Document:

Unassociated Document

    

      Exhibit
10.1

      Portions
of this exhibit marked [*]

      are
requested to be treated confidentially.

      

      Execution
Copy 3 of 3

      

      EXCLUSIVE
LICENSE AGREEMENT

      

      between

      

      S.L.A.
Pharma AG,

      Rebgasse
2, Postfach, CH-4410 Liestal, Switzerland

      

      hereinafter
"the
Licensor"

      

      and

      

      Paramount
BioSciences, L.L.C.,

      787
Seventh Avenue, 48th Floor, New York, NY 10019, United States of
America

      

      hereinafter
"the
Licensee"

      

      relating
to

      

      Anoheal
and Incostop

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

      

      
        
          	
                  1.

                	
                  Preamble

                	
                  3

                
	
                  2.

                	
                  Definitions

                	
                  3

                
	
                  3.

                	
                  License
      Grant

                	
                  9

                
	
                  4.

                	
                  Sublicensing

                	
                  10

                
	
                  5.

                	
                  Transfer
      of Know-How, Materials, and Contracts

                	
                  10

                
	
                  6.

                	
                  Best
      Efforts

                	
                  12

                
	
                  7.

                	
                  Royalties

                	
                  12

                
	
                  8.

                	
                  Milestone
      Payments and Other Payments

                	
                  16

                
	
                  9.

                	
                  Payment
      and Taxes

                	
                  21

                
	
                  10.

                	
                  Records
      and Reports

                	
                  22

                
	
                  11.

                	
                  Licensee
      Equity Interest

                	
                  24

                
	
                  12.

                	
                  Further
      Development

                	
                  25

                
	
                  13.

                	
                  Marketing

                	
                  30

                
	
                  14.

                	
                  Costs,
      Validity, and Prosecution of Patents

                	
                  32

                
	
                  15.

                	
                  Trademarks
      and Improvements

                	
                  34

                
	
                  16.

                	
                  Infringement,
      Validity Challenges and Litigation

                	
                  34

                
	
                  17.

                	
                  Third
      Party Rights

                	
                  38

                
	
                  18.

                	
                  Representations
      and Warranties

                	
                  39

                
	
                  19.

                	
                  Limitation
      of Liability

                	
                  45

                
	
                  20.

                	
                  Indemnification

                	
                  46

                
	
                  21.

                	
                  Product
      Liability

                	
                  47

                
	
                  22.

                	
                  Force
      Majeure

                	
                  48

                
	
                  23.

                	
                  Termination

                	
                  48

                
	
                  24.

                	
                  Confidentiality

                	
                  51

                
	
                  25.

                	
                  Paramount
      Guarantee

                	
                  53

                
	
                  26.

                	
                  Miscellaneous

                	
                  54

                
	
                  27.

                	
                  Governing
      Law and Dispute Resolution

                	
                  56

                

        

      

      

      List
of Exhibits:

      

      
        
          	
                  Exhibit
      1

                	 
      	
                  Licensee
      Clinical Development Plan

                
	
                  Exhibit
      2

                	 
      	
                  Patents

                
	
                  Exhibit
      3

                	 
      	
                  Material

                
	
                  Exhibit
      4

                	 
      	
                  Trademarks

                
	
                  Exhibit
      5

                	 
      	
                  Licensor
      IND(s)

                
	
                  Exhibit
      6

                	 
      	
                  Disclosed
      Agreements and Opposition

                
	 
      	 
      	
                  Termination
      Agreement between SLA Pharma AG and Solvay

                
	 
      	 
      	
                  Pharmaceuticals,
      Inc.

                
	 
      	 
      	
                  Assignment
      Agreement between Dr. M A Kamm Mr. R S Phillips and Slaco Pharma
      AG

                
	
                  Exhibit
      7

                	 
      	
                  Form
      of Stock Purchase Agreement

                
	
                  Exhibit
      8

                	 
      	
                  Material
      Agreements

                
	
                  Exhibit
      9

                	 
      	
                  Withholding
      Tax - Exemption
Certificate

                

        

      

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

      

      1.           Preamble

      The
Licensor owns certain intellectual property rights, including but not limited
to, patent rights, patent applications, trademarks, know-how and regulatory
filings relating to Anoheal and Incostop. The Licensor is in search of a partner
for the manufacture, development and distribution of Anoheal and Incostop in
North America.

      

      The
Licensee has evaluated Anoheal and Incostop under the term sheet between the
parties dated December 8, 2006, and as a result the Licensee would like to
manufacture, develop and exclusively distribute the Licensed Products as defined
hereafter in North America.

      

      Therefore,
both-parties are willing to enter into a license agreement with the following
terms and conditions:

      

      2.           Definitions

      
        	
                 
      

              	
                2.1.

              	
                "Affiliate" shall mean
      with respect to either party (i) an entity which owns or controls,
      directly or indirectly, a controlling interest in such party, by stock
      ownership or otherwise; or (ii) an entity which is wholly-owned by such
      party, either directly or indirectly, by stock ownership or
      otherwise.

              

      

      

      
        	
                 
      

              	
                2.2.

              	
                "Anoheal" means a
      topical formulation of diltiazem or any analogs, prodrugs, metabolites,
      salt forms, stereoisomers, racemates and/or derivatives
      thereof.

              

      

      
         

      

      
        	
                 
      

              	
                2.3.

              	
                "Anoheal API" means
      diltiazem or any analogs, prodrugs, metabolites, salt forms,
      sterioisomers, racemates and/or derivatives
  thereof.

              

      

      

      
        	
                 
      

              	
                2.4.

              	
                "Anoheal Net Sales" shall
      mean Net Sales of Licensed Products incorporating Anoheal API as an
      API.

              

      

      

      
        	 	
                2.5. 

              	
                "API" means active
      pharmaceutical ingredient.

              

      

      
        
           

        

        
          3

          
            

          

        

        
           

        

      

      

      
        	
                 
      

              	
                2.6.

              	
                "Effective Date" shall
      mean the date both Licensee and Licensor have signed this
      Agreement.

              

      

      

      
        	
                 
      

              	
                2.7.

              	
                "FDA" shall mean the
      U.S. Federal Food and Drug Administration and any successor agency
      thereof.

              

      

      

      
        	
                 
      

              	
                2.8.

              	
                "Incostop" means a
      topical formulation of phenylephrine or any analogs, prodrugs,
      metabolites, salt forms, stereoisomers, racemates and/or derivatives
      thereof.

              

      

      

      
        	
                 
      

              	
                2.9.

              	
                "Incostop API" means
      phenylephrine or any analogs, prodrugs, metabolites, salt forms,
      stereoisomers, racemates and/or derivatives
  thereof.

              

      

      

      
        
          	 	
                  2.10.

                	
                  "Incostop Net Sales"
      shall mean Net Sales of Licensed Products Incorporating Incostop API as an
      API.

                

        

      

      

      
        	 	
                2.11. 

              	
                "IND" shall mean
      Investigational New Drug Application to the
FDA.

              

      

      

      
        
          	
                	
                  2.12.

                	
                  "Confidential
      Information" shall mean any and all information, data or know-how,
      whether technical or non-technical, oral or written, related to the
      Licensed Products, the Technology or research and development or business
      of a party that is disclosed by one party or its Affiliates ("Disclosing
      Party") to the other party or its Affiliates ("Receiving Party"), and
      which is designated confidential or would otherwise reasonably be
      considered as confidential or proprietary to the Disclosing Party,
      consistent with industry practices and
  standards.

                

        

      

      

      
        	 	
                2.13. 

              	
                "Licensee" shall mean
      Paramount BioSciences, LLC.

              

      

      

      
        	 	
                2.14.

              	
                "Licensee Clinical Development
      Plan" means the plan for the conduct of clinical development of
      Licensed Products by or on behalf of Licensee as defined in Exhibit
      1.

              

      

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

      

      
        	 	
                2.15. 

              	
                "Licensor" shall mean
      S.L.A. Pharma AG.

              

      

      

      
        	
              	
                2.16.

              	
                "Licensor Clinical Development
      Plan" means the plan for the conduct of clinical studies of
      Licensed Products by or on behalf of Licensor for purposes of seeking
      Marketing Authorization in the European Community, as amended from time to
      time.

              

      

      

      
        	 	
                2.17. 

              	
                "NDA" shall have the
      meaning described in Clause
8.1.1.(c).

              

      

      

      
        	
              	
                2.18.

              	
                "Patents" shall (1) mean
      the patents and patent applications listed in Exhibit 2 (2) any United
      States, foreign or international patents and/or patent applications owned,
      licensed, or otherwise controlled by Licensor, prior to or during the term
      of this Agreement, with respect to the Territory that claim (i) Anoheal or
      Incostop (ii) the manufacture or use of either of any of the foregoing, or
      (iii) any Improvements (provided such improvements are used solely in the
      development and/or commercialization of Anoheal, Incostop, or other
      Licensed Products), (3) all continuations, continuations in part,
      divisionals, provisionals, continued prosecution applications, renewals,
      request for continued examinations, reissues, reexaminations, extensions,
      supplementary protection certificates, registrations, confirmations, and
      improvements of any of the foregoing with respect to the Territory, (4)
      any United States, foreign, or international patents issuing from any of
      the foregoing in the Territory, and (5) any foreign counterpart of any of
      the foregoing in the Territory.

              

      

      

      
        	
              	
                2.19.

              	
                "Know-How" shall mean
      all Material and all other technical and medical information and data,
      inventions, discoveries and other technology, whether or not patentable,
      made or developed by or on behalf of the Licensor, or owned, controlled,
      or licensed by Licensor, which relate to Licensed Products, Technology,
      Improvements, or the development, manufacture, use, or sale of any of the
      same in or for the Territory, and including, but not limited to, all data,
      information, and results of (i) Licensor's research and development
      (including but not limited to clinical studies) of Licensed Products prior
      to and following the Effective Date and (ii) Licensor's performance of the
      work described in the Licensor Clinical Development
  Plan.

              

      

      
        
           

        

        
          5

          
            

          

        

        
           

        

      

      

      
        	 	
                2.20. 

              	
                "Material" shall mean
      the documents and data listed in Exhibit
3.

              

      

      

      
        	
              	
                2.21.

              	
                "Licensed Products"
      shall mean any product containing Anoheal or Incostop, the manufacture,
      use or sale of which is covered by a Valid Claim of the Patents or which
      is manufactured, used or sold by applying the Know How or the Technology
      or any Mexican Product.

              

      

      

      
        	
              	
                2.22.

              	
                "Mexican Product" shall
      mean any product sold by Licensee or its Affiliates, or by their
      sublicensees pursuant to a license granted by Licensee or an Affiliate
      thereof, in Mexico that would, if such product had been sold in the United
      States on the date of such product's sale in Mexico, be a Licensed
      Product.

              

      

      

      
        	
              	
                2.23.

              	
                "Registration Authority"
      shall mean the FDA and any equivalent competent regulatory authority in
      the other countries of the Territory competent to grant Marketing
      Authorization.

              

      

      

      
        	
              	
                2.24.

              	
                "Marketing
      Authorization" shall mean such governmental approval (including
      pricing approval, where required) for the marketing of a Licensed Product
      in a country for human therapeutic, prophylactic, or diagnostic use as is
      necessary to enable Licensee, directly or through its respective
      Affiliates, sub-licensees or marketing partners to commercially sell and
      distribute the Licensed Product in such country for human therapeutic,
      prophylactic, or diagnostic use, including but not limited to, in the
      United States, final FDA approval of an
NDA.

              

      

      

      
        	 	
                2.25. 

              	
                "Net Sales" shall have
      them meaning described in Clause
7.2.

              

      

      
        
           

        

        
          6

          
            

          

        

        
           

        

      

       

      
        	 	
                2.26. 

              	
                "Trademarks" shall mean
      the Trademarks listed in Exhibit 4.

              

      

      

      
        	
              	
                2.27.

              	
                "Technology" shall mean
      all proprietary information, procedures, methods, prototypes, designs and
      technical data owned, controlled, or licensed by Licensor, other than
      Know-How, that are necessary or useful in the development or for obtaining
      the Marketing Authorization of Licensed Products, or which relate to the
      Licensed Products in the Territory.

              

      

      

      
        	 	
                2.28.

              	
                "Territory" shall mean
      the United States of America, Canada and Mexico, including their
      territories and protectorates.

              

      

      

      
        	 	
                2.29.

              	
                "Third Party" shall mean
      an entity other than a party to this Agreement and its respective
      Affiliates.

              

      

      

      
        	
              	
                2.30.

              	
                "Valid Claim" shall mean
      a claim of an issued and unexpired patent or pending patent application
      which has not been withdrawn, abandoned, revoked or held unenforceable,
      unpatentable, or invalid by a decision of a court or other governmental
      agency of competent jurisdiction, unappealable or unappealed within the
      time allowed for appeal, and which has not been admitted to be invalid or
      unenforceable through reissue, disclaimer or
  otherwise.

              

      

      

      
        	
              	
                2.31.

              	
                "Phase III Study" means
      a pivotal human clinical trial of a Licensed Product, which trial is
      designed to: (a) establish that a Licensed Product is safe and efficacious
      for its intended use; (b) define warnings, precautions and adverse
      reactions that are associated with the Licensed Product in the dosage
      range to be prescribed; (c) support Marketing Authorization of such
      Licensed Product; and (d) be generally consistent with the criteria of 21
      CFR § 312.21(c) or its foreign
equivalent.

              

      

       

      
        
           

        

        
          7

          
            

          

        

        
           

        

      

      
        	
              	
                2.32.

              	
                "Improvement" means any
      modification, enhancement, or improvement of a Licensed Product, or any
      inventions, discoveries, improvements (whether patentable or not),
      information, and data, owned or controlled by Licensor any time during the
      term of this Agreement, which would be useful or necessary in the
      manufacture, use, or sale of any Licensed Product in or for the Territory,
      or the practice of which would infringe an issued or pending claim within
      the Patents.

              

      

      

      
        	 	
                2.33 

              	
                "Field" means the
      treatment, prevention, or diagnosis of any disease or
      condition.

              

      

      

      
        	
                 
      

              	
                2.34

              	
                "Alternative
      Formulation" means any pharmaceutical formulation of Incostop other
      than the pharmaceutical formulation of Incostop derived by or on behalf of
      SLA as of the Effective Date. The Alternative Formulation shall include
      the pharmaceutical formulation of Incostop derived by or on behalf of
      Solvay Pharmaceuticals as of the Effective
Date.

              

      

      

      
        	
              	
                2.35.

              	
                "Orphan Indication"
      means an indication which, for a particular Licensed Product, would
      qualify such Licensed Product for designation by FDA as an orphan drug
      (i.e. drug for the treatment of a rare disease or condition) in accordance
      with the provisions of 21 C.F.R. §
316.20.

              

      

      

      
        	
              	
                2.36.

              	
                "Licensee Improvement"
      means any modification, enhancement, or improvement of a Licensed Product,
      or any inventions, discoveries, improvements (whether patentable or not),
      information, and data, owned or controlled by Licensee any time during the
      term of this Agreement, which would be useful or necessary in the
      manufacture, use, or sale of any Licensed Product, or the practice of
      which would, if practiced in the Territory, infringe an issued or pending
      claim within the Patents.

              

      

      

      
        	
              	
                2.37.

              	
                "Royalty Term" means, on
      a country-by-country and Licensed Product-byLicensed Product basis, the
      period commencing on the Effective Date and ending on the date of the last
      to expire Valid Claim contained in the Patent covering a Licensed Product
      in such country.

              

      

      
        
           

        

        
          8

          
            

          

        

        
           

        

      

      

      3.           License
Grant

      

      
        	
                 
      

              	
                3.1.

              	
                Subject
      to the terms of this Agreement, Licensor hereby grants to Licensee an
      exclusive, royalty bearing license, under the Patents, Know-How,
      Technology, and Trademarks, in the Field to sell, have sold, develop,
      make, have made, use, have used, import, and have imported Licensed
      Products in the Territory, and which license shall include but not be
      limited to a right of reference to all filings with and submissions to
      regulatory or governmental authorities (including Market Authorizations
      and INDs) and all data and information contained therein, without
      limitation, made by or on behalf of Licensor, or which is under Licensor's
      ownership or control. Additionally, Licensor hereby grants to Licensee a
      non-exclusive, royalty bearing license, under the Patents, Know-How,
      Technology, and Trademarks, in the Field to develop, make, have made, use,
      have used, import, and have imported (but not sell or have sold) Licensed
      Products outside of the Territory.

              

      

      

      
        	
                 
      

              	
                3.2.

              	
                Notwithstanding
      the foregoing, Licensee hereby agrees that Licensor shall have the
      transferable right to develop, make, have made, use, have used, and import
      (but not sell or have sold) Licensed Products in the Field in the
      Territory solely for the purpose of developing and commercializing Anoheal
      or Incostop outside of the Territory, with the right to
      sublicense.

              

      

      

      
        	
                 
      

              	
                3.3.

              	
                The
      Licensor undertakes not to give any other license for the Licensed
      Products, Know-How, Trademarks, and the Technology to a Third Party in the
      Territory during the term of this
Agreement.

              

      

      

      
        	
                 
      

              	
                3.4.

              	
                Licensee
      undertakes not to sell Licensed Products in the Field outside the
      Territory.

              

      

       

      
        
           

        

        
          9

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                3.5.

              	
                Licensee
      hereby grants Licensor a license under and right of reference to all data,
      information, and results of Licensee's development of Licensed Products,
      and all regulatory submissions and or filings made by Licensee with
      respect to Licensed Products in the Territory (including INDs and Market
      Authorizations), for the sole purpose of seeking and obtaining Marketing
      Authorization for Licensed Products outside the
  Territory.

              

      

      

      4.           Sublicensing

      

      Licensee
shall have the right to grant non-exclusive and exclusive sublicenses hereunder,
provided that:

      

      
        	
                 
      

              	
                4.1.

              	
                Licensee
      shall furnish within thirty (30) days of the execution thereof, a true and
      complete copy of each sublicense and any changes or additions
      thereto;

              

      

      

      
        	
                 
      

              	
                4.2.

              	
                Licensee
      shall pay royalties on Net Sales made by sublicensees pursuant to Section
      7; and

              

      

      

      
        	
                 
      

              	
                4.3.

              	
                Each
      sublicense granted by Licensee shall include provisions which are in all
      material respects similar of those of Clauses: 4.1, 4.2, 4.3, 6.1, 10,
      13.3, 13.4, 13.6, 15.2, 16.1.1, 17.1, 21.2 and
  24.

              

      

      

      5.           Transfer
of Know-How, Materials, and Contracts

      

      
        	
                 
      

              	
                5.1.

              	
                The
      Material and all other Know-How and Technology have been transmitted to
      the Licensee before execution of this Agreement for Licensee's use
      pursuant to the terms of this Agreement. Licensee acknowledges that it has
      checked the Material and has determined that the documents contained
      therein include information which the Licensee believes will be useful for
      the development and commercialization of the Licensed
      Products.

              

      

      
        
           

        

        
          10

          
            

          

        

        
           

        

      

      

      
        	
                 
      

              	
                5.2.

              	
                Upon
      execution of this Agreement and continuing thereafter, Licensor shall
      provide at no additional cost, the right to reference (for the purpose of
      completing regulatory filings) and a copy of the Materials and of any and
      all pre-clinical data, human safety or efficacy data, INDs, if any, (which
      shall include, but not be limited to the INDs, whether now existing or
      previously submitted, described in Exhibit 5, and of any filings, updates,
      material correspondence, or material communications to or from any
      applicable Registration Authority with respect thereto, including but not
      limited to any IND(s) (collectively, the "Licensor IND(s)"), drug master
      files, and other regulatory data, submissions, filings, and correspondence
      that is in its possession or that shall otherwise be generated and/or come
      into its possession following the execution of this Agreement related to
      the development, manufacture, use or sale of any Licensed Products in the
      Territory. Licensor shall, at Licensor's cost, take any and all actions
      requested by the Licensee to effect the purposes of the foregoing as
      promptly as practicable following the execution of this Agreement, which
      shall include but not be limited to (i) preparing and filing whatever
      filings, requests or applications are required or deemed advisable to be
      filed with any Registration Authority, if any, in connection with the
      assignment of the Licensor IND(s) and other materials, information, and
      data and (ii) taking all reasonable actions necessary to enable the
      Licensee to undertake the manufacture, development and commercialization
      of Licensed Products under this Agreement. It is however understood that
      it is Licensee's responsibility to file for the Marketing Authorization in
      the Territory.

              

      

      

      
        	
                 
      

              	
                5.3.

              	
                During
      the time that Licensor is the holder of any Licensor IND(s) or other
      materials, data, and/or information referred to above, Licensor shall (i)
      promptly provide Licensee an advance draft of any proposed responses to
      such written notices or inspections and the resolution of any issue raised
      by such Registration Authority and (ii) make such reasonable changes to
      such proposed response as may be recommended by Licensee, and the Licensee
      shall be entitled to attend any and all meetings and participate in
      telephone calls with the Registration Authorities, including without
      limitation any meeting preparation, meeting co-ordination and preparation
      of minutes.

              

      

      
        
           

        

        
          11

          
            

          

        

        
           

        

      

       

      
        	
                 
      

              	
                5.4.

              	
                Licensor
      is not a party to any material agreements relating to Licensed Products,
      Know-how or the Technology in the Territory, other than those set forth in
      Exhibit 6(A).

              

      

      

      6.           Best
Efforts

      

      
        	
                 
      

              	
                6.1.

              	
                Licensee
      shall use all reasonable commercial efforts at its own cost to bring the
      Licensed Products to market in the Territory through a diligent program
      for the exploitation of the Patents, Technology, and Know-How in the
      Field. Such program shall include the preclinical and clinical development
      of Licensed Products, including research and development, manufacturing,
      laboratory and clinical testing, registering and marketing of Licensed
      Products. Following Marketing Authorization of a Licensed Product in a
      particular country, Licensee shall use commercially reasonable efforts to
      continue active, diligent marketing efforts for the Licensed Product in
      such country throughout the term of the Agreement. Notwithstanding the
      foregoing, termination by the Licensee of clinical development or
      commercialization of either Incostop or Anoheal will not be a breach of
      this Clause 6.1 or any other Clause in this Agreement provided however,
      termination by the Licensee of clinical development or commercialization
      of both Incostop and Anoheal, subject to Clause 23.2, will be a material
      breach of this Clause 6.1 and the Licensor will be able to pursue it
      rights according to Clause 23.

              

      

      

      7.           Royalties

      

      
        	
                 
      

              	
                7.1.

              	
                During
      the Royalty Term (subject to Clause 7.5), in any country where Licensed
      Products are sold by the Licensee or its sublicensees, Licensee shall pay
      to Licensor the following royalties, as they may be further adjusted
      pursuant to this Clause 7 or Clause
16.1.5:

              

      

      
        
           

        

        
          12

          
            

          

        

        
           

        

      

      

      
        	
                 
      

              	
                (a)

              	
                [*]
      Percent ([*]%) of the first [*] Dollars ($[*]) of Anoheal Net Sales (as
      defined below) in any calendar year;
and

              

      

      

      
        	
                 
      

              	
                (b)

              	
                [*]
      Percent ([*]%) of Anoheal Net Sales in excess of [*] Dollars ($[*]) in any
      calendar year.

              

      

      

      
        	
                 
      

              	
                (c)

              	
                [*]
      Percent ([*]%) of the first [*] Dollars ($[*]) of Incostop Net Sales in
      any calendar year; and

              

      

      

      
        	
                 
      

              	
                (d)

              	
                [*]
      Percent ([*]%) of Incostop Net Sales for Incostop Net Sales in excess of
      [*] Dollars ($[*]) in any calendar
year.

              

      

      

      Further,
no multiple royalties shall be payable on a Licensed Product because the use,
lease or sale of any Licensed Product is, or shall be, covered by more than one
Valid Claim contained in the Patents.

      

      
        	
                 
      

              	
                7.2.

              	
                For
      purposes of this Agreement, "Net Sales" shall mean the total gross
      receipts for sales of Licensed Products by or on behalf of the Licensee or
      any of its Affiliates or sublicensees, less only the sum of the following:
      (a) usual trade discounts to customers; (b) sales, tariff duties and/or
      use taxes directly imposed and with reference to particular sales; (c)
      outbound transportation prepaid or allowed and transportation insurance;
      (d) amounts allowed or credited on returns; (e) bad debt deductions
      actually written off during the accounting period; (f) wholesaler and
      distribution fees (to the extent not exceeding [*]% of the respective Net
      Sales); and (g) freight charges and other duties. Components of Net Sales
      (and the deductions listed above) shall be determined in the ordinary
      course of business in accordance with internationally recognised
      accounting principles.

              

      

       

      
        

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

      
        
           

        

        
          13

          
            

          

        

        
           

        

      

       

      Notwithstanding
anything herein to the contrary, the transfer of a Licensed Product to an
Affiliate, sublicensee, or other Third Party in connection with the research,
development or testing of a Licensed Product or for purposes of resale shall not
be considered a sale of a Licensed Product under this Agreement. Nor shall the
transfer of Licensed Product solely for indigent or similar public support or
compassionate use programs be considered a sale of Licensed Product under this
Agreement.

      

      
        	
                 
      

              	
                7.3.

              	
                In
      the event that a Licensed Product is sold in the form of a combination
      product containing one or more technologies which, if incorporated into a
      product by themselves, would not render a product a Licensed Product, the
      Net Sales for such combination product shall be calculated by multiplying
      the sales price of such combination product by the fraction A/(A+B) where
      (i) A is the invoice price of a Licensed Product incorporating solely the
      technology which renders such product a Licensed Product, or, if such
      Licensed Product is not sold separately, the fair market value of a
      Licensed Product incorporating solely such technology, and (ii) B is the
      total invoice price of products incorporating solely the other
      technologies or, if such products are not sold separately, the fair market
      value of such products.

              

      

      

      
        	
                 
      

              	
                7.4.

              	
                Should
      a compulsory license be granted by a court of law or regulatory authority
      or other government entity with jurisdiction, or be the subject of a
      possible grant, to a Third Party under the applicable laws of any country
      in the Territory under the rights licensed under this Agreement, the
      Licensee shall notify Licensor, including any material information
      concerning such compulsory license, and the running royalty rate payable
      under Clause 7 for sales of Licensed Products in such country will be
      adjusted to equal any lower royalty rate granted to such Third Party for
      such country with respect to the sales of such Licensed Products therein
      (the "Compulsory Royalty") during such periods such third parties sell or
      offer for sale under the compulsory license articles that compete with the
      Licensed Products then marketed and sold by the Licensee, its Affiliates,
      or sublicensees in that country, provided that such Compulsory Royalty
      shall remain subject to further adjustment consistent with this Clause
      7.

              

      

      
        
           

        

        
          14

          
            

          

        

        
           

        

      

      

      
        	
                 
      

              	
                7.5.

              	
                If
      the Royalty Term covering a particular Licensed Product in any country of
      the Territory has expired, Licensee shall still be obligated to pay
      royalties under this Clause 7 with respect to sales of such Licensed
      Product in such country, provided, however, that the royalty percentage
      rate shall be reduced, on a calendar quarter-by-calendar quarter basis, by
      the same percentage as the average net selling price of the respective
      Licensed Product before expiration is reduced (Example: if the average net
      selling price has to be reduced by 25% from 100 to 75, then the royalty
      rate for Anoheal Net Sales up to USD 100,000,000 shall be reduced from
      [*]% to [*]%). The royalty reduction shall be effective with respect to a
      particular Licensed Product in a particular country beginning with the
      first day of the calendar quarter following the initial price reduction of
      such Licensed Product in such country following the expiration of the
      Royalty Term covering such Licensed Product in such country, and
      additional such reductions shall apply to each and every price reduction
      taking place thereafter (Example: Using the facts from the first example
      above, if the average net selling price is further reduced from 75 to 50,
      then the royalty rate for Anoheal Net Sales up to USD 100,000,000 would be
      reduced to [*]% (50/100 = 50%; 50% x [*]% = [*]%). The Licensor's royalty
      shall not be reduced pursuant to any such price reduction until there are
      no Valid Claims covering such Licensed Product in the relevant country.
      Notwithstanding anything to the contrary, (i) royalties on Net Sales of
      Mexican Products shall be entitled to the royalty reductions described
      above upon the expiration of the Royalty Term in the United States and
      (ii) any royalties adjusted pursuant to this Clause 7.5 shall remain
      subject to further adjustment consistent with this Clause
    7.

              

      

       

      
        
          

        

        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

      
        
           

        

        
          15

          
            

          

        

        
           

        

      

      
        	
                 
      

              	
                7.6.

              	
                Notwithstinding
      anything to the contrary herein, if the Licensee obtains one or more
      licenses under patents or patent applications owned by a Third Party to
      avoid infringement thereof by the manufacture, use, or sale of any
      Licensed Product, to reasonably avoid infringement-related litigation
      regarding a Licensed Product, then the Licensee, with the prior written
      approval of the Licensor, may deduct a fair and reasonable share, up to an
      amount of [*] percent ([*]%) of any fees, milestones or royalties paid
      under such license(s) (even if paid in settlement or judgment of any claim
      for infringement) from the payments otherwise due Licensor under this
      Agreement; provided, however, that, notwithstanding the foregoing, the
      total amount due Licensor under this Agreement in any particular calendar
      quarter shall not be reduced by more than [*] percent ([*]%) as a result
      of any such deduction, and any amounts not deducted in a calendar quarter
      shall be carried forward for deduction in the subsequent calendar
      quarter(s), subject to such [*] percent ([*]%) limitation in each
      case.

              

      

      

      
        	
                 
      

              	
                7.7.

              	
                Royalties
      shall be paid not later than 60 days after the end of each Accounting
      Period to the account of Licensor indicated in Clause 9.1
      hereafter.

              

      

      

      8.           Milestone
Payments and Other Payments

      

      8.1.         Milestone
Payments

      

      
        
          	 	
                  8.1.1.

                	
                  During
      the Royalty Term, Licensee shall make the following one-time milestone
      payments to Licensor:

                

        

      

      

      
        	
                 
      

              	
                a)

              	
                $0.25
      million ($250,000) upon execution of the License Agreement by both
      parties, to be payable in two installments of (i) $0.125 million
      ($125,000) within 30 days of the Effective Date; and (ii) $0.125 million
      ($125,000) within 6 months of the Effective
  Date;

              

      

      

      
        
          	
                	
                  b) 

                	
                   $0.125
      million ($125,000) upon Institutional Review Board ("IRB") approval to
      initiate a Phase III Study of a Licensed Product  incorporating
      Anoheal API as an API under a Licensee sponsored (or sublicensee
      sponsored) Investigational New Drug Application (an "IND") approved by the
      U.S. Food and Drug Administration
("FDA");

                

        

      

      

      
        
          

        

        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

       

      
        	
                 
      

              	
                c)

              	
                $[*]
      ($[*]) upon [*];

              

      

      

      
        	
                 
      

              	
                d)

              	
                $[*]
      ($[*]) upon [*];

              

      

      

      
        	
                 
      

              	
                e)

              	
                $0.125
      million ($125,000) upon IRB approval to initiate a Phase III Study of a
      Licensed Product incorporating Incostop API as an API for the treatment of
      an Orphan Indication under a Licensee sponsored (or sublicensee sponsored)
      IND approved by the FDA;

              

      

      

      
        	
                 
      

              	
                f)

              	
                $[*]
      ($[*]) upon [*];

              

      

      

      
        	
                 
      

              	
                g)

              	
                $[*]
      ($[*]) upon [*];

              

      

      

      
        	
                 
      

              	
                h)

              	
                $[*]
      ($[*]) upon [*]; and

              

      

      

      
        	
                 
      

              	
                i)

              	
                $[*]
      ($[*]) upon [*].

              

      

      

      
        
          	
                	
                  8.1.2. 

                	
                  Milestone
      payments under 8.1 above must be paid within 30 (thirty) days of such
      events taking place. Notwithstanding anything to the contrary, (i) each
      milestone payment indicated above shall only be paid once under this
      Agreement, notwithstanding the number of indications or Licensed Products
      achieving such milestone, and (ii) the total amount payable under this
      Clause 8.1. shall not exceed US$20,500,000 in any event. For the purposes
      of this Clause 8, a Current Valid Claim means a claim of an issued and
      unexpired patent included in the Patents which has not been withdrawn,
      abandoned, revoked or held unenforceable, unpatentable, or invalid by a
      decision of a court or other governmental agency of competent
      jurisdiction, and which has not been admitted to be invalid or
      unenforceable through reissue, disclaimer or
  otherwise.

                

        

      

      

      
        
 [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      
        
           

        

        
          17

          
            

          

        

        
           

        

      

      
 

      
        	
                 
      

              	
                8.1.3.

              	
                Even
      if Licensee is not obligated to remit milestone payments pursuant to 8.1.1
      Point c) or 8.1.1 Point d) because, at the time of the achievement of the
      applicable milestone, the applicable Licensed Product was not covered by a
      Current Valid Claim, the Licensee shall still have an obligation to remit
      the applicable payment if and when the applicable Licensed Product becomes
      covered by a Current Valid Claim, provided, however, the applicable
      Licensed Product becomes covered by a Current Valid Claim prior to the
      date that is [*] from the date that the FDA approves the first NDA for
      such Licensed Product.

              

      

      

      
        	 	
                8.2. 

              	
                Anoheal
      and Incostop Project Costs

              

      

      

      
        	
                 
      

              	
                8.2.1.

              	
                As
      a compensation for the Licensor's participation in and management of the
      development and commercialization of Anoheal and Incostop as described in
      the Licensee Clinical Development Plan (the "Anoheal Project" and the
      "Incostop Project" respectively) commencing on the Execution Date, the
      Licensee shall make separate payments to Licensor equal to $41,500 per
      month for the Anoheal Project (the "Anoheal Project Payment") and $41,500
      per month for the Incostop Project (the "Incostop Project Payment").
      Payments pursuant to this Clause 8.2.1 shall be due the last day of each
      calendar month for the respective calendar month, with the provision that
      for the month the NDA is accepted or the project is terminated, the full
      payment of $ 41,500 shall be due.

              

      

       

      
        
          
 [*] Confidential treatment requested; certain information omitted and
filed separately with the SEC.

      

      
        
           

        

        
          18

          
            

          

        

        
           

        

      

       

      
        	
                 
      

              	
                8.2.2.

              	
                Licensee's
      obligation to make the Anoheal Project Payment shall terminate upon the
      earlier of (i) the date Licensee informed Licensor in writing of the
      termination of the Anoheal Project and (ii) two years subsequent to the
      Effective Date, provided, however subject
      to Clause 8.2.4, if the Licensee does not file an NDA with a Licensed
      Product incorporating Anoheal API by the date that is [*] subsequent to
      the Effective Date (the "Anoheal Recommencement Date"), the Licensee will
      recommence the Anoheal Project Payments until such time as an NDA relating
      to a Licensed Product incorporating Anoheal API is filed by the Licensee,
      its Affiliate or sublicensee.

              

      

      

      
        	
                 
      

              	
                8.2.3.

              	
                Licensee's
      obligation to make the Incostop Project Payment shall end at the earlier
      of (i) the date Licensee informed Licensor in writing of the termination
      of the Incostop Project; and (ii) two years subsequent to the Effective
      Date, provided, however,
      subject to Clause 8.2.4, if the Licensee does not file an NDA with a
      Licensed Product incorporating Incostop by the date that is [*] subsequent
      to the Option Expiration Date (the "Incostop Recommencement Date"), the
      Licensee will recommence the Incostop Project Payments until such time as
      an NDA relating to a Licensed Product incorporating Incostop is filed by
      the Licensee, its Affiliate or
sublicensee.

              

      

      

      
        
          	
                	
                  8.2.4. 

                	
                  If,
      prior to the Anoheal or Incostop Recommencement Date (as applicable), the
      FDA requires, in writing, that Licensee cease, halt, suspend or delay
      initiation of any clinical trial or redesign any clinical trial or
      otherwise put the Licensee on clinical hold, for any Licensed Product
      relating to the use of Anoheal or Incostop (collectively a "Clinical
      Hold"), then Licensee shall have no obligation to remit Anoheal or
      Incostop Project Payments (as applicable), until such time as the FDA
      authorizes the commencement or continuation of such clinical
      studies.

                

        

      

      

      
        

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

      
        
           

        

        
          19

          
            

          

        

        
           

        

      

      
 

      
        	
                 
      

              	
                8.3.

              	
                Notwithstanding
      anything in this Agreement Licensee may, in its sole discretion at any
      time upon written notice to Licensor, discontinue Licensee's conduct of
      the Anoheal Project. In the event the Licensee discontinues its
      performance of the Anoheal Project during the one-year period after the
      Effective Date, Licensee nonetheless shall be required to pay to Licensor
      those amounts that otherwise would have been paid to Licensor pursuant to
      Clause 8.2.1 for the Anoheal Project for such one (1) year period after
      the Effective Date. In the event that the Licensee discontinues the
      Anoheal Project on or after the first anniversary of the Effective Date,
      then Licensee shall not be required to make any continuing payments to
      Licensor relating to the Anoheal Project pursuant to Clause
      8.2.

              

      

      

      
        
          	
                	
                  8.4. 

                	
                  Notwithstanding
      anything in this Agreement, Licensee may, in its sole discretion at any
      time upon written notice to Licensor, discontinue Licensee's conduct of
      the Incostop Project. In the event the Licensee discontinues its
      performance of the Incostop Project during the one-year period after the
      Effective Date, Licensee nonetheless shall be required to pay to Licensor
      those amounts that otherwise would have been paid to Licensor pursuant to
      Clause 8.2.1 for the Incostop Project for such one (1) year period after
      the Effective Date, unless however,
      Licensee terminates the Incostop project prior to the date that is 90 days
      subsequent to the Effective Date (the "Option Expiration Date"), in which
      case Licensee shall no longer have any obligation to remit payments to the
      Licensor pursuant to Clause 8.2.1. Additionally, in the event that the
      Licensee discontinues the Incostop Project on or after the first
      anniversary of the Effective Date, then Licensee shall not be required to
      make any continuing payments to Licensor relating to the Incostop Project,
      pursuant to Clause 8.2.

                

        

      

      

        

      

      [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      
        
           

        

        
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      9.           Payment
and Taxes

      

      
        	
                 
      

              	
                9.1.

              	
                Mode of
      Payment: All payments made by Licensee to Licensor under this
      Agreement shall be made in the Licensor's currency of choice (or, if
      Licensor fails to notify Licensee of Licensor's currency of choice prior
      to the first payment coming due, United States Dollars) to [*] or such
      other bank and account Licensor may inform Licensee of in writing from
      time to time, free of any bank or other charges. For the determination of
      the applicable exchange rate from any currency to another, such conversion
      shall be made by using the exchange rate prevailing at Citibank, N.A. in
      New York, New York (or its successor). For royalty payments, this rate
      should be the rate prevailing on the last business day of the calendar
      quarter for which the royalties are being paid. For all other payments
      this should be the prevailing rate on the earlier of the date when the
      payment is actually made or the date when the payment becomes due.
      Notwithstanding the foregoing, in each country whether the local currency
      is blocked and cannot be removed from the country under such country's
      applicable law, royalties accrued with respect to that country shall be
      paid to Licensor in such country in local currency by deposit in a local
      bank designated by Licensor, unless the parties otherwise agree in
      writing.

              

      

      

      
        	
                 
      

              	
                9.2.

              	
                Non-refundable:
      Subject to Clause 10.8, all monies paid to Licensor pursuant to this
      Agreement are non-refundable and non-creditable against future
      royalties.

              

      

      

      
        	
                 
      

              	
                9.3.

              	
                Delayed
      Payment: If any payment due under this Agreement is overdue by more
      than thirty days, interest from the due date to the date of actual payment
      will be charged at [*]% above the Bank of England base rate (or its
      successor).

              

      

      
         

        
          	
                	
                  9.4.

                	
                  Withholding
      Taxes: Licensee shall pay all taxes imposed by any governmental
      authority or agency by reason of the transactions contemplated by this
      Agreement provided that Licensee shall not be responsible for the payment
      of any taxes imposed upon the income of Licensor. If any tax or amount in
      respect of tax must be withheld or deducted from any sums payable to
      Licensor ("the Withholding Tax"), then Licensee shall withhold or deduct
      the Withholding Tax amounts from the sums payable and pay such Withholding
      Tax amounts to the relevant tax authorities. The Licensee shall pay to
      Licensor the amounts available after such withholding and deduction is
      made, which shall be in full satisfaction of its payment liability due at
      the time of the payment. Licensee shall use its commercially reasonable
      efforts to obtain any exemptions from taxes, including submittal of
      appropriate documents, available under the relevant laws and Licensor
      agrees that Licensee fulfilled its obligations with respect to the
      relevant exempt taxes by providing Licensor with a valid tax exemption
      certificate (Form W-8BEN).

                

        

      

       

      
        
 [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      
        
           

        

        
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      10.          Records
and Reports

      

      
        	
              	
                10.1.

              	
                Accounting
      Period: An "Accounting Period" shall refer to each of the four three month
      periods commencing on January 1, April 1, July 1 and October 1 of each
      year, respectively. Royalties on Net Sales shall be calculated for each
      Accounting Period not later than 60 days after the end of the respective
      Accounting Period.

              

      

      

      
        	
              	
                10.2.

              	
                The
      amount of Net Sales in foreign currencies shall be converted into
      US-dollars at the exchange rate applicable on the last business day of
      each Accounting Period as calculated by using the applicable exchange rate
      then prevailing at the Bank of England base rate. (or its
      successor).

              

      

      

      
        	
              	
                10.3.

              	
                Licensee
      shall keep records and books of account in respect of all Net Sales made
      and sold by Licensee and its sublicensees. Licensee shall keep the same
      for at least ten (10) years after it pays the Licensor the royalties due
      for such Net Sales and requires sublicensees to do the
    same.

              

      

      

      
        	
              	
                10.4.

              	
                Licensee
      shall report to Licensor in writing quarterly, concurrently with the
      payment due pursuant to Clause 7, the Net Sales by country by the Licensee
      and each sublicensee.

              

      

      
        
           

        

        
          22

          
            

          

        

        
           

        

      

       

      
        	
              	
                10.5.

              	
                No
      more frequently than once per calendar year, Licensor may, at its expense,
      designate a suitably qualified independent accountant, reasonably
      acceptable to Licensee, to review during ordinary business hours, such
      part of Licensee's and its Affiliates' books and accounts as may be
      necessary to determine, in respect of any Accounting Period, the accuracy
      of any report and/or payment made under this Agreement. Said accountant
      shall not disclose to Licensor any information other than that relating to
      the accuracy of the reports and payments hereunder. Licensee shall be
      provided within 60 days a written statement from the Licensor confirming
      the outcome of the accountant's
visit.

              

      

      

      
        	
              	
                10.6.

              	
                If
      such independent accountant's report shows any underpayment of royalties
      by Licensee, within thirty (30) days after Licensee's receipt of such
      report, Licensee shall deliver to Licensor a written response addressing
      each item in dispute. As soon as practicable, but not later than 30
      business days following the receipt of Licensee's response by Licensor,
      the parties shall meet and endeavor to resolve any disputed
      item.

              

      

      

      
        	 	
                10.7. 

              	
                In
      the event of any underpayment, Licensee shall remit to
      Licensor:

              

      

      

      
      

      (a)           the
amount of such underpayment; and

      (b)           if
such underpayment with respect to a particular calendar year exceeds [*] percent
([*]%) of the total royalties owed for the calendar year then being reviewed,
the reasonable, documented fees and expenses of such independent accountant
performing the review. Otherwise, Licensor's accountant's fees and expenses
shall be borne solely by Licensor.

      

      
        
          	 	
                  10.8. 

                	
                  Any
      overpayment of royalties shall be fully creditable against future amounts
      payable under this Agreement in any subsequent calendar
      quarter.

                

        

      

      

      
        

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

      
        
           

        

        
          23

          
            

          

        

        
           

        

      

       

      
        	
              	
                10.9.

              	
                Subject
      to the procedure described hereafter Licensor herewith authorizes Licensee
      to make certain payments as defined hereafter to Solvay Pharmaceuticals
      Inc. ("Solvay"), that would be otherwise due from Licensee to Licensor,
      under this Agreement, upon written request of Solvay and presentation of a
      final and binding judgment of a competent court condemning Licensor to pay
      Termination Fees under the Termination Agreement listed in Exhibit 6 ("the
      Judgment"). In the event of a payment request by Solvay, Licensee shall
      immediately inform Licensor thereof in writing by registered mall. If
      Licensor does not provide proof of payment to Solvay to Licensee within 10
      days after Licensor received Licensee's notice, Licensee shall be entitled
      to remit any monies owed to Solvay under the Termination Agreement and
      such amount shall be deducted from any payment due from Licensee to
      Licensor under this Agreement. Licensee shall have absolutely no liability
      to Licensor for payments made to Solvay and deducted from any amount owed
      to Licensor under this Agreement.

              

      

      

      11.          Licensee
Equity Interest

      

      
        
          	
                	
                  11.1. 

                	
                  Sometime
      after the Effective Date, Licensee shall form a Delaware Company for the
      initial purpose of developing and commercializing the Technologies
      ("NewCo") and will issue to Licensor, for a nominal consideration not to
      exceed $.01 per share, that number of shares of the NewCo's common stock
      (the "Common Stock") equal to five percent (5%) of the Licensee's
      outstanding Common Stock as of the Effective Date (the "Issued Shares"),
      which Common Stock shall be the same series as and shall carry the same
      rights and privileges as the common stock issued to the Licensee.
      Paramount shall then assign this Agreement to NewCo and Licensor hereby
      consents to such assignment, such consent subject to Clause
      11.2.

                

        

      

      

      

        
          
             

          

          
            24

            
              

            

          

          
             

          

        

      

       

      
        	
              	
                11.2.

              	
                As
      a condition to consenting to the assignment by Licensee of this Agreement
      to NewCo as provided for in Clause 11.1 above, NewCo shall agree, in
      writing and hereby undertakes that as of the tirne of the closing of
      NewCo's first equity financing including Third Party investors yielding
      total gross proceeds of not less than Five Million Dollars ($5,000,000),
      (such financing, the "Financing"), the Issued Shares do not have a fair
      market value at least equal to $500,000 (calculated by multiplying the
      number of Issued Shares by the price per share paid by Third Party
      investors in the Financing), then NewCo shall issue to Licensor that
      number of additional shares of Common Stock (the "Subsequently Issued
      Shares") so that the number of shares of Common Stock held by Licensor
      following such issuance (including the Issued Shares and Subsequently
      Issued Shares) have a fair market value equal to $500,000 (based on price
      per share paid by such Third Party investors in the Financing). For
      purposes of clarification but not limitation, the Financing may include
      Paramount as an investor, and amounts invested by Paramount in such
      Financing shall be included in the determination of gross proceeds
      described above, provided that Third Parties other than Paramount invest
      at least $500,000 in such
financing.

              

      

      

      
        	
              	
                11.3.

              	
                It
      is understood and agreed that, notwithstanding anything to the contrary in
      this Agreement, the Issued Shares and Subsequently Issued Shares (if
      applicable and collectively the "Shares") will be non-refundable. The
      Shares will not be registered under the Securities Act of 1933, as
      amended, and may not be transferred unless and until registered or NewCo
      has received an opinion of counsel or other evidence satisfactory to Newco
      and its counsel that such registration is not required. The Shares will be
      (i) issued pursuant to a subscription agreement, in the form attached
      hereto as Exhibit 7, which the parties shall execute simultaneously with
      the formation of NewCo.

              

      

      

      12.          Further
Development

      

      
        	
              	
                12.1.

              	
                Development
      Cost for the European Union

                 

                Licensor
      shall perform the work described in the Licensor Clinical Development
      Plan, on the schedule described therein in accordance with all applicable
      laws, rules, regulations, and International Conference on Harmonisation
      ("ICH") guidelines, including but not limited to Good Clinical Practices
      ("GCP") and Good Laboratory Practices ("GLP") guidelines, as reasonably
      appropriate. Material changes to the Licensor Clinical Development Plan
      may only be made upon the approval of the Committee (defined
      below).

              

      

       

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

    

     

     

    
      	
            	
              12.2.

            	
              Consideration
      to Licensor for EU Clinical
Development

            

    

    

    Subject
to Clause 12.3, in consideration for the work described In Clause 12.1, Licensee
shall reimburse Licensor for reasonable, documented, direct costs and expenses
of performing such work described in the Licensor Clinical Development Plan
incurred subsequent to the Effective Date and pursuant to the budget established
therein, as they are reasonably incurred, upon presentment of invoices therefore
to Licensee, provided,
however,
that Licensee's total payment obligation under this Agreement with respect to
such costs and expenses shall not in any event exceed (i) US$2,800,000 to be
used by Licensor for the Anoheal Project (the "Maximum Anoheal Amount) and (ii)
US$1,200,000 to be used by the Licensor for the Incostop Project (the "Maximum
Incostop Amount"). It is understood that such costs shall be invoiced to the
Licensee on a monthly basis and shall include the actual costs for the
Licensor's professional services (including proportions of employees
remuneration, travel, office and other related expenses determined in good
faith) incurred by Licensor in connection with the development of Anoheal and
Incostop (as applicable). Invoices for Third Party goods and services may at
Licensor's discretion (i) be paid by Licensor and reimbursed by Licensee or (ii)
be directed to Licensee for direct payment. The Licensee irrevocably undertakes
to settle all invoices issued by or directed for payment by the Licensor within
thirty (30) days of receipt thereof. The Licensee shall remit $50,000 to the
Licensor upon execution of this Agreement for reimbursement of clinical
development costs of Licensor, such amount to be credited toward either the
Maximum Incostop Amount or the Maximum Anoheal Amount at Licensor's discretion.
Licensor shall account for its use of funds provided to it by Licensee pursuant
to this Clause 12.2 separately between the Incostop Project and the Anoheal
Project, such records to be provided to the Licensee quarterly.

    
      
         

      

      
        26

        
          

        

      

      
         

      

    

    

    
      	
            	
              12.3.

            	
              Termination
      of Expense Payments

            

    

    

    
      	
               
      

            	
              12.3.1.

            	
              In
      the event that the Licensor discontinues the portion of the Licensor
      Clinical Development Plan relating to the Anoheal Project arid/or the
      Incostop Project, then the Licensee shall have no further payment
      obligation with respect to the applicable project other than to pay for
      uncancellabie financial commitments made prior to such discontinuance
      relating to the applicable discontinued program. Additionally, in the
      event that the Licensee discontinues the Licensee Clinical Development
      Plan relating to the Incostop Project and/or the Anoheal Project, then the
      Licensee's payment obligations pursuant to Clause 12.2 shall terminate
      with respect to the corresponding project under the Licensor Clinical
      Development Plan, other than to pay for uncancellable financial
      commitments made prior to such discontinuance relating to such
      discontinued program, and upon such payment, the balance of the Maximum
      Incostop Amount (in the case of termination of the Incostop Project) or
      the Maximum Anoheal Amount (in the case of termination of the Anoheal
      Project) shall be zero.

            

    

    

    
      	
               
      

            	
              12.3.2.

            	
              Notwithstanding
      Clause 12.3.1, IF the Licensee elects to use a Alternative Formulation to
      conduct the Incostop Project in the Territory, THEN the Maximum Incostop
      Amount shall be reduced to $600,000.  Notwithstanding the
      foregoing, IF the FDA agrees that positive data and results from a single
      United States Phase III Study conducted by Licensee using the Alternative
      Formulation will be required for the approval of an NDA relating to a
      Licensed Product incorporating Incostop API, THEN the Maximum Incostop
      Amount shall be increased back to $1,200,000. IF (i) the Licensee elects
      to use a Alternative Formulation to conduet the Incostop Project in the
      Territory and (ii) the FDA requires the Licensee .to conduct two United
      States Phase III Studies for the approval of an NDA relating to a Licensed
      Product incorporating Incostop API, THEN (x) the Maximum Incostop Amount
      shall remain $600,000 and (y) Licensee shall reimburse up to $600,000 to
      Licensor for its conduct of the Incostop Project outside the Territory
      (the "EU Incostop Trial") upon the submission by the Licensee of an NDA to
      the FDA relating to a Licensed Product incorporating Incostop and data
      generated from the EU Incostop Trial. Finally, IF the Licensor and the
      Licensee use the same pharmaceutical formulation of Incostop to conduct
      the Incostop Project in their respective territories (that is they both
      use the same Alternative Formulation or they both use the same
      non-Alternative Formulation), THEN the Maximum Incostop Amount shall be
      $1,200,000.

            

    

    
      
         

      

      
        27

        
          

        

      

      
         

      

    

    

    
      	
            	
              12.4.

            	
              Development
      Committee

            

    

    

    
      	
               
      

            	
              12.4.1.

            	
              A
      development committee (the "Committee") shall be organized to monitor the
      clinical development of the Licensed Products in the Territory and the
      European Union. The Committee will consist of independent scientific and
      technical thought leaders that are highly regarded by the scientific
      community in the field of each Licensed Product and at least one
      representative from each of Licensor and the Licensee. The Licensor and
      the Licensee will have equal membership on the Committee and all members
      of the Committee must be agreed upon in writing by Licensor and Licensee.
      The Licensee will have the tie-breaking vote with respect to matters
      regarding the Territory, including the approval of the Licensee Clinical
      Development Plan and related budget, subject to reasonably considering the
      Licensor's reasonable perspective; Licensor will have the tie-breaking
      vote with respect to matters relating to the Licensor Clinical Development
      Plan and its related budget, subject to reasonably considering the
      Licensee's reasonable
perspective.

            

    

    
      
         

      

      
        28

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              12.4.2.

            	
              The
      Committee will be responsible for (i) making recommendations relating to
      the pre-clinical and clinical development strategy of Licensed Products;
      (ii) analysis and assessment of ongoing pre-clinical and clinical
      development of each Licensed Product; (iii) proposing recommendations for
      other tactical and developmental uses of the Licensed Products; and (iv)
      approving any amendments to the Licensor Clinical Development Plan,
      Licensee Clinical Development Plan or conduct of clinical activities
      concerning Licensed Products in the Territory and the European Community
      other than the activities described in the Licensor Clinical Development
      Plan or the Licensee Clinical Development Plan. The actions and opinions
      of the Committee will be confidential. The Committee will meet at least
      two (2) times per year.

            

    

    

    
      	
            	
              12.5.

            	
              Licensor
      Development Obligations

            

    

    

    
      	
               
      

            	
              12.5.1.

            	
              Licensor
      shall use all reasonable commercial efforts to complete the clinical
      development of the Technology outside of the Territory pursuant to the
      Licensor Clinical Development Plan. Any expenses incurred over and above
      the Maximum Incostop Amount, as adjusted pursuant to this Clause 12 (for
      the development and commercialization of Incostop) and the Maximum Anoheal
      Amount (for the development and commercialization of Anoheal) to complete
      the Licensor Clinical Development Plan shall be borne solely by the
      Licensor, with the provision that any development work not provided for in
      the Clinical Development Plan which is performed by the Licensor at
      Licensee's request shall be paid by Licensee in addition to the Maximum
      Anoheal Amount or the Maxim Incostop Amount (as
    applicable).

            

    

    
      
         

      

      
        29

        
          

        

      

      
         

      

    

    
      	
              13.

            	
              Marketing

            

    

    

    
      	
               
      

            	
              13.1

            	
              The
      Licensee shall, not later than [*] ([*]) [*] prior to the anticipated
      launch of the Licensed Products in each country in the Territory, create a
      marketing plan for the commercialization of Licensed Products in that
      country and submit such marketing plan to the Licensor for
      comment.

            

    

    

    
      	
               
      

            	
              13.2

            	
              The
      marketing plan shall be updated on an annual basis and shall include a
      rolling three year sales forecast for each Licensed Product. The annual
      updates (including the updated sales forecasts) shall be sent to the
      Licensor under the notice requirements of Clause 26.3 within one month of
      each anniversary of the receipt of the first marketing plan by the
      Licensor.

            

    

    

    
      	
               
      

            	
              13.3

            	
              The
      Licensee shall, following Marketing Authorization of each Licensed
      Product, take reasonable efforts consistent with good business practice to
      promote the sale of such Licensed Product in the Territory, including any
      legally permissible pre-marketing activities, and will keep the Licensor
      informed of its marketing activities no less frequently than every twelve
      months from first submission to the Licensor of the marketing plan
      required under Clause 13.1. Where such approval by any regulatory,
      government or non-government authority is a pre-requisite to commercial
      launch of Licensed Products for human therapeutic use, the Licensee shall
      use commercially reasonable endeavours to seek pricing and reimbursement
      approval for the Licensed Products in that country in the Territory, and
      to manage any other methods of reimbursement control that may be
      reasonably necessary to materially increase the commercial potential of
      the Licensed Products in the
Territory.

            

    

    

    
      	
               
      

            	
              13.4

            	
              The
      Licensee shall launch each Licensed Product as quickly as reasonably
      practicable in each country in the Territory, but no later than [*] ([*])
      months following the grant of a Marketing Authorization for the Licensed
      Product by the Registration Authority in that
  country.

            

    

    

      

    
      [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    

    
      
         

      

      
        30

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              13.5

            	
              The
      Licensee shall, as between the parties, be responsible for the application
      and own or control all Marketing Authorizations and other regulatory
      submissions or filings in the Territory and act as the national
      representative for the Licensed Products-related medical affairs and drug
      safety matters in the Territory. The Licensee shall inform the Licensor
      regularly, but at least at the end of each calendar quarter on the status
      of the application and the progress with regard to the Licensee Clinical
      Development Plan in general. The Licensee shall promptly notify Licensor
      of the issuance of each Marketing Authorization. Furthermore the Licensee
      shall inform the Licensor of any adverse events or other events material
      to the development, marketing and/or sale of Licensed Products as soon as
      reasonably possible and within the internationally recognised time period
      appropriate to the severity of the adverse event. Licensor, or at
      Licensor's discretion, Licensor's licensees or sublicensees shall act as
      the national representative for the Licensed Products-related medical
      affairs and drug safety matters outside the Territory.  Licensor
      shall report to Licensee any adverse events or other events material to
      the development, marketing and/or sale of Licensed Products as soon as
      reasonably possible, but in any event no later than within the
      internationally recognised time period appropriate to the severity of the
      adverse event.

            

    

    

    
      	
               
      

            	
              13.6

            	
              The
      Licensee shall comply with all laws, rules and regulations, and, to the
      extent commercially reasonable, pharmaceutical industry trade association
      guidelines applicable to the marketing and distribution of the Licensed
      Products in the Territory; Licensor shall comply with all laws, rules,
      regulations, and, to the extent commercially reasonable, pharmaceutical
      industry trade association guidelines applicable to the marketing and
      distribution of Licensed Products outside the Territory. For
      clarification, this includes, but is not limited to, pharmacovigilance and
      drug safety monitoring, product promotion, product quality and product
      recall. Each party shall inform the other promptly in writing in the event
      it becomes aware of any matter which may reasonably precipitate a product
      recall, market withdrawal, or field correction, whether or not required by
      law.

            

    

    
      
         

      

      
        31

        
          

        

      

      
         

      

    

    

    
      	
              14.

            	
              Costs,
      Validity, and Prosecution of
Patents

            

    

    

    
      	
            	
              14.1.

            	
              Licensor
      shall, at Licensee's expense as described in Clause 14.3 below, diligently
      file, prepare, prosecute and maintain the Patents and Improvements
      developed by Licensor in the Territory, including, but not limited to, the
      filing of patent applications, extensions, continuations, continuations in
      part, divisionals, reexaminations, or re-issue applications that may be
      reasonably required or advisable to advance the purposes of this Agreement
      or otherwise to protect the rights and licenses granted hereunder.
      Licensor shall control such prosecution and maintenance, at Licensee's
      expense, using counsel of its choosing (but approved by Licensee, such
      approval not to be unreasonably withheld). Licensor agrees to keep
      Licensee reasonably informed with respect to the status and progress of
      any such applications, prosecutions and maintenance activities for the
      Patents and Improvements developed by Licensor in the Territory and in all
      foreign counterparts of said Patents and Improvements outside the
      Territory and to consult in good faith with Licensee and take into account
      Licensee's reasonable comments and requests with respect thereto prior to
      the filing of any such documents. Licensee shall file, prosecute, and
      maintain Patents claiming any Improvements developed by Licensee to the
      extent commercially reasonable. Both parties agree to provide reasonable
      cooperation to each other to facilitate the application and prosecution of
      Patents pursuant to this Agreement. Notwithstanding anything to the
      contrary, Licensor shall not abandon prosecution of any pending Patent or
      maintenance of any issued Patent without first giving Licensee notice at
      least sixty (60) days prior to the date on which such patent application
      or patent will become abandoned, and shall allow Licensee to assume
      prosecution of any such patent application, or maintenance of any such
      patent, at Licensee's own expense and with counsel of its choosing,
      provided that the claims of any such patent or patent application shall
      thereafter not be
      considered Valid Claims for purposes of this Agreement, including but not
      limited to the determination of payments due
  hereunder.

            

    

    
      
         

      

      
        32

        
          

        

      

      
         

      

    

    

    
      	
            	
              14.2.

            	
              Where
      reasonably possible and reasonably useful or valuable in the
      commercialization of Licensed Products, Licensor shall, at Licensee's
      cost, use commercially reasonable efforts to apply for or enable Licensee
      to apply for a patent term extension, adjustment or restoration,
      supplementary protection certificate, or other form of market exclusivity
      conferred by applicable laws, rules, or regulations (collectively, "Patent
      Term Extensions") in the relevant country of the Territory. Licensee
      shall, to the extent reasonably possible, assist Licensor in pursuing
      Patent Term Extensions.

            

    

    

    
      	
            	
              14.3.

            	
              Starting
      as of the Effective Date, Licensee shall pay, in connection with the
      preparation, filing, and prosecution, issuance and maintenance of the
      Patents (including Patent Term Extensions) in the Territory (i) all
      reasonable attorney fees for the services performed to obtain the issuance
      of the Patents and Patent Term Extensions, (ii) all government fees and
      all maintenance fees relating to the Patents and Patent Term Extension, to
      the extent such payments become due at or after Effective
      Date.

            

    

    

    
      	
            	
              14.4.

            	
              Licensee
      shall not contest the ownership of Licensor of the Patents and the
      Technology as existing, in either case. If Licensee challenges in a court
      of law the validity of the Patents or the ownership of Technology as
      existing, in either case, then Licensor shall be entitled to terminate
      this Agreement with immediate effect upon written notice to
      Licensee.

            

    

    
      
         

      

      
        33

        
          

        

      

      
         

      

    

    

    
      	
              15.

            	
              Trademarks
      and Improvements

            

    

     

    
      	
            	
              15.1.

            	
              Licensor
      will inform Licensee promptly in writing and in reasonable detail of all
      Improvements.

            

    

    

    
      	
            	
              15.2.

            	
              Licensee
      shall inform Licensor promptly in writing and in reasonable detail of all
      Licensee Improvements and Licensor shall inform Licensee promptly in
      writing and in reasonable detail of any Improvements. Licensee hereby
      grants Licensor (i) a free non exclusive license outside the Territory
      under all Licensee Improvement solely to make, have made, and use products
      (but not sell) and (ii) a free exclusive license outside the Territory
      under all Licensee Improvements solely to sell products incorporating
      Licensee Improvements, provided, however, that in the case of both (i) and
      (ii), such products incorporating Licensee Improvements are used solely in
      the development and/or commercialization of Anoheal or
      Incostop.

            

    

    

    
      	
            	
              15.3.

            	
              Licensee
      is entitled without obligation to use in the Territory the Trademarks
      listed In Exhibit 4.

            

    

    

    
      	
            	
              15.4.

            	
              Licensee,
      its Affillates, and their sublicensees may elect to use or license
      additional trademarks for the Licensed Products in the Territory. Such
      trademarks shall be registered and paid for by Licensee or its Affiliates,
      sublicensees or licensors, and shall remain the sole property of Licensee
      or its Affiliates, sublicensees or licensors, as the case may
      be.

            

    

    

    
      	
              16.

            	
              Infringement,
      Validity Challenges and Litigation

            

    

    

    
      	
            	
              16.1.

            	
              Infringement
      and Validity Challenges

            

    

    

    
      	
               
      

            	
              16.1.1.

            	
              The
      Parties to this Agreement shall inform each other promptly of any
      potential, actual, alleged, or reasonably suspected infringement of the
      Patents (or in the case of patents claiming Licensee Improvements, such
      patents), and/or challenge to the validity or enforceability of any claims
      of any of the foregoing, and provide each other with any available
      evidence of such infringement or
challenge.

            

    

    
      
         

      

      
        34

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              16.1.2.

            	
              During
      the term of this Agreement, the Licensee shall have the first right, but
      not the obligation, to take (or refrain from taking) appropriate action to
      enforce Patents, to defend any declaratory judgments seeking to invalidate
      or hold the Patents unenforceable, to control any litigation or other
      enforcement action and to enter into, or permit, the settlement of any
      such litigation, declaratory judgments or other enforcement action
      pertaining to Patents, with respect to any potential, threatened, alleged,
      or actual infringement of, or challenge, to the Patents, at its own
      expense and with counsel of its choosing, in the Territory. In furtherance
      of such right, Licensor hereby agrees that the Licensor may join Licensee
      as a party in any such suit (and will join at the Licensee's request),
      provided that the Licensee pay all of Licensor's reasonable, documented
      out-of-pocket expenses with respect thereto. If, within twelve (12) months
      of the written notice above, the Licensee (i) shall have been unsuccessful
      in persuading the alleged infringer to desist, (ii) shall not have brought
      and shall not be diligently prosecuting an infringement action, or (iii)
      has not entered into settlement discussions with respect to such
      infringement, or if the Licensee notifies Licensor that it has decided not
      to undertake any of the foregoing against any such alleged infringer, then
      Licensor shall then have the right to bring suit to enforce such Patents,
      at its own expense, provided, however, that, within thirty (30) days after
      receipt of notice of Licensor's intent to file such suit, Licensee shall
      have the right to jointly prosecute such suit and to fund up to one-half
      (1/2) the costs of such suit In exchange for a commensurate share of the
      proceeds of such suit. Subject to the effects of the foregoing in the
      event the Licensee exercises the aforementioned right, any recovery of
      damages or amounts received in settlement pursuant to this Clause 16.1.2
      shall be allocated pursuant to Clause 16.1.4
  below.

            

    

    
      
         

      

      
        35

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              16.1.3.

            	
              The
      party controlling any action, suit, or defense under Clause 16.1.1 (the
      "Controlling Party") shall be free to enter into a settlement, consent
      judgment, or other voluntary disposition of any such action, provided,
      however, that (i) the Controlling Party shall consult with the other party
      (the "Secondary Party") prior to entering into any settlement thereof and
      (ii) any settlement, consent judgment or other voluntary disposition of
      such actions which (1) materially limits the scope, validity, or
      enforceability of any patents or, if the Licensee is the Secondary Party,
      patents or patent applications owned or controlled by the Licensee, (2)
      subjects the Secondary Party to any non-indemnified liability, payment
      obligation, or injunction, or (3) admits fault or wrongdoing on the part
      of Secondary Party, it then must be approved in writing by Secondary
      Party, such approval not to be unreasonably withheld. Secondary Party
      shall provide the Controlling Party notice of its approval or denial of
      such approval within twenty (20) business days of any request for such
      approval by the Controlling Party, provided that in the event Secondary
      Party wishes to deny such approval, such notice shall include a written
      description of Secondary Party's reasonable objections to the proposed
      settlement, consent judgment, or other voluntary disposition and (ii)
      Secondary Party shall be deemed to have approved such proposed settlement,
      consent, judgment or other voluntary disposition in the event it fails to
      provide such notice within such twenty (20) business day
      period.

            

    

    
      
         

      

      
        36

        
          

        

      

      
         

      

    

    

    
      	
               
      

            	
              16.1.4.

            	
              Any
      damages, recoveries, or settlement amounts Licensee obtains .as a result
      of the matters contemplated by Clause 16.1.2, when Licensee is prosecuting
      or defending any action, shall first be applied to payment of each of the
      parties' costs related to any actions taken by the parties with respect to
      such matters, with the remainder, to the extent attributable to
      infringement of the Patents, deemed Anoheal Net Sales or Incostop Net
      Sales, as elected by Licensee in its sole discretion for book keeping
      purposes, and subject to the applicable royalty obligation under Clause 7
      of this Agreement. Any recovery of damages or amounts received in
      settlement by Licensor under Clause 16.1.2, when Licensee is prosecuting
      or defending any action, shall be applied first in satisfaction of any
      unreimbursed expenses and legal fees of each of Licensee and Licensor
      relating thereto, with the balance remaining from any such recovery being
      allocated as follows: (i) any amounts reasonably attributable to any
      intellectual property rights of Licensee (other than those licensed to
      Licensee hereunder) being paid to Licensee and (ii) the remaining balance
      shall be retained by the Licensor.

            

    

    

    
      	
               
      

            	
              16.1.5.

            	
              To
      the extent there is no recovery of damages or amounts received in
      settlement by Licensee, its Affiliates, or Licensor with respect to any
      matter contemplated by Clause 16.1.2 above, or such amounts are
      insufficient to fully reimburse the Licensee for any amounts incurred by
      the Licensee with respect to such matter (including but not limited to
      attorneys' fees, out-of-pocket costs, and all amounts paid as judgments,
      damages, or in settlement) (such amounts, "Infringement Costs"), the
      Licensee may, to the extent not deducted from amounts due under this
      Agreement pursuant to Clause 7.6, credit [*] percent ([*]%) of
      Infringement Costs (such [*] percent ([*]%), the "Infringement Cost
      Credit") against royalties or other amounts thereafter payable to Licensor
      under this Agreement. If the Infringement Cost Credit exceeds [*]% of the
      amounts payable to Licensor under this Agreement in any calendar quarter
      in which the relevant Infringement Costs are incurred, then the amount of
      such Infringement Cost Credit in excess of the amounts payable to Licensor
      shall be carried over and credited against payments due in future calendar
      quarters. In no event shall the deduction of Infringement Cost under this
      clause 16.1.5 and the deduction under clause 7.6. added together exceed
      [*]% of the total amount due Licensor under this Agreement In any
      particular calendar quarter. Notwithstanding the foregoing, If any action
      or suit is initially brought by Licensee under this Clause 16 (as opposed
      to Licensee defending an action or suit pursuant to this Clause 16.1.5),
      then this Clause 16.1.5. shall not
apply.

            

    

    

      

    

    
      [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    

    
      
         

      

      
        37

        
          

        

      

      
         

      

    

    
      	
               
      

            	
              16.1.6.

            	
              In
      any suit or other action contemplated by Clause 16.1.2, the Secondary
      Party shall, at the request and expense of the Controlling Party,
      cooperate in all respects and, to the extent possible, have its employees
      testify when requested and make available relevant records, papers,
      information, samples, specimens, and the
like.

            

    

    

    
      	
              17.

            	
              Third
      Party Rights

            

    

    

    
      	
            	
              17.1.

            	
              If
      either party is charged with the actual or alleged infringement of Third
      Party rights based on the exploitation of the Patents, the Technology, or
      the use, manufacture, sale, or import of Licensed Products or any other
      products incorporating Anoheal API or Incostop API, such party shall
      immediately inform the other party about this
  allegation.

            

    

    

    
      	
            	
              17.2.

            	
              The
      Licensee may, in its sole discretion, modify Licensed Products to avoid
      such infringement and/or may settle on terms that it deems advisable in
      its sole discretion, provided that any final disposition of the litigation
      that will restrict the claims in or admit any invalidity of any Patents
      shall not be made without consultation with and approval by Licensor, such
      approval not to be unreasonably withheld. Otherwise, the Licensee shall
      have the first right, but not the obligation, to defend or settle any such
      claim or suit. If the Licensee has not exercised such right to defend or
      entered into settlement discussions concerning such alleged infringement
      within the sooner of (i) twelve (12) months of the assertion of such a
      claim or (ii) thirty (30) days of the filing of such a suit, or if the
      Licensee notifies Licensor that it has decided not to undertake such
      defense or enter into settlement discussions with respect to its alleged
      infringement, then Licensor shall then have the right to defend such
      alleged infringement, at its sole expense, provided however that no
      settlement affecting Patents will be agreed upon without Licensee's
      written consent.

            

    

    
      
         

      

      
        38

        
          

        

      

      
         

      

    

    
      	
            	
              17.3.

            	
              If
      (i) Licensee by a final judgment is ordered to stop manufacturing, using,
      selling, or importing any Licensed Product or (ii) a judgment is rendered
      which would reasonably preclude Licensee's manufacture, use, sale, or
      import of any particular Licensed Product, and Licensee or Licensor does
      not secure sufficient rights under such Third Party patents to continue or
      resume such use, manufacture, sale, or import, Licensee shall have no
      further obligations under this Agreement to make, use, or sell such
      Licensed Product and shall not be in breach of this Agreement with respect
      to any failure to make, use, or sell such Licensed Product thereafter, and
      Licensor shall not be entitled to terminate this Agreement for any reason
      related to Licensee's failure to make, use, or sell such Licensed
      Product.

            

    

    

    
      	
            	
              17.4.

            	
              In
      any suit to defend any alleged infringement of Third Party intellectual
      property rights by the manufacture, use, sale, or import of a Licensed
      Product, Licensor shall, at the request and expense of Licensee, cooperate
      in all respects and, to the extent possible, have its employees testify
      when requested and make available relevant records, papers, information,
      samples, specimens, and the like.

            

    

    

    
      	
              18.

            	
              Representations
      and Warranties

            

    

    

    Licensor hereby
represents and warrants that:

    
      
         

      

      
        39

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.1.

            	
              It
      is not aware of any legal deficiencies of the Patents, Know-How, or
      Technology. Licensor assumes no liability for the lack of such unknown
      deficiencies.

            

    

    

    
      	
            	
              18.2.

            	
              It
      has full authority to grant the licenses provided hereunder and that all
      necessary corporate actions have been
taken.

            

    

    

    
      	
            	
              18.3.

            	
              Licensor
      owns all right, title, and interest in and to the Patents and the Material
      free and clear of all liens, encumbrances or other restrictions or
      limitations whatsoever.

            

    

    

    
      	
            	
              18.4.

            	
              The
      US and foreign patent applications and patents itemized on Exhibit 2 set
      forth all of the patents and patent applications necessary or useful for
      practicing the Technology, manufacturing, using or selling Licensed
      Products, or manufacturing, using, or selling products incorporating
      Anoheal or Incostop in the Field in the Territory, in each case owned or
      controlled by Licensor.

            

    

    

    
      	
            	
              18.5.

            	
              Licensor
      is not aware of any licenses, options, restrictions, liens, rights of
      third parties, disputes, royalty obligations, proceedings or claims
      relating to, affecting, or limiting Licensor's rights or the rights of the
      Licensee under this Agreement, or which may lead to a claim of
      infringement by or invalidity regarding, any part or all of the Patents,
      Technology, or Know-how or their use except as disclosed in Exhibit 6
      (A).

            

    

    

    
      	
            	
              18.6.

            	
              Licensor
      is not aware of any claim, pending or threatened, of infringement,
      interference or invalidity regarding any part or all of the Patents,
      Technology, or Know-how or their use in the Territory except as disclosed
      in Exhibit 6 (B).

            

    

    

    
      	
            	
              18.7.

            	
              The
      Licensor is not aware of any inventors of Patents other than those listed
      as inventors on applications filed for such
  Patents.

            

    

    
      
         

      

      
        40

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.8.

            	
              The
      development of the Technology, Patents, and Know-how were not supported in
      whole or part by funding or grants by any governmental agency or
      philanthropic or charitable
organization.

            

    

    

    
      	
            	
              18.9.

            	
              The
      Licensor is a corporation duly organized, validly existing and in good
      standing under the laws of Switzerland. The Licensor has the requisite
      power and authority to execute and deliver this Agreement and to
      consummate the transactions contemplated hereby. The execution and
      delivery of this Agreement and the performance and consummation of the
      transactions contemplated hereby by the Licensor have been duly authorized
      by all necessary action on the part of the Licensor and will not result in
      any violation or breach of, constitute (with or without notice or lapse of
      time or both) a default under or conflict with/or give rise to a right of
      termination, amendment, cancellation or acceleration of any agreement
      which is material for the performance of the present
      Agreement.

            

    

    

    
      	
            	
              18.10.

            	
              This
      Agreement has been duly executed and delivered by the Licensor and,
      subject to the due authorization, execution and delivery of this
      Agreements by the Licensee, this Agreement constitutes a valid and binding
      obligation of the Licensor, enforceable against the Licensor in accordance
      with its terms, except as such enforcement may be affected by bankruptcy,
      reorganization, insolvency, moratorium or similar laws affecting
      creditor's rights generally and except for general principles of
      equity.

            

    

    

    
      	
            	
              18.11.

            	
              The
      execution and delivery of this Agreement does not, the consummation of the
      transactions contemplated hereby and the performance of Licensor's
      obligations hereunder will not, (i) conflict with, or result in any
      violation or breach of any provision of the organizational documents of
      the Licensor, (ii) conflict with or violate any applicable statutes,
      judgments, decrees, laws, ordinances, rules, regulations, injunctions and
      orders ("Laws") of any Swiss federal, canton, or local government or any
      Swiss court, tribunal, administrative agency or commission or other
      governmental or regulatory authority, body or agency, including any
      self-regulatory organization ("Governmental Authorities") applicable to
      the Licensor.

            

    

    
      
         

      

      
        41

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.12.

            	
              No
      consent, approval or authorization of, or declaration or filing with, any
      Swiss Governmental Authority or other Third Party (a "Consent") is
      required on the part of the Licensor in connection with its execution,
      delivery, and performance of this Agreement or the consummation of the
      transactions contemplated hereby.

            

    

    

    
      	
            	
              18.13.

            	
              Exhibit
      8 hereto sets forth a true and complete list of each license, contract or
      other agreements (together with certain other agreements and any
      amendments to any of the foregoing) to which the Licensor is a party and
      which relates to the Licensed Products or the Patents in the Territory,
      including but not limited to the clinical trial agreements (collectively,
      the "Material Agreements"). True and complete copies of all Material
      Agreements have been previously delivered to the Licensee. To the best
      knowledge of the Licensor each of the Material Agreements is valid,
      binding and in full force and effect, and enforceable by the Licensor, or
      has expired, in each case in accordance with its respective terms. No
      person or entity (other than the Licensor) that is a party to any Material
      Agreement or is otherwise bound thereby is, to the knowledge of the
      Licensor, in default or breach thereof and, to the Licensor's knowledge,
      no event, condition or act exists that, with the giving of notice or the
      lapse of time or both, would give rise to such a default or breach thereof
      or a right of cancellation by the Licensor thereunder. The Licensor is not
      in default or breach in any material respect of any of the Material
      Agreements and, to the knowledge of the Licensor, no event, condition or
      act exists that, with the giving of notice or the lapse of time or both,
      would give rise to a default or breach by the Licensor thereof or a right
      of cancellation thereunder by any other party
  thereto.

            

    

    
      
         

      

      
        42

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.14.

            	
              No
      written communication has been received by the Licensor, and to the
      knowledge of the Licensor no investigation, regulatory enforcement action
      (including seizure, injunction, civil penalty or criminal action) or any
      related Governmental Authority review is or, in respect of any Licensed
      Product was at any time pending or is threatened by any Governmental
      Authority with respect to (i) any alleged or actual violation by the
      Licensor of any permit, Law or other requirement or any Governmental
      Authority relating to the operations conducted by the Licensor with
      respect to any Licensed Product or the Technology or (ii) any alleged or
      actual failure to have or maintain in effect all permits required in
      connection with the operations conducted by the Licensor with respect to
      any Licensed Product or the Technology. The Licensor has not received from
      the FDA, the U.S. Drug Enforcement Administration ("DEA"), or any similar
      state, local, federal, or foreign Governmental Authority any written
      notice regarding the approvability or approval of any of the Licensed
      Products. No Licensed Product has been withdrawn, suspended or
      discontinued by the Licensor as a result of any action by the FDA, the DEA
      or any similar state, local, federal, or foreign Governmental Authority,
      either within or outside the U.S. (whether voluntarily or otherwise). To
      the best knowledge of the Licensor with respect to any Licensed Products,
      no officer, employee or agent of the Licensor has made any untrue
      statement of a material fact or a fraudulent statement to the FDA, DEA or
      any similar state, local, federal, or foreign Governmental
      Authority.

            

    

    

    
      	
            	
              18.15.

            	
              The
      Licensor is not aware of any suits or actions, administrative, arbitration
      or other proceedings, or governmental investigations pending or threatened
      against or affecting the Licensor with respect to Licensed Products,
      Technology, Know-How, or the Patents other than pending oppositions to
      European Patents corresponding to the Patents. No Entity has notified the
      Licensor in writing of any material claim against the Licensor alleging
      any personal property or economic injury, loss or damage incurred as a
      result of or relating to the use of the Technology, Know-How, or any
      Licensed Products. The Licensor is not aware of any judgment, order,
      Injunction, decree, writ or award against the Licensor that is not
      satisfied and remains outstanding with respect to the Technology, Patents,
      Know-How, or any Licensed
Product.

            

    

    
      
         

      

      
        43

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.16.

            	
              The
      Licensor has not received any notice of infringement of, or conflict with,
      any license, patent, copyright, trademark, service mark or other
      intellectual property right of any Third Party relating to the Territory.
      Except as provided herein, the validity or enforceability of any of the
      Patents and or the title of the Licensor thereto has not been questioned
      in any litigation, governmental inquiry or proceeding to which the
      Licensor is a party and, to the knowledge of the Licensor, no such
      litigation, governmental inquiry or proceeding is threatened except as
      disclosed in Exhibit 6 (B).

            

    

    

    
      	
            	
              18.17.

            	
              To
      the knowledge of the Licensor, the Licensor has taken all reasonable
      actions necessary or appropriate to preserve the confidentiality of all
      trade secrets, proprietary and other confidential information material to
      the Licensed Products, Know-how, Technology, and
  Patents.

            

    

    

    
      	
            	
              18.18.

            	
              Licensor
      is not aware of any Third Party activities which would constitute
      misappropriation or infringement of the Patents in the
      Territory.

            

    

    

    
      	
            	
              18.19.

            	
              These
      are the only representations and warranties given by Licensor to the
      exclusion of all others.

            

    

    

    Licensee hereby
grants and warrants that:

    

    
      	
            	
              18.20.

            	
              The
      Licensee is a limited liability company duly organized, validly existing
      and in good standing under the laws of New York. The Licensee has the
      requisite power and authority to execute and deliver this Agreement and to
      consummate the transactions contemplated hereby. The execution and
      delivery of this Agreement and the performance and consummation of the
      transactions contemplated hereby by the Licensee have been duly authorized
      by all necessary action on the part of the Licensee. This Agreement has
      been duly executed and delivered by the Licensee and, subject to the due
      authorization, execution and delivery of this Agreements by the Licensor,
      this Agreement constitutes a valid and binding obligation of the Licensor,
      enforceable against the Licensee in accordance with its terms, except as
      such enforcement may be affected by bankruptcy, reorganization,
      insolvency, moratorium or similar laws affecting creditor's rights
      generally and except for general principles of
  equity.

            

    

    
      
         

      

      
        44

        
          

        

      

      
         

      

    

    

    
      	
            	
              18.21.

            	
              The
      execution and delivery of this Agreement does not, the consummation of the
      transactions contemplated hereby, and the performance of Licensor's
      obligations hereunder will not, (i) conflict with, or result in any
      violation or breach of any provision of the organizational documents of
      the Licensee, (ii) conflict with or violate any applicable statutes,
      judgments, decrees, laws, ordinances, rules, regulations, injunctions and
      orders ("Laws") of any government or court, tribunal, administrative
      agency or commission or other governmental or regulatory authority, body
      or agency, including any self-regulatory organization in the Territory
      ("Governmental Authorities") applicable to the
  Licensee.

            

    

    

    
      	
            	
              18.22.

            	
              No
      consent, approval or authorization of, or declaration or filing with, any
      Governmental Authority or other Third Party (a "Consent") is required on
      the part of the Licensee in connection with its execution, delivery, and
      performance of this Agreement or the consummation of the transactions
      contemplated hereby, that has not been received or filed by
      Licensee.

            

    

    

    
      	
              19.

            	
              Limitation
      of Liability

            

    

    

    NEITHER
PARTY SHALL BE LIABLE FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, OR INDIRECT
DAMAGES ARISING OUT OF THIS AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF
LIABILITY, subject to compulsory Swiss law regarding damages caused
intentionally or in a grossly negligent manner.

    
      
         

      

      
        45

        
          

        

      

      
         

      

    

     

    
      	
              20.

            	
              Indemnification

            

    

    

    
      	
            	
              20.1.

            	
              Licensee
      shall indemnify, hold harmless and defend Licensor and its directors,
      officers, employees and agents against any and all losses, expenses, cost
      of defense (including without limitation attorney's fees, witness fees,
      damages, judgments, fines and amounts paid in settlement) and any amounts
      Licensor becomes legally obligated to pay because of any claim or claims
      against it to the extent that such claim or claims arise out of the
      development, manufacture, sale or use of the Licensed Products by
      Licensee, its Affiliates or its sublicensees, except to the extent such
      losses, expenses, costs and amounts are due to Licensor's, its
      Affiliates', or their sublicensees' (i) development, manufacture, use, or
      sale of Licensed Products or other products incorporating Anoheal API or
      Incostop API, (ii) negligence or intentional misconduct, (iii) breach of
      this Agreement, or (iv) failure to comply with all applicable laws, rules,
      and regulations, except to the extent such loss was due to Licensor's
      gross negligence, willful misconduct or
fraud.

            

    

    

    
      	
            	
              20.2.

            	
              Licensor
      shall indemnify, hold harmless and defend Licensee and its directors,
      officers, employees and agents against any and all losses, expenses, cost
      of defense (including without limitation attorney's fees, witness fees,
      damages, judgments, fines and amounts paid in settlement) and any amounts
      Licensee becomes legally obligated to pay because of any claim or claims
      against it to the extent that such claim or claims arise out of
      Licensor's, its Affiliates', or their sublicensees' (i) development,
      manufacture, use or sale of the Licensed Products or other products
      incorporating Anoheal API or Incostop API, (ii) negligence or intentional
      misconduct, (iii) breach of this Agreement, or (iv) failure to comply with
      all applicable laws, rules, and regulations, except to the extent such
      loss was due to Licensee's gross negligence, willful misconduct or
      fraud.

            

    

    

    
      	
            	
              20.3.

            	
              In
      the event that either party intends to seek indemnification for any claim
      under Clause 20.1 or 20.2, it shall inform the other party of the claim
      promptly after receiving notice of the
claim.

            

    

    
      
         

      

      
        46

        
          

        

      

      
         

      

    

    

    
      	
            	
              20.4.

            	
              In
      the case of a claim for which Licensor seeks indemnification under Clause
      20.1, Licensor shall permit the Licensee to direct and control the defense
      of the claim and shall provide such reasonable assistance as is reasonably
      requested by the Licensee (at the Licensee's cost) in the defense of the
      claim, provided that nothing in this clause 20.4 shall permit the Licensee
      to make any admission on behalf of Licensor, or to settle any claim or
      litigation which would impose any financial obligations on Licensor
      without the prior written consent of Licensor, such consent not to be
      unreasonably withheld or
delayed.

            

    

    In the
case of a claim for which the Licensee seeks indemnification under Clause 20.2,
the Licensee shall permit Licensor to direct and control the defense of the
claim and shall provide such reasonable assistance as is reasonably requested by
Licensor (at Licensor's cost) in the defense of the claim, provided that nothing
in this Clause 20.3 shall permit Licensor to make any admission on behalf of the
Licensee, or to settle any claim or litigation which would impose any financial
obligations on the Licensee, without in either case the prior written consent of
the Licensee, such consent not to be unreasonably withheld or
delayed.

    

    
      	
              21.

            	
              Product
      Liability

            

    

    

    
      	
            	
              21.1.

            	
              Licensee
      agrees that Licensor shall have no liability to Licensee or to any
      purchasers or users of Licensed Products made or sold by Licensee for any claims, demands,
      losses, costs, or damages suffered by Licensee, or purchasers or users of
      such Licensed Products, or any other party, which may result from personal
      injury, death, or property damage related to the manufacture, use, or sale
      of such Licensed Products, except to the extend such claims, demands,
      losses, costs, or damages are a result of Licensor's gross negligence or
      willful misconduct.

            

    

    
      
         

      

      
        47

        
          

        

      

      
         

      

    

    

    
      	
            	
              21.2.

            	
              Each
      party shall maintain insurance coverage in types and amounts reasonably
      sufficient to cover its obligations under Clause 20 and provide evidence
      thereof to the other party upon written request. At such time as a party
      or its sublicensees, as applicable, begins to sell or distribute Licensed
      Products (other than for the purpose of obtaining regulatory approvals),
      such party or sublicensee, as applicable, shall at its sole expense,
      procure and maintain policies of comprehensive general liability insurance
      naming the other party as an additional insured. Such comprehensive
      general liability insurance shall provide product liability coverage. Each
      party shall provide the other with written evidence of such insurance and
      shall inform the other party with notice at least fifteen (15) days prior
      to any cancellation, non-renewal or material change in such insurance, to
      the extent such party receives advance notice of such matters from its
      insurer.

            

    

    

    
      	
              22.

            	
              Force
      Majeure

            

    

    

    Neither
party shall be liable to the other for any inability to perform any obligation
under this Agreement (except monetary obligations of either party) due to,
events beyond its reasonable control, including, but not limited to, fire,
storm, flood, earthquake, explosions, riots, strikes, transportation embargoes
or delays, shortages of materials or machinery, or acts of the
government.

    

    
      	
              23.

            	
              Termination

            

    

    

    
      	
            	
              23.1.

            	
              This
      Agreement shall come into force upon signing by both parties and shall
      continue in force for each country of the Territory for Anoheal and
      Incostop, respectively, until the sale of Licensed Products incorporating
      Anoheal API or Incostop API, respectively, is terminated, subject to
      termination pursuant to this Clause 23. For the avoidance of doubt it is
      stated that the Agreement also ends if the sale of products containing
      Anoheal or Incostop continues provided such products are not covered by
      Valid Claims and do not incorporate or use Technology or Know-How
      (including but not limited to clinical studies) as defined in Clauses 2.19
      and 2.27 above.

            

    

    
      
         

      

      
        48

        
          

        

      

      
         

      

    

    

    
      	
            	
              23.2.

            	
              The
      Licensee shall have the right to terminate the Agreernent, in its entirety
      or with respect to its rights and obligations with respect to Licensed
      Products incorporating Anoheal or Incostop, respectively, in any country,
      on ninety (90) days written notice. Upon termination of either the
      Incostop Project or the Anoheal Project pursuant to this Clause 23.2, all
      rights to the Patents relating to Incostop Project or the Anoheal Project,
      as applicable, shall revert to the Licensor, except to the extent such
      rights (i) are needed by Licensee for the development and
      commercialization of the unterminated project, if any, and (ii) relating
      to Licensee Improvements (except Licensor shall retain rights relating to
      Licensee Improvements to be used solely in the development and/or
      commercialization of Anoheal or
Incostop).

            

    

    

    
      	
            	
              23.3.

            	
              In
      the event either party (the "Insolvent Party") becomes bankrupt or files a
      petition in bankruptcy, or if the business of a party shall be placed in
      the hands of a receiver, assignee or trustee for the benefit of creditors,
      whether by the voluntary act of such party or otherwise, such party shall
      provide notice thereof to the other party and the other party may, subject
      to the effects of and protections of any applicable bankruptcy-related
      laws, rules, or regulations (including but not limited to Section 365(n)
      of the United States Bankruptcy Code, which shall apply to the rights
      granted Licensee under this Agreement), terminate this Agreement upon
      notice to the Insolvent Party given within thirty (60) business days of
      the other party's receipt of such
notice.

            

    

    

    
      	
            	
              23.4.

            	
              Upon
      any material breach or material default of this Agreement by either party
      (the "Breaching Party"), the other party (the "Non-Breaching Party") shall
      have the right to terminate this Agreement and the rights, privileges and
      license granted hereunder by giving sixty (60) days prior written notice
      to the Breaching Party. Upon the expiration of the sixty (60) day period,
      if Breaching Party shall have not cured such breach or default, this
      Agreement shall, at the option of the Non-Breaching Party, terminate upon
      written notice of Non-Breaching Party given within ten (10) business days
      of the expiration of such sixty (60) day period. Notwithstanding anything
      herein to the contrary, if the nature of the breach is such that
      additional time is reasonably needed to cure such breach, and Breaching
      Party has commenced with good faith efforts to cure such breach, then
      Non-Breaching Party shall provide Breaching Party with reasonably
      sufficient additional time in which to cure such breach, provided such
      time shall not in any event exceed ninety (90) days. For the avoidance of
      doubt, failure of the Licensee to timely remit to the Licensor monies due
      under this Agreement shall be deemed a "material breach" of this
      Agreement.

            

    

    
      
         

      

      
        49

        
          

        

      

      
         

      

    

    
      	
            	
              23.5.

            	
              Upon
      the termination of this Agreement pursuant to this Clause 23, Licensee may
      notify Licensor of the amount of Licensed Products that Licensee has in
      its possession, under its control, or in the process of manufacture and
      Licensee may then, notwithstanding anything to the contrary, be entitled
      to sell that amount of Licensed Products, but no more, subject to the
      royalties provided for in this Agreement. Licensee shall stop using the
      Know How and the Technology and the right to make reference to the
      Materials or data contained in the Know How, including but not limithd to
      clinical studies, shall end.

            

    

    

    
      	
            	
              23.6.

            	
              Sublicenses:
      In the event this Agreement is terminated pursuant to Clause 23.2, 23.3,
      or 26.4, any sublicense granted by Licensee to the extent concerning the
      rights subject to such termination shall remain in effect and be assigned
      to Licensor and Licensor shall assume all rights and obligations of
      Licensee applicable after termination of this
  Agreement.

            

    

    

    
      	
            	
              23.7.

            	
              Upon
      termination of this Agreement for any reason, nothing herein shall be
      construed to release either party from any obligation that matured prior
      to the effective date of such termination, and the following provisions
      shall survive such termination: Clauses 2, 10.3, 16 (with respect to
      infringement occurring prior to such termination), 17 (with respect to
      infringement occurring prior to such termination), 19, 20, 21, 23, 24, 25,
      26, and 27.

            

    

     

    
      
        
        

      

      
        50

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              23.8.

            	
              In
      the event Licensee terminates the development and sale of either Anoheal
      or Incostop then upon written request of the Licensor the Licensee shall
      transfer and assign at no cost, any and all pre-clinical data, human
      safety data, preliminary efficacy data, INDs and other regulatory data and
      filings that are in its possession related to the Licensed Product
      affected .by such stop, and shall provide Licensor with the right to
      reference with respect to such data and regulatory
  filings.

            

    

    

    
      	
            	
              23.9.

            	
              In
      the event Licensor terminates the development and marketing efforts for
      either Anoheal or Incostop then upon written request of the Licensee the
      Licensor shall transfer and assign at no cost, any and all pre-clinical
      data, human safety data, preliminary efficacy data, INDs and other
      regulatory data and filings that are in its possession related to the
      Licensed Product in the European Union affected by such stop, and shall
      provide Licensee with the right to reference with respect to such data and
      regulatory filings.

            

    

    

    
      	
              24. 

            	
              Confidentiality

            

    

    

    
      	
            	
              24.1.

            	
              Each
      party agrees to retain in strict confidence and not to disclose to any
      other person or entity any Confidential Information of the other party,
      whether disclosed prior to or after the date of signature of this
      Agreement or of prior secrecy agreements. The parties further agree not to
      use any such Confidential Information for any purpose, except pursuant to,
      and in order to carry out, the terms and objectives of this
      Agreement.

            

    

    

    
      	
            	
              24.2.

            	
              Each
      party agrees to undertake all necessary and appropriate precaution to
      prevent and restrain the unauthorized disclosure of such Confidential
      Information. Each party warrants that each of its employees or
      representatives to whom any Confidential Information is revealed shall
      previously have been informed of the confidential nature of the
      Confidential Information and shall have agreed to be bound by the terms
      and conditions substantially similar to this confidentiality
      obligation.

            

    

     

    
      
        
        

      

      
        51

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              24.3.

            	
              The
      provisions of this section 24 shall not apply to any Confidential
      Information disclosed hereunder
which:

            

    

    

    
      	
               
      

            	
              24.3.1.

            	
              was
      known by the receiving party prior to its disclosure to the receiving
      party by the other party, as evidenced by the prior written records of the
      receiving party, or

            

    

    

    
      	
               
      

            	
              24.3.2.

            	
              either
      before or after the date of disclosure to the receiving party by the other
      party is lawfully disclosed to the receiving party without obligation of
      confidentiality or limitation on use by an Third Party rightfully in
      possession of the Confidential Information,
or

            

    

    

    
      	
               
      

            	
              24.3.3.

            	
              Confidential
      Information that was developed before the Effective Date independently by
      the receiving party without use or benefit of the Confidential Information
      of the other party, as evidenced by written records;
  or

            

    

    

    
      	
               
      

            	
              24.3.4.

            	
              is
      required to be disclosed by the receiving party to comply with applicable
      laws, to defend or prosecute litigation or to comply with governmental
      laws or regulations, provided that the receiving party provides prior
      written notice of such disclosure to the other party and takes reasonable
      and lawful actions to avoid and/or minimize the degree of such disclosure,
      subject to the reasonable advice and comment of disclosing
      party.

            

    

    

    
      	
            	
              24.4.

            	
              The
      provisions of this section 24 shall not apply to any Confidential
      Information. disclosed hereunder

            

    

    

    
      	
               
      

            	
              24.4.1.

            	
              to
      Solvay Pharmaceuticals, Inc., pursuant to the Termination Agreement listed
      in Exhibit 6 A

            

    

     

    
      
        
        

      

      
        52

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              24.4.2.

            	
              to
      the inventors M.A. Kamm and R.S. Phillips under the Assignment Agreement
      listed in Exhibit 6 A.

            

    

    

    
      	
            	
              24.5.

            	
              The
      confidentiality obligations of the parties contained in the foregoing
      paragraphs of this section 24 shall remain binding on both parties during
      the term of this Agreement and for a period of ten (10) years after the
      termination of this Agreement, regardless of the cause of such
      termination.

            

    

    

    
      	
              25. 

            	
              Paramount
      Guarantee

            

    

    

    Until the
closing of the Financing, in consideration of Licensor's execution of and
performance under this Agreement, Paramount hereby agrees (in the event of
assignment of this Agreement to NewCo) to be jointly and severally liable for
all amounts due under Clauses 6, 7, 8, 12, 14.1, and 18 hereof. Paramount's
guarantee obligation under this Clause 25 shall continue in full force and
effect until the Financing, at which time Paramount shall have no further
obligations or liabilities under this Clause 25, regardless of any existing,
uncured nonpayment existing as of the Financing, and Paramount shall be hereby
released by Licensor and NewCo of any liability with respect thereto upon the
closing of the Financing (including any such liability with respect to, any
previously unpaid amounts due Licensor). NewCo shall reimburse Paramount in full
for any amounts incurred or paid by Paramount under this Clause 25 upon request
by Paramount, including but not limited to amounts paid Licensor by Paramount
and any reasonable, documented fees and expenses (including attorneys' fees)
incurred by or on behalf of Paramount with respect to any dispute related to
NewCo's nonpayment of amounts due hereunder.

     

    
      
        
        

      

      
        53

        
          

        

      

      
        
        

      

    

     

    
      	
              26. 

            	
              Miscellaneous

            

    

    

    
      	
            	
              26.1.

            	
              Affiliates of the
      Parties: Each party is responsible that all their Affiliates, to
      the extent exercising rights or performing obligations under this
      Agreement, comply with the terms of this
  Agreement.

            

    

    

    
      	
            	
              26.2.

            	
              No Agency:
      Neither party is, nor will be deemed to be, an employee, agent or
      representative of the other party for any purpose. Each party is an
      independent contractor, not an employee or partner of the other party.
      Neither party shall have the authority to speak for, represent or obligate
      the other party in any way without prior written authority from the other
      party.

            

    

    

    
      	
            	
              26.3.

            	
              Notices: Any
      notice or other communication given or made under or in connection with
      the matters contemplated by this Agreement shall be delivered or sent by
      registered mail, over night courier or facsimile message to the party to
      be served at the address or facsimile number appearing hereafter or such
      other address as the party may substitute for such purpose by notice given
      to the other party.

            

    

    

    To
Licensor:

    David
Slagel

    S.L.A.
Pharma AG

    Rebgasse
2

    Liestal,
Switzerland

    Office:
[*]

    Fax:
[*]

    

    to
Licensee:

    Mr. Jay
Lobell

    Paramount
BioSciences, L.L.C.

    
       

      
        

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

         

      

    
      
        
        

      

      
        54

        
          

        

      

      
        
        

      

    

     

    787
Seventh Avenue, 48th
Floor

    New York,
NY 10019, USA

    Office:
[*]

    Fax:
[*]

    

    
      	
            	
              26.4.

            	
              Entire
      Agreement: This Agreement together with its Exhibits constitute the
      whole and only Agreement between the Parties relating to the matters
      contemplated by this Agreement and supersedes and extinguishes any prior
      agreements, undertakings and arrangements of any nature whatsoever whether
      or not in writing relating thereto.

            

    

    

    
      	
            	
              26.5.

            	
              Severability:
      Should one of the provisions of this Agreement be or become invalid or
      unenforceable or should a gap become apparent, the validity of the other
      provisions in this Agreement shall remain unaffected. The parties shall
      replace the invalid or unenforceable provision or fill the gap with a
      valid and enforceable provision, to the extent legally possible and
      permissible, which comes as close as possible to what the parties would
      have agreed upon at conclusion of this Agreement if the necessity of such
      an adjustment had been known to them at that
  time.

            

    

    

    
      	
            	
              26.6.

            	
              Modifications:
      This Agreement and its Exhibits shall only be amended in writing, provided
      that (i) Exhibit 2 shall be automatically amended from time-to-time
      without further agreement by the parties as items may be included and
      excluded from Patents pursuant to the definition thereof and the terms of
      this Agreement and (ii) Exhibit 1 may be amended, and will be amended from
      time to time, at the discretion of the
  Committee.

            

    

    

    
      	
            	
              26.7.

            	
              No Waiver: The
      failure by any Party to this Agreement to enforce at any time or for any
      period of time any provision of this Agreement shall not be construed as a
      waiver of such provision or of the right of such Party thereafter to
      enforce each and every such provision of this
  Agreement.

            

    

    
       

      
        
          

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

    

     

    
      
        
        

      

      
        55

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              26.8.

            	
              Assignment:
      Neither Party shall assign this Agreement or any rights or obligations
      hereunder to any third party without the written consent of the other
      Parties hereto, provided that, notwithstanding the foregoing, each Party
      may assign this Agreement without the consent of the other party (i) to a
      purchaser, merging, or consolidating corporation, or acquirer of all or
      substantially all of that party's assets or business (or that portion
      thereof to which this Agreement relates) and/or pursuant to any
      reorganization of the respective party or (ii) to an Affiliate of the
      respective party.

            

    

    

    
      	
            	
              26.9.

            	
              Counterparts:
      This Agreement may be executed in counterparts and all counterparts shall
      constitute an original, and all counterparts shall together constitute one
      and the same instrument.

            

    

    

    
      	
              27. 

            	
              Governing
      Law and Dispute Resolution

            

    

    

    
      	
            	
              27.1.

            	
              This
      Agreement is subject to and governed by the laws of Switzerland without
      reference to its principles of conflicts of
law.

            

    

    

    
      	
            	
              27.2.

            	
              All
      disputes arising out of or in connection with the present agreement
      including disputes on its conclusion, binding effects, amendment and
      termination shall be resolved by the ordinary courts of Zurich,
      Switzerland, without limiting the right of
  recourse.

            

    

     

    
      
        
        

      

      
        56

        
          

        

      

      
        
        

      

    

     

    
      
        
          	
                  For
      the Licensor:

                	 
      	
                  For
      the Licensee:

                
	 	 	 
	
                  S.L.A.
      Pharma AG

                	 
      	
                  Paramount
      BioSciences, LLC.

                

        

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	
                                  By:

                                	
                                  /s/ D.
      Slagel

                                	 
      	
                                  By:

                                	
                                  /s/ Jay
      Lobell

                                
	
                                  Name:

                                	
                                  D. Slagel

                                	 
      	
                                  Name:

                                	
                                  Jay
      Lobell

                                
	
                                  Title:

                                	
                                  President

                                	 
      	
                                  Title:

                                	
                                  President

                                
	
                                  Date:

                                	
                                  20/03/07

                                	 
      	
                                  Date:

                                	
                                  23/03/07

                                

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        57

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
1

     

    LICENSEE
CLINICAL DEVELOPMENT PLAN

    Anoheal Development Program

    

    [*]

    

    Incostop Development Plan

    

    [*]

    
       

      
        
          

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
2

    

    PATENTS

    

    Anoheal

    

    USA-

    Application
number 09/355928 - filing (PCT) date 26/02/1998 - pending

    Application
number 10/214333 (Publication No. 2004-0028752) - filing (PCT) date 23/02/1998 -
pending

    

    Canada-

    Application
number 2281755 - filing (PCT) date 23/02/1998 (published as W098/36733) -
pending

    

    Mexico-

    None

    

    Incostop

    

    USA-

    Patent
number 6635678 (Application number 09/331163) - filing (PCT) date 23/12/1997 -
granted 21/12/2003

    Application
number 10/389773 (Publication No. 2003-0216420) - filing (PCT) date 23/12/1997 -
pending

    

    Canada-

    Application
number 2275663 - filing (PCT) date 23/12/1997 (published as W098/27971) -
pending

    

    Mexico-

    None

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    EXHIBIT
3

    

    MATERIAL

    

    

    ANOHEAL

    

    [*]

    

    INCOSTOP

    

    [*]

     

    
      
        
          

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

    

    

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    EXHIBIT
4

    

    TRADEMARKS

    

    Anoheal

    

    USA-

    Registration
number 2767016 (Application number 75/634497) - filing date 05/02/1999 -
registration date 23/09/2003 - granted

    

    Canada-

    Application
number 890193 - filing date 14/09/1998 - pending to be abandoned (use
requirements) Application number 1302465 - filing date 15/05/2006 -
pending

    

    Mexico-

    Registration
number 887847 (Application number 377132) - filing date 28/05/1999 -
registration date 24/06/2005 - granted

    

    Incostop

    

    USA-

    Application
number 76/344233 - filing date 22/06/2000 - registration number 2697369 -
registration date 18/03/2003 - granted

    

    Canada-

    Application
number 1123564 - filing date 29/11/2001 - pending

    

    Mexico-

    Application
number 521828 - filing date 05/12/2001 - pending

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    EXHIBIT
5

    

    LICENSOR
IND(S)

    

    NONE

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    EXHIBIT
6 (A)

    

    DISCLOSED
AGREEMENTS

    

    Termination
Agreement between Licensor and Solvay Pharmaceuticals signed 6/20/05 and
4/08/05

    

    M.A.
Kamm and R.S. Phillips under the Assignment Agreement dated March
1997 (See attached.)

    

    EXHIBIT
6 (B)

    

    Anoheal

    

    The
European Patent (EP 0969813 B1) in respect of Anoheal has been Opposed by
Tecnimede Sociedade Tecnico-Medicinal, S.A. The Opposition Division issued a
verbal Decision at the end of a Hearing on January 29, 2007 revoking the Patent.
As usual, no reasons for the Decision were given at that time but those reasons
will be stated in due course in a Written Decision. It is assumed that the
ground is lack of novelty over WO-A-95/06466 (Lubowski). As at February 8, 2007,
neither the Hearing Minutes nor the Written Decision had issued. An Appeal
against the Decision will be filed within a period specified in the Written
Decision but it is unlikely that the Appeal will be heard before
2009.

    

    Incostop

    

    The
European Patent (EP 0946155 B1) in respect of Incostop has been Opposed by
Norgine BV. The Opposition was filed on December 21, 2006 and an extendable
period expiring May 26, 2007 has been allowed for the filing of the Defence. It
is unlikely that the Opposition will be heard before 2009. It is believed that
Norgine’s primary objective is to obtain amendment of the granted claims to
exclude the use of Methoxamine as an active in a topical formulation for the
treatment of fecal incontinence or anal itch.

    

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      
 

    EXHIBIT 6
(C)

    

    TERMINATION
AGREEMENT

    

    entered
into by and between

    

    
      	
              1.

            	
              S.L.A. Pharma AG,
      Rebgasse 2, CH-4410 Liestal, Switzerland, hereinafter referred to as
      "SLA"

            

    

    

    and

    

    
      	
              2.

            	
              Solvay Pharmaceuticals,
      Inc., 901 Sawyer Road, Marietta, Georgia 30062, USA, hereinafter
      referred to as "SOLVAY"

            

    

    

    SLA and
SOLVAY being hereinafter referred to as the PARTY(IES).

    

    Preamble

    

    On
December 18,2001, SLA and SOLVAY entered into a license agreement (hereinafter
referred to as the "INITIAL LICENSE AGREEMENT) for Anoheal® (Diltiazem) and
Incostop® (Phenylephrine) (the "PRODUCTS" as defined below) for USA, Canada and
Mexico.

    

    Some time
after, SLA offered to SOLVAY the extension of the license granted under the
INITIAL LICENSE AGREEMENT to the whole world except Japan, North Korea, China
and Taiwan.

    

    SOLVAY
accepted the above proposal and both PARTIES entered on February 19, 2003, into
a Licence Agreement (hereinafter referred to as "LICENCE AGREEMENT") by which
SLA granted SOLVAY an exclusive licence under the SLA Patents for the
development, manufacturing, marketing use and sale of Anoheal® (Diltiazem) and
Incostop® (Phenylephrine) (the "PRODUCTS" as defined below) for the whole world
except Japan, North Korea, China and Taiwan, terminating as a consequence the
INITIAL LICENSE AGREEMENT.

    

    At the
same time, the LICENSE AGREEMENT being subject to the grant of certain
co-marketing rights and manufacturing rights with respect to the PRODUCTS to be
sublicensed to Gebro Pharma GmbH, A-6391 Fieberbrunn, Austria (hereinafter
referred to as “GEBRO”), SOLVAY’s affiliate in Switzerland, Solvay
Pharmaceuticals Marketing & Licensing AG, Binningerstrasse 94, CH-4123
Allschwill 1, Switzerland, (hereinafter referred to as “SPML”) entered with
GEBRO into a Cooperation Agreement and a Manufacturing and Supply Agreement,
granting GEBRO the aforementioned rights.

    

    SLA is
now interested to have the rights granted to SOLVAY under the LICENCE AGREEMENT
granted back to SLA to enable SLA to develop by itself or through LICENSEE(S) or
ASSIGNEE(S) the PRODUCTS and to register, promote, distribute and sell the
PRODUCTS in the TERRITORY, as SLA deems appropriate.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    SOLVAY is
willing to accept the grant-back of the said licence for the PRODUCTS and, as a
consequence, the premature termination of the LICENCE AGREEMENT and assignment
of the Cooperation Agreement and a Manufacturing and Supply Agreement to SLA,
subject to the terms and conditions set forth in this termination agreement
(hereinafter “AGREEMENT”).

    

    Now,
therefore, in consideration of the mutual covenants and agreements hereinafter
set forth and other good and valuable consideration, the receipt and legal
sufficiency of which are mutually acknowledged, the PARTIES hereto agree as
follows:

    

    Preliminary
Conditions

    

    1.           In
return for SOLVAY’s consent to the grant-back to SLA of the rights granted under
the LICENSE AGREEMENT and to the premature termination of the LICENSE AGREEMENT,
SLA shall in accordance with the terms of this AGREEMENT pay to SOLVAY certain
termination fees (hereinafter referred to as the “TERMINATION FEES”) based as
follows:

    

    
      	
               
      

            	
              a)

            	
              In
      case SLA decides to develop and/or commercialize the PRODUCTS in the
      TERRITORY by itself, SLA shall pay to SOLVAY a royalty over the NET SALES
      of the PRODUCTS made by SLA in the
TERRITORY.

            

    

    
      	
               
      

            	
              b)

            	
              In
      case SLA decides to develop and/or commercialize the PRODUCTS in the
      TERRITORY through LICENSEE(S) or ASSIGNEE(S), SLA shall pay to SOLVAY
      certain amounts of any up-front and milestone payments, as well as a
      certain percentage of the SLA ROYALTIES (as defined below), received by
      SLA.

            

    

    

    2.           SLA
shall, at its sale discretion, decide to license, sub-license or assign any or
all of its rights with respect to the PRODUCTS granted back by SOLVAY according
to this AGREEMENT provided that SOLVAY receives a prior notice in writing of the
name(s) and address(es) of any such LICENSEE(S) or ASSIGNEE(S), as the case may
be. Furthermore, notwithstanding such license, sub-license or assignment, SLA
shall remain in any case obliged toward SOLWAY, especially but not limited to
for the payment of any TERMINATION FEES as provided hereunder.

    

    1.           Definitions

    

    
      	
               
      

            	
              1.1

            	
              “AFFILIATE”
      — shall mean any company or other entity controlling, controlled by or
      under common control with a PARTY to this AGREEMENT. For the purposes of
      this AGREEMENT “control” shall mean the power to, directly or indirectly,
      appoint a majority of the directors, or to otherwise direct or cause the
      direction of the management or policies of such company or other entity,
      whether through share ownership, by contract or
  otherwise;

            

    

    

    
      	
               
      

            	
              1.2

            	
              "ASSIGNEE(S)"
      —  shall mean a SLA AFFILIATE or a third party to which SLA has
      assigned, transferred or in any way passed over any or all of its rights
      or obligations with respect to the PRODUCTS, to develop, promote,
      distribute or sell the PRODUCTS in the TERRITORY or part
      thereof;

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
            	
              1.3 

            	
              "EFFECTIVE
      DATE" — shall mean the date of signing of this
  AGREEMENT.

            

    

    

    
      	
               
      

            	
              1.4

            	
              "LICENCEE"
      — shall mean a SLA AFFILIATE or a third party to which SLA has granted
      rights under license or sublicense as the case may be, to develop,
      promote, distribute or sell the PRODUCTS in the TERRITORY or part
      thereof;

            

    

    

    
      	
               
      

            	
              1.5

            	
              "NET
      SALES" — shall mean the gross sales of the PRODUCTS invoiced by SLA its
      LICENSEE(S) or ASSIGNEE(S) or their marketing partners, as the case may
      be, to third parties in arms length transactions, less all excise and
      other sales taxes, charges for freight and other duties, all trade,
      quantity and cash discounts, all rebates and charge backs, allowances or
      credits to customers on account of rejection, withdrawal, recall or return
      which are customary in the pharmaceutical industry and which SLA, the
      LICENSEE(S) or the ASSIGNEE(S) or the marketing partner, as the case may
      be, have to pay or absorb on such
sales.

            

    

    

    
      	
               
      

            	
              1.6

            	
              “PRODUCTS”
      — shall mean the pharmaceutical products currently named Anoheal®
      (Diltiazem) cream and Incostop® (phenylephrine)
  gel.

            

    

    

    
      	
               
      

            	
              1.7

            	
              “SLA
      ROYALTIES” — shall mean any royalties on sales of the PRODUCTS in the
      TERRITORY due to SLA by LICENSEE(S), ASSIGNEE(S) or marketing partners,
      based on an agreed percentage (hereinafter referred to as the “ROYALTY
      RATE”) of the LICENSEE(S), ASSIGNEE(S) or marketing partners’ NET
      SALES.

            

    

    

    
      	
               
      

            	
              1.8

            	
              “TERRITORY”
      — shall mean the whole world except Japan, North Korea, China and
      Taiwan.

            

    

    

    2.           Termination

    

    
      	
               
      

            	
              2.1

            	
              As
      from the EFFECTIVE DATE, the LICENCE AGREEMENT is terminated prematurely
      and replaced by this AGREEMENT.

            

    

    

    
      	
               
      

            	
              2.2

            	
              SOLVAY
      hereby assigns, and SLA herewith accepts being assigned all SPML's right,
      title and interest and all of SPML obligations under the Cooperation
      Agreement and Manufacturing and Supply Agreement, provided that SOLVAY
      shall be responsible to obtain GEBRO's Consent for such assignment in a
      agreement letter which will be attached to this
  AGREEMENT.

            

    

    

    3.           Grant Back of License

    

    
      	
               
      

            	
              3.1.

            	
              From
      the EFFECTIVE DATE, SOLVAY hereby grants back to SLA the exclusive license
      formerly granted by SLA to SOLVAY under the LICENSE AGREEMENT with respect
      to the PRODUCTS, which grant back SLA hereby
  accepts.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              3.2.

            	
              Other
      than expressly stated in this AGREEMENT, SOLVAY retains no rights with
      respect to the PRODUCTS.

            

    

    

    
      	
               
      

            	
              3.3

            	
              As
      a consequence hereof and subject to the terms and conditions set forth in
      this AGREEMENT, as from the EFFECTIVE DATE SLA shall be responsible for
      carrying out, or having carried out by LICENSEE(S) or ASSIGNEE(S), all
      activities relating:

            

    

    
      	
            	
              a) 

            	
              the
      PRODUCTS development and clinical
trials;

            

    

    
      	
            	
              b) 

            	
              the
      registration of the PRODUCTS;

            

    

    
      	
               
      

            	
              c)

            	
              the
      promotion, distribution and sale of the PRODUCTS in the TERRITORY, as SLA
      will deem appropriate.

            

    

    

    4.           Transfer of data

    

    As from
the EFFECTIVE DATE, SOLVAY shall transfer and/or reassign to SLA, as the case
may be

    

    
      
        	
              	
                4.1.

              	
                All
      the PRODUCTS development data and clinical trials generated by
      SOLVAY
      or received from SLA during the LICENSE
  AGREEMENT.

              

      

    

    

    
      	
               
      

            	
              4.2.

            	
              All
      the regulatory documents and files with respect to the PRODUCTS generated
      by SOLVAY or received from SLA during the LICENSE
    AGREEMENT.

            

    

    

    
      	
            	
              4.3 

            	
              All
      marketing data generated by SOLVAY during the LICENSE
      AGREEMENT.

            

    

    

    5.           Development and Commercialization of the PRODUCTS and
Partnering

    

    
      	
               
      

            	
              5.1.

            	
              SLA
      shall keep SOLVAY regularly informed of its discussions and negotiations
      regarding the development and/or commercialization of the PRODUCTS in the
      TERRITORY through LICENSEE(S) or ASSIGNEE(S), as the case may
      be

            

    

    

    
      	
               
      

            	
              5.2.

            	
              SOLVAY
      shall provide to SLA free of charge, at SLA's request, reasonable
      technical assistance from its New Business Development Department in SLA's
      partnering discussions, provided that such assistance shall be supplied
      only to the extent that SOLVAY, in its sole discretion, determines that
      (a) it has sufficient resources available to provide such assistance, and
      (b) such technical assistance provided by SOLVAY shall be limited in Fall
      Time Equivalents and in time to one (1) FTE for up to a maximum of eighty
      (80) hours to be taken within eighteen months as from the EFFECTIVE
      DATE.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    6.           TERMINATION FEES

    

    
      	
               
      

            	
              6.1.

            	
              In
      consideration of the grant back to SLA by SOLVAY of the exclusive rights
      to the PRODUCTS and SOLVAY's acceptance of the premature termination of
      the LICENSE AGREEMENT, SLA shall pay to SOLVAY certain TERMINATION
      FEES.

            

    

    

    
      	
               
      

            	
              6.2.

            	
              In
      case SLA decides to develop and/or commercialize the PRODUCTS in the
      TERRITORY by itself, the TERMINATION FEES payable by SLA to SOLVAY shall
      be equal to [*] percent ([*]%) of the NET SALES of the PRODUCTS in the
      TERRITORY.

            

    

    

    
      	
               
      

            	
              6.3.

            	
              In
      case SLA decides to develop and/or commercialize the PRODUCTS in the
      TERRITORY through LICENSEE(S) or ASSIGNEE(S) as the case may be and
      subject to clause 6.3.3 below, SLA shall pay to SOLVAY the following
      TERMINATION FEES:

            

    

    

    6.3.1       TERMINATION
FEES on upfront and/or milestone payments:

    

    SLA shall
pay to SOLVAY on any upfront and/or milestone payments received by it the
following TERMINATION FEES:

    

    
      	
               
      

            	
              a)

            	
              On
      the [*] USD ($[*]) received by SLA as up-front and/or milestone payments,
      SLA shall [*] to SOLVAY;

            

    

    
      	
               
      

            	
              b)

            	
              [*]
      percent ([*]%) of the aggregate of up-front and/or milestone payments
      received by SLA exceeding [*] USD ($ [*]) and not exceeding [*] USD
      ($[*]);

            

    

    
      	
               
      

            	
              c)

            	
              [*]
      percent ([*]%) of the aggregate of up-front and/or milestone payments
      received by SLA exceeding [*] USD
($ [*]).

            

    

    

    6.3.2       TERMINATION
FEES on SLA ROYALTIES:

    

    SLA shall
pay to SOLVAY the following percentage of SLA ROYALTIES:

    

    
      	
               
      

            	
              (i)

            	
              up
      to and including a ROYALTY RATE imposed on the LICENSE(S) or the
      ASSIGNEE(S) equal to [*] percent ([*]%), SLA shall pay to SOLVAY [*]
      percent ([*]%) of SLA ROYALTIES;

            

    

    
      	
               
      

            	
              (ii)

            	
              as
      from a ROYALTY RATE imposed on the LICENSE(S) or the ASSIGNEE(S) exceeding
      [*] percent ([*]%), SLA shall pay to SOLVAY [*] percent ([*]%) of SLA
      ROYALTIES.

            

    

    
       

      
        
          

      

      
        [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      	
               
      

            	
              6.3.3

            	
              Notwithstanding
      the above, it is agreed between the PARTIES that in case SLA was to pay
      any down payment to GEBRO according to the Cooperation Agreement assigned
      to SLA as per this AGREEMENT, the next TERMINATION FEES normally due to
      SOLVAY as described under this Clause 6.3 shall not have be paid by SLA to
      SOLVAY. The TERMINATIONS will only become due again as from the moment SLA
      shall be considered as having received from LICENSEE(S) or ASSIGNEE(S) an
      aggregate amount of up-front and/or milestone payments as well as of SLA
      ROYALTIES equal to the amount of the down payment paid to
      GEBRO.

            

    

    

    
      	
               
      

            	
              6.4.

            	
              SOLVAY
      shall have the .right to require payment of any TERMINATION FEES directly
      from SLA's LICENSEE(S) or ASSIGNEE(S) for NET SALES in case of a default
      in payment by SLA, and SLA's LICENSEE(S) or ASSIGNEE(S) shall specifically
      agree in their agreement with SLA that in the event of such requests it
      shall make all TERMINATION FEES payments and furnish reports and documents
      directly to SOLVAY.

            

    

    

    
      	
               
      

            	
              6.5.

            	
              The
      TERMINATION FEES according to this Clause 6 shall be paid to SOLVAY as
      long as the PRODUCTS are sold by SLA and/or its successors and/or its
      LICENSEE(S) or ASSIGNEE(S) and/or their successors in the
      TERRITORY.

            

    

    

    
      	
               
      

            	
              6.6.

            	
              Accounting
      and payment of the TERMINATION FEES shall be effectuated on a quarterly
      basis in accordance with internationally recognised accounting principles.
      SLA shall submit the statement of accounts April, July, October and
      January of each year, and pay the TERMINATION FEES for each quarter within
      thirty (30) days after the end of the calendar
  quarter.

            

    

    

    
      	
               
      

            	
              6.7.

            	
              The
      TERMINATION FEES shall be paid in USD to the bank account indicated by
      SOLVAY.

            

    

    

    
      	
               
      

            	
              6.8.

            	
              SLA
      shall always keep up-to-date and correct records of the sales of the
      PRODUCTS so that SOLVAY or its accounting expert is able to verify the NET
      SALES and the SLA ROYALTIES.

            

    

    

    
      	
               
      

            	
              6.9.

            	
              SOLVAY
      is entitled to have these figures verified by an accounting expert at any
      time upon its first request not more than once a year; in such case SLA
      shall permit the accounting expert delegated by SOLVAY to inspect its
      books and other accounts relating to the PRODUCTS as well as relevant
      documents to the extent required for that purpose upon reasonable prior
      written notice and during normal business
hours.

            

    

    

    7.           Applicable Law and Jurisdiction

    

    
      	
               
      

            	
              7.1.

            	
              This
      Termination Agreement shall in all parts exclusively be construed under,
      governed by, interpreted under, and made subject to the laws of
      Switzerland.

            

    

    

    
      	
               
      

            	
              7.2.

            	
              Any
      dispute arising out of or in connection with this Termination Agreement
      shall be solved amicably. If the PARTIES do not come to a mutual
      understanding, then it is hereby agreed that any dispute shall be settled
      exclusively by the Commercial Court of
Zürich.

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    8.           Miscellaneous

    

    
      	
               
      

            	
              8.1.

            	
              If
      any provision thereof is or becomes invalid, the existence of this
      AGREEMENT and the validity of the remaining provisions shall not be
      effected thereby. The contracting PARTIES shall immediately and by mutual
      agreement replace the invalid provisions by a valid provision which is as
      consistent as possible with the original intent of the contracting
      PARTIES.

            

    

    

    
      	
               
      

            	
              8.2.

            	
              Any
      amendment to and/or modification of this AGREEMENT shall only be valid if
      made in writing and signed by both
PARTIES.

            

    

    

    
      	
               
      

            	
              8.3.

            	
              Neither
      this AGREEMENT nor any interest under this AGREEMENT shall be assignable
      by either PARTY without the written consent of the other, provided,
      however, that either PARTY may assign this AGREEMENT or any part thereof
      to any AFFILIATE or to any corporation with which it may merge or
      consolidate, or to which it may transfer all or substantially all of its
      assets to which this AGREEMENT relates, without obtaining the consent of
      the other PARTY.

            

    

    

    IN
WITNESS WHEREOF the PARTIES hereto have duly executed this AGREEMENT in a
legally binding manner

    

    
      
        
          
            	
                    S.L.A. Pharma AG

                  	 
      	
                    Solvay
      Pharmaceuticals, Inc

                  
	 
      	 
      	 
      
	
                    /s/
      D. Slagel

                  	 
      	
                    /s/ Harold
      H. Shelvin

                  
	 
      	 
      	
                    Harold
      H. Shelvin

                  
	
                    Liestal,

                  	 
      	
                    President
      & CEO

                  
	 
      	 
      	
                    Solvay
      Pharmaceuticals, Inc.

                  
	
                    4/08/05

                  	 
      	
                    6/20/05

                  

          

        

      

    

    
      
        

          
            
               

            

            
              
              

              
                

              

            

            
               

            

          

        

      

    

     

    

    Annex

    to the Termination Agreement
between

    S.L.A. Pharma AG and Solvay
Pharmaceuticals, Inc.

    

    Assignment and assumption
Agreement

    

    To be
attached.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    
      
        
          	 	 	 

        

      

    

     

    DATED                      March
1997

    

    (1)            DR
MA KAMM      

      

    (2)           MR
RS PHILLIPS

    

    and

    

    (3)           SLACO
PHARMA AG

    
      
        
          
            
              
                
                  
                    
                      
                        
                          	 	 	 
	 	 	 
	 
      	
                                  ASSIGNMENT
      AGREEMENT

                                	 
      
	 	 	 

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    Stringer
Saul

    Marcol
House

    293
Regent Street

    London
W1R 7PD

     

    
      
        
          
            	 	 	 

          

        

      

      

        
          
             

          

          
            
            

            
              

            

          

          
             

          

        

    

    ASSIGNMENT
AGREEMENT

    

    THIS
AGREEMENT is made the        day of March
1997

    

    BETWEEN

    

    Dr
Michael A. Kamm of [*] and Mr Robin K S Phillips of [*] (hereinafter
together called "the Assignors")

    

    and

    

    Slaco
Phanna AG, a Swiss company incorporated under the laws of Switzerland having its
principal
office at Oristalstrasse 87a, 73 Postfach, CH-4410 Leistal, Switzerland
(hereinafter called
"the Assignee")

    

    WHEREAS
the Assignors have agreed to assign the First Invention and Second Invention to
the Assignee in accordance with the terms and conditions hereinafter
mentioned.

    

    THEREFORE
in consideration of the mutual understanding set out below IT IS HEREBY AGREED
AS FOLLOWS:

    

    
      	
              1

            	
              In
      consideration of the matters set out below the Assignors assign all
      world-wide rights to and in:

            

    

    

    
      	
               
      

            	
              1.1

            	
              patent
      application numbers 9626750.5, 9626739.8 and 9703750.1 which applications
      relate to compounds for treating anal incontinence by means of a
      pharmaceutical composition (hereinafter called "the First
      Invention")

            

    

    

    
      	
               
      

            	
              1.2

            	
              patent
      application number 9703309.6 which application relates to a compound which
      has an effect on the longitudinal muscle for treating anal disorders
      (hereinafter called "the Second
Invention")

            

    

    

    
      	
              2

            	
              The
      Assignors will provide the Assignee with all necessary know-how and in
      return the Assignee will involve the Assignors in all future development
      of the compounds covered by this Agreement and will keep the Assignors
      fully informed of the status of all developments including but not limited
      to clinical trials. The Assignee shall be responsible for conducting all
      relevant clinical and other trials relating to the development of the
      First and Second Inventions and will appoint independent centres to
      conduct certain of the clinical or other trials. However, before
      instructing any independent centre to conduct such trials the Assignee
      shall always first offer the Assignors the right to conduct such trial on
      commercial terms to be agreed and the Assignors may accept or reject the
      offer as they see fit.

            

    

      

    
      

    

    [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    
      
        	
                3

              	
                The
      Assignee will be responsible for all filing of patents and all costs that
      are incurred and shall at its own cost diligently prosecute to grant all
      patent applications made
      or to be in respect of the First Invention and the Second Invention. The
      Assignee will be responsible for maintaining the validity of the patents
      when they issue for the fall terms thereof and will be responsible for the
      enforcement of the patents when they issue and the assignee covenants to
      use its reasonable endeavours to enforce the patents against
      infringers.

              

      

    

    

    
      	
              4

            	
              The
      Assignee shall make all diligent efforts to develop the First Invention
      and the Second Invention and will meet all development costs in those
      counties where patents are granted or
pending.

            

    

    

    
      	
              5

            	
              The
      Assignors receive [*] percent ([*]%) of the Net Sales Value shared equally
      in respect of world-wide sales where products comprising the compounds
      which form the subject matter of the First or Second Invention are
      marketed by the Assignee. This level of royalties shall continue for the
      duration of the patent where granted (as extended by any supplementary
      protection certificate if obtained in any particular country), or in the
      event of a patent application not being granted royalties shall continue
      for the life of the products and be reduced by mutual consent if the sales
      are adversely affected by competitor
products.

            

    

    

    
      	
              6

            	
              The
      Assignee undertakes that it will assign unconditionally to the Assignors
      [*] ([*]) percent of any royalty payment shared equally (less all
      applicable credits) payable to the Assignee accruing out of the rights and
      obligations contained in any licence or assignment agreement(s) between
      the Assignee and any other party.

            

    

    

    
      	
              7

            	
              The
      Assignee undertakes that it will assign. unconditionally to the Assignors
      [*] percent ([*]%) of all up-front and sell-off payments shared equally
      which have been negotiated by the Assignee and a third party in respect of
      the sale to such third party of all or any of the patents or patent
      applications resulting from the First or Second
  Invention..

            

    

    

    
      	
              8

            	
              The
      Assignee when conducting negotiations with a third party, when any patent
      or patent application is proposed to be licensed or assigned to the third
      party, shall use its best endeavours to achieve an agreement which ensures
      that the same percentage of royalties payable to the Assignors in
      accordance with clause 5 above shall continue without
      interruption.

            

    

    

    
      	
              9 

            	
              MARKETING

            

    

    

    The
Assignee shall use its reasonable endeavours to market products resulting from
the First or Second Inventions and to ensure that an equivalent provision is
included in any licence or assignment that it proposes to enter into with any
third party.

    

    
      	
              10 

            	
              PAYMENT
      TO THE ASSIGNORS

            

    

    

    
      	
              10.1

            	
              The
      Assignee will supply to the Assignors all royalty reports, sales, figures
      and other relevant information and will allow the Assignors or their duly
      appointed agents to inspect at the Assignee's place of business all
      records relating to the sales and transactions of the compounds covered by
      the agreements.

            

    

    
       

      
        

      

    

    [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      	
              10.2

            	
              All
      royalty payments payable by any company in respect of net sales of the
      compounds in any territory shall be apportioned between Assignee and the
      Assignors in accordance with the above and said amounts are paid directly
      to the Assignors by electronic fund transfer to the Assignors' accounts
      the details of which shall be provided to the Assignee. This shall also
      apply to all up-front and sell-off
payments.

            

    

    

    
      	
              10.3

            	
              As
      from the date of issue of a product licence in respect of products
      containing the compounds disclosed in the First or Second Invention on a
      country by country basis, the Assignee shall pay the Assignors a royalty
      as specified in this Agreement.  Payments shall be made
      quarterly in arrears, allowing up to three weeks following the
      quarter-end.

            

    

    

    
      	
              10.4

            	
              Royalty
      payments shall be paid in pounds sterling and shall be calculated in the
      currency in which the sales are made and where conversions of currency are
      necessary shall be converted at the rate of exchange at the date when
      payment is due. All bank charges and exchange expenses shall be at the
      expense of the Assignee.

            

    

    

    
      	
              11 

            	
              NOTICES

            

    

    

    
      	
              11.1

            	
              Any
      notice to be given hereunder shall be sent by first class mail with
      recorded delivery to the other party at the addresses contained herein or
      at such other addresses as each party shall have indicated to each other
      and shall be deemed to be given two (2) days following the date of
      mailing.

            

    

    

    
      	
              11.2

            	
              In
      the event that the Assignee proposes to assign, change or licence any or
      all of the patents granted or applied for in any country in the world in
      respect of the composition, they will negotiate with the third party on an
      arms' length basis so as to secure the best commercial terms possible, and
      they will promptly notify the Assignors of the terms and conditions of the
      proposed transactions and prior to the entering into of any contractual
      commitment obtain the Assignors prior approval; such approval not to be
      unreasonably withheld save that the Assignee agrees that it will be
      reasonable for the Assignors to withhold their approval to any proposed
      licence, assignment or other agreement which does not ensure that they
      continue to receive the same level of royalties as provided for in clause
      5 above unless there are any legal or commercial circumstances applicable
      in a particular country or countries to which the proposed agreement
      relates which prevent such level of royalty being
  achieved.

            

    

    

    
      	
              11.3

            	
              The
      Assignors shall be kept informed of all distribution and marketing
      arrangements entered into by the
Assignee.

            

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      	
              12 

            	
              GOVERNING
      LAW

            

    

    

    Disputes
in relation to this Agreement which arise between the Assignors and the assignee
shall be governed by the laws of England and shall be subject to the exclusive
jurisdiction of the English Courts.

    

    
      	
              13 

            	
              WAIVER

            

    

    

    A waiver
by one party of a breach by the other party of any terms of this Assignment
shall not prevent the subsequent enforcement of the terms and shall not be
deemed a waiver of any subsequent breach.

    

    
      	
              14

            	
              DEFINITIONS

            

    

    

    The
singular includes the plural and vice-versa where the context so admits or
requires reference to the Assignors and Assignee shall include their respective
employees or agents.

    

    "Territory"
means any country or state in which the First or Second Invention is
sold.

    

    "Net
Sales Value" for the purposes of this Agreement means the price paid by third
parties (including but not limited to distributors or agents) to the Assignee in
respect of any product comprising the First or Second Invention in an arm's
length transaction exclusively for money after deduction of normal (not special
or promotional) trade discounts actually granted and of any credits actually
given by the Assignee for returned or defective goods and excluding or making
proper deductions for any costs of packing, insurance, carriage and freight and
Value Added Tax or other sales tax and applicable governmental levies or subject
in all cases to the same being separately charged on customer invoices. In any
sale or other disposal of any products or part thereof otherwise then in any
arm's length transaction exclusively for money, the fair market price (if
higher) shall be substituted for the Net Sales Value.

    

    
      	
              15

            	
              EFFECTIVE
      DATE

            

    

    

    This
Agreement shall be effective from the date of the signed
signature.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    IN
WITNESS whereof the parties have caused this Agreement to be signed by
themselves or their duly authorised representatives on the date below
written.

    

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                SIGNED by Dr
      Michael A. Kamm

                              	 	 
      	 	) 	
                                  
      

                              	 	 
      	 
      
	
                                in the presence of:

                              	 	 
      	 	) 	
                                  
      

                              	 	
                                /s/ Michael
      Kamm

                              	  
      
	 
      	 	 
      	 	 	 
      	 	
                                Dr
      Michael A Kamm

                              	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                Witness Name

                              	: 	
                                L.
      Flack

                              	 	 	 
      	 	 
      	 
      
	
                                Witness Address

                              	: 	
                                [*]

                              	 	 	 
      	 	 
      	 
      
	 
      	 	
                                [*]

                              	 	 	 
      	 	 
      	 
      
	
                                Witness Signature

                              	: 	
                                /s/ L.
      Flack

                              	 	 	 
      	 	 
      	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                SIGNED by Mr
      Robin S Phillips

                              	 	 
      	 	) 	
                                  

                              	 	 
      	 
      
	
                                in the presence of:

                              	 	 
      	 	) 	
                                  

                              	 	
                                /s/ Robin
      Phillips

                              	 
      
	 
      	 	 
      	 	 	 
      	 	
                                Mr
      Robin S Phillips

                              	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                Witness Name

                              	: 	
                                P. Shawyer

                              	 	 	 
      	 	 
      	 
      
	
                                Witness Address

                              	: 	
                                [*]

                              	 	 	 
      	 	 
      	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                Witness Signature

                              	: 	
                                /s/ P. Shawyer

                              	 	 	 
      	 	 
      	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                SIGNED by

                              	 	 
      	 	) 	
                                 

                              	 	 
      	 
      
	
                                duly authorized on behalf of

                              	 	 
      	 	) 	
                                /s/ D.
      Slagel

                              	 	  
      	  
      
	
                                SLACO PHARMA AG

                              	 	 
      	 	) 	
                                  

                              	 	 
      	 
      
	
                                in the presence of:

                              	 	 
      	 	) 	
                                  

                              	 	 
      	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                Witness Name

                              	: 	
                                Joan
      N. Goldston

                              	 	 	 
      	 	 
      	 
      
	
                                Witness Address

                              	: 	
                                [*]

                              	 	 	 
      	 	 
      	 
      
	 
      	 	 
      	 	 	 
      	 	 
      	 
      
	
                                Witness Signature

                              	: 	
                                /s/ Joan
      N. Goldston

                              	 	 	  
      	 	  
      	 
      

                      

                    

                  

                

              

            

          

        

      

    

    
       

      
        

      

    

    [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    EXHIBIT
7

    

    SUBSCRIPTION
AGREEMENT

    

    (SEE
ATTACHED)

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    EXHIBIT
7

    

    FORM OF STOCK PURCHASE
AGREEMENT

    

    THIS STOCK PURCHASE AGREEMENT ("Agreement") is
entered into as of _____, 2007, by and between the undersigned (the "Purchaser")
and __________, Inc. a
Delaware corporation having a business address at 787 Seventh Avenue, New York,
NY 10019 (the "Corporation").

    

    RECITALS

    

    WHEREAS, the Corporation desires to
sell shares of common stock, par value $.001 per share, of the Corporation
(which class of shares is referred to herein as "Common Stock") to
Purchaser, and Purchaser desires to purchase these shares, upon the terms and
conditions herein specified; and

    

    WHEREAS, Purchaser is willing to
subject the Stock (as defined herein) to the restrictions contained
herein.

    

    AGREEMENT

    

    NOW, THEREFORE, in consideration of the
foregoing recitals and of the mutual promises herein contained, the parties
hereby agree as follows:

    

    1.        
   Issuance and Acquisition of
Stock.

    

    (a)           Immediately
after the execution of this Agreement by the parties, the Corporation shall
transfer to the Purchaser, and the Purchaser shall acquire from the Corporation,
the number of shares of Common Stock listed beside the Purchaser's name on the
signature page hereto (the "Stock"), at the
purchase price of $.001 per share, for the total purchase price listed below the
Purchaser's name on the signature page hereto (the "Purchase
Price").

    

    (b)          As
soon as reasonably practicable after the execution of this Agreement, the
Corporation shall deliver to the Purchaser a certificate or certificates
evidencing the Stock, registered in the name of the Purchaser and concurrently
therewith the Purchaser shall make payment for the Stock by delivering to the
Seller a check payable to the Corporation in the amount of the Purchase
Price.

    

    2.      
     Violation Of Transfer
Provisions.  The Corporation shall not be required (i) to
transfer on its books any shares of Stock which shall have been sold,
transferred, assigned or pledged in violation of any of the provisions of this
Agreement or (ii) to treat as owner of such shares or to accord the right to
vote as such owner or to pay dividends to any transferee to whom such shares
shall have been so sold, transferred, assigned or pledged.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    3.           Rights as
Shareholder.  Except as otherwise provided herein during the
term of this Agreement, the Purchaser shall exercise all rights and privileges
of a shareholder of the Corporation with respect to the Stock.

    

    4.           Representation and
Warranties by the Corporation.

    

    The Corporation represents, warrants
and covenants with the Purchaser as follows:

    

    (a)           The
Corporation has all necessary power and capacity to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transaction contemplated hereby.  This Agreement has been validly
executed and delivered by the Corporation and constitutes the legal, valid and
binding obligation of the Corporation, enforceable against the Corporation in
accordance with its terms.  The execution and delivery of this
Agreement by the Corporation do not and the performance of its obligations under
this Agreement will not conflict with or result in any breach or constitute a
default under any contracts to which the Corporation is a party or by which the
Corporation or any property or asset of the Corporation is bound or
affected.

    

    (b)           The
Corporation has good title to the Stock and owns the Stock free and clear of any
security interests, liens, claims, pledges, options, rights of first refusal,
agreements, limitations on voting rights, charges and other encumbrances of any
nature whatsoever (collectively, "Liens") other than restrictions on transfer
imposed under the Securities Act of 1933, as amended (the "Securities
Act").  Upon delivery thereof to the Purchaser, the Purchaser shall
acquire good title to the Stock, free and clear of any Liens other than the
restrictions set forth in this Agreement and under the Securities
Act.  The Stock is validly issued, fully paid and
nonassessable.  The Corporation is transferring the Stock to the
Purchaser hereunder pursuant to a valid exemption from registration under the
Securities Act.

    

    5.           Representations and
Warranties by the Purchaser.

    

    The Purchaser represents, warrants and
covenants with the Corporation as follows:

    

    (a)           The
Purchaser has all necessary power and capacity to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate the
transaction contemplated hereby.  This Agreement has been validly
executed and delivered by the Purchaser and constitutes the legal, valid and
binding obligation of the Purchaser, enforceable against the Purchaser in
accordance with its terms.  The execution and delivery of this
Agreement by the Purchaser do not and the performance of its obligations under
this Agreement will not conflict with or result in any breach or constitute a
default under any contracts to which the Purchaser is a party or by which the
Purchaser or any property or asset of the Purchaser is bound or
affected.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    (b)           The
Stock will be acquired by the Purchaser for his own account with the Purchaser's
own funds for investment purposes and for the Purchaser's own account, not as a
nominee or agent for any other person, firm or corporation, and not with a view
to the sale or distribution of all or any part thereof, and the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing, any or all of the Stock.  The Purchaser does not have
any contract, undertaking, agreement or arrangement with any person, firm or
corporation to sell, transfer or grant any participation to any person, firm or
corporation with respect to any or all of the Stock.

    

    (c)           The
Purchaser understands that the Stock will not be registered under the Securities
Act of 1933, as amended, (the "Securities Act"), and that the Stock is being
issued and sold to the Purchaser based upon an exemption from registration
predicated in part on the accuracy and completeness of the Purchaser's
representations and warranties appearing herein.

    

    (d)           The
Purchaser agrees that in no event will the Purchaser sell, transfer, assign or
pledge all or any part of the Stock or any interest therein, unless and until
(i) the Purchaser shall have furnished the Corporation with an opinion of
counsel satisfactory in form and content to the Corporation to the effect that
(A) such disposition will not require registration of the Stock under the
Securities Act or compliance with applicable state securities laws, or (B)
appropriate action necessary for compliance with the Securities Act and
applicable state securities laws has been taken; (ii) the Corporation shall have
waived, expressly and in writing, its right under clause (i) of this subsection;
and (iii) the proposed transferee of the Stock shall have provided the
Corporation with a written agreement or undertaking by which such transferee
agrees to be bound by all terms, conditions and limitations of this Agreement
applicable to such transferee's transferor as if such transferee were a party
hereto.  The requirement of subparagraph (iii) shall not apply to any
transfer (A) pursuant to an offering registered under the Securities Act, (B)
pursuant to Rule 144 under the Securities Act or (C) effected in a market
transaction otherwise exempt from registration under the Securities
Act.

    

    (e)           The
Purchaser is able to fend for itself in connection with the transactions
contemplated by this Agreement, has such knowledge and experience in financial
and business matters (including investments in development stage biotechnology
companies) as to be capable of evaluating the merits and risks of its investment
in the Corporation, has the ability to bear the economic risks of its investment
for an indefinite period of time and can afford a complete loss of its
investment and has had the opportunity prior to the Purchaser's purchase of the
Stock to ask questions of and receive answers from representatives of the
Corporation concerning the finances, operations and business of the
Corporation.  The Purchaser acknowledges and agrees that (i) it is not
relying upon any statement, promise or assurance of the Corporation or any
investor in the Corporation (or any representative of the Corporation or any
such investor) in arriving at the Purchaser's decision to purchase the Stock,
and has not otherwise been induced to purchase the Stock by the Corporation or
any such investor (or any representative of the Corporation or any such
investor); and that (ii) it has decided to purchase the Stock based upon the
Purchaser's own analysis of the merits and risks of investing in the Corporation
without the intervention or assistance of any other person, firm or
corporation.

    

    (f)           The
Purchaser understands and acknowledges that the Purchaser will not be permitted
to sell, transfer, assign or pledge the Stock until it is registered under the
Securities Act or an exemption from the registration and prospectus delivery
requirements of the Securities Act is available to the Purchaser, and that there
is no assurance that such an exemption from registration will ever be available
or that the Purchaser will ever be able to sell any of the
Stock.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (g)          All
certificates representing the Stock and, until such time as the Stock is sold in
an offering which is registered under the Securities Act or the Corporation
shall have received an opinion of counsel satisfactory in form and content to
the Corporation that such registration is not required in connection with a
resale (or subsequent resale) of the Stock, all certificates issued in transfer
thereof or substitution therefor, shall, where applicable, have endorsed thereon
the following (or substantially equivalent) legends:

    

    
      	
               
      

            	
              (i)

            	
              THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE ARE NOT TRANSFERABLE WITHOUT
      THE EXPRESS WRITTEN CONSENT OF __________, INC., (THE "COMPANY") AND HAVE
      NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 OR ANY APPLICABLE
      STATE SECURITIES OR "BLUE SKY" LAWS, AND MAY NOT BE SOLD, OFFERED FOR
      SALE, PLEDGED, OR HYPOTHECATED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF
      A REGISTRATION STATEMENT IN EFFECT WITH RESPECT TO THE SECURITIES UNDER
      SUCH ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
      REGISTRATION IS NOT REQUIRED OR UNLESS SOLD PURSUANT TO RULE 144 OF SUCH
      ACT.  ANY SUCH TRANSFER MAY ALSO BE SUBJECT TO APPLICABLE STATE
      SECURITIES OR "BLUE SKY" LAWS.

            

    

    

    
      	
            	
              (ii) 

            	
              Any
      legend required to be placed thereon by any applicable state securities
      law.

            

    

    

    (h)          The
Corporation shall not be obligated to transfer any of the Stock if counsel for
the Corporation determines that any applicable registration requirement under
the Securities Act or any other applicable requirement of federal or state law
has not been met.

    

    6.           General
Provisions.

    

    (a)          No
Assignments.  The Purchaser shall not transfer, assign or
encumber any of its rights, privileges, duties or obligations under this
Agreement without the prior written consent of the Corporation, and any attempt
to so transfer, assign or encumber shall be void.

    

    (b)          Notices.  All
notices and other communications which are required or permitted to be given
pursuant to the terms of this Agreement shall be in writing and shall be
sufficiently given (i) if personally delivered, (ii) if sent by telex or
facsimile, provided that "answer-back" confirmation is received by the sender or
(iii) upon receipt, if sent by registered or certified mail, postage paid return
receipt requested in any case addressed as follows:

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    
      
        	
                 
      

              	
                (i)

              	
                If
      to the Corporation:

              
	 	 	 
	 	 	____________________________________
	 	 	____________________________________
	 	 	____________________________________

      

    

     

    
      	
            	
              (ii) 

            	
              If
      to the Purchaser, to the address set forth on the signature page of this
      Agreement.

            

    

    

    The
address of a party, for the purposes of this Section 6(b)(ii), may be changed by
giving written notice to the other party of such change in the manner provided
herein for giving notice.  Unless and until such written notice is
received, the addresses as provided herein shall be deemed to continue in effect
for all purposes hereunder.

    

    (c)          Standoff
Agreement.  The Purchaser agrees that, in connection with each
underwritten public offering registered under the Securities Act of shares of
Common Stock or other equity securities of the Corporation by or on behalf of
the Corporation, the Purchaser shall not sell or transfer, or offer to sell or
transfer, any shares of Common Stock or other equity securities of the
Corporation for such period as the managing underwriter of such offering or the
Corporation determines is necessary to effect the underwritten public
offering.

    

    (d)          Choice of Law; Consent to
Jurisdiction.  This Agreement shall be governed by and
construed in accordance with the internal laws (without giving effect to the
conflicts of law principles) of the State of New York.

    

    (e)          Severability.  The
parties hereto agree that the terms and provisions in this Agreement are
reasonable and shall be binding and enforceable in accordance with the terms
hereof and, in any event, that the terms and provisions of this Agreement shall
be enforced to the fullest extent permissible under law.  In the event
that any term or provision of this Agreement shall for any reason be adjudged to
be unenforceable or invalid, then such unenforceable or invalid term or
provisions shall not affect the enforceability or validity of the remaining
terms and provisions of this Agreement, and the parties hereto hereby agree to
replace such unenforceable or invalid term or provision with an enforceable and
valid arrangement which, in its economic effect, shall be as close as possible
to the unenforceable or invalid term or provision.

    

    (f)           Successors.  All
references in this Agreement to the Corporation shall include any and all
successors in interest to the Corporation, whether by merger, consolidation,
sale of all or substantially all assets or otherwise, and this Agreement shall
inure to the benefit of the successors and assigns of the Corporation and,
subject to the terms herein set forth, shall be binding upon the Purchaser, its
successors and permitted assigns.

    

    (g)          Counterparts.  This
Agreement may be executed in two counterparts, each of which shall be deemed an
original, but which together shall constitute one and the same
instrument.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (h)         Modification, Amendment and
Waiver.  No modification, amendment or waiver of any provision
of this Agreement shall be effective against the Corporation unless the same
shall be in a written instrument signed by an officer of the Corporation on its
behalf and such instrument is approved by its Board of Directors.  The
failure at any time to enforce any of the provisions of this Agreement shall in
no way be construed as a waiver of such provisions and shall not affect the
right of either party thereafter to enforce each and every provision hereof in
accordance with its terms.

    

    (i)           Further
Assurances.  The parties agree to execute such further
instruments and to take such further action as may reasonably be necessary to
carry out the intent of this Agreement.

    

    (j)           Integration.  This
Agreement constitutes the entire agreement of the parties with respect to the
subject matter hereof.

    

    (k)          Headings.  The
headings of the Sections and paragraphs of this Agreement have been inserted for
convenience of reference only and do not constitute a part of this
Agreement.

    

    (l)           Gender and
Number.  As used in this Agreement, the masculine, feminine or
neuter gender, and the singular or plural, shall be deemed to include the others
whenever and wherever the content so requires.  Additionally, unless
the context requires otherwise, "or" is not exclusive.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    EXHIBIT
8

    

    MATERIAL
AGREEMENTS

    

    NONE
OTHER THAN DISCLOSED AGREEMENTS

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    EXHIBIT
9

    

    WITHOLDING
TAX - EXEMPTION CERTIFICATE

    

    (SEE
ATTACHED)

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    [*]

     

      
        

      

    

    
      [*] Confidential
treatment requested; certain information omitted and filed separately with the
SEC.

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

     

    AMENDMENT
NO. 1 TO EXCLUSIVE LICENSE AGREEMENT

    

    AMENDMENT NO. 1 TO EXCLUSIVE LICENSE
AGREEMENT, dated July 24, 2008 (this “Amendment”), between
S.L.A. PARMA AG (the
“Licensor”),
and VENTRUS BIOSCIENCES,
INC., as assignee of Paramount Biosciences, LLC (the “Licensee”).

    

    WHEREAS, the Licensor and the
Licensee have entered into that certain Exclusive License Agreement, dated as of
March 23, 2007 (the “License
Agreement”);

    

    WHEREAS, the parties hereto
desire to amend the License Agreement as set forth herein.

    

    NOW, THEREFORE, in
consideration of the foregoing and for other consideration the sufficiency and
receipt of which is hereby acknowledged by the parties, it is hereby agreed by
and between the parties as follows:

    

    1.           Capitalized
Terms. Terms used herein but not otherwise defined shall have the meaning
ascribed thereto in the License Agreement.

    

    2.           Amendments.

    

    (a)           “Maximum
Anoheal Amount”, as defined in Section 12.2 of the License Agreement, shall be
increased to US$4,000,000, to be used by Licensor for the Anoheal Project, and
all references to Maximum Anoheal Amount in such License Agreement shall be
deemed a reference to this increased amount.  Notwithstanding anything
to the contrary contained in the License Agreement, the Maximum Anoheal Amount
shall be paid in advance in accordance with the schedule set forth on Annex I hereto, so
that on each Specified Date set forth therein Licensor shall have available to
it no less than the Threshold Amount set forth on Annex I.

    

    (b)           Notwithstanding
anything contained in Sections 8.2.2 of the License Agreement to the contrary,
Licensee’s obligation to make the “Anoheal Project Payment” shall terminate upon
the earlier of (i) the date Licensee informed Licensor in writing of the
termination of the Anoheal Project and (ii) such time as an NDA relating to a
Licensed Product incorporating Anoheal API is filed by the License, its
Affiliate or sublicensee.

    

    (c)           Notwithstanding
anything contained in Sections 8.2.3 of the License Agreement to the contrary,
Licensee’s obligation to make the “Incostop Project Payment” shall terminate
upon the earlier of (i) the date Licensee informed Licensor in writing of the
termination of the Incostop Project and (ii) such time as an NDA relating to a
Licensed Product incorporating InCostop API is filed by the Licensee, its
Affiliate or sublicensee.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (d)          For
the avoidance of doubt it is stated that the due dates for Anoheal Project
Payments and the Incostop Project Payments as defined in Section 8.2.1 of the
License Agreement are not affected by the payment schedule in Annex I but shall
continue to be due at the end of each calendar month.

    

    (e)          The
Licensee shall reimburse the Licensor the costs of the sponsored research fellow
in Australia. Such salary costs will be invoiced quarterly to the Licensee at a
rate of £10,000 per quarter for the next eighteen (18) months. Such amounts
shall be paid by Licensee in addition to the Maximum Anoheal
Amount.

    

    (f)           Notwithstanding
anything contained in Section 23.4 of the License Agreement to the contrary, the
cure period for purposes of a material breach or material default of the License
Agreement relating in its entirety to failure to pay to the Licensor the amounts
set forth in accordance with the schedule on Annex
I  hereto or the Anoheal Project Payments or the Incostop
Project Payments, on each date specified, shall be twenty one (21) days from the
date the notice of termination is received by the non-breaching or
non-defaulting party. For the avoidance of doubt, no other cure period set forth
in Section 23.4 of the License Agreement shall apply with respect to a material
breach or material default by the Licensee with respect to the payments set
forth on Annex
I hereto, the Anoheal Project Payments and the Incostop Project Payments.
Notwithstanding anything contained in Section 23.4 of the License Agreement to
the contrary the License Agreement shall end without further notice upon
expiration of the 21 day cure period, if such material breach or material
default has not otherwise been cured. Upon termination of the Projects pursuant
to this clause, all rights to the Patents relating to Incostop Project and the
Anoheal Project shall revert to the Licensor.

    

    3.           Counterparts.
This Amendment may be executed in any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument. Facsimile counterpart signatures to this Amendment
shall be acceptable and binding.

    

    4.           Applicable
Law. This Amendment shall be governed by and construed in accordance with
the laws of Switzerland without regard to principles of conflicts of
law.

    

    5.           Dispute
Resolution. All disputes arising out of or in connection with this
Amendment shall be resolved by the ordinary courts of Zurich, Switzerland,
without limiting the right of recourse.

    

    6.           No Other
Amendments. Except as expressly set forth herein, the License Agreement
remains in full force and effect in accordance with its terms and nothing
contained herein shall be deemed to be a waiver, amendment, modification or
other change of any term, condition or provision of the License
Agreement.

    

    7.           Effectiveness.
This Amendment shall become effective immediately upon the date
hereof.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    8.           References
to the License Agreement. From and after the date hereof,  all
references in the License Agreement and any other documents to the License
Agreement shall be deemed to be references to the License Agreement after giving
effect to this Amendment.

    

    * * * *
*

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Amendment No. 1 to Exclusive License Agreement
as of the date first written above.

    

    
      	
              SLA
      PHARMA AG

            	 
      	
              VENTRUS
      BIOSCIENCES, INC.

            
	 
      	 
      	 
      
	 
      	 
      	 
      
	
              By:

            	
              /s/ Rudolf Syz
    28-7-2008

            	 
      	 
      	
              By:

            	
              /s/ Thomas Rowland

            	 
      
	 
      	
              Name:
      Rudolf Syz

            	 
      	 
      	
               Name:  Thomas
      Rowland

            
	 
      	
              Title:
      Director

            	 
      	 
      	
               Title:
      President & CEO

            

    

    

      
        
           

        

        
          4

          
            

          

        

        
           

        

      

    

    

    ANNEX I

    

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                Specified Date

                              	 	
                                Nature of Payment

                              	 	
                                Threshold Amount

                              	 
	
                                November 30, 2008

                              	 	
                                Cost
      of Anoheal development from June 2008 to October 2008

                              	 	$	300,000	 
	
                                November 30, 2008

                              	 	
                                First
      upfront installment to SLA

                              	 	$	1,000,000	 
	
                                April 30, 2009

                              	 	
                                Second
      upfront installment to SLA

                              	 	$	800,000	 
	
                                October 30, 2009

                              	 	
                                Third
      upfront installment to SLA

                              	 	$	700,000	 
	
                                April 30, 2010

                              	 	
                                Final
      upfront installment to SLA

                              	 	
                                Balance
      of $4,000,000

                              	 

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    PARAMOUNT
BIOSCIENCES, LLC

    787
Seventh Avenue

    48th
Floor

    New
York, NY 10019

    
      	 
      	
              October
      27, 2008

            

    

    

    SLA
Pharma AG

    Rebgasse
2

    Liestal,
Switzerland

    Attn:
David Slagel

    

    Dear
David:

    

    Reference
is hereby made to the Exclusive License Agreement, dated as of March 23, 2007,
as amended on July 24, 2008 (the “License Agreement”),
between SLA Pharma AG (“SLA”) and Ventrus
Biosciences Inc. (“Ventrus”), as
assignee of Paramount Biosciences, LLC (“Paramount”).  Paramount
shall make a payment (the “Payment”) in an
amount equal to USD$100,000 to SLA on behalf of Ventrus on the date hereof, in
partial satisfaction of the $250,000 presently owed by Ventrus to SLA that has
been guaranteed by Lindsay A. Rosenwald, M.D.  At such time as (i) no
cash payments are past due under the License Agreement, and (ii) Ventrus has
paid SLA an amount of cash exceeding what is then owed under the License
Agreement by at least USD$100,000, SLA shall promptly remit to Paramount an
amount equal to USD$100,000.

    * * * *
*

    

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    

     

    If the
foregoing correctly sets forth your understanding of our agreement with respect
to the matters addressed above, please indicate your acceptance and approval
below.

    
      	 
      	
              PARAMOUNT
      BIOSCIENCES, LLC

            
	 
      	 
      	 
      
	 
      	
              By:

            	
              /s/ 

            	
              Lindsay A. Rosenwald

            
	 
      	 
      	 
      	
              Name:  Lindsay
      A. Rosenwald, MD

            
	 
      	 
      	 
      	
              Title:  Sole
      Member

            
	 
      	 
      	 
      
	 
      	
              VENTRUS
      BIOSCIENCES, INC.

            
	 
      	 
      	 
      
	 
      	
              By:

            	
              /s/ 

            	
              Thomas Rowland

            
	 
      	 
      	 
      	
              Name:  Thomas
      Rowland

            
	 
      	 
      	 
      	
              Title:  President
      & CEO

            

    

    

    AGREED
AND ACKNOWLEDGED:

    

    SLA
PHARMA AG

    

    
      	
              By:

            	
                /s/ D. Slagel

            	 
      
	 
      	
              Name:  D.
      Slagel

            
	 
      	
              Title:  President

            
	 
      	
              29/10/08

            

    

    

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    

     

    AMENDMENT
NO. 2 TO EXCLUSIVE LICENSE AGREEMENT

    

    AMENDMENT NO. 2 TO EXCLUSIVE LICENSE
AGREEMENT, dated November 20, 2008 (this “Amendment”), between
S.L.A. PARMA AG (the
“Licensor”),
and VENTRUS BIOSCIENCES,
INC., (the “Licensee”) as
assignee of Paramount Biosciences, LLC (“Paramount”).

    

    WHEREAS, the Licensor and the
Licensee have entered into that certain Exclusive License Agreement, dated as of
March 23, 2007, as amended by Amendment No. 1 to Exclusive License Agreement
dated as of July 24, 2008 (as amended to date, the “License
Agreement”);

    

    WHEREAS, the parties hereto
desire to further amend the License Agreement as set forth herein.

    

    NOW, THEREFORE, in
consideration of the foregoing and for other consideration the sufficiency and
receipt of which is hereby acknowledged by the parties, it is hereby agreed by
and between the parties as follows:

    

    1.           Capitalized
Terms. Terms used herein but not otherwise defined shall have the meaning
ascribed thereto in the License Agreement.

    

    2.           Amendments.

    

    (a)           Notwithstanding
anything to the contrary contained in the License Agreement, the Maximum Anoheal
Amount shall be paid in advance in accordance with the schedule set forth on
Annex I hereto,
so that on each Specified Date set forth therein Licensor shall have available
to it no less than the Threshold Amount set forth on Annex I.

    

    (b)           As
of October 31, 2008 Licensee owes to Licensor the amounts set forth on Annex
II.  Notwithstanding anything contained in Section 8.2 of the License
Agreement to the contrary, Licensee’s obligation to make the Anoheal Project
Payment and the Incostop Project Payment from the date hereof through December
31, 2008 (such period, the “Forbearance Period”)
shall be suspended, and such amounts shall instead accrue and be payable in full
at the end of the Forbearance Period.

    

    (c)           Notwithstanding
anything contained in Section 23.4 of the License Agreement and section 2 (f) of
Amendment No. 1 to the Exclusive License Agreement to the contrary, the cure
period for purposes of a material breach or material default of the License
Agreement relating in its entirety to failure to pay to the Licensor any amounts
due under the License Agreement, shall be twenty one (21) days from the date the
notice of termination is received by the non-breaching or non-defaulting
party.  For the avoidance of doubt, no other cure period set forth in
Section 23.4 of the License Agreement shall apply with respect to a material
breach or material default by the Licensee with respect to any payments due to
the Licensor.  Notwithstanding anything contained in Section 23.4 of
the License Agreement to the contrary the License Agreement shall end without
further notice upon expiration of the 21 day cure period, if such material
breach or material default has not otherwise been cured, subject to clause 2 (d)
hereafter.  Upon termination of the Projects pursuant to this clause,
all rights to the Patents relating to Incostop Project and the Anoheal Project
shall revert to the Licensor.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (d)           In
the event Licensor does not receive new funds in the amount of at least USD $1
(one) million on or before December 31, 2008 (the “Funds”), payment of all
monies due under the License Agreement shall be suspended until the earlier of
(i) the date Licensee receives the Funds and (ii) February 28, 2009 (“the
Extended Forbearance Period”), subject to clause 2 (e) hereafter.

    

    (e)           Notwithstanding
anything to the contrary in section 2 (d) above Licensee shall make the payments
set forth in Annex III in accordance with the schedule set forth therein, so
that on each Specified Date set forth therein Licensor shall have available to
it no less than the Threshold Amount set forth in Annex
III.

    

    (f)    
       Notwithstanding anything contained in
Section 2 (e) above, Licensor shall be entitled to terminate the License
Agreement without notice and with immediate effect, if any of the payments set
forth in Annex III is not available to him on the Specified Date.

    

    For so
long as Licensee complies with the payment terms and conditions of this
Amendment, then Licensee shall not be entitled to terminate this License
Agreement for non-payment pursuant to Section 23.4 thereof.

    

    3.           Counterparts.
This Amendment may be executed in any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument. Facsimile counterpart signatures to this Amendment
shall be acceptable and binding.

    

    4.           Applicable
Law. This Amendment shall be governed by and construed in accordance with
the laws of Switzerland without regard to principles of conflicts of
law.

    

    5.           Dispute
Resolution. All disputes arising out of or in connection with this
Amendment shall be resolved by the ordinary courts of Zurich, Switzerland,
without limiting the right of recourse.

    

    6.           No Other
Amendments. Except as expressly set forth herein, the License Agreement
remains in full force and effect in accordance with its terms and nothing
contained herein shall be deemed to be a waiver, amendment, modification or
other change of any term, condition or provision of the License
Agreement.

    

    7.           Effectiveness.
This Amendment shall become effective immediately upon the date
hereof.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    8.           References
to the License Agreement. From and after the date hereof, all references
in the License Agreement and any other documents to the License Agreement shall
be deemed to be references to the License Agreement after giving effect to this
Amendment.

    

    * * * *
*

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Amendment No. 2 to Exclusive License Agreement
as of the date first written above.

    

    
      
        
          
            
              
                
                  	
                          SLA
      PHARMA AG

                        	 
      	
                          VENTRUS
      BIOSCIENCES, INC.

                        
	 
      	 
      	 
      	 
      	 
      
	
                          By: 

                        	
                          /s/ David Slagel

                        	 
      	
                          By: 

                        	
                          /s/ Thomas Rowland

                        
	 
      	
                          Name:  David
      Slagel

                        	 
      	 
      	
                           Name:  Thomas
      Rowland

                        
	 
      	
                          Title:
      PRESIDENT

                        	 
      	 
      	
                           Title:  President
      &
CEO

                        

                

              

            

          

        

      

    

    

    
      
        
          
            
              
                
                  	 
      	 	
                          PARAMOUNT
      BIOSCIENCES, LLC

                        
	 
      	 	 
      	 
      
	 
      	 	
                          By:

                        	
                          /s/ Lindsay A. Rosenwald

                        
	 
      	 	 
      	
                           Name:  Lindsay
      A. Rosenwald, MD

                        
	 
      	 	 
      	
                           Title:  Sole
      Member

                        
	 
      	 	 
      	 
      
	 
      	 	 
      	
                          Legal
      Approved

                        
	 
      	 	
                          Initial: 

                        	
                          MRD

                        
	 
      	 	
                          Date:

                        	 

                

              

            

          

        

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    ANNEX I

    

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                Specified
      Date

                              	 	
                                Nature
      of Payment

                              	 	
                                Threshold
      Amount

                              	 
	
                                December
      31, 2008

                              	 	
                                In
      account of cost of Anoheal development from June 2008 to December
      2008

                              	 	$	300,000	 
	
                                December
      31, 2008

                              	 	
                                First
      upfront installment to SLA

                              	 	$	1,000,000	 
	
                                April
      30, 2009

                              	 	
                                Second
      upfront installment to SLA

                              	 	$	800,000	 
	
                                October
      30, 2009

                              	 	
                                Third
      upfront installment to SLA

                              	 	$	700,000	 
	
                                April
      30, 2010

                              	 	
                                Final
      upfront installment to SLA

                              	 	
                                Balance
      of $4,000,000

                              	 

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    ANNEX
II

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    Annex
II

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      	
                                              S.L.A. Pharma AG

                                            	 	
                                              Invoices to Ventrus Schedule

                                              Outstanding

                                            	 	 	
                                              as of

                                              01/10/08

                                            	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 
      	 	 	 	 	 	 
	
                                              Invoice

                                              Date

                                            	 	
                                              Invoice

                                              No.

                                            	 	
                                              Invoice

                                              Type

                                            	 	
                                              Period

                                            	 	
                                              Invoice

                                              Amount

                                            	 	
                                              Date

                                              Received

                                            	 	
                                              Amount

                                              Received

                                            	 	 	
                                              Balance

                                              Due

                                            	 
	
                                              2/29/2008

                                            	 	
                                              12A

                                            	 	
                                              DR

                                            	 	
                                              February ‘08

                                            	 	 	166,863.00	 	 
      	 	 	 	 	 	 
	
                                              3/1/2008

                                            	 	
                                              13B

                                            	 	
                                              MF

                                            	 	
                                              March ‘08

                                            	 	 	88,000.00	 	 
      	 	 	 	 	 	 
	
                                              3/31/2008

                                            	 	
                                              13A

                                            	 	
                                              DR

                                            	 	
                                              March ‘08

                                            	 	 	91,593.00	 	 
      	 	 	 	 	 	 
	
                                              3/31/2008

                                            	 	
                                              4D

                                            	 	
                                              PR

                                            	 	
                                              March
      ‘08

                                            	 	 	10,695.00	 	 
      	 	 	 	 	 	 
	
                                              3/31/2008

                                            	 	
                                              1E

                                            	 	
                                              OS

                                            	 	
                                              March
      ‘08

                                            	 	 	9,430.00	 	 
      	 	 	 	 	 	 
	
                                              4/30/2008

                                            	 	
                                              14B

                                            	 	
                                              MF

                                            	 	
                                              April
      ‘08

                                            	 	 	53,000.00	 	 
      	 	 	 	 	 	 
	
                                              4/30/2008

                                            	 	
                                              14A

                                            	 	
                                              DR

                                            	 	
                                              April
      ‘08

                                            	 	 	111,566.00	 	 
      	 	 	 	 	 	 
	
                                              5/31/2008

                                            	 	
                                              16B

                                            	 	
                                              MF

                                            	 	
                                              May
      ‘08

                                            	 	 	83,000.00	 	 
      	 	 	 	 	 	 
	
                                              5/31/2008

                                            	 	
                                              15A

                                            	 	
                                              DR

                                            	 	
                                              May
      ‘08

                                            	 	 	116,987.00	 	
                                              8/20/2008

                                            	 	 	249,863.00	*)	 	 	 
	
                                              6/26/2008

                                            	 	
                                              16B

                                            	 	
                                              MF

                                            	 	
                                              June
      ‘08

                                            	 	 	83,000.00	 	
                                              7/11/2008

                                            	 	 	100,000.00	*)	 	 	 
	
                                              6/30/2008

                                            	 	
                                              6D

                                            	 	
                                              PR

                                            	 	
                                              June
      ‘08

                                            	 	 	36,760.00	 	
                                              7/22/2008

                                            	 	 	160,000.00	*)	 	 	 
	
                                              7/31/2008

                                            	 	
                                              17B

                                            	 	
                                              MF

                                            	 	
                                              July
      ‘08

                                            	 	 	83,000.00	 	 
      	 	 	 	 	 	 	 
	
                                              8/31/2008

                                            	 	
                                              16B

                                            	 	
                                              IJF

                                            	 	
                                              August
      ‘08

                                            	 	 	83,000.00	 	 
      	 	 	 	 	 	 	 
	
                                              9/20/2008

                                            	 	
                                              16B

                                            	 	
                                              IJF

                                            	 	
                                              September
      ‘08

                                            	 	 	83,000.00	 	 
      	 	 	 	 	 	 	 
	
                                              9/20/2008

                                            	 	
                                              6D

                                            	 	
                                              PR

                                            	 	
                                              September
      ‘08

                                            	 	 	21,802.00	 	 
      	 	 	 	 	 	 	 
	
                                              9/30/2008

                                            	 	
                                              2E

                                            	 	
                                              OS

                                            	 	
                                              September
      ‘08

                                            	 	 	16,169.00	 	
                                              10/29/2008

                                            	 	 	100,000.00	*)	 	 	 
	
                                              10/31/2008

                                            	 	
                                              20B

                                            	 	
                                              IJP

                                            	 	
                                              October
      ‘08

                                            	 	 	83,000.00	 	 
      	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	2,245,885.00	 	 
      	 	 	899,065.00	 	 	$	880,122.00	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	 
      	 	
                                              Invoice
      Type and _____ reference

                                            	 	 
      	 	
                                              *
      from Paramount

                                            	 
	 
      	 	 
      	 	 
      	 	 
      	 	 	 	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	
                                              MF        Management
      Fee (ref 0.2)

                                            	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	
                                              DR        
      Development recharge (ref 12.2)

                                            	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	
                                              PR        
      Patent recharge (ref 14.1 / 14.3)

                                            	 	 
      	 	 	 	 	 	 	 	 
	 
      	 	 
      	 	
                                              OS        
      Outside scope (ref 12.5.1)

                                            	 	 
      	 	 	 	 	 	 	 	 

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    ANNEX
III

    

    
      
        
          
            
              
                
                  
                    	
                            Specified
      Date

                          	 	
                            Nature
      of Payment

                          	 	
                            Threshold
      Amount

                          	 
	
                            January
      1, 2009

                          	 	
                            in
      account of management fees and patent costs June to December
      2008

                          	 	$	100,000	 
	
                            February
      1, 2009

                          	 	
                            in
      account of management fees and patent costs June to December
      2008

                          	 	$	100,000	 

                  

                

              

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    PARAMOUNT
BIOSCIENCES, LLC

    787
Seventh Avenue

    48th
Floor

    New York,
NY  10019

    

    November
20, 2008

    

    SLA
Pharma AG

    Rebgasse
2

    Liestal,
Switzerland

    Attn:
David Slagel

    

    Dear
David:

    

    Reference
is hereby made to the Exclusive License Agreement, dated as of March 23, 2007,
as amended on July 24, 2008 (the “License Agreement”),
between SLA Pharma AG (“SLA”) and Ventrus
Biosciences, Inc. (“Ventrus”), as
assignee of Paramount Biosciences, LLC (“Paramount”).  Paramount
shall make a payment (the “Payment”) in an
amount equal to USD$150,000 to SLA on behalf of Ventrus on the date hereof, in
full satisfaction of the amounts presently owed by Ventrus to SLA that have been
guaranteed by Lindsay A. Rosenwald, M.D.  At such time as (i) no cash
payments are past due or have been suspended under the License Agreement, and
(ii) Ventrus has paid SLA an amount of cash exceeding what is then owed under
the License Agreement by at least USD$250,000, SLA shall promptly remit to
Paramount an amount equal to USD$150,000.

    

    *  *  *  *  *

    
      
      

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    If the
foregoing correctly sets forth your understanding of our agreement with respect
to the matters addressed above, please indicate your acceptance and approval
below.

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	
                                    LEGAL
      APPROVAL

                                  	 	PARAMOUNT
      BIOSCIENCES, LLC
	 
      	 
      	 	 	 
      	 
      
	 
      	 
      	 	 	
                                    By:

                                  	
                                    /s/  Lindsay A. Rosenwald,
      MD

                                  
	
                                    Initial: 

                                  	
                                    MHD

                                  	 	 	
                                    Name:   
      Lindsay A. Rosenwald, MD

                                  
	
                                    Date:

                                  	 
      	 	 	
                                    Title:     
      Sole Member

                                  
	 
      	 
      	 	 	 
      	 
      
	 
      	 
      	 	 	
                                    VENTRUS
      BIOSCIENCES, INC.

                                  
	 
      	 
      	 	 	 
      	 
      
	 
      	 
      	 	 	
                                    By:

                                  	
                                    /s/ Thomas Rowland

                                  
	 
      	 
      	 	 	 
      	
                                    Name:  Thomas
      Rowland

                                  
	 
      	 
      	 	 	 
      	
                                    Title:   
      President &
CEO

                                  

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    
      
        
          
            	
                    AGREED
      AND ACKNOWLEDGED:

                  
	 
      	 
      
	
                    SLA
      PHARMA AG

                  
	 
      	 
      
	
                    By:

                  	
                    /s/ D. Slagel

                  
	 
      	
                    Name:  D.
      Slagel

                  
	 
      	
                    Title:
      President

                  

          

        

      

    

    

      
        
           

        

        
          2

          
            

          

        

        
           

        

      

    PARAMOUNT
BIOSCIENCES, LLC

    8400
E Crescent Pkwy, Suite 600

    Greenwood
Village, CO 80111

    January
22, 2009

    

    SLA
Pharma AG

    Rebgasse
2

    Liestal,
Switzerland

    Attn:
David Slagel

    

    Dear
David:

    

    Reference
is hereby made to the Exclusive License Agreement, dated as of March 23, 2007,
between SLA Pharma AG (“SLA”) and Ventrus
Biosciences, Inc. (“Ventrus”), as
assignee of Paramount Biosciences, LLC (“Paramount”), as
amended by Amendment No. 1 to Exclusive License Agreement, between SLA, Ventrus,
and Paramount, dated as of July 24, 2008, Amendment No. 2 to Exclusive License
Agreement, between SLA, Ventrus, and Paramount, dated as of November 20, 2008,
the letter agreement between Paramount, Ventrus, and SLA, dated as of October
27, 2008, and the letter agreement between Paramount, Ventrus, and SLA dated as
of November 20, 2008 (taken together, including all amendments and alterations
to date, the “License
Agreement”).  To the extent this letter agreement is in
conflict with any provision of the License Agreement, such provision of the
License Agreement is hereby superseded and replaced in all respects by the
content of this Letter Agreement.

    Ventrus
shall make a payment to SLA in the amount set forth in Exhibit A hereto
immediately upon its receipt of this document countersigned by SLA, in full
satisfaction of all accrued expenses to date under the License Agreement (the
“2008 Balance
Payment”).  In addition, Ventrus will make a payment to SLA at
that time in the amount set forth in Exhibit A hereto in
full satisfaction of any other Incostop and Anoheal Project payments due to SLA
by Ventrus by February 15, 2009 under the License Agreement (the “Outstanding Project
Payment”).  Finally, any other payments to SLA that may be
required no later than February 28, 2009 under the License Agreement shall
instead become due no later than May 31, 2009.

    Upon the
payment of the amounts in the described in the preceding paragraph, all accrued
but unpaid Anoheal Project Payments and the Incostop Project Payments (each as
defined the License Agreement) shall be have been paid in full to SLA as of the
date hereof, and Ventrus shall continue to pay to SLA the Anoheal Project
Payments and Incostop Project Payments until May 31, 2009, on a monthly basis as
set forth in Exhibit
A hereto (the “Remaining Project
Payments”).  Thereafter, no additional Anoheal Project Payments
or Incostop Project Payments shall accrue or be payable, and such ongoing or
further payments as may be called for in the License Agreement shall be of no
further force or effect, in the event that Ventrus chooses to return licenses to
these products to SLA or to contribute these licenses to a possible joint
venture to be formed among SLA and Ventrus, as described in the succeeding
paragraph with the provision that Ventrus shall remain obliged to fulfil all
payment obligations due but no fulfilled at the time of the return or
contribution of the license unless the parties agree otherwise.

    Finally,
Ventrus and SLA shall discuss the terms and feasibility of a possible
United-States-based joint venture to develop and/or commercialize the Patents,
Know-How, Technology, Trademarks, and/or Licensed Products (each as defined in
the License Agreement).

    Except as
specified herein, the License Agreement in full force and in good standing among
Ventrus, Paramount, and SLA.

    * * * *
*

    
      
      

      
        
           

        

        
          
          

          
            

          

        

        
           

        

      

    If the
foregoing correctly sets forth your understanding of our agreement with respect
to the matters addressed above, please indicate your acceptance and approval
below.

    

    
      
        
          
            
              	 	
                      PARAMOUNT
      BIOSCIENCES, LLC

                    
	 	 
      	 
      
	 	
                      By:

                    	
                      /s/ Lindsay A. Rosenwald

                    
	 	 
      	
                       Name:  Lindsay
      A. Rosenwald, MD

                    
	 	 
      	
                       Title:  Sole
      Member

                    
	 	 
      	 
      
	 	
                      VENTRUS
      BIOSCIENCES, INC.

                    
	 	 
      	 
      
	 	
                      By:

                    	
                      /s/ Thomas Rowland

                    
	 	 
      	
                       Name:  Thomas
      Rowland

                    
	 	 
      	
                       Title:  President
      & CEO

                    

            

          

        

      

    

    

    
      
        
          
            
              
                	
                        AGREED
      AND ACKNOWLEDGED:

                      	 	 
      
	 
      	 
      	 	 
      
	
                        SLA
      PHARMA AG

                      	 	 
      
	 
      	 
      	 	 
      
	 
      	 
      	 	 
      
	
                        By:

                      	
                        /s/ D. Slagel

                      	 	 
      
	 
      	
                        Name:  D.
      Slagel

                      	 	 
      
	 
      	
                        Title:  President

                      	 	 
      

              

            

          

        

      

    

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    EXHIBIT
A

    

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                Payment

                              	 	
                                Amount

                              	 	
                                Due
      Date

                              
	
                                2008
      Balance Payment

                              	 	$	612,056	 	
                                upon
      signing

                              
	
                                Outstanding
      Project Payment

                              	 	$	100,000	 	
                                upon
      signing

                              
	
                                Remaining
      Project Payment

                              	 	$	66,000	 	
                                February
      28, 2009

                              
	
                                Remaining
      Project Payment

                              	 	$	83,000	 	
                                March
      31, 2009

                              
	
                                Remaining
      Project Payment

                              	 	$	83,000	 	
                                April
      30, 2009

                              
	
                                Remaining
      Project Payment

                              	 	$	83,000	 	
                                May
      31,
2009

                              

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    AMENDMENT
NO. 3 TO EXCLUSIVE LICENSE AGREEMENT

    

    AMENDMENT NO. 3 TO EXCLUSIVE LICENSE
AGREEMENT, dated June 1, 2009 (this “Amendment”), between
S.L.A. PARMA AG (the
“Licensor”),
and VENTRUS BIOSCIENCES,
INC. (the “Licensee”), as
assignee of Paramount Biosciences, LLC (“Paramount”).

    

    WHEREAS, the Licensor and the
Licensee have entered into that certain Exclusive License Agreement, dated as of
March 23, 2007, as amended by Amendment No. 1 to Exclusive License Agreement
dated as of July 24, 2008, Amendment No. 2 to Exclusive License Agreement dated
as of November 20, 2008, and as supplemented by those certain sideletters dated
as of October 27, 2008, November 20, 2008 and January 22, 2009 (as amended,
restated, supplemented or otherwise modified to date, the “License
Agreement”);

    

    WHEREAS, the parties hereto
desire to further amend the License Agreement as set forth herein.

    

    NOW, THEREFORE, in
consideration of the foregoing and for other consideration the sufficiency and
receipt of which is hereby acknowledged by the parties, it is hereby agreed by
and between the parties as follows:

    

    1.           Capitalized
Terms. Terms used herein but not otherwise defined shall have the meaning
ascribed thereto in the License Agreement.

    

    2.           Amendments.

    

    (a)           Notwithstanding
anything to the contrary contained in the License Agreement, the Licensee shall
pay to the. Licensor US$198,201 on the date hereof, receipt of which the
Licensor hereby acknowledges, and the Licensor hereby rescinds that certain
termination letter, dated May 11, 2008, which was previously delivered to
Licensee, and the Licensor hereby confirms and acknowledges that, subject to
Licensor’s and Licensee’s continuing performance pursuant to the terms and
conditions under this Agreement, the License Agreement shall be in good standing
and remain in full force and effect.

    

    (b)           Commencing
July 1, 2009, and continuing until December 1, 2009 or the earlier termination
of the License Agreement, Licensee shall pay Licensor $75,000 per month, in
account of the cost of Anoheal development from June 2008 onward.

    

    (c)           Notwithstanding
anything to the contrary contained in the License Agreement, all Incostop and
Anoheal Project payments shall accrue during the term of the License Agreement,
and, subject to paragraph 2 (f) below, be payable promptly after the Licensee or
Paramount BioSciences, L.L.C. consummates a financing (or series of related
financings) resulting in net proceeds to it of at least US$10 million (the
“Qualified Financing”).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (d)           Notwithstanding
anything to the contrary contained in the License Agreement, the balance of the
Maximum Anoheal Amount shall be paid quarterly (commencing for the quarter ended
September 30, 2009), and Licensor shall make payments in account of the cost of
Anoheal development from June 2008 onward, in accordance with Schedule A attached
hereto. Consequently payments on account of Anoheal Development Costs shall be
executed as described in Schedule B. The payment due for the quarterly period
ended September 30, 2009 may, at the option of the Licensee, be deferred by
written notice until December 31, 2009, solely in the event that the Licensee
has not consummated a Qualified Financing by September 30, 2009.

    

    (e)           Notwithstanding
anything contained in Section 23.4 of the License Agreement and section 2 (f) of
Amendment No. 1 to the Exclusive License Agreement to the contrary, the cure
period for purposes of a material breach or material default of the License
Agreement relating in its entirety to failure to pay to the Licensor any amounts
due under the License Agreement (including but not limited to non-payment of
moneys due pursuant to this Amendment), shall be three (3) business days from
the date the notice of termination is received by the non-breaching or
non-defaulting party. For the avoidance of doubt, no other cure period set forth
in Section 23.4 of the License Agreement shall apply with respect to a material
breach or material default by the Licensee with respect to any payments due to
the Licensor. Notwithstanding anything contained in Section 23.4 of the License
Agreement to the contrary the License Agreement shall end without further notice
upon expiration of the 3-day cure period, if such material breach or material
default has not otherwise been cured. Upon termination of the Projects pursuant
to this clause, all rights to the Patents relating to Incostop Project and the
Anoheal Project shall revert to the Licensor.

    

    (f)      
     For so long as Licensee complies with the payment
terms and conditions
of this Amendment, then Licensee shall not be entitled to terminate this License
Agreement for non-payment Licensor shall, however, be entitled to terminate the
License Agreement without notice and with immediate effect, if the Licensee has
not consummated a Qualified Financing by December 31, 2009. Furthermore, on or
after September 30, 2009, Licensor shall be entitled to terminate this License
Agreement with one month’s notice in the event a third party wishes to enter
into a license agreement relating to Anoheal and Incostop and has entered into a
binding agreement with Licensor to that end. The termination shall however not
become effective if within the notice period Licensee pays all moneys invoiced
and unpaid as of such notice and all unpaid Management Fees through the end of
2009.

    

    3.           Counterparts.
This Amendment may be executed in any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument.  Facsimile counterpart signatures to this
Amendment shall be acceptable and binding.

    

    4.           Applicable
Law. This Amendment shall be governed by and construed in accordance with
the laws of Switzerland without regard to principles of conflicts of
law.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    5.           Dispute
Resolution. All disputes arising out of or in connection with this
Amendment shall be resolved by the ordinary courts of Zurich, Switzerland,
without limiting the right of recourse.

    

    6.           No Other
Amendments. Except as expressly set forth herein, the License Agreement
remains in full force and effect in accordance with its terms and nothing
contained herein shall be deemed to be a waiver, amendment, modification or
other change of any term, condition or provision of the License
Agreement.

    

    7.           Effectiveness.
This Amendment shall become effective immediately upon the date
hereof.

    

    8.           References
to the License Agreement. From and after the date hereof, all references
in the License Agreement and any other documents to the License Agreement shall
be deemed to be references to the License Agreement after giving effect to this
Amendment.

    

    * * * *
*

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Amendment No. 3 to Exclusive License Agreement
as of the date first written above.

    

    
      
        
          
            
              
                
                  
                    	
                            SLA
      PHARMA AG

                          	 
      	
                            VENTRUS
      BIOSCIENCES, INC.

                          
	 
      	 
      	 
      	 
      	 
      
	
                            By:

                          	
                            /s/ D. Slagel

                          	 
      	
                            By:

                          	
                            /s/ Thomas Rowland

                          
	 
      	
                            Name:  D.
      SLAGEL

                          	 
      	 
      	
                             Name:  Thomas
      Rowland

                          
	 
      	
                            Title:
      PRESIDENT

                          	 
      	 
      	
                             Title:  President
      & CEO

                          
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                            PARAMOUNT
      BIOSCIENCES, LLC

                          
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                            By:

                          	
                            /s/ Lindsay A. Rosenwald

                          
	 
      	 
      	 
      	 
      	
                             Name:  Lindsay
      A. Rosenwald, MD

                          
	 
      	 
      	 
      	 
      	
                             Title:
      Sole
Member

                          

                  

                

              

            

          

        

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    Schedule
A

    

    
      
        
          
            
              	
                      Quarterly Period Ending

                    	 	
                      Payments on Account

                    	 
	
                      September
      30, 2009

                    	 	$	775,000	 
	
                      December
      31, 2009

                    	 	$	775,000	 
	
                      March
      31, 2010

                    	 	$	800,000	 

            

          

        

      

    

    

    Schedule
B

    

    
      
        
          
            
              	
                      Date

                    	 	
                      Payments

                    	 
	
                      July
      1, 2009 / immediately

                    	 	$	75,000	 
	
                      August
      1, 2009

                    	 	$	75,000	 
	
                      September
      1, 2009

                    	 	$	75,000	 
	
                      September
      30, 2009

                    	 	$	775,000	 
	
                      October
      1, 2009

                    	 	$	75,000	 
	
                      November
      1, 2009

                    	 	$	75,000	 
	
                      December
      1, 2009

                    	 	$	75,000	 
	
                      December
      31, 2009

                    	 	$	775,000	 
	
                      March
      31, 2010

                    	 	$	800,000	 
	
                      Total

                    	 	$	2,800,000	 
	 
      	 	 	 	 
	
                      Already
      paid on account of Maximum Anoheal

                    	 	$	1,200,000	 
	
                      Maximum
      Anoheal Amount

                    	 	$	4,000,000	 

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    AMENDMENT
NO. 4 TO EXCLUSIVE LICENSE AGREEMENT

    

    AMENDMENT NO. 4 TO EXCLUSIVE LICENSE
AGREEMENT, dated December 18, 2009 (this “Amendment”), between
S.L.A. PHARMA AG (the
“Licensor”) and
VENTRUS BIOSCIENCES,
INC. (the “Licensee”), as
assignee of Paramount Biosciences, LLC (“Paramount”).

    

    WHEREAS, the Licensor and the
Licensee have entered into that certain Exclusive License Agreement, dated as of
March 23, 2007, as amended by Amendment No. 1 to Exclusive License Agreement
dated as of July 24, 2008, Amendment No. 2 to Exclusive License Agreement dated
as of November 20, 2008 and Amendment No. 3 to Exclusive License Agreement dated
as of June 1, 2009, and as supplemented by those certain sideletters dated as of
October 27, 2008, November 20, 2008, and January 22, 2009 (as amended, restated,
supplemented or otherwise modified to date the “License  Agreement”);

    

    WHEREAS, the parties hereto
desire to further amend the License Agreement as set forth herein.

    

    NOW, THEREFORE, in
consideration of the foregoing and for other consideration the sufficiency and
receipt of which is hereby acknowledged by the parties, it is hereby agreed by
and between the parties as follows:

    

    1.           Capitalized
Terms. Terms used herein but not otherwise defined shall have the meaning
ascribed thereto in the License Agreement.

    

    2.           Amendments.

    

    (a)           Notwithstanding
anything to the contrary contained in the License Agreement, the Licensee shall
pay to the Licensor US$723,846 for recharge of patent costs (article 14.1. of
the License Agreement) and Anoheal and Incostop Project Payments (article 8.2.
of the License Agreement) as shown in Schedule A in two
equal installments on December 31, 2009 and January 31, 2010. Given Licensee’s
continuing performance pursuant to the terms and conditions under this
Agreement, the License Agreement shall be in good standing and remain in full
force and effect.

    

    (b)           Commencing
January 31, 2010, and continuing until June 30, 2010 or the earlier termination
of the License Agreement, Licensee’s obligation to make the Incostop and Anoheal
Project Payments shall be suspended for half of the amount due and Licensee
shall pay Licensor $41,500 per month only, in account of the cost of Incostop
and Anoheal Project payments. Commencing July 2010 Incostop and Anoheal Project
payments shall revert to $83,000 per month payable on the last day of each
month.

    

    (c)           The
amounts suspended pursuant to paragraph 2 b) above shall be payable promptly
after the earlier of (i) June 30, 2010 and (ii) Licensee consummating a
financing (or series of related financings) resulting in net proceeds to it of
at least US$10 million (the “Qualified Financing”).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    (d)           Notwithstanding
anything to the contrary contained in the License Agreement, Licensee shall pay
the balance of the Maximum Anoheal Amount (recharge of development costs
pursuant to article 12.2. of the License Agreement) from January 2010 onward, in
accordance with Schedule B attached
hereto. In accordance therewith, Licensor shall use commercially reasonable
efforts using the January 31, 2010 Schedule B payment to initiate a Phase 3
trial of diltiazem cream (VEN 307) for the relief of pain associated with anal
fissures in Europe by the end of the second quarter of 2010, based on a clinical
development program to be agreed upon by the Licensor and Licensee. The
Licensors commitment to continue the Phase 3 study shall cease in the event of
non payment by the Licensee in accordance with Schedule B.

    

    (e)           Notwithstanding
anything contained in Section 23.4 of the License Agreement and section 2 (f) of
Amendment No. 1 to the Exclusive License Agreement to the contrary, the cure
period for purposes of a material breach or material default of the License
Agreement relating in its entirety to failure to pay to the Licensor any amounts
due under the License Agreement (including but not limited to non-payment of
moneys due pursuant to this Amendment), shall be three (3) business days from
the date the notice of termination is received by the breaching or defaulting
party. For the avoidance of doubt, no other cure period set forth in Section
23.4 of the License Agreement shall apply with respect to a material breach or
material default by the Licensee with respect to any payments due to the
Licensor. Notwithstanding anything contained in Section 23.4 of the License
Agreement to the contrary the License Agreement shall end without further notice
upon expiration of the 3-day cure period, if such material breach or material
default has not otherwise been cured. Upon termination of the Projects pursuant
to this clause, all rights to the Patents relating to Incostop Project and the
Anoheal Project shall revert to the Licensor.

    

    (f)      
     For so long as Licensee complies with the payment
terms and conditions of this Amendment, then Licensor shall not be entitled to
terminate this License Agreement for non-payment.  Licensor shall,
however, be entitled to terminate the License Agreement without notice and with
immediate effect, if the Licensee has not consummated a Qualified Financing by
September 30, 2010. Furthermore, Licensor shall be entitled to terminate this
License Agreement with one month’s notice in the event a third party wishes to
enter into a license agreement relating to Anoheal and Incostop and has entered
into a binding agreement with Licensor to that end. The termination shall
however not become effective if within the one month notice period Licensee pays
all moneys invoiced and unpaid as of such notice and the balance of the Maximum
Anoheal Amount.

    

    (g)           As
a condition to consenting to the amendments to the License Agreement contained
herein, Licensee shall issue to Licensor 25,000 shares of common stock, par
value $0.001 per share. Such shares of common stock shall be issued pursuant to
a stock purchase agreement substantially in the form previously executed by the
parties in connection with the prior issuance of shares by Licensee to Licensor.
It is understood that Article 11.2. of the License Agreement shall be applicable
mutatis mutandis to the shares issued pursuant to this Amendment No
4.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    3.           Counterparts.
This Amendment may be executed in any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument. Facsimile counterpart signatures to this Amendment
shall be acceptable and binding.

    

    4.           Applicable
Law. This Amendment shall he governed by and construed in accordance with
the laws of Switzerland without regard to principles of conflicts of
law.

    

    5.           Dispute
Resolution. All disputes arising out of or in connection with this
Amendment shall be resolved by the ordinary courts of Zurich, Switzerland,
without limiting the right of recourse.

    

    6.           No Other
Amendments. Except as expressly set forth herein, the License Agreement
remains in full force and effect in accordance with its terms and nothing
contained herein shall be deemed to be a waiver, amendment, modification or
other change of any term, condition or provision of the License
Agreement.

    

    7.           Effectiveness.
This Amendment shall become effective immediately upon the date
hereof.

    

    8.           References
to the License Agreement. From and after the date hereof, all references
in the License Agreement and any other documents to the License Agreement shall
be deemed to be references to the License Agreement after giving effect to this
Amendment.

    

    * * * *
*

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Amendment No. 4 to Exclusive License Agreement
as of the date first written above.

    

    
      
        
          	
                  By:

                	
                  /s/ D. Slagel

                	 
      	
                  By:

                	
                  /s/ Thomas Rowland

                
	 
      	
                  Name:  D.
      Slagel

                	 
      	 
      	
                   Name:  President

                
	 
      	
                  Title:
      PRESIDENT

                	 
      	 
      	
                   Title:  Thomas
      Rowland

                
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                  PARAMOUNT
      BIOSCIENCES, LLC

                
	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	
                  By:

                	
                  /s/ Lindsay A. Rosenwald

                
	 
      	 
      	 
      	 
      	
                   Name:  Lindsay
      A. Rosenwald, MD

                
	 
      	 
      	 
      	 
      	
                   Title:  Sole
      Member

                

        

      

    

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    

    Schedule
A

    

    
      
        
          
            	
                    Invoice Description

                  	 	
                    Payments

                  	 
	
                    May
      31, 2009 – Invoice 27B Project
      payment

                  	 	$	83,000	 
	
                    Jun
      30, 2009 – Invoice 9D Patent
      recharge

                  	 	$	32,664	 
	
                    Nov
      30, 2009 – Invoice 10D Patent
      recharge

                  	 	$	27,182	 
	
                    Jun
      2009 to Dec 2009 – Invoice 28B Project
      payments

                  	 	$	581,000	 
	
                    Total

                  	 	$	723,846	 

          

        

      

    

    

    Schedule
B

    

    
      
        
          
            
              	
                      Date

                    	 	
                      Payments

                    	 
	
                      January
      31, 2010

                    	 	$	350,000	 
	
                      June
      30, 2010

                    	 	$	600,000	 
	
                      October
      31, 2010

                    	 	$	600,000	 
	
                      February
      28, 2011

                    	 	$	800,000	 
	
                      Total

                    	 	$	2,350,000	 
	 
      	 	 	 	 
	
                      Already
      paid on account of Maximum Anoheal Amount

                    	 	$	1,650,000	 
	
                      Maximum
      Anoheal Amount

                    	 	$	4,000,000	 

            

          

        

      

    

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    AMENDMENT
NO. 5 TO EXCLUSIVE LICENSE AGREEMENT

    

    AMENDMENT NO. 5 TO EXCLUSIVE LICENSE
AGREEMENT, dated June 24, 2010 (this “Amendment”), between
S.L.A. PHARMA AG (the
“Licensor”) and
VENTRUS BIOSCIENCES,
INC. (the “Licensee”), as
assignee of Paramount Biosciences, LLC (“Paramount”).

    

    WHEREAS, the Licensor and the
Licensee have entered into that certain Exclusive License Agreement, dated as of
March 23, 2007, as amended by Amendment No. 1 to Exclusive License Agreement
dated as of July 24, 2008, Amendment No. 2 to Exclusive License Agreement dated
as of November 20, 2008, Amendment No. 3 to Exclusive License Agreement dated as
of June 1, 2009, and Amendment No. 4 to Exclusive License Agreement dated as of
December 18, 2009 and as supplemented by those certain sideletters dated as of
October 27, 2008, November 20, 2008, and January 22, 2009 (as amended, restated,
supplemented or otherwise modified to date the “License  Agreement”);

    

    WHEREAS, the parties hereto
desire to further amend the License Agreement as set forth herein.

    

    NOW, THEREFORE, in
consideration of the foregoing and for other consideration the sufficiency and
receipt of which is hereby acknowledged by the parties, it is hereby agreed by
and between the parties as follows:

    

    1.           Capitalized
Terms. Terms used herein but not otherwise defined shall have the meaning
ascribed thereto in the License Agreement.

    

    2.           Amendments.

    

    (a)           Given
Licensee’s continuing performance pursuant to the terms and conditions under
this Agreement, the License Agreement shall be in good standing and remain in
full force and effect.

    

    (b)           Commencing
January 31, 2010, and continuing until September 30, 2010 or the earlier
termination of the License Agreement, Licensee’s obligation to make the Incostop
and Anoheal Project Payments shall be suspended for half of the amount due and
Licensee shall pay Licensor $41,500 per month only, in account of the cost of
Incostop and Anoheal Project payments. Commencing October 2010 Incostop and
Anoheal Project payments shall revert to $83,000 per month payable on the last
day of each month.

    

    (c)           The
amounts suspended pursuant to paragraph 2 (b) above shall be payable promptly
after the earlier of (i) September 30, 2010 and (ii) Licensee consummating a
financing (or series of related financings) resulting in net proceeds to it of
at least US$10 million (the “Qualified Financing”).

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    

    3.           Counterparts.
This Amendment may be executed in any number of separate counterparts, each of
which shall be an original and all of which taken together shall constitute one
and the same instrument. Facsimile counterpart signatures to this Amendment
shall be acceptable and binding.

    

    4.           Applicable
Law. This Amendment shall he governed by and construed in accordance with
the laws of Switzerland without regard to principles of conflicts of
law.

    

    5.           Dispute
Resolution. All disputes arising out of or in connection with this
Amendment shall be resolved by the ordinary courts of Zurich, Switzerland,
without limiting the right of recourse.

    

    6.           No Other
Amendments. Except as expressly set forth herein, the License Agreement
remains in full force and effect in accordance with its terms and nothing
contained herein shall be deemed to be a waiver, amendment, modification or
other change of any term, condition or provision of the License
Agreement.

    

    7.           Effectiveness.
This Amendment shall become effective immediately upon the date
hereof.

    

    8.           References
to the License Agreement. From and after the date hereof, all references
in the License Agreement and any other documents to the License Agreement shall
be deemed to be references to the License Agreement after giving effect to this
Amendment.

    

    * * * *
*

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Amendment No. 5 to Exclusive License Agreement
as of the date first written above.

    

    
      
        	
                By:

              	
                /s/ D. Slagel

              	 
      	
                By:

              	
                /s/  Russell
    Ellison

              
	 
      	
                Name:  D.
      Slagel

              	 
      	 
      	
                 
      Name:  Russell Eillison, MD

              
	 
      	
                Title:
      PRESIDENT

              	 
      	 
      	
                 
      Title:  Chief Executive
Officer

              

      

    

     

    
      
        
          
          

        

        
          3Exhibit
10.12

    EMPLOYMENT
AGREEMENT

    

    This
EMPLOYMENT AGREEMENT (the “Agreement”), is entered into
as of the Commencement Date (defined below) by and between Ventrus BioSciences,
Inc., a Delaware corporation with principal executive offices at 787 Seventh
Avenue, New York, New York 10019 (the “Company”), and David Barrett
residing at 300 West
55th Street Apt 14N New York,
NY 10023 (the “Executive”) and supersedes the
prior Consulting Agreement between the parties.

     

    WITNESSETH:

     

    WHEREAS,
the Executive has been serving as the Chief Financial Officer of the Company
pursuant to a Consulting Agreement dated June 2010; and

     

    WHEREAS,
the Company and the Executive wish to memorialize the terms and conditions upon
which the Executive shall serve as the Chief Financial Officer of the
Company;

     

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

     

    1.           Employment.

     

    (a)
Services.  The
Executive will be employed by the Company as its Chief Financial Officer. The
Executive will report to the Chief Executive Officer and the Audit Committee of
the Company (the "Committee") and shall perform
such duties as are consistent with a position as Chief Financial Officer (the “Services”). The Executive
agrees to perform such duties faithfully, to devote substantially all of his
working time, attention and energies to the business of the Company, and while
he remains employed and subject to the terms of this Agreement, not to engage in
any other business activity that is in conflict with his duties and obligations
to the Company.

     

    (b)Acceptance.  Executive
hereby accepts such employment and agrees to render the Services.

     

    2.           Term. The Executive's
employment under this Agreement (the "Initial Term") shall be deemed
to commence on the day following such date that the Company completes an Initial
Public Offering of its common stock or such other financing that generates no
less than eight million dollars (US$8,000,000) in net proceeds to the Company
(the “Commencement
Date”), and shall continue for a term of three (3) years, unless sooner
terminated pursuant to Section 9 of this Agreement.  Notwithstanding
anything to the contrary contained herein, the provisions of this Agreement
governing protection of Confidential Information shall continue in effect as
specified in Section 6 hereof and survive the expiration or termination
hereof.  This Agreement may be extended for additional one (1) year
periods (each an “Additional
Term” and, together with the Initial Term, the “Term”) if the Company and the
Executive agree in writing on the terms of such renewal.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    3.           Best Efforts; Place of
Performance.

     

    (a) The
Executive shall devote substantially all of his business time, attention and
energies to the business and affairs of the Company and shall use his best
efforts to advance the best interests of the Company and shall not during the
Term be actively engaged in any other business activity, whether or not such
business activity is pursued for gain, profit or other pecuniary advantage, that
will interfere with the performance by the Executive of his duties hereunder or
the Executive’s availability to perform such duties or that will adversely
affect, or negatively reflect upon, the Company; provided, however, that the
Executive’s continued service as Director of Media/And, Inc, is expressly agreed
not to conflict with this section so long as Executive does not spend more than
two days per month on such activity.

     

    (b) The
duties to be performed by the Executive hereunder shall be performed at the
principal executive offices of the Company during the Term.

     

    4.           Compensation.  As
full compensation for the performance by the Executive of his duties under this
Agreement, the Company shall pay the Executive as follows:

     

    (a) Base
Salary.  Throughout the Term, the Company shall pay Executive
an annual salary (the “Base
Salary”) equal to two hundred and fifty thousand dollars ($250,000) per
year. Payment shall be made in accordance with the Company’s normal payroll
practices.  The Base Salary will be
reviewed by the Chief Executive Officer and the Audit Committee no less
frequently than annually, and may be increased (but not
decreased).

     

    (b) Incentive
Bonus.  The Company shall pay the Executive periodic
milestone-based incentive bonuses (each an “Incentive Bonus”)
of:

     

    (i)  In
the event that the Market Capitalization (as defined below) of the Company shall
exceed One Hundred Million Dollars (US$100,000,000) for a period of thirty (30)
consecutive trading days during the Term, and the average trading volume of the
Common Stock during such period is at least One Hundred Thousand (100,000)
shares per trading day (the “First Capitalization
Milestone”), then the Company shall pay to the Executive a cash bonus of
Two Hundred Fifty Thousand Dollars ($250,000), payable within 10 days of written
notice by the Executive of the occurrence of the First Capitalization
Milestone.  For purposes of this Agreement, “Market Capitalization” shall
be determined by multiplying the total shares of the Company’s Common Stock
which are issued and outstanding by the last reported closing price of the
Company’s Common Stock on a nationally recognized exchange, NASDAQ, or in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization; and

    

    (ii)  In
the event that the Market Capitalization of the Company shall exceed Two Hundred
Fifty Million Dollars (US$250,000,000) for a period of thirty (30) consecutive
trading days during the Term, and the average trading volume of the Common Stock
during such period is at least One Hundred Thousand (100,000) shares per trading
day (the “Second Capitalization
Milestone”), then the Company shall pay to the Executive a cash bonus of
Five Hundred Thousand Dollars ($500,000), payable within 10 days of written
notice by the Executive of the occurrence of the Second Capitalization
Milestone.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)          Withholding.  The
Company shall withhold all applicable federal, state and local taxes and social
security and such other amounts as may be required by law from all amounts
payable to the Executive under this Section 5.

     

    (d)          Equity.

    

    i.   Upon
the Commencement Date, the Company shall grant to the Executive an option (the
“Stock Option”) to
acquire shares at the price of such Initial Public Offering or other financing
(or such other price that the Company shall be advised by counsel represents the
fair value of the Company’s shares) equal to four percent (4%) of the
outstanding of Common Stock on a fully diluted and as-converted basis (prior to
giving effect to this Stock Option or the options in favor of Tim Hofer or Dr.
Russell Ellison). The Stock Option shall be governed by the Company’s Employee
Stock Option Plan and, in connection with such grant, the Executive shall enter
into the Company’s standard stock option agreement which, among other things,
shall (A) provide for a ten (10) year term, (B) provide for the Stock Option to
vest as follows: (1) one-third (or approximately 33%) of such Stock Option shall
vest as of the date such Stock Option is granted to the Executive and (2) an
additional one-third (or approximately 33%) of such Stock Option shall vest on
each of the first and second annual anniversaries of the date on which such
Stock Option is granted, and (C) incorporate the additional Stock Option related
provisions contained in Section 10 below.

    

    (e)          Expenses.  The
Company shall provide Executive with a corporate credit card for business use,
and shall reimburse the Executive for all normal, usual and necessary expenses
incurred by the Executive in furtherance of the business and affairs of the
Company, including reasonable travel and entertainment, upon timely receipt by
the Company of appropriate vouchers or other proof of the Executive’s
expenditures and otherwise in accordance with any expense reimbursement policy
as may from time to time be adopted by the Company.

     

    (f)          Other
Benefits.  The Executive shall be entitled to all rights and
benefits for which he shall be eligible under any benefit or other plans
(including, without limitation, dental, medical, medical reimbursement and
hospital plans, pension plans, employee stock purchase plans, profit sharing
plans, bonus plans and other so-called "Fringe Benefits”) as the
Company shall make available to its senior executives from time to time. In
addition, the Company shall reimburse the Executive for his reasonable licensing
fees, continuing professional education, and other professional
dues.  Company shall also name Executive as a covered person under its
Directors & Officers insurance policies.

     

    (g)         Vacation.  The
Executive shall, during the Term, be entitled to a vacation of three (3)
nonconsecutive weeks per annum, in addition to
holidays observed by the Company.  The Executive shall not be
entitled to carry any vacation forward to the next year of employment without
the written consent of the Chief Executive Officer and shall not receive any
compensation for unused vacation days.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    6.     Confidential Information and
Inventions.

     

    (a)           The
Executive recognizes and acknowledges that in the course of his duties he is
likely to receive confidential or proprietary information owned by the Company
or third parties with whom the Company has an obligation of
confidentiality.  Accordingly, during and after the Term, the
Executive agrees to keep confidential and not disclose or make accessible to any
other person or use for any other purpose other than in connection with the
fulfillment of his duties under this Agreement, any Confidential and Proprietary
Information (as defined below) owned by, or received by or on behalf of, the
Company.  “Confidential and Proprietary
Information” shall include, but shall not be limited to, confidential or
proprietary scientific or technical information, data, formulas and related
concepts, business plans (both current and under development), client lists,
promotion and marketing programs, trade secrets, or any other confidential or
proprietary business information relating to development programs, costs,
revenues, marketing, investments, sales activities, promotions, credit and
financial data, manufacturing processes, financing methods, plans or the
business and affairs of the Company or of any affiliate or client of the
Company.  The Executive expressly acknowledges the trade secret status
of the Confidential and Proprietary Information and that the Confidential and
Proprietary Information constitutes a protectable business interest of the
Company.  The Executive agrees: (i) not to use any such Confidential
and Proprietary Information for himself or others; and (ii) not to take any
Company Confidential and Proprietary Information (including but not limited to
writings, correspondence, notes, drafts, records, invoices, technical and
business policies, computer programs or disks) from the Company’s offices at any
time during his employment by the Company, except as required in the execution
of the Executive’s duties to the Company.  The Executive agrees to
return immediately all Company material and reproductions (including but not
limited, to writings, correspondence, notes, drafts, records, invoices,
technical and business policies, computer programs or disks) thereof in his
possession to the Company upon request,  upon termination of
employment.

     

    (b)           Except
with prior written authorization by the Company, the Executive agrees not to
disclose or publish any of the Confidential and Proprietary Information, or any
confidential, scientific, technical or business information of any other party
to whom the Company owes an obligation of confidence, at any time during or
after his employment with the Company.

     

    (c)           The
Executive agrees that all inventions, discoveries, improvements and patentable
or copyrightable works (“Inventions”) initiated,
conceived or made by him, either alone or in conjunction with others, during the
Term shall be the sole property of the Company to the maximum extent permitted
by applicable law and, to the extent permitted by law, shall be “works made for
hire” as that term is defined in the United States Copyright Act (17 U.S.C.A.,
Section 101).  The Company shall be the sole owner of all patents,
copyrights, trade secret rights, and other intellectual property or other rights
in connection therewith.  The Executive hereby assigns to the Company
all right, title and interest he may have or acquire in all such Inventions;
provided, however, that the Board may in its sole discretion agree to waive the
Company’s rights pursuant to this Section 6(c) with respect to any Invention
that is not directly or indirectly related to the Company’s
business.  The Executive further agrees to assist the Company in every
proper way (but at the Company’s expense) to obtain and from time to time
enforce patents, copyrights or other rights on such Inventions in any and all
countries, and to that end the Executive will execute all documents
necessary:

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (i)          to
apply for, obtain and vest in the name of the Company alone (unless the Company
otherwise directs) letters patent, copyrights or other analogous protection in
any country throughout the world and when so obtained or vested to renew and
restore the same; and

    

    (ii)          to
defend any opposition proceedings in respect of such applications and any
opposition proceedings or petitions or applications for revocation of such
letters patent, copyright or other analogous protection.

     

    (d)         The
Executive acknowledges that, while performing the services under this Agreement
the Executive may locate, identify and/or evaluate patented or patentable
inventions having commercial potential in the fields of pharmacy,
pharmaceutical, biotechnology, healthcare, technology and other fields which may
be of potential interest to the Company (the “Third Party
Inventions”).  The Executive understands, acknowledges and
agrees that all rights to, interests in or opportunities regarding, all
Third-Party Inventions identified by the Company or either of the foregoing
persons’ officers, directors, employees (including the Executive), agents or
consultants during the Employment Term shall be and remain the sole and
exclusive property of the Company or such affiliate and the Executive shall have
no rights whatsoever to such Third-Party Inventions and will not pursue for
himself or for others any transaction relating to the Third-Party Inventions
which is not on behalf of the Company.

     

    (e)          The
provisions of this Section 6 shall survive any termination of this
Agreement.

     

    7.    Non-Competition,
Non-Solicitation and Non-Disparagement.

     

    (a)           The
Executive understands and recognizes that his services to the Company are
special and unique and that in the course of performing such services the
Executive will have access to and knowledge of Confidential and Proprietary
Information (as defined in Section 6). As a result of such access, the Executive
agrees that during the Term and for a period of 6 months thereafter, he shall
not in any manner, directly or indirectly, on behalf of himself or any person,
firm, partnership, joint venture, corporation or other business entity (“Person”), enter into or engage
in any business that is directly competitive with the Business of the Company,
either as an individual for his own account, or as a partner, joint venturer,
owner, executive, employee, independent contractor, principal, agent,
consultant, salesperson, officer, director or shareholder of a Person in a
business competitive with the Company within the geographic area of the
Company’s Business (each, a “Restricted Activity”), which
is deemed by the parties hereto to be in the United States and European Union.
The Executive acknowledges that, due to the unique nature of the Company’s
business, the loss of any of its clients or business flow or the improper use of
its Confidential and Proprietary Information could create significant
instability and cause substantial damage to the Company and therefore the
Company has a strong legitimate business interest in protecting the continuity
of its business interests and the restriction herein agreed to by the Executive
narrowly and fairly serves such an important and critical business interest of
the Company.  For purposes of this Agreement, the “Business” of the Company and
its affiliates shall mean the following:  the development of novel
prescription drugs for the specific disease treatment of hemorrhoids, anal
fissures, and fecal incontinence.  Notwithstanding the foregoing,
nothing contained in this Section 7(a) shall be deemed to prohibit the Executive
from (i) acquiring or holding, solely for investment, publicly traded securities
of any corporation, some or all of the activities of which are competitive with
the business of the Company so long as such securities do not, in the aggregate,
constitute more than five percent (5%) of any class or series of outstanding
securities of such corporation, or (ii) engaging in a Restricted Activity for or
with respect to any subsidiary, division or affiliate or unit (each, a “Unit”) of a Person if that
Unit is not engaged in business which is directly competitive with the Business
of the Company, irrespective of whether some other Unit of such Person engages
in such competition (as long as the Executive does not engage in a Restricted
Activity for such other Unit).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)         During
the Term and for a period of 6 months thereafter, the Executive shall not,
directly or indirectly, without the prior written consent of the
Company:

     

    (i)        
   solicit or induce any employee of the Company to leave the
employ of the Company or any such affiliate; or hire for any purpose any
employee of the Company or any affiliate, or any employee who has left the
employment of the Company or any affiliate, within one year of the termination
of such employee’s employment with the Company or any such affiliate or at any
time if to hire such person would be in violation of such employee’s
non-competition agreement with the Company or any such affiliate;
or

     

    (ii)           solicit
or accept employment or be retained by any Person who, at any time during the
term of this Agreement, was an agent, client or customer of the Company or any
of its affiliates where Executive’s position will be competitive with or adverse
to the business of the Company or any such affiliate or solicit or accept the
business of any client or customer of the Company with respect to products,
services or investments competitive with those provided by the
Company.

    

    (c)         The
Company and the Executive each agree that both during the Term and at all times
thereafter, neither party shall directly or indirectly disparage, whether or not
true, the name or reputation of the other party, including but not limited to,
any officer, director, employee or shareholder of the Company.

     

    (d)         In
the event that the Executive breaches any provisions of Section 6 or this
Section 7 or there is a threatened breach, then, in addition to any other rights
which the Company may have, the Company shall (i) be entitled, without the
posting of bond or other security, to seek injunctive relief to enforce the
restrictions contained in such Sections and (ii) have the right to require the
Executive to account for and pay over to the Company all compensation, profits,
monies, accruals, increments and other benefits (collectively “Benefits”) derived or received
by the Executive as a result of any transaction constituting a breach of any of
the provisions of Sections 6 or 7.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    (e)         Each
of the rights and remedies enumerated in Section 7(d) shall be independent of
the others and shall be in addition to and not in lieu of any other rights and
remedies available to the Company at law or in equity.  The Employee
hereby acknowledges and agrees that the covenant against competition provided
for pursuant to Section 7(a) is reasonable with respect to it duration,
geographic area and scope. If, at the time of enforcement of this Section 7, a
court holds that the restrictions stated herein are unreasonable under the
circumstances then existing, the Parties hereto agree that the maximum duration,
scope or geographic area legally permissible under such circumstances will be
substituted for the duration, scope or area state herein. If any of the
covenants contained in this Section 7, or any part of any of them, is hereafter
construed or adjudicated to be invalid or unenforceable, the same shall not
affect the remainder of the covenant or covenants or rights or remedies which
shall be given full effect without regard to the invalid portions. No such
holding of invalidity or unenforceability in one jurisdiction shall bar or in
any way affect the Company’s right to the relief provided in this Section 7 or
otherwise in the courts of any other state or jurisdiction within the
geographical scope of such covenants as to breaches of such covenants in such
other respective states or jurisdictions, such covenants being, for this
purpose, severable into diverse and independent covenants.

     

    (f)         
In the event that an actual proceeding is brought in equity to enforce the
provisions of Section 6 or this Section 7, the Executive shall not urge as a
defense that there is an adequate remedy at law nor shall the Company be
prevented from seeking any other remedies which may be available.  The
Executive agrees that he shall not raise in any proceeding brought to enforce
the provisions of Section 6 or this Section 7 that the covenants contained in
such Sections limit his ability to earn a living.

     

    (g)         The
provisions of this Section 7 shall survive any termination of this
Agreement.

    

    8.           Representations and
Warranties.

     

    (a)           The
Executive hereby represents and warrants to the Company as follows:

     

    (i)          Neither
the execution or delivery of this Agreement nor the performance by the Executive
of his duties and other obligations hereunder violate or will violate any
statute, law, determination or award, or conflict with or constitute a default
or breach of any covenant or obligation under (whether immediately, upon the
giving of notice or lapse of time or both) any prior employment agreement,
contract, or other instrument to which the Executive is a party or by which he
is bound.

     

    (ii)         The
Executive has the full right, power and legal capacity to enter and deliver this
Agreement and to perform his duties and other obligations
hereunder.  This Agreement constitutes the legal, valid and binding
obligation of the Executive enforceable against him in accordance with its
terms.  No approvals or consents of any persons or entities are
required for the Executive to execute and deliver this Agreement or perform his
duties and other obligations hereunder.

     

    (b)           The
Company hereby represents and warrants to the Executive that this Agreement, the
employment of the Executive hereunder and the grant of the Options have been
duly authorized by and on behalf of the Company, including, without limitation,
by all required action by the Board.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    9.           Termination.  The
Executive’s employment hereunder shall be terminated upon the Executive’s death
and may be otherwise terminated as follows:

     

    (a)         The
Executive’s employment hereunder may be terminated by the Company for
Cause.  Any of the following actions by the Executive shall constitute
“Cause”:

     

    (i)         
 The willful failure, disregard or continuing refusal by the Executive to
perform his duties hereunder;

    

    (ii)          Any
act of willful or intentional misconduct, or a grossly negligent act by the
Executive having the effect of injuring, in a material way (as determined in
good-faith by the Company), the business or reputation of the Company, including
but not limited to, any officer, director, or executive of the
Company;

     

    (iii)         Willful
misconduct by the Executive in carrying out his duties or obligations under this
Agreement, including, without limitation,
insubordination with respect to lawful directions received by the Executive from
Chief Executive Officer or from the Board;

     

    (iv)         The
Executive’s indictment of any felony or a misdemeanor involving moral turpitude
(including entry of a nolo contendere plea);

     

    (v)          The
determination by the Company, based upon clear and convincing evidence, after a
reasonable and good-faith investigation by the Company following a written
allegation by another employee of the Company, that the Executive engaged in
some form of harassment prohibited by law
(including, without limitation, age, sex or race discrimination), unless the Executive’s actions were specifically
directed by the Board;

     

    (vi)        Any
intentional misappropriation of the property of the Company, or embezzlement of
its funds or assets (whether or not a misdemeanor or felony);

     

    (vii)       Breach
by the Executive of any of the provisions of Sections 6, 7 or 8 of this Agreement; and

    

    (viii)      Breach
by the Executive of any provision of this Agreement other than those contained
in Sections 6, 7 or 8 which is not cured by the Executive within
thirty (30) business days after notice thereof is given to the Executive by the
Company.

     

    (b)         The
Executive’s employment hereunder may be terminated by the Board due to the
Executive’s Disability.  For purposes of this Agreement, a termination
for “Disability” shall
occur (i) when the Board has provided a written termination notice to the
Executive supported by a written statement from a reputable independent
physician mutually selected by the Company and the Executive, or the Executive’s
legal representatives in the event he is unable to make such selection due to
mental incapacity, to the effect that the Executive shall have become so
physically or mentally incapacitated as to be unable to resume, even with
reasonable accommodation as may be required under the Americans With
Disabilities Act, within the ensuing twelve (12) months, his employment
hereunder by reason of physical or mental illness or injury, or (ii) upon
rendering of a written termination notice by the Company after the Executive has
been unable to substantially perform his duties hereunder, even with reasonable
accommodation as may be required under the Americans With Disabilities Act, for
120 or more consecutive days, or more than 180 days in any consecutive twelve
month period, by reason of any physical or mental illness or
injury.  For purposes of this Section 9(b), the Executive agrees to
make himself available and to cooperate in any reasonable examination by a
reputable independent physician mutually selected by the Company and the
Executive, and paid for by the Company.  The Company shall provide
salary continuation (through insurance or otherwise) at the rate of 100% of
salary and continuation of Fringe Benefits set forth in this Agreement during
the first six months Executive is unable to perform his duties by reason of
disability.  The Company shall reimburse Executive for his actual cost
of maintaining a supplementary long-term disability insurance policy during the
Term up to a maximum reimbursement of $10,000 per year.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)           The
Executive’s employment hereunder may be terminated by the Company (or its
successor) by written notice to the Executive upon the occurrence of a Change of
Control.  For purposes of this Agreement, “Change of Control” means (i)
the acquisition, directly or indirectly, following the date hereof by any person
(as such term is defined in Section 13(d) and 14(d)(2) of the Securities
Exchange Act of 1934, as amended), in one transaction or a series of related
transactions, of securities of the Company representing in excess of fifty
percent (50%) or more of the combined voting power of the Company’s then
outstanding securities if such person or his or its affiliate(s) do not own in
excess of 50% of such voting power on the date of this Agreement, or (ii) the
future disposition by the Company (whether direct or indirect, by sale of assets
or stock, merger, consolidation or otherwise) of all or substantially all of its
business and/or assets in one transaction or series of related transactions
other than a merger (1) effected exclusively for the purpose of changing the
domicile of the Company or (2) effected for the purpose of obtaining a public
listing and/or publicly traded securities.

     

    (d)           The
Executive’s employment hereunder may be terminated by the Executive for Good
Reason.  For purposes of this Agreement, “Good Reason” shall mean any of
the following: (i) any material reduction by the Corporation of the
Executive's duties, responsibilities, or authority as Chief Financial Officer of
the Company which causes his position with the Company to become of less
responsibility or authority than his position as of immediately following the
Effective Date; (ii) any reduction by the Corporation of the Executive's
compensation or benefits payable hereunder (it being understood that a reduction
of benefits applicable to all employees of the Corporation, including the
Executive, shall not be deemed a reduction of the Executive's compensation
package for purposes of this definition); (iii) any requirement by the Company
that the Executive locate Company headquarters, or Executive’s residence or
primary place of employment, to a location outside a 30-mile radius of New York,
NY, or (iv) a material breach by the Company of Section 7(c) or 8(b) of this
Agreement which is not cured by the Company within 30 days after written notice
thereof is given to the Company by the Executive, or (v) a change in the lines
of reporting such that the Executive no longer reports directly to the Chief
Executive Officer.

     

    (e)           The
Executive’s employment may be terminated by the Company without Cause by
delivery of written notice to the Executive effective the date of delivery of
such notice.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)
           The
Executive’s employment may be terminated by the Executive in the absence of Good
Reason by delivery of written notice to the Company effective fifteen (15) days
after the date of delivery of such notice.

     

    10.         Compensation upon
Termination.

     

    (a)           If
the Executive’s employment is terminated as a result of his death or Disability
or upon a Change of Control, the Company shall pay to the Executive or to the
Executive’s estate, as applicable, his Base Salary for a period of six (6)
months following the date of termination and any accrued but unpaid Bonus and
expense reimbursement amounts through the date of his Death or
Disability.  All Stock Options
that are scheduled to vest on the next succeeding
anniversary of the Commencement Date shall be accelerated and deemed to
have vested as of the termination date.  All Stock Options that have not vested (or been
deemed pursuant to the immediately preceding sentence to have vested) as of the
date of termination shall be forfeited to the
Company as of such date.  Stock Options that have vested as of
the Executive’s termination shall remain exercisable for 360 days following such
termination.

     

    (b)           If
the Executive’s employment is terminated either (i) by the Company for Cause, or
(ii) by the Executive in the absence of Good Reason, then the Company shall
promptly pay to the Executive his Base Salary through the date of his
termination and any expense reimbursement amounts owed through the date of
termination.  The Executive shall have no further entitlement to any
other compensation or benefits from the Company.  All Stock Options that have not vested as of the date of
termination shall be forfeited to the
Company as of such date.  Stock Options that have vested as of
the Executive’s termination shall remain exercisable for 90 days following such
termination.

     

    (c)           If
the Executive’s employment is terminated by the Company other than as a result
of the Executive’s death or Disability and other than for reasons specified in
Section 10(b) then the Company shall (i) continue to pay to the Executive his
Base Salary and all Fringe Benefits for a period of six (6) months following
such termination, (ii) pay any expense reimbursement amounts owed through the
date of termination, (iii) pay any accrued but unpaid Bonus and (iv) all Stock
Options that are scheduled to vest during the Term shall be accelerated and
deemed to have vested as of the termination date.  Any Stock Options that have vested as of the date of the
Executive’s termination shall remain exercisable for a period of 360
days.

     

    (d)           This
Section 10 sets forth the only obligations of the Company with respect to the
termination of the Executive’s employment with the Company, and the Executive
acknowledges that, upon the termination of his employment, he shall not be
entitled to any payments or benefits which are not explicitly provided in
Section 10.

     

    (e)           The
provisions of this Section 10 shall survive any termination of this
Agreement.

     

    11.         Miscellaneous.

     

    (a)           This
Agreement shall be governed by, and construed and interpreted in accordance
with, the laws of the State of New York, without giving effect to its principles
of conflicts of laws.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)           In
the event of any dispute arising out of, or relating to, this Agreement or the
breach thereof (other than Sections 6 or 7 hereof), or regarding the
interpretation thereof, the parties agree to submit any differences to
nonbinding mediation prior to pursuing resolution through the
courts.  The parties hereby submit to the exclusive jurisdiction of
the Courts of the...County of New York, or the United States District Court for
the Southern District of New York, and agree that service of process in such
court proceedings shall be satisfactorily made upon each other if sent by
registered mail addressed to the recipient at the address referred to in Section
11(g) below.

     

    (c)           This
Agreement shall be binding upon and inure to the benefit of the parties hereto,
and their respective heirs, legal representatives, successors and permitted
assigns.

     

    (d)           This
Agreement, and the Executive’s rights and obligations hereunder, may not be
assigned by the Executive.  The rights and obligations of the Company
under this Agreement shall inure to the benefit of and shall be binding upon the
successors and assigns of the Company, including any successors or assigns in
connection with any sale, transfer or other disposition of all or substantially
all of its business or assets.

     

    (e)           This
Agreement cannot be amended orally, or by any course of conduct or dealing, but
only by a written agreement signed by the parties hereto.

     

    (f)            The
failure of either party to insist upon the strict performance of any of the
terms, conditions and provisions of this Agreement shall not be construed as a
waiver or relinquishment of future compliance therewith, and such terms,
conditions and provisions shall remain in full force and effect.  No
waiver of any term or condition of this Agreement on the part of either party
shall be effective for any purpose whatsoever unless such waiver is in writing
and signed by such party.

     

    (g)           All
notices, requests, consents and other communications, required or permitted to
be given hereunder, shall be in writing and shall be delivered personally or by
an overnight courier service or sent by registered or certified mail, postage
prepaid, return receipt requested, to the parties at the addresses set forth on
the first page of this Agreement, and shall be deemed given when so delivered
personally or by overnight courier, or, if mailed, five days after the date of
deposit in the United States mails.  Either party may designate
another address, for receipt of notices hereunder by giving notice to the other
party in accordance with this Section 11 (g).

     

    (h)           This
Agreement sets forth the entire agreement and understanding of the parties
relating to the subject matter hereof, and supersedes all prior agreements,
arrangements and understandings, written or oral, relating to the subject matter
hereof.  No representation, promise or inducement has been made by
either party that is not embodied in this Agreement, and neither party shall be
bound by or liable for any alleged representation, promise or inducement not so
set forth.

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (i)            As
used in this Agreement, “affiliate” of a specified person or entity shall mean
and include any person or entity controlling, controlled by or under common
control with the specified person or entity.

     

    (j)            The
section headings contained herein are for reference purposes only and shall not
in any way affect the meaning or interpretation of this Agreement.

     

    (k)           This
Agreement may be executed in any number of counterparts, each of which shall
constitute an original, but all of which together shall constitute one and the
same instrument.

    

    [Remainder of Page Intentionally Left
Blank – Signature Page Follows]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the
parties hereto have executed this Agreement and intend it to be effective as of
the Commencement Date by proper person thereunto duly authorized.

    

    
      
        	
                VENTRUS
      BIOSCIENCES, INC.

              
	 
      	 
      
	
                By:

              	
                Russell H. Ellison

              
	
                Name:

              	
                Russell
      H. Ellison, MD

              
	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      
	
                David
      Barrett

              
	 
      	 
      
	
                By:

              	
                David Barrett

              
	
                Name:

              	
                David
      Barrett

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