a sale or other disposition of at least 80% of
the stock or assets of such Operating Sub.

     

    
      	
              I.

            	
              Obligations
      of the Company or a Successor Upon Termination of Employee In Connection
      With or After a Restructuring
Transaction.

            

    

     

    In the
event that either

     

    
      	
               
      

            	
              (X)

            	
              while
      employed by the Company, Employee’s employment by the Company is
      terminated following the date of this Agreement and before the earlier of
      (A) the termination of this Agreement in accordance with Section XII and
      (B) the one-year anniversary of the Effective Date of a Restructuring
      Transaction, either (i) by the Company for any reason other than Cause or
      Employee’s Disability or (ii) by Employee for Good Reason
    or

            

    

     

    
      	
               
      

            	
              (Y)

            	
              while
      employed by a Successor, Employee’s employment by such Successor is
      terminated following the Effective Date of a Restructuring
      Transaction  and before the one-year anniversary of such
      Effective Date, either (i) by the Successor for any reason other than
      Cause or Employee’s Disability or (ii) by Employee for Good Reason (in the
      case of either of the immediately preceding clause (i) or this clause
      (ii), the Successor being substituted for the Company in the definitions
      of Cause and Good Reason herein),

            

    

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

     

    then, in
either case, the Company or such Successor, as applicable, shall (in all cases,
subject to the proviso in clause (f) below with respect to awards described in
that clause, no later than March 15 following the year in which Employee so
terminates); provided that by such date, Employee has signed an agreement that
is no longer subject to rescission prepared by the Company or Successor, as
applicable, which is solely a release of the Company, Successor (if applicable),
and each of their respective affiliates, directors, officers and other customary
persons from any claim or liability arising out of or related to Employee’s
employment with or termination from the Company or a Successor, except for
amounts to which Employee is legally entitled pursuant to employee benefit plans
or this Agreement, and rights to insurance coverage or
indemnification:

     

    
      	
               
      

            	
              (a)

            	
              pay
      to Employee within 30 days after the date of termination of Employee’s
      employment (or such earlier time as may be required by applicable law) the
      Accrued Benefits;

            

    

     

    
      	
               
      

            	
              (b)

            	
              in
      the event that a bonus is paid after the date of Employee’s termination of
      employment under the Company’s or such Successor’s Executive Incentive
      Compensation Plan (such plan or any successor or replacement plan,
      including any annual bonus plan of such Successor, in any case in which
      Employee was a participant immediately prior to such termination being
      hereinafter referred to as the “EICP”), as applicable, for the year prior
      to the year in which the termination takes place (the “Measurement
      Period”), pay to Employee in a lump sum, at the same time such bonus is
      paid to other participants in the EICP, a cash bonus equal to the product
      of the multiplier used for Employee’s position during the Measurement
      Period and Employee’s annual base salary for the Measurement
      Period;

            

    

     

    
      	
               
      

            	
              (c)

            	
              pay
      to Employee in a lump sum, in cash, within 30 days after the date of
      termination of Employee’s employment, a payment equal to the product of
      Employee’s target bonus under the EICP as in effect immediately prior to
      the date of termination and a fraction, the numerator of which is the
      number of days that have elapsed in the year in which the termination
      takes place through the date of termination of Employee’s employment and
      the denominator of which is 365;

            

    

     

    
      	
               
      

            	
              (d)

            	
              pay
      to Employee in a lump sum, in cash, as soon as administratively
      practicable after the date of termination of Employee’s employment, 299%
      of the sum of (1) Employee’s annual base salary as in effect immediately
      prior to the date of termination of Employee’s employment and (2)
      Employee’s target bonus under the EICP as in effect immediately prior to
      the date of termination;

            

    

     

    
      	
               
      

            	
              (e)

            	
              (1)
      pay to Employee in a lump sum, in cash, within 30 days after the date of
      termination of Employee’s employment, a payment equal to two times the
      full annual cost of coverage for medical, dental and vision benefits
      provided to Employee and Employee’s covered dependents by the Company and,
      if applicable, a Successor for the year in which Employee’s termination
      takes place and (2) permit Employee and Employee’s covered dependents to
      be covered under the Company’s, or if applicable, a Successor’s medical,
      dental and vision benefits for 48 months provided Employee pays the full
      then applicable COBRA premium;

            

    

     

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (f)

            	
              as
      of the date of Employee’s termination of employment, cause Employee to
      have a fully vested and nonforfeitable interest in each of the awards
      identified on the attached Schedule A (as the same may be modified
      pursuant to the terms of the applicable plans and award agreements in
      connection with the Restructuring Transaction), and to the extent
      applicable immediately pay such awards to Employee; provided that none of
      the awards subject to Section 409A of the Internal Revenue Code of 1986,
      as amended (“Code”), will be paid on a date earlier than as provided in
      the applicable award agreements without regard to this
      Agreement;

            

    

     

    
      	
               
      

            	
              (g)

            	
              as
      of the date of Employee’s termination of employment, cause Employee to
      have a fully vested and nonforfeitable interest in Employee’s account
      balance in the McDermott International, Inc. New Supplemental Executive
      Retirement Plan (“SERP”); provided that, notwithstanding anything to the
      contrary, Employee’s SERP benefits shall be distributed in accordance with
      the terms of the SERP; and

            

    

     

    
      	
               
      

            	
              (h)

            	
              pay
      to Employee within 30 days after the date of termination of Employee’s
      employment an amount equal to the portion of Employee’s account under the
      Thrift Plan for Employees of McDermott Incorporated and Participating
      Subsidiary and Affiliated Companies  that was not vested as of
      the date of termination of Employee’s
  employment.

            

    

     

    Notwithstanding
the foregoing provisions of Section I, payments and benefits shall be subject to
reduction as set out in Schedule B.

     

    
      	
              II.

            	
              Obligations
      of the Company if Employee remains employed through the Effective Date of
      a Restructuring Transaction.

            

    

     

    In the
event that Employee’s employment by the Company is not terminated as of the
Effective Date of the Restructuring Transaction under circumstances entitling
Employee to benefits under Section I above, and if Employee has remained
employed with the Company through the Effective Date of the Restructuring
Transaction, then the Company or, if applicable, the Successor shall cause
Employee to be granted the number of whole shares of restricted stock under the
Company’s or Successor’s, as applicable, stock plan, as near equal in value to,
but not greater than, 50% of the amount described in Section I(d) above, on
terms and conditions set forth in the grant agreement approved in accordance
with such stock plan; provided, however, the restricted stock shall vest on the
first anniversary of the Effective Date of the Restructuring Transaction if, and
only if, Employee remains employed with the Company or the Successor through
such first anniversary.

     

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    
      	
              III.

            	
              Participation
      In Other Company Programs.

            

    

     

    Nothing in
this Agreement shall prevent or limit Employee’s continuing or future
participation in any plan, program, policy or practice provided by the Company
for which Employee may qualify, nor shall anything herein limit or otherwise
affect such rights as Employee may have under any other contract or agreement
with the Company, except as provided in Section X of this
Agreement.  Amounts which are vested benefits or which Employee is
otherwise entitled to receive under any plan, policy, practice or program of or
any contract or agreement with the Company at or subsequent to the date of
termination of Employee’s employment shall be payable in accordance with such
plan, policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.  Notwithstanding the foregoing, it is
expressly understood and acknowledged by Employee that any payment by the
Company or a Successor under Section I of this Agreement shall be in lieu of any
obligation on the part of the Company or such Successor for payment of severance
benefits under the Severance Plan for Employees of McDermott Incorporated and
Participating Subsidiary and Affiliated Companies or any successor thereto or
any other plan, policy or agreement of the Company or such Successor in the
event of termination of Employee’s employment as provided in Section I of this
Agreement with the Company or such Successor during the one-year period
following the Effective Date of a Restructuring Transaction.

     

    
      	
              IV.

            	
              Confidentiality
      and Non-Competition Agreement.

            

    

     

    
      	
               
      

            	
              (a)

            	
              Definition
      of Trade Secrets and Confidential Business Information. Employee
      acknowledges and agrees that any and all non-public information regarding
      the Company, any of its Subsidiaries and its or their customers (including
      but not limited to any and all information relating to its or their
      business practices, products, services, finances, customers, equipment,
      marketing programs and other business systems and materials, management,
      strategy, profits and overhead) is confidential and the unauthorized
      disclosure of such confidential information will result in irreparable
      harm to the Company. Such confidential information includes the Company
      property interest in its trade secrets, including, without limitation, its
      list of customers and prospective customers, and other information that
      has recognized value and that is not generally available through other
      sources ("Trade
      Secrets") and information regarding its various products, services,
      procedures and systems that is treated as confidential by the Company that
      may not rise to the level of a Trade Secret ("Confidential
      Business Information").  Confidential Business
      Information does not include information that properly and lawfully has
      become generally known to the public other than as a result of the act or
      omission of Employee. Collectively, Trade Secrets and Confidential
      Business Information are referred to hereafter as “Confidential
      Information.”  For the purposes of this Section IV, the
      term “Company” shall include a
Successor.

            

    

     

    
      	
               
      

            	
              (b)

            	
              Importance
      of Confidential Information.  The Company hereby agrees
      to provide Employee with Confidential Information. By signing this
      Agreement, Employee acknowledges delivery and receipt of Confidential
      Information. Employee acknowledges that thereafter Employee will be making
      use of, acquiring, accessing and/or adding to such Confidential
      Information.   Employee further acknowledges that the
      preservation and protection of the Confidential Information is an
      essential part of Employee's employment by and business relationship with
      the Company and that Employee has a duty of fidelity and trust to the
      Company in handling the Confidential
  Information.

            

    

     

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (c)

            	
              Non-Disclosure
      or Misuse.  Employee agrees that Employee will not
      disclose or take away any of the Confidential Information, directly or
      indirectly, or use such information in any way, either during the term of
      Employee's employment by the Company or at any time thereafter, except as
      required in the ordinary course of Employee's employment for the benefit
      of the Company or as may be required by
law.

            

    

     

    
      	
               
      

            	
              (d)

            	
              Return
      of Confidential Information.  At the termination of the
      Employee’s employment with the Company and/or its affiliates for any
      reason, all documents or other information containing or referring to the
      Confidential Information of the Company and its affiliates as may be in
      Employee’s possession, or over which Employee may have control, and all
      other documents, data, records, materials, notes, reports and other
      property of the Company or any of its affiliates provided to Employee
      during the course of Employee’s employment, regardless of whether prepared
      by the Employee, shall be returned by Employee to the Company immediately,
      with no request being required (and Employee shall not retain, recreate or
      deliver to anyone else such
information).

            

    

     

    
      	
               
      

            	
              (e)

            	
              Noncompetition
      Agreement. Employee acknowledges and agrees that information,
      including the Confidential Information, Employee has acquired and will
      acquire during the course of Employee’s employment will enable Employee to
      irreparably injure the Company if Employee should engage in competition.
      Ancillary to the above agreements and in consideration of the
      compensation, benefits and Confidential Information provided to Employee
      and for other good and valuable consideration, the receipt and sufficiency
      of which are hereby acknowledged, Employee hereby agrees that the
      following covenants are reasonable and necessary protective covenants for
      the protection of the value of the agreements described in paragraphs (a),
      (b), (c) and (d) above and the other terms and conditions contained in
      this Agreement:

            

    

     

    
      	
               
      

            	
              (i)

            	
              During
      the term of Employee’s employment with the Company and/or its Subsidiaries
      and other controlled entities and for a period of two years following the
      termination of Employee’s employment for any reason (the “Non-Competition
      Period”), Employee shall not, directly or indirectly, without the prior
      written approval of the Company, act in any capacity for, be employed by,
      provide services to, or contract with any other company or entity engaged
      in Competing Services (a “Competitive Entity”), or acquire any interest of
      any type in any Competitive Entity; provided, however, that the foregoing
      shall not be deemed to prohibit Employee from acquiring, solely as an
      investment and through market purchases, securities of any Competitive
      Entity which are registered under Section 12(b) or 12(g) of the Securities
      and Exchange Act of 1934 and which are publicly traded, so long as
      Employee is not part of any control group of such Competitive Entity and
      such securities, including converted securities, do not constitute more
      than one percent of the outstanding voting power of that entity. For the
      purposes of this Agreement, the phrase “Competing Services” shall mean any
      services that are the same as or similar to the services currently being
      provided or offered by the Company and/or which are provided or offered by
      the Company during the term of Employee’s employment; Competing Services
      include but are not limited to the following:  (a) engineering,
      construction, installation and project management services to offshore oil
      and gas field development; (b) power generation systems, including
      fossil-fired steam generating systems, replacement commercial nuclear
      steam generators, environmental equipment, replacement parts and related
      services; and (c) government operations, including supply of nuclear
      components to the U.S. Government and various services including uranium
      processing, environmental site restoration services and management and
      operating services for government-owned
  facilities.

            

    

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (ii)

            	
              During
      the Non-Competition Period, Employee shall not, directly or indirectly,
      solicit the Company’s Protected Customers for the purpose of engaging in
      any business which is the same as or similar to the business in which the
      Company is engaged.  The phrase “Protected Customers” means all
      persons or entities with whom Employee has had contact with by virtue of
      Employee's position with the Company, and to whom the Company or any of
      its affiliates has sold any product or service, whether or not for
      compensation, within a period of one (1) year prior to the time Employee
      ceases to be employed by the
Company.

            

    

     

    
      	
               
      

            	
              (iii)

            	
              During
      the Non-Competition Period, Employee shall not, on Employee's own behalf
      or on behalf of any other person or entity, solicit, divert or recruit any
      person who is, during such time frame, an employee of the Company or any
      subsidiary or affiliate, to leave such employment or in any other manner
      attempt, directly or indirectly, to influence, induce, or encourage any
      employee of the Company to leave the employment of the
      Company.

            

    

     

    
      	
               
      

            	
              (f)

            	
              Notification
      of Restrictions to Third Parties.  Employee agrees that
      the Company may notify any person or entity employing or contracting with
      Employee or evidencing an intention of employing or contracting with
      Employee of the existence and provisions of this
  Agreement.

            

    

     

    
      	
               
      

            	
              (g)

            	
              Enforcement
      of Covenants.  Either party may seek a temporary
      restraining order, preliminary injunction, specific performance or other
      equitable relief regarding the other party’s obligations set forth in this
      Section IV before a court of law pending a final resolution of the
      disputes between the parties before an arbitrator, and either party may
      seek a judgment including a permanent injunction, if appropriate, from the
      court based on the final decision of the arbitrator. In addition, in the
      event that the Company determines that the Employee has breached any term
      of this Section IV, in addition to any other remedies at law or in equity
      the Company may have available to it, it is agreed that the Company shall
      be entitled, upon application to any court of proper jurisdiction, to a
      temporary restraining order or preliminary injunction (without the
      necessity of (i) proving irreparable harm, (ii) establishing that monetary
      damages are inadequate, or (iii) posting any bond with respect thereto)
      against the Employee prohibiting such breach or attempted or threatened
      breach by proving only the existence of such breach or attempted or
      threatened breach.

            

    

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (h)

            	
              Right
      of Court or Arbitrator to Reform Restrictions. The Company and the
      Employee state that it was their intent to enter into a valid and
      enforceable agreement.  The Employee and the Company hereby
      acknowledge the reasonableness of the restrictions set forth in Section
      IV, including the reasonableness of the geographic area, duration as to
      time and scope of activity restrained. Employee further acknowledges that
      his skills are such that he can be gainfully employed in noncompetitive
      employment and that the Agreement not to compete does not prevent him from
      earning a living.  Employee agrees that if a court or arbitrator
      finds that Section IV contains limitations as to time or scope of activity
      to be restrained that are not reasonable and impose a greater restraint
      than is necessary to protect the goodwill or other business interest of
      the Company and its affiliates, the court or arbitrator may reform the
      covenants to the extent necessary to cause the limitations contained in
      Section IV as to time or scope of activity to be reasonable and to impose
      a restraint that is not greater than necessary to protect the goodwill or
      other business interest of the Company and its affiliates, and enforce
      Section IV.

            

    

     

    
      	
               
      

            	
              (i)

            	
              Extension
      of Non-Competition Period.  Employee agrees that the
      Non-Competition Period shall be computed by excluding from such
      computation any time during which the Employee is in violation of any
      provision of Article VI.

            

    

     

    
      	
               
      

            	
              (j)

            	
              Repayment
      and Forfeiture.  Employee agrees that in the event that
      (i) the Company determines that the Employee has breached any term of
      Section IV, or (ii) all or any part of Section IV is found invalid or
      unenforceable for any reason whatsoever by a court of competent
      jurisdiction or an arbitrator in a proceeding between the Employee and the
      Company or its affiliates, in addition to any other remedies at law or in
      equity the Company may have available to it, the Company shall not be
      obligated to make any of the payments or to provide for any of the
      benefits specified in Section I, and shall be entitled to recoup any
      amounts paid to the Employee and the value of any benefit provided
      pursuant hereto on and following the date of termination, through either
      (x) the date of a material breach by the Employee of the provisions of
      Section IV, which breach continues without having been cured within
      fifteen (15) days after written notice to the Employee specifying the
      breach in reasonable detail, or (y) the date of the determination of
      invalidity or unenforceability by the court or arbitrator, as
      applicable.

            

    

     

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (k)

            	
              Successors.  For
      purposes of this Section IV, the term “Company” shall include a
      Successor.

            

    

     

    
      	
              V.

            	
              Notices.

            

    

     

    All
notices and other communications provided for by this Agreement shall be in
writing and shall be deemed to have been duly given when (a) delivered by hand,
(b) sent by facsimile to the facsimile number given below, provided that a copy
is also sent by a nationally recognized overnight delivery service, (c) the day
after being sent by a nationally recognized overnight delivery service, or (d)
three days after being mailed by United States Certified Mail, return receipt
requested, postage prepaid, addressed as follows:

     

    If to
Employee:                       ___________________

    ___________________

    ___________________

    

    Facsimile:                ___________________

    

    If to the Company or a
Successor:

    

    McDermott International,
Inc.

    Vice President, Human
Resources

    777 N. Eldridge Parkway

    Houston,
TX  77079

    

    Facsimile:                      281-870-5095

    

    or to such
other address as Employee, the Company or a Successor may hereafter specify in a
notice furnished in writing in accordance with this Section V.

     

    
      	
              VI.

            	
              Governing
      Law.

            

    

     

    The
provisions of this Agreement shall be interpreted and construed in accordance
with, and enforcement may be made under, the law of the State of Texas without
giving effect to any principles of conflict of laws thereof which would result
in the application of the laws of any other jurisdiction.

     

    
      	
              VII.

            	
              Successors
      and Assigns.

            

    

     

    
      	
               
      

            	
              (a)

            	
              This
      Agreement is personal to Employee and, without the prior written consent
      of the Company, shall not be assignable by Employee otherwise than by will
      or the laws of descent and
distribution.

            

    

     

    
      	
               
      

            	
              (b)

            	
              This
      Agreement shall be binding upon and shall inure to the benefit of
      Employee, and of the Company and any Successor and their respective
      successors and assigns.

            

    

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (c)

            	
              The
      Company will require that any successor to all or substantially all of its
      business and/or assets (other than a Successor, as to which the last
      sentence of this Section VII(c) shall apply) (whether such successor
      acquires such business and/or assets directly or indirectly, and whether
      by purchase, merger, consolidation or otherwise) expressly assume and
      agree to perform this Agreement in the same manner and to the same extent
      that the Company would be required to perform it if no such succession had
      taken place.  As used in this Agreement, “Company” shall mean
      the Company as herein defined and any such successor to its business
      and/or assets. In the event that Employee becomes employed by a Successor
      in connection with a Restructuring Transaction, the Company shall require
      such Successor to expressly assume and adopt this Agreement and to honor
      the terms and conditions of this Agreement applicable to such Successor,
      unless Employee terminates Employee’s employment within thirty-one days
      after the Effective Date of the Restructuring Transaction for a Good
      Reason event which occurs upon the consummation of such Restructuring
      Transaction (in which case the Company shall remain obligated under this
      Agreement).

            

    

     

    
      	
              VIII.

            	
              Employment
      by Subsidiaries.

            

    

     

    If
Employee is not employed by McDermott International, Inc., but is only employed
by a Subsidiary of McDermott International, Inc., then, except for purposes of
determining whether a Restructuring Transaction has occurred, (a) the “Company”
as defined herein shall be deemed to include such Subsidiary, and (b)
termination of employment shall be determined with reference to Employee’s
employment by such Subsidiary, but, in each case, only if such Subsidiary is not
a Successor.  Further, the Company agrees that it will perform its
obligations hereunder without regard to whether Employee is employed by the
Company or by a Subsidiary of the Company.

     

    
      	
              IX.

            	
              Severability.

            

    

     

    If any
provision or portion of this Agreement shall be determined to be invalid or
unenforceable for any reason, the remaining provisions of this Agreement shall
be unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by applicable law.

     

    
      	
              X.

            	
              Entire
      Agreement; Amendment.

            

    

     

    This
Agreement sets forth the entire Agreement of the parties hereto and supersedes
all prior agreements, understandings and covenants between the parties with
respect to the subject matter hereof; provided
that:  if Employee is entitled to payments and benefits under both
Section I of this Agreement and the Change in Control Agreement between the
Company and Employee, dated as of October 1, 2008 (the “Change in Control
Agreement”), Employee will receive payments and benefits only under Section I of
this Agreement (and not under the Change in Control Agreement), except that
Section I(f) of the Change in Control Agreement will continue to apply, with the
payments (if any) under such Section I(f) limited to those which would have been
payable had Employee received the payments and benefits under the Change in
Control Agreement (and not under this Agreement) (it being the intention of the
parties hereto that, in no event, shall substantially the same benefits become
payable under both the Change in Control Agreement and Section I of this
Agreement).  This Agreement may be amended or terminated (other than
pursuant to Section XII of this Agreement) only by mutual agreement of the
parties in writing.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    
      	
              XI.

            	
              Miscellaneous.

            

    

     

    
      	
               
      

            	
              (a)

            	
              The
      captions and headings of this Agreement are not part of the provisions
      hereof and shall have no force or
effect.

            

    

     

    
      	
               
      

            	
              (b)

            	
              The
      Company (or a Successor) shall be entitled to withhold from any amounts
      payable under this Agreement such Federal, state, local, foreign or excise
      taxes as shall be required or permitted to be withheld pursuant to any
      applicable law or regulation.

            

    

     

    
      	
               
      

            	
              (c)

            	
              Employee’s
      or the Company’s (or a Successor’s) failure to insist upon strict
      compliance with any provision of this Agreement or the failure to assert
      any right Employee or the Company (or a Successor) may have hereunder,
      including, without limitation, the right of Employee to terminate
      employment for Good Reason pursuant to paragraph (f) of Section XIII of
      this Agreement, shall not be deemed to be a waiver of such provision or
      right or any other provision or right of this
  Agreement.

            

    

     

    
      	
               
      

            	
              (d)

            	
              Employee
      and the Company acknowledge that, except as may otherwise be provided
      under any other written agreement between Employee and the Company, the
      employment of Employee by the Company is “at
  will.”

            

    

     

    
      	
               
      

            	
              (e)

            	
              For
      purposes of this Agreement, the date of termination of Employee’s
      employment shall be: (i) if Employee’s employment is terminated by the
      Company (or a Successor) for Cause, the date on which the Company (or a
      Successor) delivers to Employee the resolution referred to in the last
      sentence of Section XIII, paragraph (c), or, with respect to a termination
      as described in this Agreement under Section XIII, paragraph (c)(iii), the
      date on which the Company (or a Successor) notifies Employee of such
      termination, (ii) if Employee’s employment is terminated by the Company
      (or a Successor) for a reason other than Cause (including on account of
      Disability), the date on which the Company (or a Successor) notifies
      Employee of such termination, or such later date as is reflected in such
      notification, (iii) if Employee’s employment is terminated by Employee for
      Good Reason, the date on which Employee notifies the Company (or a
      Successor) of such termination (after having given the Company (or such
      Successor) notice and a 30-day cure period), or (iv) if Employee’s
      employment is terminated by reason of death, the date of death of
      Employee.

            

    

     

    
      	
               
      

            	
              (f)

            	
              This
      Agreement may be executed in two counterparts, each of which shall be
      deemed an original and together shall constitute one and the same
      agreement, with one counterpart being delivered to each party
      hereto.

            

    

     

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (g)

            	
              In
      the event Employee’s employment is terminated (i) by the Company (or a
      Successor) for Cause or as a result of Employee’s Disability, (ii) by
      Employee without Good Reason, or (iii) on account of Employee’s death,
      Employee shall not be entitled to the payments described in Section 1 of
      this Agreement.

            

    

     

    
      	
              XII.

            	
              Term.

            

    

     

    This
Agreement shall terminate on the earliest to occur of (i) the date one year
after the Effective Date of a Restructuring Transaction, or (ii) the date on
which Employee’s employment with the Company (or a Successor) is terminated;
provided, however, that if Employee’s employment with the Company (or a
Successor) is terminated under any of the circumstances described in Section I
of this Agreement, Employee’s rights hereunder shall continue following the
termination of Employee’s employment until all benefits to which Employee is
entitled hereunder has been paid and the Company’s (or a Successor’s) rights
hereunder shall continue until all obligations owed to it hereunder have been
satisfied.  Notwithstanding the foregoing:  (a) if no
Restructuring Transaction shall have been completed with an Effective Date on or
before the second anniversary of the date of this Agreement, then this Agreement
shall automatically terminate on such second anniversary; and (b) the
provisions of this Section XII and Sections II, XIII and XIV shall survive any
termination of this Agreement.

     

    
      	
              XIII.

            	
              Definitions.

            

    

     

    For
purposes of this Agreement, the following terms shall have the meanings given
them in this Section XIII.

     

    
      	
               
      

            	
              (a)

            	
              “Accrued
      Benefits” shall mean:

            

    

     

    
      	
               
      

            	
              (i)

            	
              Any
      portion of Employee’s Annual Base Salary earned through the date of
      termination of Employee’s employment and not yet
  paid;

            

    

     

    
      	
               
      

            	
              (ii)

            	
              Reimbursement
      for any and all amounts advanced in connection with Employee’s employment
      for reasonable and necessary expenses incurred by Employee through the
      date of termination of Employee’s employment in accordance with the
      Company’s (or a Successor’s) policies and procedures on reimbursement of
      expenses;

            

    

     

    
      	
               
      

            	
              (iii)

            	
              Any
      earned vacation pay not theretofore used or paid in accordance with the
      Company’s (or a Successor’s) policy for payment of earned and unused
      vacation time; and

            

    

     

    
      	
               
      

            	
              (iv)

            	
              All
      other payments and benefits to which Employee may be entitled under the
      terms of any applicable compensation arrangement or benefit plan or
      program of the Company (or a Successor) that do not specify the time of
      distribution; provided that Accrued Benefits shall not include any
      entitlement to severance under any severance policy of the Company (or
      such Successor) generally applicable to the salaried employees of the
      Company (or such Successor).

            

    

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (b)

            	
              “Annual
      Base Salary” shall mean Employee’s annual rate of pay excluding all other
      elements of compensation such as, without limitation, bonuses,
      perquisites, expatriate or hardship premiums, restricted stock awards,
      stock options and retirement and welfare
  benefits.

            

    

     

    
      	
               
      

            	
              (c)

            	
              “Cause”
      shall mean:

            

    

     

    
      	
               
      

            	
              (i)

            	
              the
      willful and continued failure of Employee to perform substantially
      Employee’s duties with the Company (occasioned by reason other than
      physical or mental illness or disability of Employee) after a written
      demand for substantial performance is delivered to Employee by the
      Compensation Committee of the Board or the Chief Executive Officer of the
      Company which specifically identifies the manner in which the Compensation
      Committee of the Board or the Chief Executive Officer believes that
      Employee has not substantially performed Employee’s duties, after which
      Employee shall have thirty days to defend or remedy such failure to
      substantially perform Employee’s
duties;

            

    

     

    
      	
               
      

            	
              (ii)

            	
              the
      willful engaging by Employee in illegal conduct or gross misconduct which
      is materially and demonstrably injurious to the Company;
  or

            

    

     

    
      	
               
      

            	
              (iii)

            	
              the
      conviction of Employee with no further possibility of appeal or, or plea
      of guilty or nolo contendere by Employee to, any
  felony.

            

    

     

    The
cessation of employment of Employee under subparagraph (i) and (ii) above shall
not be deemed to be for “Cause” unless and until there shall have been delivered
to Employee a copy of a resolution duly adopted by the affirmative vote of not
less than three-quarters (3/4) of the entire membership of the Compensation
Committee of the Board of Directors of the Company at a meeting of such
Committee called and held for such purpose (after reasonable notice is provided
to Employee and Employee is given an opportunity, together with Employee’s
counsel, to be heard before such Committee), finding that, in the good faith
opinion of such Committee, Employee is guilty of the conduct described in
subparagraph (i) or (ii) above, and specifying the particulars thereof in
detail.

     

    
      	
               
      

            	
              (d)

            	
              “Disability”
      shall mean circumstances that would qualify Employee for long-term
      disability benefits under the Company’s Long-Term Disability Plan as in
      effect immediately prior to the Restructuring Transaction, whether or not
      such Plan remains in effect subsequent to the Restructuring
      Transaction.

            

    

     

    
      	
               
      

            	
              (e)

            	
              “Effective
      Date” with respect to a Restructuring Transaction for purposes of this
      Agreement shall be the effective date of date of the consummation of the
      spinoff or split off (i.e., the date shares
      of the Subsidiary subject to the spinoff or split off are first
      distributed to the Company’s stockholders) or sale (i.e., the closing date
      for the sale) that results in the completion of the Restructuring
      Transaction.

            

    

     

    

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              (f)

            	
              “Good
      Reason” shall mean:

            

    

     

    
      	
               
      

            	
              (i)

            	
              any
      action by the Company which results in a material diminution in Employee’s
      position, authority, duties or responsibilities immediately prior to the
      date of this Agreement; but, for the avoidance of doubt, if Employee has a
      position with either the Company or a Successor and, in either case, the
      employer is publicly traded, a material diminution in position, authority,
      duties or responsibilities will not have occurred if Employee has a
      position, authority, duties and responsibilities substantially the same as
      those attendant to Employee’s position with the Company immediately prior
      to the date of this Agreement (notwithstanding that the business
      operations of the  Company or such Successor may be smaller or
      less complex).

            

    

     

    
      	
               
      

            	
              (ii)

            	
              requiring
      Employee, without Employee’s consent, to be based at any office or
      location other than the office or location at which Employee was employed
      immediately following the date of this Agreement; provided, however, that
      any such relocation requests shall not be grounds for resignation with
      Good Reason if such relocation is within a fifty mile radius of the
      location at which Employee was employed immediately following the date of
      this Agreement  or such relocation does not result in an
      increase in Employee’s actual commuting distance from his principal
      residence to Employee’s new office or
location;

            

    

     

    
      	
               
      

            	
              (iii)

            	
              a
      material reduction in Employee’s Annual Base Salary in effect immediately
      prior to the date of this Agreement or a material reduction in the target
      multiplier used to calculate the annual bonus awarded to Employee below
      the target multiplier used to calculate the bonus paid to Employee under
      the EICP immediately prior to the date of this Agreement, provided,
      however that in either case a material reduction in the Annual Base Salary
      or the target bonus multiplier shall not be considered “Good Reason” with
      respect to any year for which such reduction is part of a reduction
      uniformly applicable to all similarly situated
  employees;

            

    

     

    
      	
               
      

            	
              (iv)

            	
              a
      material adverse change in Employee’s eligibility to participate in
      long-term incentive compensation plans as in effect immediately prior to
      the date of this Agreement, unless Employee is eligible to participate in
      a comparable plan; or

            

    

     

    
      	
               
      

            	
              (v)

            	
              any
      material breach of this Agreement by the Company, excluding for this
      purpose an isolated, insubstantial or inadvertent action not taken in bad
      faith and which is remedied by the Company promptly after receipt of
      notice thereof given by Employee.

            

    

     

    

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    In the
event (A) any of the events described above occurs (an “Event”) or (B) the
Company, in connection with but prior to the Effective Date of a Restructuring
Transaction, notifies Employee in writing that the terms and conditions of
Employee’s employment will be changed in connection with the consummation of a
Restructuring Transaction in a manner that would constitute Good Reason (a
“Company Notice”), Employee shall give the Company or Successor written notice
(the “Employee Notice”) within 60 days following Employee’s knowledge of an
Event or receipt of the Company Notice, as applicable, that such change in
employment terms or conditions would constitute Good Reason and Employee intends
to terminate employment 1as a result. The Company or Successor shall
have thirty days following receipt of the Employee Notice in which to cure the
Event or retract the Company Notice, or amend the Company Notice such that the
proposed changes in employment terms or conditions do not constitute Good
Reason.  If the Company does not take such action within that time,
the Event, or the event described in the Company Notice when it would have
occurred, as applicable, shall constitute Good Reason.  If Employee
does not provide the Employee Notice within 60 days as required above in this
clause (f), then the Event, or the change in employment terms and conditions
described in the Company Notice, as applicable, shall not constitute Good
Reason, and thereafter, for purposes of determining whether Employee has Good
Reason, Employee's terms and conditions of employment after the occurrence of
the Event or the implementation of the changes described in the Company Notice,
as applicable, shall be substituted for those terms and conditions of Employee's
employment in effect immediately prior to the date of this Agreement in each of
clauses (i), (ii), (iii) and (iv) above.

     

    
      	
               
      

            	
              (g)

            	
              “Subsidiaries”
      shall mean every corporation, limited liability company, partnership or
      other entity of which 50% or more of the total combined voting power of
      all classes of voting securities or other equity interests is owned,
      directly or indirectly, by McDermott International, Inc. or, upon and
      following a Restructuring Transaction, by the
  Successor.

            

    

     

    
      	
               
      

            	
              (h)

            	
              “Successor”
      shall mean an entity that has acquired a separate reporting segment of the
      Company (by reference to the Company’s audited consolidated financial
      statements as of and for the year ended December 31, 2008) from the
      Company in a Restructuring Transaction or a Subsidiary that is sold or
      spun off to the stockholders of the Company in a Restructuring
      Transaction.

            

    

     

     

     

     

      
        

      

    

     

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    
      	
              XIV.

            	
              Arbitration.

            

    

     

    Any
controversy or claim arising out of or relating to this Agreement (or the breach
thereof) shall be settled by final and binding arbitration in Houston, Texas by
one arbitrator selected in accordance with the Commercial Arbitration Rules (the
“Rules”) of the American Arbitration Association (the “Association”) then in
effect.  Subject to the following provisions, the arbitration shall be
conducted in accordance with the Rules then in effect.  Any award
entered by the arbitrator shall be final and binding, and judgment may be
entered thereon by any party hereto in any court of law having competent
jurisdiction.  This arbitration provision shall be specifically
enforceable.  The Company (or a Successor, if applicable) and Employee
shall each pay half of the administrative fees of the Association and the
compensation of the arbitrator and shall each be responsible for its own
attorney’s fees and expenses relating to the conduct of the
arbitration.

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

     

    IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.

     

    MCDERMOTT INTERNATIONAL,
INC.

    

    

    

    By:__________________________________ 

    Printed
Name:__________________________

    Title:_________________________________ 

    Date:_________________________________ 

    

    

    EMPLOYEE:__________________________

    Date:_________________________________ 

     

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    SCHEDULE  A

    

    
      	
              (a)

            	
              2008
      Performance Shares Agreement dated March 3, 2008, between Employee and the
      Company, the amount of shares calculated as if the Restructuring
      Transaction were a “change in control” as defined in such grant
      agreement.

            

    

     

    
      	
              (b)

            	
              2008
      Restricted Stock Grant Agreement dated March 3, 2008, between Employee and
      the Company.

            

    

     

    
      	
              (c)

            	
              2008
      Performance Shares Agreement dated October 1, 2008, between Employee and
      the Company, the amount of shares calculated as if the Restructuring
      Transaction were a “change in control” as defined in such grant
      agreement.

            

    

     

    
      	
              (d)

            	
              2008
      Restricted Stock Grant Agreement dated October 1, 2008, between Employee
      and the Company.

            

    

     

    
      	
              (e)

            	
              2009
      Performance Share Grant Agreement dated March 5, 2009, between the
      Company and Employee, applicable only as to the Initial Grant of
      shares.

            

    

     

    
      	
              (f)

            	
              2009
      Deferred Stock Unit Grant Agreement dated March 5, 2009, between the
      Company and Employee.

            

    

     

    
      	
              (g)

            	
              2009
      Stock Option Grant Agreement dated March 5, 2009, between the Company
      and Employee.

            

    

     

    

    Effective
as of the date of this Agreement, any of the foregoing awards that are subject
to Section 409A of the Code are hereby modified to provide that no “Change in
Control” (as defined in the applicable award) shall occur unless it is a change
in control within the meaning of Section 409A of the Code.

     

    

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    SCHEDULE
B

    

    Excise Tax Modified Cutback
Provisions

    

    Anything
in this Agreement to the contrary notwithstanding, in the event the Firm (as
defined below) shall determine that Employee shall become entitled to payments
and/or benefits provided by this Agreement which would be subject to
the  excise tax imposed by Section 4999 of the Code (the “Payments”), the Firm
shall determine whether to reduce any of the Payments to the Reduced Amount (as
defined below).  The Payments shall be reduced to the Reduced Amount
only if the Firm determines that Employee would have a greater Net After-Tax
Receipt (as defined below) of aggregate Payments if the Employee’s Payments were
reduced to the Reduced Amount.  If such a determination is not made by
the Firm, Employee shall receive all Payments to which Employee is entitled
under this Agreement.

     

    If the
Firm determines that aggregate Payments should be reduced to the Reduced Amount,
the Company shall promptly give Employee notice to that effect and a copy of the
detailed calculation thereof.  All determinations made by the Firm
under this Schedule B shall be binding upon the Company and Employee absent
manifest error and shall be made as soon as reasonably practicable and in no
event later than 15 business days of the receipt of notice from the Company that
there has been a Payment, or such earlier time as is requested by the
Company.  For purposes of reducing the Payments to the Reduced Amount,
only amounts payable under this Agreement (and no other Payments) shall be
reduced.  The reduction of the amounts payable hereunder, if
applicable, shall be made by reducing, in order, cash payments otherwise due
under clauses (c), (d), (e) and (h) of Section I of this Agreement, and then by
reducing equity-based compensation otherwise due under clause (f) of Section I
of this Agreement in chronological order with the most recent equity-based
compensation awards reduced first.

     

    As a
result of the uncertainty in the application of Section 4999 of the Code at the
time of the initial determination by the Firm hereunder, it is possible that
amounts will have been paid or distributed by the Company to or for the benefit
of Employee pursuant to this Agreement which should not have been so paid or
distributed (“Overpayment”) or that
additional amounts which will have not been paid or distributed by the Company
to or for the benefit of Employee pursuant to this Agreement could have been so
paid or distributed (“Underpayment”), in
each case, consistent with the calculation of the Reduced Amount
hereunder.  In the event that the Firm, based upon the assertion of a
deficiency by the Internal Revenue Service against either the Company or
Employee which the Firm believes has a high probability of success determines
that an Overpayment has been made, Employee shall pay any such Overpayment to
the Company together with interest at the applicable federal rate provided for
in Section 7872(f)(2) of the Code; provided, however,
that no amount shall be payable by Employee to the Company if and to the extent
such payment would not either reduce the amount on which Employee is subject to
tax under Section 1 and Section 4999 of the Code or generate a refund of
such taxes.  In the event that the Firm, based upon controlling
precedent or substantial authority, determines that an Underpayment has
occurred, any such Underpayment shall be paid promptly (and in no event later
than 60 days following the date on which the Underpayment is determined) by the
Company to or for the benefit of Employee together with interest at the
applicable federal rate provided for in Section 7872(f)(2) of the
Code.

     

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    For
purposes hereof, the following terms have the meanings set forth
below:

     

    “Firm” shall mean an
internationally recognized accounting or employee benefits consulting firm
selected by the Company with the input of Employee (but without Employee’s
consent) and which shall not, during the one year preceding the date of its
selection, have acted in any way on behalf of the Company or its affiliated
companies.

     

    “Net After-Tax
Receipt” shall mean the present value (as determined in accordance with
Sections 280G(b)(2)(A)(ii) and 280G(d)(4) of the Code) of a Payment net of all
taxes imposed on Employee with respect thereto under Sections 1 and 4999 of the
Code and under applicable state and local laws, determined by applying the
highest marginal rate under Section 1 of the Code and under state and local laws
which applied to the Employee’s taxable income for the immediately preceding
taxable year, or such other rate(s) as Employee certifies, in Employee’s sole
discretion, as likely to apply to him in the relevant tax year(s).

     

    “Reduced Amount” shall
mean the greatest amount of Payments that can be paid that would not result in
the imposition of the excise tax under Section 4999 of the Code if the Firm
determines to reduce Payments pursuant to paragraph (a) of this Attachment
A.

     

    

     

    19

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