Document:

ex10_3.htm

 Exhibit 10.3 

 

 INFINITY DISTRIBUTION, INC.  Convertible Promissory Note   USD:  $21,500.00  Date:May 11, 2015   FOR VALUE RECEIVED, the undersigned, Infinity Distribution, Inc., a Delaware corporation ("Borrower"), hereby promises to pay to Raul Mansueto ("Lender"), the principal sum of Twenty One Thousand  Five Hundred Dollars ($21,500.00) ("Principal Sum"), or such lesser amount as may then be outstanding, together with accrued but unpaid interest thereon unless converted to common stock according to Section 1 herein ("Note"), on the earlier of (i) March 19, 2016 or (ii) the Next Equity Financing ("Maturity Date"). Interest on the outstanding Principal Sum shall be at a rate of 5.0% per annum ("Interest").   This Note being issued pursuant to, and subject to certain covenants and conditions contained in, a certain Convertible Note Purchase Agreement entered into between the partied dated herewith.   1.CONVERSION  a.Investment by Lender. The entire Principal Sum of and (at the Borrowers option) accrued Interest on this Note shall be converted into shares of the common stock of the Borrower ("Shares"). The number of Shares to be issued upon such conversion shall be equal to the quotient obtained by dividing (i) the entire Principal Sum of this Note plus (if applicable) accrued Interest by (ii) 30% of the price per share of the securities sold in the Next Equity Financing, rounded to the nearest whole share.   b.Next Equity Financing. For purposes of the Note, the term "Next Equity Financing" shall mean a sale of equity securities by the Borrower.  c. Mechanics and  Effect Conversion. Upon conversion of this Note, the Lender shall  surrender this Note, duly endorsed, at the principal offices of the Borrower or any transfer agent of the Borrower. At this expense, the Borrower will, as soon as practicable thereafter, issue and deliver to such Lender, at such principal office, a certificate of  certificates for the number of Shares to which such Lender is entitled upon such  conversion. Upon conversion of this Note, the Borrower will be forever released from all of its obligations and liabilities under the Note with regard to the portion of the Principal Sum and accrued Interest being converted including without limitation the obligation to pay such portion of the principal amount and accrued interest. Moreover, the Lender acknowledges and agrees that the securities underlying the Note, if converted, shall be subject to the applicable provisions of any shareholders agreement governing the Borrowers common stock and Lender agrees, as a condition to exercising any rights of conversion under the Note, to enter into any such shareholders agreement. 

 

    

    

    

 

 2.           Prepayment. Prepayment of this Note may be made at any time without penalty or premium.  3.Transfer; Successors and Assigns. The terms and conditions of this Note shall inure to the benefit  of and be, binding upon the respective successors and assigns of the parties. Notwithstanding the foregoing, the Lender may assign, pledge, or otherwise transfer this Note without the prior written consent of the Borrower.   4. Payment. Unless converted pursuant to Section 1 above, payment of the Principal Sum and  Interest on the Maturity Date shall be made by certified or bank cashiers check payable to the Lender at the Lender's principal address, or by bank wire transfer, in immediately available funds, to the account specified, in lawful money of the United States of America. If the Maturity Date occurs on a date that is not a Business Day then the Principal Sum or Interest then due shall be paid on the next succeeding Business Day. "Business Day" shall mean any day other than Saturday, Sunday or any day upon which banks authorize or required to the closed.  IN WITNESS WHEREOF, the Borrower has caused this Note to be signed on its behalf, in its corporate name, by its duly authorized officer as an instrument under seal, as of the day and year first above written.   BORROWER:  INFINITY DISTRIBUTION, INC.    By:),A)5u-c Its:    LENDER:  RAUL MANSUETO       flACA/1/1 3 LAIL:  Its:             Page 2 of 2IntelGenx Corp. - Exhibit 10.1 - Filed by newsfilecorp.com

EXECUTION VERSION 

 

 

 

ROYALTY PURCHASE
AGREEMENT 

 

BY AND BETWEEN 

INTELGENX
CORP. 

AND 

SWK FUNDING LLC 

 

DATED AS OF AUGUST 4,
2016 

TABLE OF CONTENTS 

	 	 	  	Page 
	 	 	  	  
	 	 	  	  
	 	 	  	  
	 ARTICLE
    I DEFINITIONS; INTERPRETATION  	1
      
	 	Section
      1.1 	Definitions
      	1
      
	 	Section
      1.2 	Certain
      Interpretations 	5
      
	ARTICLE
      II PURCHASE AND SALE OF PURCHASED
    RECEIVABLES  	6
      
	 	Section
      2.1 	Purchase
      and Sale of Purchased Receivables. 	6
      
	 	Section
      2.2 	No
      Purchase or Sale of Excluded Assets 	6
      
	 	Section
      2.3 	No
      Obligations Transferred 	7
      
	 	Section
      2.4 	Sale
      	7
      
	 	Section
      2.5 	Nonassignable
      Assets 	7
      
	 	Section
      2.6 	Power
      of Attorney 	8
      
	 	Section
      2.7 	No
      Guarantee of Purchased Receivables 	8
      
	ARTICLE
    III CLOSING  	8
      
	 	Section
      3.1 	Closing
      	8
      
	 	Section
      3.2 	Payment
      of Purchase Price 	9
      
	 	Section
      3.3 	Seller’s
      Secretary Certificate 	9
      
	 	Section
      3.4 	Bill
      of Sale and Assignment 	9
      
	 	Section
      3.5 	Tax
      Forms 	9
      
	 	Section
      3.6 	Edgemont
      Consent and Payment Instruction Letter 	9
      
	 	Section
      3.7 	Receipt
      	9
      
	ARTICLE
      IV SELLER’S REPRESENTATIONS AND
    WARRANTIES  	9
      
	 	Section
      4.1 	Existence
      	9
      
	 	Section
      4.2 	Authorization
      	9
      
	 	Section
      4.3 	Enforceability
      	10
      
	 	Section
      4.4 	Absence
      of Conflicts 	10
      
	 	Section
      4.5 	Consents
      	10
      
	 	Section
      4.6 	Litigation
      	10
      
	 	Section
      4.7 	Brokers
      Fees 	10
      
	 	Section
      4.8 	Product
      Agreements. 	11
      
	 	Section
      4.9 	Title
      to Purchased Receivables 	12
      
	 	Section
      4.10 	Product
      Related IP. 	13
      
	 	Section
      4.11 	Development
      of Competitive Products 	13
      
	 	Section
      4.12 	Compliance
      with Laws 	13
      
	 	Section
      4.13 	UCC
      and Code Representations and Warranties 	14
      
	 	Section
      4.14 	Solvency
      	14
      
	ARTICLE
      V PURCHASER’S REPRESENTATIONS AND
    WARRANTIES  	14
      
	 	Section
      5.1 	Existence
      	14
      
	 	Section
      5.2 	Authorization
      	14
      
	 	Section
      5.3 	Enforceability
      	14
      
	 	Section
      5.4 	Absence
      of Conflicts 	15
      

	 	Section 5.5
      	Consents
    	15

	 	Section 5.6 	Litigation 	15 
	 	Section 5.7
      	Brokers Fees
      	15

	ARTICLE VI
    COVENANTS  	15 
	 	Section 6.1
      	Performance
      of Product Agreements 	15

	 	Section 6.2 	Misdirected Payments;
      Offsets by Counterparties. 	15 
	 	Section 6.3
      	Royalty
      Reports; Notices; Correspondence. 	16

	 	Section 6.4 	Inspections and Audits of
      Counterparties. 	17 
	 	Section 6.5
      	Amendment of
      Product Agreements; Waivers 	17

	 	Section 6.6 	Enforcement of Product
      Agreements. 	17 
	 	Section 6.7
      	Termination
      of Product Agreements 	18

	 	Section 6.8 	Approval of Assignments of
      Product Agreements. 	18 
	 	Section 6.9
      	Consent and
      Instruction Letter 	19

	 	Section 6.10 	Public Announcements; Use of
      Names 	19 
	 	Section 6.11
      	Taxes
	19

	 	Section 6.12 	Remittance of Previously
      Received Purchased Receivables; Further Actions 	19 
	 	Section 6.13
      	Intellectual
      Property Matters. 	20

	 	Section 6.14 	Additional License
      Agreements 	20 
	ARTICLE
    VII INDEMNIFICATION  	21
      
	 	Section 7.1 	Obligation of Parties to
      Indemnify. 	21 
	 	Section 7.2
      	Procedures
      Relating to Indemnification for Third Party Claims. 	22

	 	Section 7.3 	Procedures Relating to
      Indemnification for Other Claims 	23 
	 	Section 7.4
      	Exclusive
      Remedy 	23

	 	Section 7.5 	Survival 	24 
	 	Section 7.6
      	Limitations
      on Damages 	24

	ARTICLE VIII
    MISCELLANEOUS  	25 
	 	Section 8.1
      	Headings
    	25

	 	Section 8.2 	Notices 	25 
	 	Section 8.3
      	Expenses
    	26

	 	Section 8.4 	Assignment 	26 
	 	Section 8.5
      	Successors
      and Assigns 	26

	 	Section 8.6 	Amendment and Waiver.
	26 
	 	Section 8.7
      	Entire
      Agreement 	27

	 	Section 8.8 	Independent Contractors
    	27 
	 	Section 8.9
      	No Third
      Party Beneficiaries 	27

	 	Section 8.10 	Governing Law 	27 
	 	Section 8.11
      	Jurisdiction; Venue; Service Of Process; Waiver of Jury
      Trial 	27

	 	Section 8.12 	Equitable Remedies 	28 
	 	Section 8.13
      	Severability
      	28

	 	Section 8.14 	Counterparts 	28 

ii 

List of Exhibits 

	A 	
      Seller’s Wire Transfer Instructions

	B 	
      Purchaser’s Wire Transfer Instructions

	C 	
      Schedule of Exceptions to Seller’s Representations and
      Warranties

	D 	
      Product Agreements (to be amended with any additional
      Product Agreements, if executed in the future)

	E 	
      Consent and Instruction Letter

iii 

INDEX OF DEFINED TERMS

	Additional
      License Agreements 	1
      
	Adverse
      Claim 	1
      
	Affiliate
      	1
      
	Agreement
      	1
      
	Bill
      of Sale 	9
      
	Business
      Day 	1
      
	Closing
      Date 	8
      
	Code
      	2
      
	Consent
      	2
      
	Consent
      and Instruction Letter 	9
      
	Contract
      	2
      
	Control
      	2
      
	Counterparties
      	2
      
	Counterparty
      	2
      
	Depomed
      	1
      
	Depomed
      Agreements 	2
      
	Depomed
      License Agreement 	1
      
	Governmental
      Entity 	2
      
	Indemnified
      Party 	22
      
	Indemnifying
      Party 	22
      
	Intellectual
      Property 	2
      
	Judgment
      	2
      
	Knowledge
      of Seller 	3
      
	Law
      	3
      

	Losses
      	21
      
	Modification
      	17
      
	Net
      Sales 	3
      
	Nonassignable
      	7
      
	Outstanding
      Litigation 	3
      
	Permitted
      Adverse Claim 	3
      
	Person
      	4
      
	Proceeds
      	4
      
	Product
      	4
      
	Product
      Agreements 	4
      
	Product
      Related IP 	4
      
	Purchased
      Receivables 	4
      
	Purchaser
      	1
      
	Purchaser
      Indemnified Party 	21
      
	Purchaser
      Material Adverse Effect 	4
      
	Royalty
      Payment 	4
      
	Royalty
      Reports 	5
      
	Seller
      	1
      
	Seller
      Indemnified Party 	22
      
	Seller
      Material Adverse Effect 	5
      
	Third
      Party Claim 	22
      
	Transaction
      Documents 	5
      
	UCC
      	5
      
	Upfront
      Payment 	5
      

iv 

            THIS
ROYALTY PURCHASE AGREEMENT (this “Agreement”) dated August 4, 2016 by and
between INTELGENX CORPORATION, a Canadian corporation (“Seller”), and SWK
FUNDING LLC, a Delaware limited liability company (“Purchaser”). 

INTRODUCTION 

            Seller
is a party to that certain License and Asset Transfer Agreement, dated as of
February 13, 2012 (as amended by the First Amendment to License and Asset
Transfer Agreement effective as of November 13, 2014, and as the same may be
further amended, modified or supplemented hereafter, the “Edgemont License
Agreement”), between Seller and Edgemont Pharmaceuticals, LLC, a Delaware
limited liability company (“Edgemont”). 

            Seller
desires to sell, transfer, assign and convey to Purchaser, and Purchaser desires
to purchase, acquire and accept from Seller, all of Seller’s right, title and
interest in and to the Purchased Receivables (as defined below), for the
consideration and on the terms and subject to the conditions set forth in this
Agreement. 

            In
consideration of the representations, warranties, covenants and agreements set
forth herein and for good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, Seller and Purchaser hereby agree as follows:

ARTICLE I 

DEFINITIONS;
INTERPRETATION 

            Section
1.1        Definitions. For purposes
of this Agreement, the following capitalized terms have the meanings specified
below: 

                          “Additional
License Agreements” means any additional revenue generating agreements
entered into by Seller with Counterparties with respect to the sale,
manufacture, marketing, distribution or licensing of the Product within the
United States, as well as any and all sub-license agreements entered into by
such Counterparty and any and all other related agreements by and between Seller
and such Counterparty, or such Counterparty and a sub-licensee, as applicable
with respect to the sale, manufacture, marketing, distribution or license of the
Product within the United States. 

                          “Adverse
Claim” means a lien, title defect, pledge, security interest, charge or
encumbrance, or other right or claim in or on any Person’s assets or properties
in favor of any other Person. 

                          “Affiliate”
means, with respect to any Person, any other Person that directly, or indirectly
through one or more intermediaries, Controls, or is Controlled by, or is under
common Control with, such Person. 

                          “Business
Day” means any day other than (a) a Saturday or Sunday or (b) a day on which
banking institutions located in New York, New York, or Montreal, Quebec are
permitted or required by applicable Law to remain closed. 

                         
“Code” means the Civil Code of Québec as in effect in the Province of
Quebec. 

                          
“Consent” means any consent, approval, license, permit, order,
authorization, registration, filing or notice. 

                          “Contract”
means any contract, lease, license, indenture, instrument or other agreement.

                          “Control”
and its derivatives mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities or other voting interests, by
contract or otherwise. 

                          “Counterparties”
and “Counterparty” means Edgemont and any other Persons counterparty to
an Additional License Agreement. 

                          “Edgemont
Agreements” means the Edgemont License Agreement, the Sublicense Agreement
and any sub-license agreements concerning the Product entered into by
Edgemont and any and all other related agreements concerning the Product by and
between Seller and Edgemont, or Edgemont and a sub-licensee and/or a third
party, as applicable, in each case only to the extent that such agreements
relate to sale, manufacture, marketing, distribution or license of the Product
within the United States. 

                         
“FDA” means the United States Food and Drug Administration. 

                          “Governmental
Entity” means any United States, Canadian or other foreign (i) federal,
state, local, municipal or other government, (ii) governmental or
quasi-governmental entity of any nature (including any governmental agency,
branch, department, official, or entity and any court or other tribunal) or
(iii) body exercising or entitled to exercise any administrative, executive,
judicial, legislative, police, regulatory, or taxing authority, or power of any
nature, including any arbitral tribunal. 

                          “Intellectual
Property” means, with respect to any Person, all intellectual property owned
or licensed (as licensor or licensee) by such Person and in which such Person
has a pecuniary interest, including (i) all patents, patent applications, and
inventions and discoveries that may be patentable, (ii) all know-how, trade
secrets, software, technical information, data, registrations, applications for
governmental approvals, inventions, processes, devices, improvements,
formulations, discoveries, compositions, ingredients, research, developments,
best practices (including clinical pathways), formulae, protocols, standards,
methods, techniques, designs, quality control practices and information,
research and test procedures and information, and safety, environmental and
health practices and information, (iii) all confidential or proprietary
information, commercial information, management systems, business processes and
practices, trial results and files, procurement practices and information,
supplier qualification and approval practices and information, training
materials, sales and marketing materials, advertising and promotional materials
and (iv) all rights in any jurisdiction to limit the use or disclosure of any of
the foregoing, and rights to sue and recover damages or obtain injunctive relief
for infringement, dilution, misappropriation, violation or breach of any of the
foregoing. “Judgment” means any judgment, order, ruling, injunction,
assessment, award, writ or decree of any Governmental Entity or arbitrator. 

2 

                          “Knowledge
of Seller” means the actual knowledge of Horst Zerbe and Andre Godin after
reasonable inquiry. “Known to Seller” has the correlative meaning
“Law” means any law, statute, code, rule, regulation or ordinance of
any Governmental Entity and all Judgments. 

                          “Licensed
Know-How” means all information (other than that contained in the Patents)
whether patentable or not and physical objects related to the Product, including
but not limited to Product data, Product-related results and information
including but not limited to, clinical data, analytical test methods, validation
and results, non-clinical pharmacology and safety data, other R&D data,
regulatory documentation, manufacturing and formulation information of a like
nature, all provided that the Licensed Know-How is known to, generated by,
vested in (or licensed to) and/or controlled by Seller. 

                          “NDA”
means the new drug application for the Product submitted to the FDA on or about
March 31, 2009 and received by the FDA on or about April 6, 2009, having been
assigned NDA #22-497 by the FDA, and approved by the FDA on or about November
10, 2011, including all amendments and supplements thereto. 

                          “Net
Sales” shall have the meaning as set forth in the Edgemont License
Agreement, but shall be deemed to include (i) any equivalent or similar net
sales definition as set forth in any Product Agreement other than the Edgemont
Agreements, and (ii) in the case of any direct sales or marketing of the Product
by Seller, its Affiliates or their respective sub-licensees within the United
States, other than pursuant to a Product Agreement, any and all gross amounts
billed or invoiced by Seller, such Affiliate or sub-licenses, less all the
deductions as set forth in the Net Sales definition of the Edgemont License
Agreement, in each case stemming from or relating to the sale or other transfer
of the Product within the United States. 

                          “Outstanding
Litigation” means any litigation matters described in Exhibit C
hereto. 

                          “Patents”
means all Product-related intellectual property including but not limited to (a)
U.S. patents and patent applications, including without limitation U.S. Patent
Number 7,674,479, (b) any substitutions, divisions, continuations,
continuations-in-part (but only to the extent that they cover the same invention
claimed in the foregoing), reissues, renewals, registrations confirmations,
re-examinations, extensions, supplementary protection certificates and the like,
and nay provisional applications, of any such patents or patent applications,
and (c) any foreign or international equivalent of any of the foregoing, of
which Seller is the owner, controller or licensee.

                          “Permitted
Adverse Claim” means (i) any Adverse Claim in favor of Purchaser created
pursuant to this Agreement or (ii) any Adverse Claim as to which no enforcement
collection, execution, levy or foreclosure proceeding shall have been commenced
or threatened that secures the payment of taxes, assessments and governmental
charges or levies, if and to the extent the same are either (x) not yet due and
payable or (y) being contested in good faith and as to which adequate reserves
have been provided, in any case with respect to clause (ii) only to the extent such Adverse Claim could not reasonably be expected to
have a Seller Material Adverse Effect. 

3 

                          “Person”
means any individual, firm, corporation, partnership, limited liability company,
trust, joint venture, association, unincorporated organization, Governmental
Entity or other entity or organization. 

                          “Proceeds”
means any amounts but only to the extent both: (i) related to the Purchased
Receivables, and (ii) actually recovered by Seller from a Person as a result of
any settlement or resolution of any actions, suits, proceedings, claims or
disputes. 

                          “Product”
means extended release tablets that contain 450 mg of bupropion hydrochloride as
approved in the NDA.

                          “Product
Agreements” means the Edgemont Agreements and any Additional License
Agreements. 

                          “Product
Related IP” means the Intellectual Property related to the Product that is
owned or licensed (as licensor or licensee) by Seller, any Counterparty or their
Affiliates, including, without limitation, the Patents, the Product Trademark,
the Licensed Know-How and the Product, or any part thereof. 

                          “Product
Trademark” means the trademark FORFIVOTM associated with the
Product, any other related trademark, service mark or domain name containing the
word “FORFIVO” (whether registered or unregistered). 

                          “Purchased
Receivables” means all (whether paid or payable) Royalty Payments paid or
payable to Seller accruing on or after April 1, 2016. 

                          “Purchaser
Material Adverse Effect” means any one or more of (i) a material adverse
effect on the ability of Purchaser to consummate the transactions contemplated
by this Agreement and perform its obligations under this Agreement or (ii) a
material adverse effect on the validity or enforceability of this Agreement or
the rights of Seller hereunder. 

                          “Royalty
Payment” means the following royalty payments, or any other amounts which
are received relating to Net Sales of the Product within the United States
whether pursuant to a Product Agreement or otherwise (in the case of any direct
sales in the United States or manufacture of a Product by or on behalf of Seller
or its Affiliate), (i) 100% of any and all Royalties (as defined in the Edgemont
License Agreement) or similar royalty amounts paid or payable to Seller or its
Affiliate pursuant to or in connection with the Edgemont License Agreement and
any other Edgemont Agreement, (ii) 100% of the $2,000,000 payment to be made to
Seller pursuant to the Edgemont License Agreement once Annual Net Sales reach
$15,000,000 for the first time during Successful Commercialization (as each such
capitalized term in clause (ii) is defined in the Edgemont License Agreement),
(iii) 35% of all other conditional fees, non-refundable incentive fees, and
milestone payments (other than the milestone payment described in clause (ii)
hereof) paid or payable to Seller under Section 7 of the Edgemont License
Agreement, and (iv) any other royalty or similar payments or Upfront Payments paid or payable to Seller or its Affiliate pursuant to
or in connection with any Additional License Agreement. 

4 

                          “Royalty
Reports” means the reports delivered by a Counterparty pursuant to the
applicable Product Agreement in respect of Net Sales. 

                          “Seller
Material Adverse Effect” means any one or more of: (i) a material adverse
effect on the ability of Seller to consummate the transactions contemplated by
this Agreement and perform its obligations under this Agreement or any Product
Agreement, (ii) a material adverse effect on the validity or enforceability of
this Agreement or any Product Agreement or the rights of Purchaser hereunder or
(iii) a material adverse effect on the rights of Seller under any Product
Agreement. 

                          “Sublicense
Agreement” means that certain Authorized Generic and Sublicense Agreement,
dated November 20, 2014, among Edgemont, Wockhardt, Ltd., Wockhardt Bio AG and
Wockhardt USA, LLC. 

                          “Subsidiary”
means, with respect to any Person, any other Person of which more than 50% of
the outstanding Voting Securities of such other Person is at the time directly
or indirectly owned or controlled by such Person, by such Person and one or more
other Subsidiaries of such Person or by one or more other Subsidiaries of such
Person. 

                          “Transaction
Documents” means this Agreement, the Bill of Sale and all of the other
agreements, documents, letters and certificates executed or delivered in
connection herewith. 

                          “UCC”
means the Uniform Commercial Code as in effect in the State of New York or the
District of Columbia, as applicable. 

                          “United
States” means the United States of America and its territories and
possessions, including the Commonwealth of Puerto Rico, and any installation,
territory or location or jurisdiction under the control of the government of the
United States of America. 

                          “Upfront
Payment” means any payment from a Counterparty pursuant to an Additional
License Agreement payable at the time such agreement is executed. 

                          Capitalized
terms used in this Agreement and not otherwise defined herein shall have the
respective meanings ascribed to them in the applicable Product Agreement. In the
event a capitalized term used herein is defined in both this Agreement and a
Product Agreements, the meaning given to such term in this Agreement shall
control. 

            Section
1.2        Certain Interpretations.
Except where expressly stated otherwise in this Agreement, the following rules
of interpretation apply to this Agreement: 

                         
(a)        “include,” “includes” and
“including” shall be deemed to be followed by the words “without limitation”;

5 

                          (b)       
“hereof,” “hereto,” “herein” and “hereunder” and words of similar import when
used in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement; 

                         
(c)        references to a Contract mean such
Contract as amended, modified or supplemented and including any annexes,
exhibits and schedules attached thereto, in each case to the extent not
prohibited by such Contract or this Agreement; 

                         
(d)        references to a Person are also to
its permitted successors and assigns; 

                         
(e)        references to an “Article,”
“Section,” “Exhibit” or “Schedule” refer to an Article or Section of, or an
Exhibit or Schedule to, this Agreement; 

                         
(f)        references to “$” or otherwise to
dollar amounts refer to the lawful currency of the United States; 

                         
(g)        references to a Law include any
amendment or modification to such Law and any rules and regulations issued
thereunder, whether such amendment or modification is made, or issuance of such
rules and regulations occurs, before or after the date of this Agreement; and

                         
(h)        references to this “Agreement”
shall include a reference to all Schedules and Exhibits attached to this
Agreement (including the Schedule of Exceptions attached hereto as Exhibit
C), all of which constitute a part of this Agreement and are incorporated
herein for all purposes. 

ARTICLE II 

PURCHASE AND SALE OF
PURCHASED RECEIVABLES 

           
Section 2.1        Purchase and Sale of
Purchased Receivables. 

                          (a)       
Purchase and Sale. Upon the terms and subject to the conditions of this
Agreement, on the Closing Date, Seller shall sell, transfer, assign and convey
to Purchaser, and Purchaser shall purchase, acquire and accept from Seller, free
and clear of all Adverse Claims (other than Permitted Adverse Claims or Adverse
Claims arising through Purchaser), all of Seller’s right, title and interest in
and to the Purchased Receivables. 

                          (b)       
Purchase Price. The purchase price for the Purchased Receivables shall be
$6,000,000 (the “Purchase Price”), less Purchaser’s out-of-pocket
fees, costs and expenses (including legal fees) and other amounts (the
“Purchaser’s Expenses”), payable by Purchaser to Seller on the Closing
Date as required by Section 8.3 hereof.

            Section
2.2        No Purchase or Sale of Excluded
Assets. Except for the Purchased Receivables and as otherwise set forth in
this Agreement, Seller shall retain all of its right, title and interest in and
to the Product, and all rights to the Product and rights under the Product
Agreement and any Additional License Agreements are excluded from the sale,
transfer, assignment and conveyance to Purchaser under this Agreement.

6 

            Section
2.3        No Obligations
Transferred. Notwithstanding anything to the contrary contained in
this Agreement, (a) the sale, transfer, assignment and conveyance to Purchaser
of the Purchased Receivables pursuant to this Agreement shall not in any way
subject Purchaser to, or transfer, affect or modify, any obligation or liability
of Seller under any Product Agreement and (b) Purchaser expressly does not
assume or agree to become responsible for any obligation or liability of Seller
under any Product Agreement or otherwise. 

            Section
2.4        Sale. It is the intention
of the parties hereto that the sale, transfer, assignment and conveyance
contemplated by this Agreement shall constitute a sale of the Purchased
Receivables from Seller to Purchaser and not a financing transaction, borrowing
or loan; and accordingly, Seller and Purchaser will treat the sale, transfer,
assignment and conveyance of the Purchased Receivables as sales of “accounts”
for accounting purposes, and Seller hereby authorizes Purchaser or its designee,
from and after the Closing Date, to execute, record and file such financing
statements (and continuation statements with respect to such financing
statements when applicable) naming Seller as the seller/debtor and Purchaser as
the purchaser/secured party of the Purchased Receivables as may be necessary to
perfect such sale in accordance with the UCC and the Code, as applicable. If,
notwithstanding the intent of the parties hereto in this regard, the sale,
transfer, assignment and conveyance contemplated hereby is held not to be a
sale, this Agreement shall constitute a security agreement and Seller does
hereby grant to Purchaser a security interest and hypothec in and to the
Purchased Receivables, whether now owned or hereafter acquired or arising, and
wherever located, and any proceeds, to secure payment to Purchaser of amounts
equal to the Purchased Receivables as they are paid under the Product
Agreements, and Seller does hereby authorize Purchaser to file such financing
statements (and continuation statements with respect to such financing
statements when applicable) as may be necessary to perfect its security
interest. Seller waives, to the maximum extent permitted by law, any right to
contest or otherwise assert that this Agreement is other than a true, complete,
absolute and irrevocable sale by Seller to Purchaser of the Purchased
Receivables under applicable Law, which waiver shall be enforceable, to the
maximum extent permitted by law, against Seller in any bankruptcy or insolvency
proceeding relating to Seller. The sale, transfer, assignment and conveyance of
the Purchased Receivables shall be reflected on Seller’s financial statements
and other records as a sale of assets to Purchaser. Seller agrees that in any
consolidated financial statements of Seller it shall indicate that the Purchased
Receivables are the assets of Purchaser. 

            Section
2.5        Nonassignable Assets.
Nothing in this Agreement nor the consummation of the transactions contemplated
hereby shall be construed as an attempt or agreement to assign any asset
included in the Purchased Receivables, including any Contract, approval,
authorization or other right, which by its terms or by Law is nonassignable
without the consent of a third party or is cancelable by a third party in the
event of an assignment (“Nonassignable Assets”) unless and until such
consent shall have been obtained or to the extent any such assignment
restriction is removed or expires by its term. Seller shall use its commercially
reasonable efforts to cooperate with Purchaser in endeavoring to obtain such
consents promptly. In the event consents to the assignment thereof cannot be
obtained, such Nonassignable Assets shall be held by Seller in trust for
Purchaser and the covenants and obligations thereunder shall be performed by
Seller in Purchaser’s name and all benefits and obligations existing thereunder
shall be for Purchaser’s account. Seller shall take such actions as Purchaser
may reasonably request so as to provide Purchaser with the benefits of the
Nonassignable Assets and to effect collection of money or other consideration that becomes due and payable under the
Nonassignable Assets, and Seller shall promptly pay over to Purchases all money
or other consideration received by it in respect of all Nonassignable Assets. 

7 

            Section
2.6        Power of Attorney. As of
and from the Closing Date, Seller on behalf of itself and its Affiliates hereby
irrevocably constitutes and appoints Purchaser, to the extent permitted by
applicable Law and the terms of the Nonassignable Assets, with full power of
substitution, as Seller’s true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of Seller and in the name of Seller
or in its own name, from time to time in Purchaser’s discretion, to take any and
all appropriate action and to execute and deliver any and all documents and
instruments which may be necessary or desirable to accomplish the purposes of
this Agreement and the Bill of Sale and, without limiting the generality of the
foregoing, to the extent that Seller has the right under applicable Law and any
applicable Contract, Seller hereby grants to Purchaser the power and right, on
behalf of Seller, to the extent Seller has the legal power or right to do such
act for its own benefit without notice to or assent by Seller, and at any time,
to do the following: (a) pay or discharge any taxes, liens, security interests,
or other encumbrances or other Adverse Claims levied or placed on or threatened
against the Purchased Receivables (other than Adverse Claims arising through
Purchaser); (b) communicate in its own name with any party to any Contract with
regard to the assignment of the right, title and interest of Seller in and under
the Purchased Receivables and other matters relating thereto; (c) execute, in
connection with the transfer of title, any endorsements, assignments or other
instruments of conveyance or transfer with respect to the Purchased Receivables,
(d) to perform all the obligations and receive all the benefits of Seller under
the Nonassignable Assets, and (e) defend, exercise or enforce any of Seller’s
rights under the Product Agreements in any manner reasonably necessary or
advisable to protect Purchaser’s rights under this Agreement and appoint
Purchaser their attorneys-in-fact to act in their name on their behalf. The
power of attorney granted hereby is coupled with an interest, and may not be
revoked or canceled by Seller without Purchaser’s written consent. If reasonably
requested by Purchaser, Seller shall execute a stand-alone power of attorney
consistent with the terms of this Section 2.6 to enable Purchaser to present
such power of attorney to other parties without disclosing this Agreement. 

            Section
2.7        No Guarantee of Purchased
Receivables. Seller makes no guarantee to Purchaser that Net Sales of the
Product will equal any minimum amount or that Royalty Payments or Purchased
Receivables will equal any minimum amount. So long as Seller complies with the
terms of this Agreement, the Purchase Price is not subject in whole or in part
to any reduction, discount or set-off due to the Net Sales, Royalty Payments, or
Purchased Receivables created under the Product Agreements. 

ARTICLE III 

CLOSING 

     Section
3.1        Closing. The closing of the
purchase and sale of the Purchased Receivables shall take place at the offices
of Holland & Knight LLP, 200 Crescent Court, Suite 1600, Dallas, Texas
75201, at 10:00 a.m. Dallas time on August 4, 2016 (the “Closing Date”).

8 

            Section
3.2        Payment of Purchase Price.
On the Closing Date, Purchaser shall deliver to Seller the Purchase Price
less the Purchaser’s Expenses, by wire transfer of immediately available
funds to the account set forth in Exhibit A. 

            Section
3.3        Seller’s Secretary
Certificate. On the Closing Date, Seller shall deliver to Purchaser a
certificate of the Secretary of Seller, dated the Closing Date, certifying as to
(i) the incumbency of the officer of Seller executing this Agreement and (ii)
the attached copies of Seller’s organizational documents and resolutions adopted
by Seller’s Board of Directors authorizing the entry into this Agreement by
Seller and the consummation by Seller of the transactions contemplated hereby.

            Section
3.4        Bill of Sale and
Assignment. On the Closing Date, Seller and Purchaser shall each deliver to
the other party hereto a duly executed bill of sale and assignment in form and
substance acceptable to Purchaser in its sole discretion and evidencing the sale
and assignment to Purchaser of the Purchased Receivables (the “Bill of
Sale”). 

            Section
3.5        Tax Forms. Prior to the
Closing Date, Purchaser shall deliver to Seller a valid and properly executed
IRS Form W-9, certifying that Purchaser is exempt from United States federal
withholding tax with respect to all payments with respect to the Purchased
Receivables. 

            Section
3.6        Edgemont Consent and Payment
Instruction Letter. Set forth as Exhibit E is an executed consent and
payment instruction letter, duly executed by Edgemont and Seller (the
“Consent and Instruction Letter”). 

            Section
3.7        Receipt. On the Closing
Date, Seller shall deliver to Purchaser a duly executed receipt for payment of
the Purchase Price. 

ARTICLE IV 

SELLER’S REPRESENTATIONS
AND WARRANTIES 

            Except
as otherwise set forth on Exhibit C, Seller hereby represents and
warrants to Purchaser as of the date hereof:

           
Section 4.1        Existence. Seller
is a corporation duly organized, validly existing and in good standing under the
laws of Canada. Seller has all power and authority, and all Consents of all
Governmental Entities, required to own its property and conduct its business as
now conducted and to exercise its rights and to perform its obligations under
this Agreement and the Product Agreements. Seller is duly qualified to transact
business and is in good standing in every jurisdiction in which such
qualification or good standing is required by applicable Law, except as
individually or in the aggregate would not result in a Seller Material Adverse
Effect. 

            Section
4.2        Authorization. Seller has
the corporate power to enter into the Transaction Documents and to consummate
the transactions contemplated thereby. The entry into the Transaction Documents,
and the consummation of the transactions contemplated thereby, have been duly
authorized by Seller. Each of the Transaction Documents to which Seller is a
party has been duly executed and delivered by Seller. 

9 

            Section
4.3        Enforceability. Each of the
Transaction Documents to which Seller is a party constitutes a valid, binding
and enforceable obligation of Seller, except as may be limited by general
principles of equity (regardless of whether considered in a proceeding at law or
in equity) and by applicable bankruptcy, insolvency, and other laws of general
application relating to or affecting creditors’ rights generally. 

            Section
4.4        Absence of Conflicts. The
execution, delivery and performance by Seller of the Transaction Documents to
which it is a party and the consummation of the transactions contemplated
therein do not and will not (a) contravene any provision of Seller’s
organizational and governing documents, (b) constitute a breach of, or result in
a default under or cause the acceleration of any payments pursuant to, any
Contract (including, without limitation, any Product Agreement) to which Seller
or any of its Subsidiaries is a party or by which any of their respective assets
or properties are bound, except as individually or in the aggregate would not
result in a Seller Material Adverse Effect, (c) violate any provision of Law
applicable to Seller or any of its Subsidiaries, except as individually or in
the aggregate would not result in a Seller Material Adverse Effect, or (d)
result in or require the creation or imposition of any Adverse Claim on the
Purchased Receivables (in each case except as created by this Agreement) other
than a Permitted Adverse Claim. 

            Section
4.5        Consents. Except as
disclosed on Exhibit C, and other than the Consent and Instruction
Letter, the UCC financing statements and the registration of the hypothec under
the Code required to be filed under this Agreement, the execution and delivery
by Seller of the Transaction Documents to which Seller is party, the performance
by Seller of its obligations hereunder and thereunder and the consummation of
any of the transactions contemplated hereunder and thereunder (including the
sale, assignment, transfer and conveyance of the Purchased Receivables to
Purchaser and the granting of the security interest therein) do not require any
Consent from, notice to, action or registration by or filing with any
Governmental Entity or any other Person. 

            Section
4.6        Litigation. Except as
disclosed on Exhibit C, there is no (a) action, suit, arbitration
proceeding, claim, demand, citation, summons, subpoena, investigation or other
proceeding (whether civil, criminal, administrative, regulatory, investigative
or informal) pending or, to the Knowledge of Seller, threatened in respect of
the Purchased Receivables, the Product or otherwise, at law or in equity, or (b)
inquiry or investigation (whether civil, criminal, administrative, regulatory,
investigative or informal) by or before a Governmental Entity pending or, to the
Knowledge of Seller, threatened against Seller or any of its Subsidiaries in
respect of the Product, the Purchased Receivables or otherwise, that, in either
case, (i) if adversely determined, could reasonably be expected to result in a
Seller Material Adverse Effect, or (ii) challenges or seeks to prevent or delay
the consummation of any of the transactions contemplated by any of the
Transaction Documents. To the Knowledge of Seller, no event has occurred or
circumstance exists that may give rise to or serve as a basis for the
commencement of any such action, suit, arbitration, claim, investigation,
proceeding or inquiry. 

            Section
4.7        Brokers Fees. Other than
fees payable solely by Seller to its advisors, there is no investment banker,
broker, finder, financial advisor or other intermediary who has been retained by
or is authorized to act on behalf of Seller who is entitled to any fee or
commission in connection with the transactions contemplated by this Agreement.

10 

           
Section 4.8        Product Agreements.

                          (a)       
Product Agreements. Attached hereto as Exhibit D is a true,
correct and complete listing of each of the Product Agreements, along with all
exhibits, schedules and other attachments thereto and all amendments and
modifications thereto as of the Closing Date, true and correct copies of which
have previously been provided to Purchaser. 

                          (b)       
Validity and Enforceability of Product Agreements. Each of the Product
Agreements is a valid, binding and enforceable obligation of Seller, if Seller
is a party thereto, and to the Knowledge of Seller, of the Counterparties, as
applicable, except as may be limited by general principles of equity (regardless
of whether considered in a proceeding at law or in equity) and by applicable
bankruptcy, insolvency, and other laws of general application relating to or
affecting creditors’ rights generally. Seller has not received any written
notice from any Counterparty challenging the validity or enforceability of any
Product Agreement or any obligation of such parties to pay the Royalty Payments
or perform their respective obligations thereunder, nor, to the Knowledge of
Seller, has any Counterparty given or received any such notice. 

                          (c)       
No Waivers, Releases. Seller has not granted any material
acknowledgement, settlement or waiver under any Product Agreement and has not
released any Counterparty in whole or in part, from any of its material
obligations under the Product Agreements, except, in each case, to the extent
set forth in the Product Agreements. To the Knowledge of Seller, no Counterparty
has granted any material waiver under the Product Agreements to any other
Person, nor has any Counterparty released any other Person in whole or in part,
from any of its material obligations under the Product Agreements. 

                          (d)       
No Termination, Force Majeure, etc. Seller has not (i) given any
Counterparty any notice of termination of any of the applicable Product
Agreements or of Force Majeure thereunder or (ii) received from any Counterparty
any written notice of termination of any of the Product Agreements or of Force
Majeure thereunder, nor, to the Knowledge of Seller, has any Counterparty given
or received any such notice. To the Knowledge of Seller, no event has occurred
and is continuing that would give any party to the Product Agreements a right to
terminate any of the Product Agreements. Seller has not received any notice from
any Counterparty expressing any intention or desire to terminate any of the
Product Agreements, nor, to the Knowledge of Seller, has any Counterparty given
or received any such notice.

                          (e)       
No Breaches. Seller has not breached any provision of the Product
Agreements in any material respect, and, to the Knowledge of Seller, no
Counterparty has breached any provision of the applicable Product Agreements in
any material respect. 

                          (f)       
Royalty Reports. Seller has made available to Purchaser complete and
accurate copies of all Royalty Reports delivered by Counterparties, and received
by, Seller prior to the date hereof.

                          (g)       
Payments Made. As of the Closing Date, Seller has received from each
Counterparty (or its predecessor in interest), as applicable, the full amount of
all Royalty Payments required to be made pursuant to the applicable Product
Agreements. Except as set forth on Exhibit C, none of the Royalty Payments listed
in the Royalty Reports were received from the applicable Counterparty (or its
predecessor in interest) more than ten (10) calendar days after the due date
therefor. 

11 

                          (h)       
No Royalty Deductions. The Royalty Payments have not been, and to the
Knowledge of Seller are not, as of the date hereof, subject to any deductions or
offsets. 

                          (i)       
Sublicenses. Except as attached hereto as Exhibit D, Seller has
not received any written notice of, and, to the Knowledge of Seller, no
Counterparty (or its predecessor in interest, as applicable) has granted, any
sublicense of such Counterparty’s rights under the applicable Product
Agreements. 

                          (j)       
No Assignments. Except for the Sublicense Agreement, Seller has not
consented to any assignment by a Counterparty of, and, to the Knowledge of
Seller, no Counterparty has assigned any of, the Product Agreements or any part
thereof. Except as contemplated by this Agreement, Seller has not assigned, in
whole or in part, and has not granted any liens upon or security interests with
respect to, the Product Agreements or the Receivables. 

                          (k)       
Audits. Other than an audit performed by Seller completed on July 5, 2016
(the “Audit”), Seller has not initiated any audit or examination of the
books and records of Edgemont (or its predecessor in interest) by an independent
auditor in order to verify any previously-delivered Royalty Reports. Seller and
Edgemont orally agreed that no adjustments will be made for any discrepancies
discovered during the Audit. 

                          (l)       
Receivables. Except as set forth on Exhibit C, to the Knowledge of
Seller (without duty of reasonable inquiry), no event has occurred or fact
exists that will lead to a material reduction of the amount or frequency of the
Royalty Payments; provided, however, that the representation in
this Section 4.8(l) shall not be construed as a guarantee of collectability by
Seller of any amount of the Purchased Receivables. 

                          (m)       
No Conflicting Grants. Seller has not granted any rights to the Patents,
Product Trademarks or the Licensed Know-How that conflict with the rights
granted to Edgemont under the Edgemont License Agreement. 

                          (n)       
No Other Agreements. Other than the Product Agreements and the agreements
set forth in Exhibit D hereto, there are no other Contracts between Seller and
the Counterparties related to the Product, and to the Knowledge of Seller, there
are no Product Agreements other than the Edgemont Agreements. 

            Section
4.9        Title to Purchased
Receivables. Seller is the exclusive owner of the entire right, title (legal
and equitable) and interest in and to the Purchased Receivables and has good,
valid and indefeasible title thereto, free and clear of all Adverse Claims
(other than Permitted Adverse Claims). The Purchased Receivables sold, assigned,
transferred and conveyed to Purchaser on the Closing Date have not been pledged,
sold, contributed, assigned, transferred or conveyed by Seller to any other
Person. Seller has full right to sell, assign, transfer and convey the Purchased
Receivables (and grant a security interest therein) to Purchaser. Upon the sale,
assignment, transfer and conveyance by Seller of the Purchased Receivables to
Purchaser, Purchaser shall acquire good, valid and indefeasible title to the
Purchased Receivables free and clear of all Adverse Claims arising through the Seller, and
shall be the exclusive owner of the Purchased Receivables. 

12 

           
Section 4.10      Product Related IP. 

                          (a)       
Seller has not received any written notice of, and, to the Knowledge of Seller,
there are not, any pending or threatened litigations, interferences,
reexaminations, oppositions or like proceedings involving any Product Related
IP. 

                         
(b)        To the Knowledge of Seller, the
Patents are valid and enforceable. 

                          (c)       
Seller has the sole legal and/or beneficial title to all of the Product Related
IP. 

                          (d)       
Seller has not, and, to the Knowledge of Seller, no Counterparty has, received
any written notice of any claim by any Person (including without limitation from
any employees or former employees of Seller) challenging the ownership of the
rights of Seller or the Counterparties in and to, or the validity or
enforceability of, the Product Related IP, or asserting that the manufacture,
sale, offer for sale or use of the Product infringes such Person’s patents or
other Intellectual Property rights, other than for any challenges having been
finally settled with the claimants under certain settlement agreements as
described on Exhibit C hereto. 

                          (e)       
To the Knowledge of Seller (without duty of reasonable inquiry): (i) no third
party Intellectual Property rights have been, or are infringed by the
manufacture, sale, offer for sale or use of the Product, and (ii) no Person is
infringing any of the Product Related IP. 

                          (f)       
No actions, suits, claims, disputes, or proceedings are currently pending or, to
the Knowledge of Seller, have been threatened, that could have an adverse effect
on the Product or could impair Seller’s ability to perform its obligations under
the Edgemont License Agreement. 

                          (g)       
To the Knowledge of Seller (without duty of reasonable inquiry): except as set
forth on Exhibit C, no additional licenses to any patents (including
patents owned or controlled by third parties) or know how, are required to
develop, manufacture, use or sell the Product. 

            Section
4.11      Development of Competitive Products.
None of Seller or any of its Affiliates is involved in the development of any
products reasonably likely to lead to a reduction or termination of any Royalty
Payments under the Product Agreements, nor, to the Knowledge of Seller, is any
Counterparty engaging in any such development action. 

            Section
4.12      Compliance with Laws. None of Seller
or any of its Subsidiaries (a) has violated or is in violation of, or, to the
Knowledge of Seller, is under investigation with respect to or has been
threatened to be charged with or been given notice of any violation of, any
applicable Law or any Judgment, or (b) is subject to any Judgment except, in
each case, to the extent any such violation, investigation, threat or Judgment
could not reasonably be expected to have a Seller Material Adverse Effect. Each
of Seller and its Subsidiaries is in compliance with the requirements of all Laws except to the extent any such failure
to be in compliance could not reasonably be expected to have a Seller Material
Adverse Effect. 

13 

            Section
4.13      UCC and Code Representations and
Warranties. Seller’s exact legal name is, and since its formation has been,
“IntelGenx Corp.”. Seller’s U.S. location, for purposes of Section 9-307 of the
UCC is, and since its formation has been, the District of Columbia, and Seller’s
registered office for purposes of registration of the hypothec under the Code
is, 6420 Abrams, Ville Saint-Laurent, Quebec, Canada. 

            Section
4.14      Solvency. Upon consummation of the
transactions contemplated hereby and the application of the Purchase Price
received by Seller on the Closing Date, (i) the present fair saleable value of
Seller’s assets is not less than the amount that will be required to pay its
probable liabilities on its existing debts and other obligations, including
contingent liabilities, as they become absolute and matured, (ii) Seller will
not have unreasonably small capital with which to engage in its business, and
(iii) Seller has not incurred, and does not have present plans or intentions to
incur, debts or other liabilities beyond its ability to pay such debts or other
liabilities as they become absolute and matured. The amount of contingent
liabilities at any time shall be computed as the amount that, in light of all
the facts and circumstances existing at such time, would reasonably be expected
to become an actual or matured liability. 

ARTICLE V 

PURCHASER’S
REPRESENTATIONS AND WARRANTIES 

            Purchaser
hereby represents and warrants to Seller that as of the date hereof: 

           
Section 5.1        Existence.
Purchaser is duly organized, validly existing and in good standing under the
laws of its state of Delaware. Purchaser has all power and authority, and all
Consents of all Governmental Entities, required to own its property and conduct
its business as now conducted and to exercise its rights and to perform its
obligations under this Agreement except where the failure to have such Consents
could not reasonably be expected to have a Purchaser Material Adverse Effect.
Purchaser is duly qualified to transact business and is in good standing in
every jurisdiction in which such qualification or good standing is required by
applicable Law except where the failure to be so qualified or in good standing
could not reasonably be expected to have a Purchaser Material Adverse Effect.

            Section
5.2        Authorization. Purchaser
has the requisite power to enter into this Agreement and to consummate the
transactions contemplated hereby. The entry into the Transaction Documents, and
the consummation of the transactions contemplated thereby, have been duly
authorized by Purchaser. Each of the Transaction Documents to which Purchaser is
a party has been duly executed and delivered by Purchaser. 

            Section
5.3        Enforceability. Each of the
Transaction Documents to which Purchaser is a party constitutes a valid, binding
and enforceable obligation of Purchaser, except as may be limited by general
principles of equity (regardless of whether considered in a proceeding at law or
in equity) and by applicable bankruptcy, insolvency, and other laws of general
application relating to or affecting creditors’ rights generally. 

14 

            Section
5.4        Absence of Conflicts. The
execution, delivery and performance of the Transaction Documents by Purchaser
and the consummation of the transactions contemplated therein do not and will
not (a) contravene any provision of Purchaser’s certificate of formation,
by-laws, or similar formation documents, (b) constitute a breach by Purchaser
of, or result in a default under or cause the acceleration of any payments
pursuant to any Contract to which Purchaser is a party or by which any of its
assets are bound or (c) violate any provision of Law applicable to Purchaser,
except in the case of clause (c) to the extent any such breach, default or
violation could not reasonably be expected to have a Purchaser Material Adverse
Effect. 

            Section
5.5        Consents. Other than the
UCC financing statements required to be filed under this Agreement, the
registration of the hypothec under the Code and, the execution and delivery by
Purchaser of the Transaction Documents to which Purchaser is party, the
performance by Purchaser of its obligations hereunder and thereunder and the
consummation of any of the transactions contemplated hereunder and thereunder do
not require any Consent from, notice to, action or registration by or filing
with any Governmental Entity or any other Person. 

            Section
5.6        Litigation. There is no (a)
action, suit, arbitration proceeding, claim, demand, citation, summons,
subpoena, investigation or other proceeding (whether civil, criminal,
administrative, regulatory, investigative or informal) pending or, to the
knowledge of Purchaser, threatened at law or in equity, or (b) inquiry or
investigation (whether civil, criminal, administrative, regulatory,
investigative or informal) by or before a Governmental Entity pending or, to the
knowledge of Purchaser, threatened against Purchaser, that, in either case, (i)
if adversely determined, could reasonably be expected to result in a Purchaser
Material Adverse Effect, or (ii) challenges or seeks to prevent or delay the
consummation of any of the transactions contemplated by any of the Transaction
Documents to which Purchaser is party. To the knowledge of Purchaser, no event
has occurred or circumstance exists that may give rise to or serve as a basis
for the commencement of any such action, suit, arbitration, claim,
investigation, proceeding or inquiry. 

            Section
5.7        Brokers Fees. There is no
investment banker, broker, finder, financial advisor or other intermediary who
has been retained by or is authorized to act on behalf of Purchaser who is
entitled to any fee or commission in connection with the transactions
contemplated by this Agreement. 

ARTICLE VI 

COVENANTS 

            Section
6.1        Performance of Product
Agreements. Seller agrees that it shall perform all of its obligations under
the Product Agreements in all material respects. 

           
Section 6.2        Misdirected Payments;
Offsets by Counterparties. 

                          (a)       
Payments to Purchaser. If Seller or its Affiliate shall, notwithstanding
the provisions of the Consent and Instruction Letter or any similar Transaction
Document delivered from time to time, receive from, or on behalf of, any
Counterparty any Purchased Receivables, Seller shall promptly, and in any event
no later than five (5) Business Days, following the receipt by Seller or its Affiliate of such Purchased Receivables, remit
to Purchaser such Purchased Receivables by wire transfer in United States
dollars to the deposit account set forth on Exhibit B hereto. 

15 

                          (b)       
Payments to Seller. If Purchaser shall receive any Royalty Payment that
does not consist entirely of Purchased Receivables, Purchaser shall promptly,
and in any event no later than five (5) Business Days, following the receipt of
such Royalty Payment, remit to Seller the portion, if any, of such Royalty
Payment that does not constitute Purchased Receivables. 

                          (c)       
Offsets by Counterparty. If any Counterparty sets off against the
Purchased Receivables any amount owing from Seller to such Counterparty in
respect of any right of such Counterparty against Seller arising from or in
connection with any matter other than the Purchased Receivables, then Seller
shall promptly, and in any event no later than twenty (20) Business Days,
following the date on which Seller becomes aware of such set-off, pay to
Purchaser a sum equal to such set-off amount. After Seller makes the payment
referred to in the first sentence of this Section 6.2(c), Seller shall be
entitled to, and Purchaser shall not be entitled to, any amounts recovered from
such Counterparty in respect of such set-off. 

                          (d)       
Remittances. All remittances pursuant to this Section 6.2 shall be made
(i) without set-off or deduction of any kind (except as required by applicable
Law) and (ii) by wire transfer of immediately available funds to the account set
forth in Exhibit A (if the payee is Seller) or Exhibit B (if the
payee is Purchaser) or to such other account as the relevant payee may designate
in writing (such designation to be made at least five (5) Business Days prior to
any such payment). 

                          (e)       
Payments Held In Trust. Each party hereto agrees that it shall hold any
amounts received by it to which the other party hereto is entitled under Section
6.2(a) or Section 6.2(b) in trust for the sole benefit of the other party and
agrees that it shall have no right, title or interest whatsoever in such
amounts. 

            Section
6.3        Royalty Reports; Notices;
Correspondence. 

                          (a)       
Royalty Reports. Promptly, and in any event no later than five (5)
Business Days, following the receipt by Seller of a written notice from
Purchaser certifying that Edgemont has not furnished Purchaser with the Revenue
Report under Section 6.2.3 of the Edgemont License Agreement (the “Quarterly
Report”) prior to the date of such written notice from Purchaser, Seller
shall furnish a copy of such Royalty Report (if Seller shall have received such
Royalty Report) to Purchaser. 

                          (b)       
Notices; Correspondence. Promptly, and in any event no later than five
(5) Business Days, following the receipt by Seller of any material written
notice or material written correspondence, including any Royalty Reports
delivered to Seller in respect of a Product Agreement (other than the Quarterly
Report unless otherwise requested by Purchaser pursuant to Section
6.3(a)), relating to, or involving, the Product, the Product Agreements and
of the Receivables generally, Seller shall furnish a copy of such notice,
Royalty Report or correspondence to Purchaser. Seller shall not send any
material written notice or correspondence to any Counterparty relating to, or involving, the Product, the
Product Agreements and or the Receivables generally, in each case, without the
prior written consent of Purchaser (such consent not to be unreasonably withheld
or delayed), unless the sending of such notice or correspondence could not
reasonably be expected to adversely affect in any material respect the value of
the Purchased Receivables, and Seller shall promptly provide to Purchaser a copy
of any such notice or correspondence sent by Seller to such Counterparty. 

16 

            Section
6.4        Inspections and Audits of
Counterparties. 

                         
(a)        Consultation. Seller and
Purchaser shall consult and cooperate with each other regarding, the timing,
manner and conduct of any examination of a Counterparty’s books and records with
respect to Net Sales and Royalty Payments pursuant to a Product Agreement. 

                          (b)       
Examinations and Audits. If requested by Purchaser, Seller shall, cause
an examination, audit or inspection to be made of a Counterparty’s books and
records with respect to Net Sales, Royalty Payments and/or Royalty Reports
generally; provided, however, that Purchaser shall not be entitled to
request such an examination more frequently than once every calendar year. With
respect to any such examination, Purchaser shall select such independent auditor
for such purpose. All of the expenses of any such examination (including the
fees and expenses of any independent auditor) that would otherwise be borne by
Seller pursuant to the applicable Product Agreement shall instead be borne (as
such expenses are incurred) by Purchaser, provided that any reimbursement
by the applicable Counterparty of any such audit expenses shall belong to
Purchaser, provided further, that any reimbursement due from the
applicable Counterparty arising in periods prior to April 1, 2016 shall be
remitted to Seller. 

            Section
6.5        Amendment of Product
Agreements; Waivers. Seller shall provide Purchaser a copy of any proposed
amendment, supplement, modification, waiver or request for approval of any
material item or action by or on behalf of a Counterparty (each a
“Modification”) of any provision of the Product Agreements as soon as
practicable and in any event not less than ten (10) Business Days prior to the
date Seller proposes to execute such Modification. Seller shall not, without the
prior written consent of Purchaser, execute or agree to execute any proposed
Modification if such Modification could reasonably be expected to adversely
affect the Purchased Receivables or the value thereof (it being understood and
agreed that any proposed Modification to the provisions of any Product
Agreements governing the amount or calculation of the Receivables or the
procedures for payment of the Receivables shall be deemed, for purposes of this
Section 6.5, to have such an effect). From and after the Closing Date, Seller
agrees that it shall not in any way cause or request any Counterparty to alter
the amount or timing of their Royalty Payments without the written consent of
the Purchaser. Promptly, and in any event within five (5) Business Days,
following receipt by Seller of a fully executed Modification of the Product
Agreements, Seller shall furnish a copy of such Modification to Purchaser.

            Section
6.6        Enforcement of Product
Agreements. 

                          (a)       
Notice of Counterparty Breaches. Promptly, and in any event within five
(5) Business Days, following a breach of any of the Product Agreements by Seller
or any Counterparty becoming Known to Seller that, in Seller’s good faith
judgment, could reasonably be expected to adversely affect in any material respect the
Purchased Receivables or the value thereof, Seller shall provide notice of such
breach to Purchaser. In addition, Seller shall provide to Purchaser a copy of
any written notice of breach of the Product Agreements delivered or received by
Seller as soon as practicable and in any event no later than five (5) Business
Days following such delivery or receipt. 

17 

                          (b)       
Enforcement of Product Agreements. Seller and Purchaser shall consult and
cooperate with each other regarding any breach referred to in Section 6.6(a) and
the timing, manner and conduct of any enforcement of Seller and/or any
Counterparty’s obligations under the Product Agreements relating thereto. If
reasonably requested by Purchaser within twenty (20) Business Days after receipt
of notice of such breach pursuant to Section 6.6(a), Seller shall proceed to
enforce compliance by the Counterparty with the relevant provisions of the
Product Agreements and to exercise such rights and remedies relating to such
breach as shall be available to Seller, whether under the Product Agreements or
by operation of applicable Law. 

                          (c)       
Allocation of Proceeds and Costs of Enforcement. The Proceeds of any
enforcement of a Counterparty’s obligations under the Product Agreements
relating to the Purchased Receivables pursuant to this Section 6.6, after
deduction of all costs and expenses (including attorneys’ fees and expenses)
incurred by Seller and/or Purchaser in connection with such enforcement, shall
belong to Purchaser. The costs and expenses (including attorneys’ fees and
expenses) of any enforcement pursuant to this Section 6.6 (other than any costs
and expenses of Seller to the extent such amounts are specifically satisfied out
of the Proceeds of such enforcement) shall be borne by Purchaser,
provided that any reimbursement by a Counterparty of these expenses shall
belong to Purchaser. 

            Section
6.7        Termination of Product
Agreements. In no event shall Seller exercise any right to terminate any of
the Product Agreements, or agree with a Counterparty to terminate any of the
Product Agreements, except with the prior written consent of Purchaser (which
consent may be withheld or delayed in Purchaser’s sole discretion). 

            Section
6.8        Approval of Assignments of
Product Agreements. 

                          (a)       
Promptly, and in any event within five (5) Business Days, following receipt by
Seller of a request from a Counterparty for consent to assign its rights, or
delegate its duties, under any of the Product Agreements, Seller shall provide
notice of such request to Purchaser. Seller and Purchaser shall consult with
each other regarding whether to grant such consent. Subject to any obligations
Seller may have not to withhold consent, Seller shall not grant such consent
without the prior written consent of Purchaser. 

                          (b)       
Seller may not assign its rights, or delegate its duties, under any of the
Product Agreements or otherwise sell, transfer or grant any lien on any of the
Product Related IP without the prior written consent of Purchaser (which consent
may be withheld or delayed in Purchaser’s sole discretion); provided,
that Seller may, without the prior written consent of Purchaser, assign all, but
not less than all, of the Product Agreements and its interest in the Product
Related IP to any Person that acquires all or substantially all of Seller’s
business or assets (whether through an asset purchase agreement, stock purchase
agreement, merger agreement or otherwise) if Seller also assigns this Agreement
to such Person and such Person agrees in writing to be bound by the terms of
this Agreement. 

18 

                          (c)       
Promptly, and in any event no later than five (5) Business Days, following
receipt of any executed assignment of rights, or delegation of duties, under any
of the Product Agreements by a Counterparty or Seller, Seller shall furnish a
copy of such assignment or delegation to Purchaser. 

            Section
6.9        Consent and Instruction
Letter. Seller shall not, without Purchaser’s prior written consent, deliver
any inconsistent directions to any Counterparty regarding the payment of the
Purchased Receivables or the delivery of Royalty Reports to Purchaser of the
type referred to in the Consent and Instruction Letter or any similar
Transaction Documents entered into from time to time. 

            Section
6.10      Public Announcements; Use of Names.
Neither party shall, and each party shall instruct its Affiliates not to, issue
a press release or other public announcement or otherwise make any public
disclosure with respect to this Agreement or the subject matter hereof without
the prior consent of the other party (which consent shall not be unreasonably
withheld or delayed), except as may be required by applicable Law, by any
Governmental Entity or by any self-regulatory agency or stock exchange on which
such party’s securities are listed or which has regulatory or supervisory
authority over such party, and to such party’s regulators and in the course of
inspections, examinations or inquiries by regulatory agencies or self-regulatory
organizations that have requested or required the inspection of records that
contain or reflect this Agreement; it being understood that both parties are
public companies and this Agreement may be filed as an exhibit to a Form 8-K or
other filing by either party to be made in connection with the execution of this
Agreement; and it being further understood that each party shall provide the
other party with a reasonable opportunity to review and comment on the portions
of any filings that relate to this Agreement, to the extent practicable. 

            Section
6.11      Taxes. Seller and Purchaser agree that
for United States federal income tax purposes, (i) any and all Purchased
Receivables remitted by Seller to Purchaser pursuant to Section 6.2(a) or
otherwise under this Agreement shall be treated as received by Seller as agent
for Purchaser, and (ii) any and all amounts remitted by Seller to Purchaser
pursuant to Section 6.2(a) of this Agreement shall be treated as remittances of
amounts collected by Seller on behalf of Purchaser. Each party hereto agrees to
provide (to the extent it is legally eligible to do so) any tax forms that any
other party hereto or a Counterparty may reasonably request in order to comply
with applicable tax Law. 

            Section
6.12      Remittance of Previously Received
Purchased Receivables; Further Actions. From and after the Closing
Date, each of Purchaser and Seller shall, at the expense of the requesting
party, execute and deliver such additional documents, certificates and
instruments, and perform such additional acts, as may be reasonably requested
and necessary or appropriate to carry out all of the provisions of this
Agreement and to give full effect to and consummate the transactions
contemplated by this Agreement. At the Closing, the parties agree that the
amount of any payments made by or on behalf of a Counterparty on or before the
Closing Date received by Seller that constitute or otherwise relate to the
Purchased Receivables shall be offset against the Purchase Price by the
Purchaser. After the Closing, Seller shall promptly, but in any event no later than two (2) Business Days after the Closing Date, remit
to Purchaser any payments made by or on behalf of a Counterparty on or before
the Closing Date that constitute or otherwise relate to the Purchased
Receivables not offset at the Closing.  

19

           
Section 6.13      Intellectual Property Matters.

                          (a)       
Administration. Seller shall, or shall cause the applicable Counterparty
to, diligently administer the prosecution, maintenance, defense and enforcement
of all Product Related IP, necessary for commercialization of the Product within
the United States, owned or licensed by Seller (including any Outstanding
Litigation), in accordance with and subject to the Product Agreements, as
applicable, and in consultation with the applicable Counterparty (to the extent
required or deemed appropriate by Seller) and Purchaser.

                          (b)       
Costs. All costs and expenses (including attorneys’ fees and expenses)
incurred by Seller in connection with the prosecution, maintenance, defense or
enforcement of the Product Related IP (including any Outstanding Litigation)
shall, to the extent not reimbursed to Seller by a Counterparty pursuant to the
applicable Product Agreement, be borne by Seller (c) Proceeds. The
Proceeds (if any) of any enforcement or defense of the Product Related IP (less
any costs and expenses (including reasonable attorneys’ fees and expenses)
actually incurred by Seller in connection therewith) shall belong to Purchaser.
In the event that the Proceeds include payment in respect of the Purchased
Receivables and any other amounts, the parties agree to allocate the Proceeds
between Purchaser and Seller in the proportion following the nature of the
Proceeds and the rights under this Agreement, such that only amounts paid in
respect of Purchased Receivables (less any costs and expenses (including
reasonable attorneys’ fees and expenses) actually incurred by Seller in
connection therewith) are payable to Purchaser. 

                          (d)       
Monitoring. Purchaser shall have the right to retain, at its sole
expense, outside counsel, who shall be permitted (together with Purchaser),
where and when reasonably practical, to consult with Seller and its counsel
regarding the prosecution, maintenance, enforcement and defense of the Product
Related IP (including the Outstanding Litigation) and any actions taken or
proposed to be taken by Seller in respect thereof. Seller and its counsel shall
(i) give reasonable consideration to the views of Purchaser and their counsel
with respect to the subject matter of this Section 6.13(d) and (ii) provide
Purchaser with such information with respect to the subject matter of this
Section 6.13(d) as Purchaser may, from time to time, reasonably request. 

           
Section 6.14      Additional License Agreements.

                          (a)       
Consultation. Seller shall provide Purchaser a copy of any proposed
Additional License Agreement as soon as practicable and in any event not less
than ten (10) Business Days prior to the date Seller proposes to execute such
Additional License Agreement. Seller agrees to consult with Purchaser regarding
any such proposed agreements and Seller shall not, without the prior written
consent of Purchaser, not to be unreasonably withheld or delayed, execute or
agree to execute any proposed Additional License Agreement. Promptly, and in any event within five (5) Business Days, following receipt by
Seller of a fully executed Additional License Agreement, Seller shall furnish a
copy of such agreement to Purchaser.

20 

                          (b)
Payment Direction. Any Additional License Agreement, or consent and
notice letter shall executed in connection therewith among the applicable
Counterparty, Seller and Purchaser, shall contain payment instructions for the
payment of the Purchased Receivables to Purchaser. 

                          (c)       
Replacement. In the event of the termination of any of the Edgemont
Agreements, Seller agrees to use commercially reasonable efforts to enter into
Product Agreements with suitable replacement Counterparties as soon as
practicable. In the event Seller is unable or unwilling to secure one or more
replacement Product Agreements within one hundred twenty (120) days of any such
termination, Seller agrees that Purchaser shall have the right to negotiate a
replacement agreement and grant a license to the Product Related IP on
substantially the same terms to those in the Edgemont Agreements. 

                          (d)       
Manufacture of Product by Seller. For the avoidance of doubt, to the
extent that Seller and or its Affiliate engages in any direct sale , manufacture
or other transfer of the Product within the United States (other than pursuant
to a Product Agreement), the definitions of Net Sales and Royalty Payments shall
include any and all amounts received by Seller and/or its Affiliate in relation
thereto and the subject matter of this Agreement shall be deemed to cover the
amounts received by Seller and/or its Affiliate in connection therewith. In the
event that Seller and/or its Affiliate engage in any such direct sale, marketing
or transfer of the Product, Seller and Purchaser shall reasonably cooperate to
amend this Agreement accordingly. 

ARTICLE VII 

INDEMNIFICATION 

            Section
7.1        Obligation of Parties to
Indemnify. 

                          (a)       
Indemnification by Seller. Subject to the limitations set forth in this
Article VII, Seller shall indemnify, defend and hold harmless, Purchaser, its
Affiliates and their respective employees, officers, directors and agents (each,
a “Purchaser Indemnified Party”) against any and all losses, liabilities,
expenses (including reasonable attorneys’ fees and expenses in connection with
any third party action, suit or proceeding) and damages (collectively,
“Losses”) incurred by any of them, to the extent arising or resulting
from any of the following: 

                         
(i)        any breach of any representation
or warranty made by Seller in this Agreement or any other Transaction Document
delivered to Purchaser in connection herewith; 

                         
(ii)       any breach of any covenant of Seller
contained in this Agreement or any other Transaction Document delivered to
Purchaser in connection herewith; and 

                         
(iii)      any obligations of Seller in accordance with
Section 2.3 hereof. 

21 

                          (b)       
Indemnification by Purchaser. Subject to the limitations set forth in
this Article VII, Purchaser shall indemnify Seller, its Affiliates and their
respective employees, officers, directors and agents (each a “Seller
Indemnified Party”) against any and all Losses incurred by any of them, to
the extent arising or resulting from any of the following: 

                         
(i)        any breach of any representation
or warranty made by Purchaser in this Agreement or any other Transaction
Document delivered to Seller in connection herewith; and 

                         
(ii)       any breach of any covenant of Purchaser
contained in this Agreement or any other Transaction Document delivered to
Seller in connection herewith. 

            Section
7.2        Procedures Relating to
Indemnification for Third Party Claims. 

                          (a)       
Notice of Third Party Claim. In order for a party (an “Indemnified
Party”) to be entitled to any indemnification under this Article VII in
respect of Losses arising out of or involving a claim or demand made by any
Person other than Purchaser or Seller against a Purchaser Indemnified Party or a
Seller Indemnified Party, as applicable (a “Third Party Claim”), the
Indemnified Party must notify the party from whom indemnification is sought
under this Article VII (the “Indemnifying Party”) promptly in writing
(including in such notice a brief description of the Third Party Claim,
including damages sought or estimated, to the extent actually known or
reasonably capable of estimation by the Indemnified Party); provided,
however, that the failure to promptly provide such notice shall not
affect the indemnification provided under this Article VII except to the extent
that the Indemnifying Party has been actually prejudiced as a result of such
failure. Thereafter, the Indemnified Party shall deliver to the Indemnifying
Party, promptly after the Indemnified Party’s receipt thereof, copies of all
documents (including court papers) received by the Indemnified Party relating to
the Third Party Claim. 

                          (b)       
Defense of Third Party Claims. The Indemnifying Party shall be entitled
to participate in the defense of the Third Party Claim and, if it so chooses, to
assume the defense thereof, at its own expense, with counsel selected by the
Indemnifying Party (so long as such counsel is not reasonably objected to by the
Indemnified Party) if: (i) the Indemnifying Party makes reasonably adequate
provision to satisfy the Indemnified Party of the Indemnifying Party’s ability
to defend, satisfy and discharge such Third-Party Claim; (ii) no material
defense exists for the Indemnified Party which is not available to the
Indemnifying Party; and (iii) if the named parties to such Third Party Claim
(including impleaded parties) include both the Indemnifying Party and the
Indemnified Party, representation of both parties by the same counsel would not
be appropriate due to actual material differing interests between them (as
determined by the Indemnified Party in its reasonable discretion) (collectively,
the “Defense Conditions”). If the Indemnifying Party elects to assume the
defense of any Third Party Claim, the Indemnifying Party shall not be liable to
the Indemnified Party for legal expenses subsequently incurred by the
Indemnified Party in connection with the defense thereof; provided, however,
that if any of the Defense Conditions cease to be satisfied for any reason, the
Indemnified Party may assume its own defense, and the Indemnifying Party will be
liable for all reasonable costs or expenses paid or incurred in connection
therewith, and the Indemnified Party shall have the right to compromise or settle such Third Party Claim with the consent of
the Indemnifying Party (which consent shall not be unreasonably withheld or
delayed) and, if settled with such consent, or if there is a final judgment
against the Indemnified Party, the Indemnifying Party agrees to indemnify the
Indemnified Party from and against any loss or liability by reason of such
settlement or judgment. In the event the Indemnifying Party has assumed control
of the defense of the Third Party Claim, the Indemnifying Party shall permit the
Indemnified Party to participate in, but not control, the defense of any such
action or suit through counsel chosen by the Indemnified Party; provided that
such counsel is not reasonably objected to by the Indemnifying Party and the
fees and expenses of such counsel shall be borne by the Indemnified Party. The
Indemnifying Party shall be liable for the fees and expenses of counsel employed
by the Indemnified Party in the defense of a Third Party Claim for any period
during which the Indemnifying Party has not assumed the defense thereof (other
than during the period prior to the time the Indemnified Party shall have
notified the Indemnifying Party of such Third Party Claim). 

22 

                          (c)       
Cooperation. The parties hereto shall cooperate in the defense or
prosecution of any Third Party Claim, with such cooperation to include (i) the
retention of and the provision to the Indemnifying Party of records and
information that are reasonably relevant to such Third Party Claim and (ii) the
making available of employees on a mutually convenient basis for providing
additional information and explanation of any material provided hereunder. If
the Indemnifying Party shall have assumed the defense of a Third Party Claim,
the Indemnified Party shall agree to any settlement, compromise or discharge of
such Third Party Claim that the Indemnifying Party may recommend and that by its
terms obligates the Indemnifying Party to pay the full amount of the liability
(if any) in connection with such Third Party Claim and which (i) does not
include a statement as to or admission of, fault, culpability or a failure to
act by or on behalf of any such Indemnified Party, (ii) includes an
unconditional release of such Indemnified Party from all liability on claims
that are the subject matter of such Third Party Claim and (iii) does not provide
for injunctive relief or other relief relating to such Indemnified Party other
than monetary damages. 

            Section
7.3        Procedures Relating to
Indemnification for Other Claims. In order for an Indemnified Party to be
entitled to any indemnification under this Article VII in respect of Losses that
do not arise out of or involve a Third Party Claim, the Indemnified Party must
notify the Indemnifying Party promptly in writing (including in such notice a
brief description of the claim for indemnification and the Loss, including
damages sought or estimated, to the extent actually known or reasonably capable
of estimation by the Indemnified Party); provided, however, that
the failure to promptly provide such notice shall not affect the indemnification
provided under this Article VII except to the extent that the Indemnifying Party
has been actually prejudiced as a result of such failure. 

            Section
7.4        Exclusive Remedy. Other
than for claims for equitable relief, including the seeking of specific
performance in accordance with Section 8.12, the parties hereto acknowledge and
agree that, from and after the Closing Date, this Article VII (including Section
7.4) shall provide such parties’ sole and exclusive remedy with respect to any
matter or claim arising out of, relating to, or in connection with, this
Agreement and the transactions contemplated hereby, except that any such claim
or matter based upon common law fraud shall not be subject to or limited by this
Article VII and each of Purchaser and Seller accordingly preserves all remedies available with respect to any such claim
or matter based thereon under applicable Law. 

23 

            Section
7.5        Survival. Subject to the
limitations and other provisions of this Agreement, the representations and
warranties contained herein shall survive the Closing and shall remain in full
force and effect until the date that is twenty months from the Closing Date.
None of the covenants or other agreements contained in this Agreement shall
survive the Closing Date other than those which by their terms contemplate
performance after the Closing Date, and each such surviving covenant and
agreement shall survive the Closing until fully performed, or if earlier, the
date upon which all of the Product Agreements have been terminated.
Notwithstanding the foregoing, any claims asserted in good faith with reasonable
specificity (to the extent known at such time) and in writing by notice from the
non-breaching party to the breaching party prior to the expiration date of the
applicable survival period shall not thereafter be barred by the expiration of
such survival period and such claims shall survive until finally resolved. 

           
Section 7.6        Limitations on
Damages.

                          (a)       
Seller shall not be liable to any Purchaser Indemnified Party until the
aggregate amount of all Losses suffered by Purchaser Indemnified Parties exceeds
1% of the Purchase Price (the “Threshold”) in which event the Seller
shall be required to pay or be liable for all Losses to the first dollar,
regardless of the Threshold; provided, however, that the Threshold
shall not apply to Seller’s obligations hereunder to transfer the Purchased
Receivables to Purchaser; provided, further, that nothing in this
Section 7.6(a) shall be construed as a prohibition against Purchaser’s right to
seek specific performance under Section 8.12. 

                          (b)       
The aggregate amount of all Losses for which Seller shall be liable pursuant to
this Agreement shall not exceed an amount equal to the Purchase Price plus an
annual rate of return of 12% (compounded monthly), less the amount of all
payments received by Purchaser hereunder, including indemnification payments,
and any Royalty Payments actually received by Purchaser (as so calculated, the
“Cap”); provided, however, that the Cap shall not apply to
Seller’s obligations hereunder to transfer the Purchased Receivables to
Purchaser. 

                          (c)       
Payments by Seller in respect of any Loss shall be limited to the amount of any
liability or damage that remains after deducting therefrom any insurance
proceeds and any indemnity, contribution or other similar payment received or
reasonably expected to be received by the Purchaser Indemnified Party in respect
of any such claim. The Purchaser Indemnified Party shall use its commercially
reasonable efforts to recover under insurance policies or indemnity,
contribution or other similar agreements for any Losses prior to seeking
indemnification under this Agreement. 

                          (d)       
Notwithstanding anything contained in this Agreement to the contrary, “material”
and “Seller Material Adverse Effect” or similar materiality type qualifications
contained in the representations and warranties set forth in this Agreement
shall be ignored and not given any effect for purposes of calculating the amount
of any Losses, but not the determination of whether there has been a breach,
which determination shall give full effect to all “material”, “Seller Material
Adverse Effect” and similar materiality type qualifications. 

24 

                          (e)       
All indemnification payments made under this Agreement shall be treated by the
parties as an adjustment to the Purchase Price for Tax purposes, unless
otherwise required by Law. 

                          (f)       
Notwithstanding anything to the contrary in this Agreement, whether based upon a
claim or action of contract, warranty, negligence or tort, or otherwise arising
out of this Agreement, in no event shall either party hereto be liable for any
consequential, exemplary or punitive damages unless such damages are payable to
a third party in connection with a Third Party Claim or are based upon common
law fraud.

ARTICLE VIII 

MISCELLANEOUS 

            Section
8.1        Headings. The captions to
the Articles, Sections and subsections hereof are not a part of this Agreement
but are for convenience only and shall not be deemed to limit or otherwise
affect the construction thereof. 

            Section
8.2        Notices. Except where
expressly provided otherwise in this Agreement, whenever it is provided in this
Agreement that notice, demand, request, consent or other communication shall be
given to or served upon any party hereto by the other, any such notice demand,
request, consent or other communication shall be in writing and personally
delivered, sent by certified or registered mail, return receipt requested, by
overnight delivery service with confirmation of delivery or by electronic
(notices and other communications sent to an e-mail address shall also be sent
by overnight delivery service or personal delivery) to the following address or
addresses, or such other address or addresses as may be designated from time to
time by a party hereto in accordance with this Section 8.2: 

	 	If to Seller: 	Intelgenx Corp. 
	 	  	6420 Rue Abrams 
	 	 	Saint-Laurent, Quebec 
	 	  	H4S 1Y2, Canada 
	 	  	Attn: Andre Godin 
	 	  	  
	 	With a copy to: 	Dorsey & Whitney LLP 
	 	  	TD Canada Trust Tower 
	 	  	Brookfield Place 161 Bay Street, Suite 4310  
	 	 	Toronto, ON M5J 2S1 
	 	 	Attn: Richard Raymer 
	 	  	  
	 	  	  
	 	If to Purchaser: 	SWK Funding LLC 
	 	  	c/o SWK Holdings 
	 	  	14755 Preston Road, Suite 105 
	 	 	Dallas, Texas 75254 
	 	 	Attn: Winston Black

25 

	 	With a copy to: 	Holland & Knight LLP 
	 	  	200 Crescent Court, Suite 1600 
	 	  	Dallas, Texas 75201 
	 	  	Attn: Ryan Magee 

Notice in each of the above cases shall be deemed effective for
all purposes (i) upon hand delivery if hand delivered, (ii) three (3) Business
Days after posting in the United States Mail if sent by certified mail, or (iii)
on the day of confirmed delivery by overnight delivery service, facsimile or
email (return receipt requested). 

          Section
8.3        Expenses. All reasonable
out-of-pocket fees, costs and expenses (including any legal fees) incurred by
Seller or Purchaser in connection with the preparation and negotiation of, and
entry into, this Agreement and to consummate the transactions contemplated
hereby shall be paid by the party incurring such expenses. Notwithstanding the
foregoing, Seller has agreed to pay up to $35,000 (the “Fee Cap”) of such
out-of-pocket fees, costs and expenses (including any legal fees) incurred by
Purchaser pursuant to that certain letter agreement between Seller and Purchaser
dated June 17, 2016 (the “Letter Agreement”), provided,
however, that if the Seller terminates exclusivity pursuant to clause
(i)(b) of the “Exclusivity” Section of Exhibit A of the Letter Agreement for any
reason other than Purchaser proposing an alternative deal structure to the one
contained in the Letter Agreement, then the Fee Cap will be increased to
$50,000.

            Section
8.4        Assignment. Neither this
Agreement nor any of Seller’s rights, interests or obligations hereunder may be
assigned, delegated or otherwise transferred, in whole or in part, by operation
of Law or otherwise by Seller without the prior written consent of Purchaser,
and any such purported assignment, delegation or transfer without such consent
shall be void ab initio and of no effect; provided, however, that
Seller may, without the prior written consent of Purchaser, assign this
Agreement to any Person that acquires all or substantially all of Seller’s
business or assets (whether through an asset purchase agreement, stock purchase
agreement, merger agreement or otherwise) if Seller also assigns all, but not
less than all, Product Agreements to such Person and such Person agrees in
writing to be bound by the terms of this Agreement. 

            Section
8.5        Successors and Assigns.
Subject to the provisions of Section 8.4, this Agreement shall be binding upon,
inure to the benefit of and be enforceable by, the parties hereto and their
respective permitted successors and assigns. 

           
Section 8.6        Amendment and
Waiver. 

                          (a)       
This Agreement may be amended, modified or supplemented, or any provision hereof
waived, only in a writing signed by Seller and Purchaser. 

                          (b)       
No failure or delay on the part of either party hereto in exercising any right,
power or remedy hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy preclude any other
or further exercise thereof or the exercise of any other right, power or remedy. No course of
dealing between the parties hereto shall be effective to amend, modify,
supplement or waive any provision of this Agreement. 

26 

            Section
8.7        Entire Agreement. This
Agreement, including the Exhibits and Schedules attached to this Agreement, sets
forth the entire agreement and understanding between the parties hereto as to
the subject matter hereof. All express or implied agreements, arrangements,
representations and understandings as to the subject matter hereof, whether oral
or written, heretofore made are superseded by this Agreement. The parties agree
that nothing contained in the Consent and Instruction Letter shall alter any of
the obligations and rights contained in this Agreement. 

            Section
8.8        Independent Contractors.
The parties hereto recognize and agree that each is operating as an independent
contractor and not as a partner, joint venturer, agent or fiduciary of the
other. 

            Section
8.9        No Third Party
Beneficiaries. This Agreement is for the sole benefit of Seller and
Purchaser and their permitted successors and assigns, and nothing herein
expressed or implied shall give or be construed to give to any Person, other
than the parties hereto and such successors and assigns, any legal or equitable
rights hereunder. 

            Section
8.10      Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF
(OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

            Section
8.11      Jurisdiction; Venue; Service Of Process;
Waiver of Jury Trial. Each party hereto irrevocably submits to the exclusive
jurisdiction of (a) the United States District Court for the Southern District
of New York, and (b) the Supreme Court of the State of New York, New York
County, for the purposes of any suit, action or other proceeding arising out of
this Agreement or any transaction contemplated hereby. Each party hereto agrees
to commence any action, suit or other proceeding relating hereto in the courts
of United States District Court for the Southern District of New York or, if
such suit, action or other proceeding may not be brought in such court for
jurisdictional reasons, in the Supreme Court of the State of New York located in
New York County. Each party hereto irrevocably and unconditionally waives any
objection to the laying of venue of any action, suit or other proceeding arising
out of this Agreement and the transactions contemplated hereby in (a) the United
States District Court for the Southern District of New York, or (b) the Supreme
Court of the State of New York, New York County, and hereby further irrevocably
and unconditionally waives, and shall not assert by way of motion, defense, or
otherwise, in any such suit, action or proceeding, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that its
property is exempt or immune from attachment or execution, that the suit, action
or proceeding is brought in an inconvenient forum, that the venue of the suit,
action or proceeding is improper, or that this Agreement and the transactions
contemplated hereby and thereby may not be enforced in or by any of the
above-named courts. EACH OF SELLER AND PURCHASER HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM FILED BY EITHER PARTY, WHETHER IN CONTRACT, TORT OR OTHERWISE, RELATING DIRECTLY OR INDIRECTLY
TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREIN. 

27 

            Section
8.12      Equitable Remedies. The parties agree
that irreparable damage for which monetary damages, even if available, would not
be an adequate remedy, would occur in the event that the parties hereto do not
perform their respective obligations under the provisions of this Agreement in
accordance with their specific terms or otherwise breach such provisions. It is
accordingly agreed that the parties shall be entitled to seek an injunction or
injunctions, specific performance and other equitable relief to prevent breaches
of this Agreement and to enforce specifically the terms and provisions of this
Agreement, including, without limitation, Seller’s obligation to enforce, and
perform its obligations under, the Product Agreements. Each of the parties
agrees that it will not oppose the granting of an injunction, specific
performance and other equitable relief when expressly available pursuant to the
terms of this Agreement on the basis that the other party has an adequate remedy
at law or an award of specific performance is not an appropriate remedy for any
reason at law or equity. 

            Section
8.13      Severability. If any term or provision
of this Agreement is held to be invalid, illegal or unenforceable by a court or
other Governmental Entity of competent jurisdiction, such invalidity, illegality
or unenforceability shall not affect any other term or provision of this
Agreement, which shall remain in full force and effect, and the parties hereto
shall replace such term or provision with a new term or provision permitted by
applicable Law and having an economic effect as close as possible to the
invalid, illegal or unenforceable term or provision. The holding of a term or
provision to be invalid, illegal or unenforceable in a jurisdiction shall not
have any effect on the application of the term or provision in any other
jurisdiction. 

            Section
8.14      Counterparts. This Agreement may be
executed in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Copies of executed counterparts transmitted by email with PDF attachment shall
be considered original executed counterparts. 

[The remainder of this page is left intentionally blank.
Signature pages follow.]

28 

      
     IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be signed by their respective representatives thereunto duly
authorized as of the date first above written. 

	 	SELLER: 
	 	  
	 	INTELGENX CORP. 
	 	  
	 	  
	 	 
             /s/ Horst Zerbe 
	 	Name: Horst Zerbe 
	 	Title: Chairman and Chief Executive Officer
  

 

 

 

[SIGNATURE PAGE TO ROYALTY PURCHASE AGREEMENT] 

	 	PURCHASER: 
	 	  
	 	SWK FUNDING, LLC 
	 	  
	 	  
	 	 
             /s/ Winston Black 
	 	Name: Winston Black 
	 	Title: Chief Executive Officer

[SIGNATURE PAGE TO ROYALTY PURCHASE AGREEMENT] 

E-1

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