Document:

Exhibit
10.2

 

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

 

	
  BioReliance

  	
   

  	
  BioReliance  

  
	
   

  	
   

  	
  14920 Broschart Road

  
	
   

  	
   

  	
  Rockville, Maryland 20850-3349 USA  

  
	
   

  	
   

  	
  Phone: 301.738.1000 · Fax: 301138.1605 

  
	
   

  	
   

  	
  www.bioreliance.com

  

 

Proposal for Biodistribution and Repeat Dose
Toxicity Studies in Mice

Submitted by:

BioReliance

14920 Broschart Road

Rockville, MD 20850

 

To:

Cato Research Ltd.

and

Senesco Technologies, Inc

 

Date

September 5, 2008

 

THE INFORMATION CONTAINED IN THIS PROPOSAL IS
SUBJECT TO THE FOLLOWING RESTRICTIONS:

 

The information contained herein is submitted upon the understanding
that it is privileged or confidential within the meaning of the Freedom of
Information Act 5 U_S_C., Sec 552 (b) 4.

 

Data contained in all pages of this proposal shall not be used or
disclosed, except for evaluation purposes

 

This proposal is valid for the next ninety (90) days from the submission
date.

 

 

1.0                               Objective: To perform biodistribution and toxicity
studies in mice analyzing Senesco test materials eIF-5A DNA and siRNA

 

2.0                               Scope of Work :

Based on the documentation provided by Cato
Research and Senesco, technical meetings and the technical review of
BioReliance, the following were determined to be distinct milestones of this
project:

 

I.              Development of DNA QPCR Assay

a.     Design
and Development

b.     Characterization
and Qualification

c.     Non-GLP
Final Report

 

II.            Development of RNA QPCR Assay

a.     Assay
Feasibility

b.     Design
and Development

c.     Characterization
and Qualification

d.     Non-GLP
Final Report

 

NOTE:   BioReliance recommends initiating Milestone II first. Due to
unfamiliarity with the best technology suitable for this project, BioReliance
does not guarantee a successful outcome. BioReliance will make best effort to
design an assay that can be used in support of the biodistribution study. In
case the outcome is unsuccessful (i.e., no assay), BioReliance will consult
with Cato to assist in the identification of path forward.

 

III.           Repeat Dose ***-Day Acute Toxicity Study ***
(*** *** of ***, *** of ***, *** and *** and ***); *** ***; *** ***; *** ***
and *** on *** ***; ***

 

IV.           Repeat Dose Toxicity and Biodistribution
Study in Mice *** *** (*** *** of ***, *** of ***, *** and ***, ***); ***
***; *** for *** ***; *** on *** *** and *** *** for ***, *** for *** from ***
and ***; *** and ***; clinical *** at *** *** (***); *** *** and ***; *** ***;
*** ***and*** ***, and ***

 

V.            Development of Immunoassay for detection of ***

 

a.     ***

i.        ***

ii.       ***

iii.      ***

 

b.     ***

i.           ***

ii.          ***

 

VI.           ***

a.             *** *** to ***

b.             *** of ***

c.             ***

d.             *** to ***

 

VII.          ***

a.     *** of *** to ***

b.     *** of ***

c.     ***

d.     ***to ***

 

2

 

VIII.        Immunoassay Antibody Detection Sample Analysis

 

Note:      Any
changes to the scope of this study including, but not limited to, design,
development, performance, materials andlor equipment are subject to BioReliance
change control process, which may result in additional cost to the client.

 

3.0           Required from Cato Research or Senesco Technologies:

 

·                  siRNA for Milestones II

·                  Test Samples for Milestones III, IV and V

·                  Purchase Order prior to project commencement

 

4.0           Deliverables :

 

·                  GLP final report for Milestones III and IV

 

Note:      Unless otherwise stated or requested, all studies conducted by
BioReliance are performed in compliance with the requirements of the UK and
German GLP Regulations, the US FDA Good Laboratory Practice Regulations (21 CFR
58), the Japanese GLP Standard and the OECD Principles of Good Laboratory
Practice. BioReliance is fully accredited for GLP.

 

5.0           Contacts:

 

BioReliance
point of contact for this project that will be:

Diane Brecha

Senior Technical Sales Specialist

(301) 260-7544

Diane.brecha@bioreliance.com

 

Cato Research
point of contact for this project:

Sharon Daily

(732) 241-0480

 

6.0           Study Costs:

 

	
  Milestone I:

  	
   

  	
  ***

  
	
  Milestone
  II:

  	
   

  	
  ***

  
	
  Milestone
  III:

  	
   

  	
  ***

  
	
  Milestone
  IV:

  	
   

  	
  ***

  
	
  Milestone
  V:

  	
   

  	
  ***

  
	
  Milestone
  VI:

  	
   

  	
  ***

  
	
  Milestone
  VII:

  	
   

  	
  ***

  
	
  Milestone
  VIII:

  	
   

  	
  ***

  
	
  Total for
  Project:

  	
   

  	
  ***

  

 

Note:        the pricing information provided in this
proposal is best estimated of BioReliance based on the details available at
this time. The price may vary upon further investigation by BioReliance and
additional information provided by Cato Research and Senesco. If the number of
tissue samples and/or mice for the project changes the price of testing will
change. In this case this holds true, BioReliance will issue an amended proposal.

 

All data
and results generated in this study are confidential and are solely owed by
Senesco Technologies, Inc. All information from this study can not be
shared with any other entity beside Cato Research without first receiving
written permission from Senesco.

 

3

 

All
materials relating to eIF-5A and siRNA against eIF-5A, or their detection or
modification, employed in this study are owned by Senesco
Technologies, Inc. and will be disposed of properly at the conclusion of
the study by BioReliance.

 

By
initiating this study neither party grants or implies the transfer of any Intellectual
Property to the other party.

 

7.0           Payment Terms

 

The project will be billed to responsible
party in installments. Invoicing and Payment terms will be discussed with Cato
and Senesco at upon finalization of project requirements.

 

8.0           Cancellation Policy

 

BioReliance charges a cancellation fee for
studies cancelled within 120 days of scheduled study start. The cancellation
fee is based on time of cancellation prior to study start as described in the
following table:

 

	
  Months before study start*

  	
   

  	
  Cancellation charge

  	
   

  
	
  1 month or less

  	
   

  	
  $

  	
  ***

  	
   

  
	
  2 months

  	
   

  	
  $

  	
  ***

  	
   

  
	
  3 months

  	
   

  	
  $

  	
  ***

  	
   

  
	
  4 months

  	
   

  	
  $

  	
  ***

  	
   

  
	
  Greater than 4 months

  	
   

  	
  No charge

  	
   

  

 

* Study start is defined as first day of
dosing.

 

Once this agreement is signed, a study start
date will be agreed to by both BioReliance and the Sponsor

 

·                  If more than 4 months (120 days) ahead of
scheduled animal arrival there is a change to the schedule, this will be at no
charge. However, we are not able to guarantee availability of a new slot within
a similar time frame, but will work with the Sponsor to find an appropriate
time slot.

 

·                  In all other cases of date changes, a charge
of $7,500 per week will be assessed. This change fee is in addition to the cost
of the study and will be added to the initial invoice. We will not be able to
guarantee availability of a new slot within a similar time frame, but will work
with the Sponsor to find an appropriate time slot.

 

9.0           Risk Assessments and Safety

 

Any known safety hazards associated with the
test articles or reagents supplied for use in these studies must be reported to
BioReliance in order to allow a full risk assessment of the study to be
conducted. Please be aware that there may be a requirement for licences to
import and/or handle certain biological or infectious materials, and it is
essential that these be in place before shipment of materials is arranged.
Please note that no work shall commence until all relevant risk assessments and
licences are in place.

 

Please also note that for studies under
consideration at our UK facilities, BioReliance is required by the UK Health
and Safety Executive under European Commission Directive 94151/EC to have a
risk assessment of any GMO present in its facility. Therefore, if the material
to be supplied is classified as a Genetically Modified Organism (GMO), we
request that you inform us of the safety assessment for the test article.
Alternatively, if requested by you, BioReliance’s own Genetic Safety Committee
can do an assessment for you.

 

4

 

10.0         Signatures

 

	
  Client:

  	
   

  	
  BioReliance:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Richard S. Dondero

  	
   

  	
  /s/ Diane Brecha

  	
   

  
	
  Name

  	
   

  	
  Name

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  VP of Research and Development

  	
   

  	
  Sr. Technical Sales Specialist

  	
   

  
	
  Title

  	
   

  	
  Title

  	
   

  

 

Confidentiality

 

This
document has been prepared by and remains the sole property of BioReliance. It
is submitted to the Client solely for use in evaluating BioReliance’s
qualifications and/or quotations concerning the particular projects for which it was
prepared. This document is confidential to BioReliance, and the Client agrees
to treat the document in accordance with the terms of any Confidentiality
Agreements previously signed and, in any event, shall not disclose to any third
party without the consent of BioReliance not to be unreasonably withheld.

 

5

 

BioReliance Overview:

 

BioReliance Corporation is a leading contract
services organization, offering more than 1,000 tests or services related to biologics
safety testing, in vitro and in vivo toxicology, viral manufacturing and lab
animal health diagnostics for the biopharmaceutical and pharmaceutical
industries. The Company provides cost-effective services to over 600 clients
annually, including most of the largest pharmaceutical and biopharmaceutical
companies in the world. BioReliance is headquartered in Rockville, Maryland and
has additional facilities in Glasgow, Scotland and Stirling, Scotland.

 

	
  Experience

  	
   

  	
  ·         Leader in biologics safety testing, viral
  clearance, viral manufacturing, genetic toxicology and simian testing 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Global services provided through Rockville, MD; GIasgow and Stirling,
  Scotland 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         More than 140 employees with advanced degrees in science 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Have provided regulatory support for 20% of marketed biologics 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Over 1,000 customers worldwide — 50% of
  companies that develop biologics perform work with BioReliance

  
	
   

  	
   

  	
   

  
	
  Services

  	
   

  	
  ·         Biologics Testing - more than 700 testing services for the
  detection of viral and microbial contaminants 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Toxicology Testing - provider of 100 in vitro and in vivo toxicology services 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Lab Animal Diagnostics - More than 300 full-service diagnostic assays for laboratory animals used
  in research studies. Services for testing health of animal research models 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Viral Manufacturing - production services for viral vaccines
  and gene therapy products. Viral oncolytics and cell therapies at all stages
  of development

  
	
   

  	
   

  	
   

  
	
  Quality & 

  	
   

  	
  ·         Majority of assays are validated. 

  
	
  Regulatory

  	
   

  	
   

  
	
   

  	
   

  	
  ·         GLP and GMP infrastructure and compliance. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Dedicated QA personnel audit specific steps and procedures during
  each study. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Senior personnel available to meet directly with the regulatory
  authorities, if required, to review study results and data. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Regulatory advice - regular dialogue with the FDA, EMEA and other 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Regulatory Authorities help ensure the advice we give is up to date
  and relevant. 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         Expert scientists provide technical and
  regulatory support before, during and after completion of the study.

  

 

6

 

	
  History of 

  	
   

  	
  ·         1951 - First commercial supplier of cell cultures 

  
	
  Innovation

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1955 - First polio vaccine biosafety protocols 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1960 - First mouse antibody (MAP) test in
  collaboration with the NIH 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1978 - First ELISA Dx test for the detection of
  cytomegalovirus (CMV) 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1981 — Biosafety protocol for first mammalian
  derived biologic (Activase)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1990 - Developed safety protocol for first gene
  therapy to enter human clinical trials 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1994 - First xeno-transplantation safety testing
  program  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         1997 - Commercial TSE Western Blot offered  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         2000 - First use of molecular quantification for viral
  infectivity  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         2007 Selected to characterize first US national
  stem cell banks 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         2007 - Introduction of iNet for real-time sample
  tracking 

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·         2007 - HyMy assay for rapid detection of
  mycoplasma

  

 

7Exhibit 10.3

 

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

 

KBI BioPharma, Inc. Services Agreement

 

This
Services Agreement (“Agreement”) dated 5 September, 2008 between Senesco
Technologies, Inc, a Delaware company (“Client”) having its principal place
of business at 303 George Street, Suite 420, New Brunswick, NJ 08901
and KBI BioPharma, Inc., a Delaware company (“KBI BioPharma”) having its
principal place of business at 1101 Hamlin Road, Durham, North Carolina 27704
(each a “Party”, collectively the “Parties”).

 

Whereas:

 

Client
desires KBI BioPharma to perform services in accordance with the terms of this
Agreement and KBI BioPharma desires to perform such services.

 

In
consideration of the above statements, which form part of this Agreement, and
other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, the Parties hereto agree as follows:

 

1.             Performance

 

KBI
BioPharma will perform the services (the “Services”) detailed in the proposal
and/or scope-of-work set forth in Attachment One (the “Proposal”) on behalf of
Client in accordance with this Agreement herein incorporating the Proposal and
incorporating the Quality Agreement (applicable only for projects with cGMP
activities) attached hereto as Attachment Two.  In the event of any conflict between this
Agreement and the Proposal, this Agreement shall control.  In the event of any conflict between the
Proposal and any applicable Quality Agreement, the Quality Agreement shall control.

 

Client
shall support and cooperate with the execution of the services and shall not
engage in any act or omission, which may reasonably be expected to prevent or
delay the successful execution of the Services. Such support and cooperation
shall include, but not be limited to, informing KBI BioPharma of global
regulatory strategy for development and approval of the product(s) to the
extent relevant to the Proposal, prompt review and approval of documents
requiring Client’s signature, timely delivery of methods and materials and
prompt response to other similar issues.

 

2.             Compliance with Applicable
Government Regulations

 

KBI
BioPharma will undertake the Services in compliance in all material respects
with applicable laws, rules, regulations and guidelines; provided that the U.S.
Food and Drug Administration (FDA) current Good Manufacturing Practices (cGMP)
shall apply if and only to the extent cGMP activities are specified in the
Proposal.

 

3.             Client Obligations

 

Unless
otherwise agreed to by the Parties in writing, Client is solely responsible, in
each case in accordance with the Proposal, for: (a) provision of complete
and accurate scientific data regarding the Proposal; (b) provision of all
information necessary to effect the reliable transfer of methods to KBI
BioPharma; (c) provision of specific reagents, reference standards or
other materials 

 

1

 

necessary
for execution of the Proposal; (d) if applicable, review and approve
in-process and finished product test results to ensure conformity of such
results with product specifications, regardless of which party is responsible
for finished product release; (e) preparation of all submissions to
regulatory authorities; and (f) performance of other obligations of Client
set forth in the Proposal.

 

4.             Hazardous Materials

 

Client
warrants to KBI BioPharma that no specific safe handling instructions are
applicable to any substance or material provided by Client to KBI BioPharma,
except as disclosed to KBI BioPharma in sufficient time for review and training
by KBI BioPharma prior to delivery. 
Where appropriate or required by law Client shall provide a Material
Safety Data Sheet and instructions for proper storage for all Client-provided
materials, finished product and reference standards.

 

5.             Facility Visits and Audits

 

Client’s
representatives may visit KBI BioPharma’s facilities during normal business
hours and with prior written notice to observe the progress of the Proposal,
provided that such access does not compromise cGMP compliance or safety.  KBI BioPharma will assist Client in
scheduling such visits, which will be conducted in a manner reasonably required
to protect confidentiality of other clients.Client may conduct one quality
assurance audit per calendar year at no cost in accordance with the provisions
of the Quality Agreement (if applicable). 
Additional audits will be invoiced separately on a time and materials
basis at the then current rate for such services.

 

6.             Regulatory Inspections

 

KBI
BioPharma will promptly notify Client of any regulatory inspections directly
relating to the Proposal in accordance with the terms of the Quality Agreement
(if applicable) incorporated herein. 
Client accepts reasonable and documented costs charged by a regulatory
authority for inspections directly related to the Proposal.

 

7.             Compensation

 

KBI
BioPharma will invoice Client as set forth in the Proposal.  Payments are due thirty (30) days from date
of invoice.  Late payments are subject to
an interest charge of one and one half percent (11⁄2%) per month or, if less, the
maximum legal interest rate per month. 
Failure to bill for interest due shall not be a waiver of KBI BioPharma’s
right to charge interest.

 

KBI
BioPharma requires payment of an initial fee, specified in the proposal, prior
to commencement of Services, to account for facilities preparation costs and
resource allocation commitments with respect to Client’s project(s).  Unless otherwise provided in the applicable
Proposal, initial fees are nonrefundable (absent an uncured breach by KBI BioPharma)
and are due and payable at signing, or in any event within five (5) days,
without issuance of an invoice by KBI BioPharma.

 

8.             Taxes

 

Client
will pay (or reimburse in full to KBI BioPharma) any sales, use, gross
receipts, compensating or other taxes, licenses or fees (excluding KBI
BioPharma’s net income and franchise taxes) to be paid by KBI BioPharma to any
tax jurisdiction arising from the Proposal.

 

9.             Change Orders

 

KBI
BioPharma may revise the price for the Services as set forth in the Proposal if
(a) Client revises KBI BioPharma’s responsibilities, the specifications,
the Proposal instructions, procedures, assumptions, processes, test protocols,
test methods, analytical requirements or otherwise requests a modification to
the Proposal, (b) Client’s requirements or any Client-provided 

 

2

 

information
is inaccurate or incomplete and such inaccuracy or incompleteness results in
increased costs to KBI BioPharma, (c) necessitated by changes to applicable
laws, rules or regulations (d) if necessitated by an event outside
the control of KBI BioPharma, including , without limitation, the events
described in section 16 (Force Majeure) or (e) for other such reasons set
out in the Proposal.  Client will be notified
of such revision via issuance of a Change Order detailing the reasons for the
price revision and subject to Client’s written consent.

 

10.           Shipment

 

Unless
otherwise agreed in writing by the parties, all products, raw materials,
samples components or other materials shipped by KBI BioPharma are delivered
F.O.B. KBI BioPharma’s facilities.  KBI
BioPharma shall package for shipment such product, raw materials, samples,
components or other materials at Client’s expense (including insurance) and in
accordance with Client’s full written and reasonable instructions.

 

11.           Limitations of Liability

 

Notwithstanding
any other provision in this Agreement, KBI BioPharma’s liability for losses to
Active Pharmaceutical Ingredient, bulk drug product, intermediates, samples,
reagents or other materials provided by Client, whether or not incorporated
into finished product, shall in no event exceed the undisputed fair market
value thereof.

 

Notwithstanding
anything herein to the contrary, UNDER NO
CIRCUMSTANCES SHALL EITHER PARTY BE ENTITLED TO INCIDENTAL, INDIRECT,
CONSEQUENTIAL, EXEMPLARY OR SPECIAL DAMAGES, WHETHER OR NOT FORESEEABLE,
ARISING IN CONNECTION WITH THE DEFAULT OR BREACH OF ANY OBLIGATION OF THE OTHER
PARTY UNDER THIS AGREEMENT, THE PROPOSAL, THE QUALITY AGREEMENT OR ANY
APPENDICES OR DOCUMENTS RELATED THERETO, SUBJECT TO SECTION 15 HEREOF.

 

12.           Warranties

 

KBI
BioPharma warrants to Client that (i) it will render the Services in a
manner that meets professional and industry standards for work of a similar nature
and (ii) it will use commercially reasonable efforts to perform the
Services and, to the extent applicable for cGMP services, the Quality
Agreement. EXCEPT AS EXPRESSLY STATED IN THIS
SECTION 12, KBI BIOPHARMA DISCLAIMS ALL WARRANTIES, EXPRESS OR IMPLIED
WITH RESPECT TO THE SERVICES AND ANY MATERIALS PROVIDED HEREUNDER, AND CLIENT
HEREBY WAIVES ALL SUCH WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT
LIMITATION ANY IMPLIED WARRANTIES OF MERCHANTABILITY, NONINFRINGEMENT OR
FITNESS FOR A PARTICULAR PURPOSE.   Except
as otherwise provided in this Agreement, Client’s sole remedy and KBI BioPharma’s
exclusive obligation under the foregoing warranty in this Section 12 is
for KBI BioPharma, at its option, to either re-perform or correct such services
(without cost or expense to Client, including shipping conforming KBI BioPharma
deliverables to Client) or to refund to Client the amount paid therefore,
including the cost of shipping.  For
avoidance of doubt, Client understands and agrees that the Services are experimental
in nature, that biopharmaceutical process development is subject to certain
inherent risks, and as such nothing in this Agreement shall be construed as a
guarantee or warranty by KBI BioPharma that the Services, or the materials,
data, information of other results produced in connection therewith, will meet
or otherwise satisfy any of the objectives, goals or targets stated in the
Proposal.

 

13.           Confidentiality

 

All
information disclosed by a party in connection with the Proposal shall be considered
confidential information.  For the
duration of the Proposal and for a period of five (5) years thereafter,
neither Party shall disclose confidential information disclosed by the other
Party without prior written permission unless such information is (i) disclosed
to an affiliate that is under similar obligation to 

 

3

 

keep
such information confidential; (ii) is or becomes publicly available
through no fault of the receiving Party; (iii) is disclosed by a third
party entitled to disclose it; (iv) is already known to the receiving
Party as shown by its prior written records; or (v) is required to be
disclosed by any law, rule, regulation, order, decision, decree, subpoena or
other legal process provided that the receiving Party shall give prompt notice
thereof to the disclosing Party and shall cooperate with the disclosing Party
to obtain a confidentiality order or other similar protection.

 

14.           Intellectual Property

 

All
Client Materials  that KBI
BioPharma may have access to in order to perform the Services shall be owned
exclusively by the Client.  Nothing in
this Agreement shall be deemed to grant any rights to KBI BioPharma in any
Client Materials, other than the right for KBI BioPharma to perform the Services
in accordance with the terms of this Agreement. 
For the purposes hereof, “Client Materials” means all Client proprietary
information, intellectual property and developments, including without
limitation, all patents, patent applications, know-how, inventions, design,
concepts, technical information, manuals, instructions which are owned,
licensed or controlled by Client relating to pharmaceutical or diagnostic
products or the development, formulation, manufacture, processing, packaging,
analysis or testing thereof.  In the
event that Client loses or forfeits its rights in such proprietary technologies
during the term of this Agreement for any reason, Client shall provide notice
of same to KBI BioPharma immediately and this Agreement shall be subject to
immediate termination by KBI BioPharma at that time.

 

Any
and all ***, and ***, whether *** of this Agreement (“***”), including without
limitation any *** and *** which are based on Client Materials, shall be ***
KBI BioPharma shall at Client’s request assign to Client or its designee all of
its rights and title in the Custom Intellectual Property, which assignment is
accepted by Client. Prior to the commencement of work hereunder, KBI BioPharma
has or shall enter into agreements with all employees and consultants involved
in the carrying out of this Agreement sufficient to provide Client with the
assignments and licenses set forth in this Agreement.

 

Client
acknowledges that KBI BioPharma, and KBI BioPharma’s personnel, possess and
continuously update proprietary inventions, tools, templates, models,
methodologies, processes, know-how, trade secrets, improvements, and other
intellectual properties and other assets (including but not limited, to
analytical methods, procedures and techniques, computer technical expertise and
software, and business practices, related to the development and
commercialization of biopharmaceuticals, as well as other areas, which have
been independently developed by KBI BioPharma and its personnel), certain of
which may be used, improved, modified or developed by KBI BioPharma in the
course of a rendering Services (collectively, “KBI BioPharma Process Technology”).  Except as otherwise specified herein, KBI
BioPharma, and KBI BioPharma’s personnel, shall retain exclusive right, title
and interest in and to all KBI BioPharma Process Technology and improvements
thereto.

 

15.           Indemnification

 

KBI
BioPharma will indemnify and hold harmless Client, its affiliates and their
officers, directors, agents, and employees against any loss, cost, damage or
expense (a “Loss”) from any lawsuit, action, claim, demand, assessment or
proceeding brought by a third party (a “Claim”) arising directly or indirectly
from (i) the conduct of the Proposal as a result of KBI BioPharma’s gross
negligence or intentional misconduct or inaction or (ii) KBI BioPharma’s
material breach or non-performance of this Agreement; provided that if
such Loss or Claim arises in whole or part from Client’s gross negligence or
intentional misconduct or inaction, then the amount of such loss that KBI
BioPharma shall indemnify Client for shall be reduced by an amount proportional
to Client’s responsibilities for such Loss as determined by a court of
competent jurisdiction.

 

4

 

Client
will indemnify and hold harmless KBI BioPharma, its affiliates and their
officers, directors, agents, and employees against any Loss or Claim arising
directly or indirectly from (i) Client’s gross negligence or intentional
misconduct or inaction, (ii) Client’s material breach or non-performance
of this Agreement, or (iii) Client’s use, handling, distribution or sale
of the products or other deliverables resulting from a Proposal; provided
that if such Loss or Claim arises in whole or part from KBI BioPharma’s gross
negligence or intentional misconduct or inaction, then the amount of such loss
that Client shall indemnify KBI BioPharma for shall be reduced by an amount
proportional to KBI BioPharma’s responsibilities for such Loss as determined by
a court of competent jurisdiction.

 

16.           Force Majeure

 

Neither
party will be liable for any failure to perform or for delay in performance
resulting from any cause beyond its reasonable control, including, without
limitation, acts of God, fires, floods, or weather, disease, strikes or
lockouts, factory shutdowns, embargoes, wars, hostilities or riots, acts of
terrorism, shortages in transportation, government action or power failure,
provided that such failure to perform shall be excused only to the extent of
and during such disability.  Any time
specified or estimated for completion of performance of Services falling due
during or subsequent to the occurrence of any such events shall be
automatically extended for a period of ninety (90) days to recover from such
disability.  If any part of the Proposal
is invalid as a result of such disability, KBI BioPharma will, upon written
request from Client, and at Client’s sole cost and expense, repeat that part of
the Proposal affected by the disability.

 

17.           Use and Disposal

 

Client
represents and warrants to KBI BioPharma that it has legal title and/or a valid
license to materials, process patents and other intellectual property necessary
to conduct the Proposal and that KBI BioPharma’s performance of the Proposal
will not violate or infringe on the patents, trademarks, service marks or
copyrights of any third party.  Client
further represents and warrants to KBI BioPharma that it will hold, use and/or
dispose of Product and materials provided by KBI BioPharma in accordance with
all applicable laws, rules and regulations.

 

KBI
BioPharma represents and warrants to Client that it has legal title and/or a
valid license to those materials, process patents and other intellectual
property not furnished by Client that are necessary to conduct the Services,
and that KBI BioPharma’s use or application thereof in its performance of the
Services will not violate or infringe on the patents, trademarks, service marks
or copyrights of any third party.  KBI
BioPharma further represents and warrants to Client that it will hold, use
and/or dispose of information and materials provided by Client in accordance
with all applicable laws, rules and regulations.

 

18.           Independent Contractor

 

KBI
BioPharma shall perform the Proposal as an independent contractor of the Client
and shall have complete and exclusive control over its facilities, equipment,
employees and agents.  The relationship
between the parties shall not constitute a partnership, joint venture or agency
nor constitute either party as the agent, employee or legal representative of
the other.

 

19.           Publicity

 

Neither
Party will make any press release or public disclosure or use the name of the
other party or its employees in any advertising or sales promotional material
without the other Party’s express prior written consent.

 

5

 

20.           Authority

 

Client
grants KBI BioPharma full authority to use any Client supplied materials or
substances *** for the ***. Each party represents and warrants to the other
party that it has the full right and authority to enter into this Agreement and
to perform in accordance with the terms and conditions set forth herein.  Each Party further represents and warrants to
the other Party that it has obtained and will, at all times during the term of
this Agreement, hold and comply with all licenses, permits and authorizations
necessary to perform this Agreement as now or hereafter required under any
applicable statutes, laws, ordinances, rules and regulations of the United
States and any applicable foreign, state and local governments and governmental
agencies.

 

21.           Amendment and Precedence

 

The
Proposal, the terms and conditions herein and any applicable Quality Agreement
constitute the entire agreement between the Parties relative to the Proposal
and may not be modified without the mutual written consent of both Parties. The
Parties agree that the terms and conditions contained in this Agreement shall
prevail over any terms and conditions of any purchase order, acknowledgment
form or other instrument.  Each Party has
had the opportunity to consult with counsel in connection with the review,
drafting and negotiation of this Agreement. 
Accordingly, the rule of construction that any ambiguity in this
Agreement shall be construed against the drafting Party shall not apply.

 

22.           Choice of Law

 

This
Agreement between the Parties governed by these standard terms and conditions
shall be construed and enforced in accordance with the laws of and in the venue
of the State of North Carolina except for its rules regarding conflict of
laws.

 

23.           Dispute Resolution

 

If
a dispute arises between the Parties in connection with this Agreement, the
respective presidents or senior executives of KBI BioPharma and Client shall
first meet as promptly as practicable and attempt to resolve in good faith such
dispute.  If such parties cannot resolve
the dispute, then such dispute shall be referred to mediation in accordance
with the rules of the American Arbitration Association.  The Parties shall participate in the
mediation in a good faith attempt to settle the dispute.  The mediation shall be held in Durham County,
North Carolina.  If mediation fails to
resolve the dispute, such dispute shall be resolved in the jurisdiction of the
defendant by binding arbitration, by a neutral arbitrator, under the rules of
the American Arbitration Association.

 

24.           Assignment

 

This
Agreement between the Parties shall not be assigned in whole or in part by
either Party without the prior written consent of the other, which consent
shall not be unreasonably withheld or delayed except that no such consent shall
be required for an assignment by a Party in whole or in part in connection with
a merger or other business combination or sale of all or substantially all
assets.

 

25.           Termination

 

Client
may terminate this Agreement prior to completion of the Proposal by providing
sixty (60) days written notice to KBI BioPharma.  Upon receipt of such notice of termination,
KBI BioPharma will promptly scale down the affected portion of the Proposal and
avoid (or minimize, where non-cancellable) any further related expenses.  In the event that Client elects to terminate
for reasons other than a material breach of this Agreement by KBI BioPharma that
KBI BioPharma fails to cure or commence such cure within thirty (30) days of
written notice of such breach, Client shall pay KBI BioPharma upon receipt of
invoice all of its costs incurred or irrevocably obligated related 

 

6

 

to
the Proposal, plus, as liquidated damages and not as a penalty, a cancellation
fee equal to twenty percent (20%) of the uninvoiced portion of the total
Proposal as of the effective date of termination.

 

In
the event of a material breach of this Agreement by Client that is not cured
after a thirty (30) day written notice of such breach, KBI BioPharma may
terminate this Agreement prior to completion of the Proposal by giving sixty
(60) days written notice to Client.  Upon
such termination, KBI BioPharma will promptly scale down the affected portion
of the Proposal and avoid (or minimize, where non-cancellable) any further
related expenses.  In addition, Client
shall pay KBI BioPharma upon receipt of invoice all of its costs incurred or
irrevocably obligated related to the Proposal, plus, as liquidated damages and
not as a penalty, a cancellation fee equal to twenty percent (20%) of the
uninvoiced portion of the total Proposal as of the effective date of
termination.

 

The
termination of this Agreement for any reason shall not relieve either Party of
its obligations to the other in respect of: (i) confidentiality; (ii) consents
for advertising purposes and publications; (iii) indemnification; (iv) intellectual
property; and (v) compensation for Services performed.

 

26.           Survival

 

Sections
13, 14, 15, 18, 19, 22, 23 and this Section 26 of the terms and conditions
herein shall survive termination or expiration of this Agreement.

 

27.           Notice

 

Any
notice required to be given pursuant to the terms and provisions hereof shall
be in writing and shall be sent by certified or registered mail, postage
prepaid with return receipt requested, or by nationally recognized overnight
courier, postage prepaid with return receipt requested, or by confirmed
facsimile (with printed confirmation of receipt), to the other Party at the
address first indicated above, or at such other address or addresses indicated
in written notice by a Party from time to time hereafter.  Each notice shall be deemed sufficiently
given, served, sent, or received for all purposes at such time as it is
delivered to the addressee or at such time as delivery is refused by the
addressee upon presentation.

 

28.           Severability

 

In
the event that any one or more of the provisions of this Agreement should be
held for any reason by any court or authority having jurisdiction over this
Agreement, or over any of the Parties to this Agreement, to be invalid,
illegal, or unenforceable, such provision or provisions shall be reformed to
approximate as nearly as possible the intent of the parties, and if
unreformable, shall be divisible and deleted in such jurisdictions; elsewhere,
this Agreement shall not be affected.

 

29.           Waiver.

 

The
waiver by either Party hereto of any right hereunder, or of any failure of the
other Party to perform, or of any breach by the other Party, shall not be
deemed a waiver of any other right hereunder or of any other breach by or
failure of such other Party, whether of a similar nature or otherwise.  No remedy referred to in this Agreement is
intended to be exclusive, but each shall be cumulative and in addition to any
other remedy referred to in this Agreement or otherwise available under law.

 

30.           Counterparts

 

This
Agreement may be executed in duplicate and either copy or both copies are
considered originals.

 

7

 

In
Witness Whereof, the Parties by their authorized representatives execute this
Agreement as of the date first above written

 

 

	
  KBI BioPharma, Inc.

  	
   

  	
  Client

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:  

  	
  /s/
  KHURSHID IQBAL

  	
   

  	
  By:
  

  	
  /s/
  Richard S. Dondero

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:
  

  	
  KHURSHID
  IQBAL

  	
   

  	
  Name:
  

  	
  Richard
  S. Dondero

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:
  

  	
  Senior
  VP and CSO

  	
   

  	
  Title:
  

  	
  VP
  of Research and Development

  	
   

  

 

8

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