Document:

ACTIVE PHARMACEUTICAL
INGREDIENT

    MANUFACTURING AND CLINICAL
SUPPLY AGREEMENT

    

    (RECOMBINANT
HUMAN INSULIN)

    

    THIS MANUFACTURING AND SUPPLY
AGREEMENT (this “Agreement”) is
entered into as of  July 5, 2010 (the “Effective Date”)
ORAMED LTD., a company organized
under the laws of the State of Israel with principal offices at Hi-Tech Park 2/5
Givat-Ram, PO Box 39098, Jerusalem 91390, Israel (“Buyer”) and SANOFI-AVENTIS DEUTSCHLAND
GMBH, a
company existing under the laws of Germany, located at Industriepark Hoechst,
65926 Frankfurt am Main, Germany (“SAD”).

    

    Buyer and
SAD are individually referred to herein as a “Party” and are
collectively referred to herein as the “Parties”.

    

    Background

    

    A.          Buyer
wishes to engage SAD to perform services for Buyer, as more specifically set
forth herein, in connection with the manufacturing and supply of Active
Ingredient (as defined below) for use in clinical trials of the Product (as
defined below).

    

    B.           SAD
wishes to perform such services, all on the terms and conditions set forth in
this Agreement.

    

    Covenants

    

    In consideration of the mutual
covenants and promises set forth herein, and intending to be legally bound
hereby, the Parties agree as follows:

    

    ARTICLE
1

    DEFINITIONS

    

    The following terms, whether used in
the singular or plural, shall have the meanings assigned to them below for
purposes of this Agreement

    

    “Acquisition Cost”
shall mean the actual invoiced price actually paid by SAD to any Third Party for
materials, components and packaging materials required to manufacture and
package the Active Ingredient hereunder, including, but not limited to, shipping
and handling costs, taxes and customs duties incurred and paid by SAD to any
Third Party in connection with the acquisition of such materials and components,
as the case may be.

    

    “Active Ingredient”
shall mean Recombinant Human Insulin as manufactured by SAD in accordance with
the Active Ingredient Specifications, for use in the Product.

    
      
        
          
            
              	 	 	 
	 	
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    “Active Ingredient
Price(s)” shall have the meaning set forth in Section 8.1(a)
hereof.

    

    “Active Ingredient
Specifications” shall mean the specifications for the Active Ingredient
attached hereto as Exhibit 2 and made a
part hereof, as determined in accordance with this Agreement, the analytical
methodology set forth and in accordance with the terms and conditions of the
Quality Agreement.

    

    “Affiliate” shall mean
any corporation or non-corporate entity which controls, is controlled by, or is
under common control with a Party.  A corporation or non-corporate
entity shall be regarded as in control of another corporation if it owns or if
it directly or indirectly controls at least fifty percent (50%) of the voting
stock of the other corporation or (a) in the absence of the ownership of at
least fifty percent (50%) of the voting stock of a corporation or (b) in
the case of a non-corporate entity, the power to direct or cause the direction
of the management and policies of such corporation or non-corporate entity, as
applicable.

    

    “Agreement” shall mean
this Manufacturing and Supply Agreement, as it may hereafter be amended or
supplemented from time to time.

    

    “cGMPs” shall mean
applicable standards for current good manufacturing practices of active
ingredients specified in (i) the ICH Guidelines,(ii) the FDA’s “Guidance for
Industry Q7A Good Manufacturing Practice Guidance for Active Pharmaceutical
Ingredients”, and (iii) the EU GMP Guidelines.  For clarity, such
definition of cGMPs shall not include other country-specific regulatory
requirements.

    

    “Certificate of
Analysis” shall mean a document, signed by an authorized representative
of SAD, certifying the Specifications for, and testing methods applied to, the
Active Ingredient, and the results thereof, and which includes the Active
Ingredient date of manufacture, date for re-testing or expiration date as
appropriate.

    

    “Certificate of cGMP
Compliance” shall mean a document, signed by an authorized representative
of SAD, certifying that the Active Ingredient being delivered to Buyer has been
manufactured in conformity with cGMPs.

    

    “Confidential
Information” shall mean, as the case may be, any and all information
relating to the Active Ingredient, of a confidential nature not known to the
public or to the recipient of the information before its disclosure belonging to
either Party in written, electronic or any other form. This includes, but is not
limited to, Know-How, operational methods, formulae, samples, Specifications,
analytical methods as well as any details of commercial, technical,
pharmaceutical, scientific and industrial nature. The terms of this Agreement
shall also be deemed Confidential Information.  Confidential
Information shall not include information, materials, technical data or Know-How
which: (i) is in a receiving Party’s possession at the time of disclosure as
evidenced by the receiving Party’s written records immediately prior to the time
of disclosure; (ii) is in the public domain at the time of disclosure; (iii)
becomes part of the public domain by publication or otherwise after disclosure
hereunder other than by breach of this Agreement by a receiving Party; (iv) is
disclosed to a receiving Party by a third party having the right to disclose
such information without any violation of any rights of or obligations to the
disclosing Party; or (v) is independently developed by an employee or agent of a
receiving Party without knowledge of the disclosing Party’s Confidential
Information as evidenced by the receiving Party’s written records.

    
      
        	 	 	 
	 	
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    “FDA” shall mean the
United States Food and Drug Administration or any successor entity
thereto.

    

    “FDCA” shall mean the
Federal Food, Drug and Cosmetic Act (21 U.S.C. § et seq.), as the same may be
amended from time to time, together with any rules and regulations promulgated
thereunder, and any foreign counterpart.

    

    “Force Majeure Event”
shall have the meaning set forth in Section 18.1 hereof.

    

    “ICH Guidelines” shall
mean the document titled “Q7A - Good Manufacturing Practice Guide for Active
Pharmaceutical Ingredients” endorsed by the International Conference on
Harmonisation of Technical Requirements for Registrations of Pharmaceuticals
for

    

    “Invention” shall mean
information relating to any innovation, improvement, development, discovery,
computer program, device, trade secret, method, Know-How, process, technique or
the like, whether or not written or otherwise fixed in any form or medium,
regardless of the media on which contained and whether or not patentable or
copyrightable.

    

    “Know-How” shall mean
all confidential and identified technical and scientific information and data,
irrespective of its subject-matter and form, including, but not limited to,
processes, formulae, designs and data as well as Inventions and improvements
whether patentable or not.

    

     “Packaging
Specifications” shall mean the packaging and labeling specifications for
the Active Ingredient attached hereto as Exhibit 1 and made a
part hereof, as such specifications may be amended from time to time by mutual
agreement of the Parties in accordance with the terms and conditions of the
Quality Agreement.

    

    “PO” shall have the
meaning set forth in Article 6 hereof.

    

    “Product” shall mean
Buyer’s finished oral insulin product

    

    “Production Site”
shall mean [the SAD site in which it manufactures the Active Ingredient i) the active
pharmaceutical ingredient facility owned by SAD or an Affiliate of SAD (both
directly or indirectly under the control of Sanofi-Aventis, SA, the French
parent company) located at Industriepark Hoechst, 65926, Frankfurt am Main,
Germany, and (ii) such other facilities owned by SAD or an Affiliate of SAD, if
any, as the Parties may mutually agree to in writing from time to
time].

    

     “Quality Agreement”
shall mean the Quality Agreement which the parties shall in good faith negotiate
and execute within thirty (30) days after the execution of this Agreement, and
which shall be made part hereof.

    
      
        	 	 	 
	 	
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    “Recall” shall have
the meaning set forth in Section 12.2(a) hereof.

    

    “Recalled Product”
shall mean any Product subject to a Recall.

    

    “Regulatory Change”
shall have the meaning set forth in Section 18.2 hereof.

    

    “Specifications” shall
mean the Active Ingredient Specifications and the Packaging
Specifications.

    

    “Term” shall have the
meaning set forth in Section 11.1 hereof.

    

    “Territory” shall mean
those territories set forth in Exhibit 4 as may be modified from time to time
only in accordance with the terms of the Agreement.

    

     “Third Party” shall
mean any person or entity other than Buyer, SAD and their respective
Affiliates.

    

    “Third Party Claims”
shall have the meaning set forth in Section 13.1 hereof.

    

    ARTICLE
2

    MANUFACTURE, SALE AND
PURCHASE OF ACTIVE INGREDIENT

    

    2.1 Generally.  Subject
to the terms and conditions of this Agreement, SAD shall manufacture and supply
to Buyer and Buyer shall exclusively purchase from SAD, all of its Active
Ingredient required to conduct clinical trials used to register the Product for
sale in the Territory.  For clarification,
Buyer shall not use any clinical trial or data related thereto to register
Product in the Territory unless the active ingredient for such clinical trial is
supplied by SAD.

    

    2.2           Additional
Territories.  Should Buyer seek to conduct clinical trials
outside the Territory in order to register the Product outside the Territory,
then Buyer will discuss with SAD a proposal for SAD to supply Active Ingredient
for those trials, and SAD will make its best commercial efforts in order
accommodate Buyer’s commercially reasonable requirements.

    

    ARTICLE
3

    PACKAGING

    

    SAD shall procure all packaging
materials and components for, and shall package, the Active Ingredient in
accordance with the Production Site receipt procedures and the Packaging
Specifications as set forth in Exhibit 1 attached
hereto.  Typical packaging materials and components are described in
the Drug Master File in respect of the Active Ingredient and the use thereof is
supported by extant stability data.

    
      
        	 	 	 
	 	
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    ARTICLE
4

    

    COOPERATION WITH
GOVERNMENTAL REQUIREMENTS

    

    The Parties shall cooperate with one
another as may be reasonably necessary or appropriate to satisfy all
governmental requirements and obtain all needed permits, approvals and licenses
with respect to the manufacture and supply of the Active Ingredient. Such
cooperation shall include, without limitation but strictly in regards to United
States territories, communicating with regulatory authorities and making
available as promptly as practicable all information, documents and other
materials which result from the performance by SAD of its services hereunder
which Buyer is required to submit or which Buyer may otherwise reasonably
request in connection with governmental filings relating to the Active
Ingredient. The costs and expenses of such cooperation, if applicable, shall be
subject to the Parties’ mutual agreement.  Notwithstanding the
foregoing, it shall be the responsibility of (i) Buyer to obtain and maintain
all such permits, approvals and licenses which are specific to the Active
Ingredient or the Product, and (ii) SAD to obtain and maintain all such permits,
approvals and licenses which are generally required for the Production Site and
to maintain the Drug Master File in respect of the Active
Ingredient.

    

    ARTICLE
5

    SPECIFICATION
CHANGES

    

    Upon any change in the Active Ingredient
Specifications or Packaging Specifications requested by Buyer (“Buyer Specification
Changes”), including the addition of new packaging configurations, Buyer
shall promptly advise SAD in writing of any requested Buyer Specification
Changes, and SAD shall promptly advise Buyer as to the feasibility of the Buyer
Specification Changes, and if in SAD’s reasonably exercised discretion, the
Buyer Specification Changes are found to be commercially reasonable and
feasible, SAD will inform Buyer of any scheduling and/or price adjustments which
may result from the Buyer Specification Changes.  Prior to
implementation of Buyer Specification Changes, the Parties shall negotiate in
good faith in an attempt to reach agreement on (a) the new Active Ingredient
Price for any Active Ingredient which embodies the Buyer Specification Changes,
(b) any amounts to be reimbursed by Buyer to SAD as described in the next
sentence of this paragraph, and (c) any other amendments to this Agreement which
may be necessitated by the Buyer Specification Changes (i.e., an adjustment to
the lead time for POs). Buyer shall reimburse SAD for the mutually agreed upon
reasonable expenses incurred by SAD as a result of the Buyer Specification
Changes, including, but not limited to, reimbursing SAD for its mutually agreed
validation and development costs, capital expenditure costs and costs for any
reasonable inventory of packaging components or other materials maintained by
SAD for purposes of this Agreement and consistent with the PO, and rendered
unusable as a result of the Buyer Specification Changes.  If during
the Term, Buyer, in accordance with this Article 5, causes the amendment of
the Active Ingredient Specifications or Packaging Specifications so as to
render obsolete reasonable quantities of the Active Ingredient and/or materials
and components used to manufacture and package the Active Ingredient pursuant to
this Agreement on hand at SAD, Buyer shall purchase from SAD (i) all such
obsolete Active Ingredient at the Active Ingredient Prices then in effect, (ii)
all work-in-progress of the Active Ingredient at SAD’s actual cost thereof, and
(iii) at SAD’s Acquisition Cost, all such obsolete materials and components
obtained by SAD pursuant to its normal procurement policies to manufacture
quantities of the Active Ingredient pursuant to the PO.  SAD’s normal
procurement policies for purposes of the preceding sentence of this Article 5
shall be considered to be quantities of materials and components corresponding
to the PO.  For greater certainty, the foregoing provisions of this
Article 5 shall not apply in respect of any change in the Active Ingredient
Specifications or Packaging Specifications made by SAD other than pursuant to a
Buyer request.  SAD shall provide Buyer with not less than three (3)
months’ prior written notice of SAD’s implementation of any intended significant
change(s) to its manufacturing processes for the Active Ingredient, which might
affect the quality of the Active Ingredient (“Change Notice”) (e.g.
any change in the Active Ingredient Specifications or Packaging Specifications
made by SAD other than pursuant to a Buyer request).  If a significant
change is implemented by SAD and Buyer provides SAD with demonstrable evidence
that the utility (i.e. the conditions of being useful as a pharmaceutical
product in connection with the manufacture and performance of the Product) of
the Active Ingredient is significantly altered in that there is no similar
bioequivalence (to Active Ingredient before the significant change) or similar
Product specifications when formulated in the final Product formulation
(together, “Utility
Loss”), the parties shall exert their best commercial efforts to resolve
issues related to the Utility Loss in order to continue operating under this
Agreement.  If the parties cannot reach agreement and resolution
regarding Utility Loss, Buyer shall have the option to provide sixty (60) days
written notice of termination of this Agreement to SAD.

    
      
        	 	 	 
	 	
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    ARTICLE
6

    FORECASTS AND
ORDERS

    

    6.1         Communication of Forecasts
and Purchase Orders by Buyer.  Subject to and upon [REDACTED],
and subsequent finalization of Buyer’s continuing trial(s) design(s), Buyer
shall submit in writing to SAD a binding purchase order (“the PO”) of all clinical
quantities of Active Ingredient which are required to conduct such clinical
trials of Product.

    

    SAD will
supply the Active Ingredient in packaging in accordance with the Packaging
Specifications set forth in Exhibit 1.

    

    6.2         Confirmation by
SAD.  No later than fifteen (15) business days after receipt of
Buyer’s POs, SAD shall confirm that it can fulfill the monthly quantities
specified in such orders.

    

    6.3         Intentionally
omitted.

    
      
        	 	 	 
	 	
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    6.4         Purchase
Orders.  Buyer shall issue the PO for all known total clinical
quantities of Active Ingredient from SAD which are required to conduct [REDACTED]
of Product at the Active Ingredient Price.  The quantities of the
Active Ingredient and the PO dates will be dependent upon the relevant
regulatory authorities’ responses to the Product’s clinical trials, whether
during review of the clinical program or after completion of clinical trial
which may necessitate further trials, regarding trial participant number,
dosage, length, and other relevant factors.  Buyer estimates that it
will require a quantity of Active Ingredient greater or equal to [REDACTED]for
the anticipated clinical trials, and that the PO related thereto shall occur
within the year 2011.  The only quantities that Buyer is bound to
purchase shall be those as determined in accordance with section
6.1.  PO(s) for quantities up to 10KG shall be issued by Buyer at
least three (3) months in advance of the expected date of delivery of Active
Ingredient from SAD to Buyer.  PO(s) for quantities from 10KG to 50KG
shall be issued by Buyer at least six (6) months in advance of the expected date
of delivery of Active Ingredient from SAD to Buyer. In the event that Buyer
submits PO(s) for quantities above 50KG, the parties shall discuss and negotiate
in good faith the lead time and advance notice required for delivery of Active
Ingredient to Buyer.  SAD shall deliver to Buyer those quantities
ordered on a PO issued in accordance with this section 6.4 within the respective
timeframe set out in immediately above.  For clarification, regardless
of expiration or termination of this Agreement, Buyer is obligated to pay any
amounts due in accordance with issued POs.

    

    ARTICLE
7

    DELIVERIES

    

    7.1         Purchase Quantities.
SAD will use commercially reasonably efforts to ship the quantities specified in
the PO.    Variations in shipments as outlined herein shall
be deemed to be in compliance with such PO; provided, however, that Buyer
shall only be invoiced and required to pay for the quantities of Active
Ingredient which SAD actually ships to Buyer.  Quantities shipped are
subject to the Packaging Specifications set out in Exhibit 1
hereto.

    

    7.2         Active Ingredient
Release.  No Active Ingredient shall be released to Buyer
without a Certificate of Analysis and Certificate of cGMP Compliance, both of
which shall be supplied to Buyer by SAD.  SAD shall conduct such
quality assurance testing for the Active Ingredient as is required by the
Specifications[,] [and ]cGMPs[ and the Quality Agreement.  SAD shall
conduct in parallel on-going stability studies of the Active
Ingredients].

    

    7.3         Delivery Terms.
Shipment of the Active Ingredient will be to one location as designated by
Buyer.  Buyer will select and pay the carrier to be
used.  The Active Ingredient will be shipped with the requisite
Certificates of Analysis and Certificate of cGMP Compliance, FCA Production Site
(Incoterms 2000), freight class, Class 70 (Class of Commodity for Food and
Pharmaceutical Compound).  Loading of the Active Ingredient shall be
performed at no cost by SAD, but under the responsibility and liability of
Buyer.  All shipments of the Active Ingredient to Buyer shall be made
via such carrier(s) as Buyer may direct.  Title and risk of loss shall
pass to Buyer upon delivery to the carrier.  Freight charges shall be
billed ship collect.

    

    7.4         Shipping; Dating and Customs
Costs. SAD shall make commercially reasonable efforts to cause Active
Ingredient delivered hereunder to have [REDACTED]months
until expiration, but in any event, SAD shall deliver Active Ingredient
hereunder with at least twelve (12) months until expiration. For clarity,
costs for the shipment of Active Ingredient from the Production Site and all
customs tariffs and duties shall be for the account of Oramed.

    
      
        	 	 	 
	 	
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    7.5         Inconsistencies. In
the event of any inconsistencies between the terms of this Agreement and the PO
issued by Buyer hereunder or any acceptance thereof by SAD, the terms of this
Agreement shall govern.

    

    7.6         Inspections by
Buyer.  With reasonable written notice and upon a mutually
agreed upon date, Buyer or its designated agents shall have the right to inspect
those portions of the manufacturing, storage and warehouse facilities of a
Production Site where Active Ingredient is being manufactured or stored, during
regular business hours, to verify compliance with the terms and provisions of
this Agreement or for insurance inspection purposes.  Unless for
reasonable cause, Buyer agrees to not inspect a Production Site more often than
one (1) time in a three-calendar year period or any other frequency mutually
agreed upon.

    

    7.7         Governmental
Inspections.  If SAD is notified that the Active Ingredient or
the Production Site will be subject to an inspection related to the Active
Ingredient, by any governmental authority of the Territory, SAD shall promptly
inform Buyer of such inspection and shall cooperate with and allow such
inspection to the extent required by applicable laws.  Buyer shall not
have the right to be present at any meetings or events related to such
inspection.  Subject to being excluded due to restrictions under
confidentiality obligations of SAD to Third Parties, and to SAD’s determination
that particular information and/or documentation is confidential in nature, SAD
shall provide information related to inspection outcomes to Buyer resulting from
such inspection to the extent relevant to the Active Ingredient.  SAD
will promptly inform Buyer whether any Form FDA 483 or warning letters or
citations are issued to SAD (by the FDA or any other governmental authority)
which are related to or impact the supply of the Active Ingredient to
Buyer.

    

    ARTICLE
8

    PRICE; PRICE ADJUSTMENTS;
PAYMENT TERMS

    

    8.1         Price.

    

    (a)           General.  The
per- gram price(s) payable by Buyer for all quantities of the Active Ingredient
ordered hereunder (the “Active Ingredient
Price(s)”) shall be [REDACTED]Euros[REDACTED].

    

    8.2         Payment Terms. SAD
shall invoice Buyer for all quantities of the Active Ingredient purchased
hereunder concurrently with SAD’s shipment thereof to Buyer. Subject to Section
7.3 and Section 13.1, all amounts properly invoiced by SAD hereunder shall be
due and payable [REDACTED]from
the date of such invoice.  SAD shall deliver invoices to Buyer on the
date the invoice is issued. Payment may be made by Buyer’s corporate check or by
wire transfer of funds to such account as SAD may designate.  Orders,
invoices and payments under this Agreement shall be made in
Euros.  Invoices shall reflect the actual quantities shipped and Buyer
shall be responsible for payment for such actual quantities shipped in
accordance with this Agreement.

    
      
        	 	 	 
	 	
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    ARTICLE
9

    SAD’S REPRESENTATIONS,
WARRANTIES AND COVENANTS

    

    SAD
represents, warrants and covenants to Buyer as follows:

    

    9.1         Active Ingredient.
The Active Ingredient, at the time of sale and shipment to Buyer by SAD, (a)
will conform to the Specifications, as then in effect, (b) will have dating
until re-evaluation of not less than that which is set forth in Section 7.4
above, (c) will have been manufactured in all material respects in accordance
with cGMP in effect at the time of manufacture, (d) will not be adulterated or
mis-branded within the meaning of the FDCA, (e) will not have been manufactured,
sold or shipped in violation of any applicable laws in any material respect, (f)
will be conveyed with good title, free and clear of all security interests,
liens or encumbrances, and (g) as may be appropriate or applicable, will have
been approved by any and all requisite governmental and regulatory
authorities.

    

    9.2         Manufacturing
Standards. SAD shall manufacture the Active Ingredient in accordance with
(i) the Specifications, (ii) then-current cGMPs, and (iii) ICH
Guidelines.

    

    9.3         Compliance with Applicable
Laws. SAD shall fully comply with all applicable federal, state and local
laws in performing the services contemplated hereunder.

    

    9.4             Qualified Personnel.
SAD shall engage and employ only professionally qualified personnel to perform
the services contemplated hereunder, and will not knowingly utilize any
individual, in any material capacity, who has been debarred under FDCA 21 USC
335a or who is subject to a conviction described in FDCA 21 USC
331.

    

    9.5             SAD
represents and warrants to Buyer that the Production Site is wholly-owned by an
Affiliate of SAD and that such Affiliate and SAD are wholly owned, directly or
indirectly, by Sanofi-Aventis SA.

    

    ARTICLE
10

    GENERAL REPRESENTATIONS AND
WARRANTIES

    

    Each
Party represents and warrants to the other as follows:

    

    10.1       Power and
Authorization. It has all requisite power and authority (corporate and
otherwise) to enter into this Agreement and has duly authorized by all necessary
action the execution and delivery hereof by the officer or individual whose name
is signed on its behalf below.

    

    10.2       No Conflict. Its
execution and delivery of this Agreement and the performance of its obligations
hereunder do not and will not conflict with or result in a breach of or a
default under its organizational instruments or any other agreement, instrument,
order, law or regulation applicable to it or by which it may be
bound.

    
      
        	 	 	 
	 	
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    10.3       Enforceability. This
Agreement has been duly and validly executed and delivered by it and constitutes
its valid and legally binding obligation, enforceable in accordance with its
terms, except as enforcement may be limited by bankruptcy, insolvency or other
laws of general application relating to or affecting the enforcement of
creditors’ rights and except as enforcement is subject to general equitable
principles.

    

    10.4       Debarment.  As
of the Effective Date, both parties have not been debarred under 21 USC 335a,
and to the best of their knowledge, is not subject to pending debarment under 21
USC 335a.

    

    ARTICLE
11

    TERM;
TERMINATION

    

    11.1       Term. Unless sooner
terminated pursuant to the terms hereof, the term of this Agreement shall
commence on the Effective Date and shall expire with the acceptance by Buyer of
the total quantities of Active Ingredient as set forth in Article 6
above.

    

    11.2       Termination by Buyer for
Utility Loss.  Buyer shall be entitled to terminate this
Agreement pursuant to and in accordance with Article 5 in the event of a Utility
Loss.  In the event of a termination by Buyer in accordance with this
Section 11.2 and Article 5, Buyer’s then-current payment obligations under this
Agreement which are not related to Utility Loss shall remain until fully
satisfied, including the payment of amounts due to SAD for Active Ingredient or
otherwise, which are not related to Utility Loss.

    

    11.3       Termination by Mutual
Agreement. The Parties may terminate this Agreement at any time by mutual
written agreement.

    

    11.4       Termination Upon
Breach. Either Party may terminate this Agreement upon not less than
thirty (30) days prior written notice to the other Party upon the material
breach or default by the other Party of any of its representations, warranties,
covenants or agreements (provided, however, that such
notice period shall be extended by such additional period as the breaching Party
may request upon the breaching Party’s written certification that (i) such
breach is reasonably capable of being cured within the period of the proposed
extension, but not within such thirty (30) day period and (ii) it has commenced
and is diligently pursuing efforts to cure such breach). Upon the expiration of
such notice period, this Agreement shall terminate without the need for further
action by either Party; provided, however, that if the
breach upon which such notice of termination is based shall have been fully
cured to the reasonable satisfaction of the non-breaching Party within such
notice period, then such notice of termination shall be deemed rescinded, and
this Agreement shall be deemed reinstated and in full force and effect. Such
right of termination shall be in addition to such other rights and remedies
specified in this Agreement and as provided by law.  For greater
certainty, any breach or default (material or otherwise) by a Party under any
other agreement between the Parties (other than the Quality Agreement) shall not
entitle the other Party to terminate this Agreement.

    
      
        	 	 	 
	 	
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     11.5      Other
Termination.   Either of the Parties may terminate this
Agreement at anytime, upon written notice, during the clinical development of
Product should Buyer execute and enter into binding agreements with [REDACTED]as
a marketing partner related to the Product.  Upon termination in
accordance with this section 11.5, Buyer will compensate SAD for [REDACTED]of
Active Ingredient shipped from SAD in accordance with a Letter of Intent between
the parties, effective November 1, 2009, at a rate of [REDACTED],
totaling [REDACTED].  Should
Buyer enter into marketing partnerships for the Product with partners other than
[REDACTED],
Buyer shall remain obligated to the terms of this Agreement with
SAD.

    

    11.6       Rights and Duties Upon
Termination.

    

    (a)           Unless
otherwise mutually agreed by the Parties, SAD shall manufacture and ship, and
Buyer shall purchase in accordance with the provisions hereof, all quantities of
Active Ingredient ordered by Buyer hereunder prior to the date of expiration or
termination.

    

    (b)           Upon
the expiration or termination of this Agreement (other than termination by Buyer
pursuant to Section 11.2 or Section 11.4 hereof), Buyer shall, if so
requested by SAD, purchase (i) all materials and components acquired by SAD
hereunder to manufacture the Active Ingredient in accordance with the
then-current Forecast, at SAD’s Acquisition Cost thereof, (ii) all
work-in-progress of the Active Ingredient in respect of the then-current
Forecast at SAD’ actual cost thereof, and (iii) all finished Active
Ingredient inventory in respect of the then-current Forecast then in SAD’s
possession at the then-current Active Ingredient Price hereunder. In addition,
in such case Buyer shall pay SAD for any uncancellable commitments made by SAD
for materials and components hereunder in respect of the then-current
Forecast.  Notwithstanding anything to the contrary in this Section
11.6 (b), the foregoing purchase and payment obligations of Buyer shall be
limited solely to materials and components obtained as to the time periods for
the types of materials and components provided in Article 5, and Active
Ingredient quantities manufactured as to which Buyer’ Forecasts under Section
6.1 hereof constitute a firm commitment.

     

    ARTICLE
12

    CLAIMS;
RECALLS

    12.1       Claims. Buyer may
reject any quantity of the Active Ingredient which fails to conform to any
applicable PO, warranty, Specifications or laws upon written notice to SAD
describing such nonconformity given within thirty (30) days after Buyer’s
receipt thereof (or, in the case of any defects not reasonably susceptible of
discovery upon receipt of such goods, within thirty (30) days after discovery
thereof by Buyer).  SAD shall have no liability to Buyer with respect
to any such nonconformity which the Parties agree (or, absent such agreement,
which a mutually acceptable independent laboratory or consultant determines) (i)
was caused by information supplied by Buyer or due to a fault in materials
supplied by Buyer, (ii) was otherwise caused by Buyer or its agents, or
(iii) was caused after delivery thereof to the carrier at the point of
origin.  In all other cases, SAD shall promptly credit Buyer’s account
for SAD’s invoice price to Buyer of such nonconforming Active
Ingredient.  Additionally, if Buyer shall have previously paid for
such nonconforming Active Ingredient, SAD shall promptly, at Buyer’s election,
either (a) refund the invoice price thereof (b) offset the amount
thereof against other amounts then due SAD hereunder or (c) replace such
nonconforming Active Ingredient with conforming Active Ingredient at no
additional cost to Buyer (including replacement shipping costs).  THE
FOREGOING REMEDY CONSTITUTES THE EXCLUSIVE REMEDY AGAINST SAD AND THE ENTIRE
LIABILITY OF SAD IN CONNECTION WITH THE REJECTED SHIPMENT.  The fees
and expenses of any independent laboratory or consultant engaged by the Parties
for purposes of this section shall be paid by the Party which is determined to
bear responsibility for the nonconformity in question

     

    
      
        
          
            
              	 	
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    12.2       Recalls.

    

    (a)           Notices.  Each
Party shall notify the other of any information, whether received directly or
indirectly, which might affect the marketability, safety or effectiveness of
Product which was manufactured using Active Ingredient supplied by SAD hereunder
and/or which might result in the Recall or seizure of the Product which was
manufactured using Active Ingredient supplied by SAD hereunder. For purposes of
this Agreement, a “Recall” shall mean
any action: (i) by either Party to recover title to or possession of quantities
of the Product which was manufactured using Active Ingredient supplied by SAD
hereunder sold or shipped to Third Parties (including, without limitation, the
voluntary withdrawal of such Product which was manufactured using Active
Ingredient supplied by SAD hereunder from the market) or (ii) by any regulatory
authority to detain or destroy any of such Product which was manufactured using
Active Ingredient supplied by SAD hereunder. “Recall” shall also
include the election by either Party to refrain from selling or shipping
quantities of such Product which was manufactured using Active Ingredient
supplied by SAD hereunder to Third Parties that would have been subject to a
Recall if sold or shipped.

    

    (b)           Discretion.  Buyer
shall institute a Recall of the Product as a consequence of any defect that
Buyer deems sufficiently serious. Buyer shall consult with SAD regarding any
Recall of Product which was manufactured using Active Ingredient supplied by SAD
hereunder; provided, however, that Buyer
shall retain sole discretion whether to institute a Recall.  SAD shall
provide a rapid initial response and a full report with respect thereto within
thirty (30) calendar days of such notification.

    

    (c)           Responsibilities.  SAD
shall have no liability to Buyer with respect to any Recall which the Parties
agree (or, absent such agreement, which a mutually acceptable independent
laboratory or consultant determines) (i) was caused by information or materials
supplied by Buyer, (ii) was otherwise caused by Buyer or its agents,
(iii) was caused by factors occurring after delivery of the Active
Ingredient to the carrier at the point of origin, or (iv) did not result from a
breach of SAD’s warranties provided under Article 10 hereof.  In
addition, Buyer shall reimburse SAD for all reasonable out-of-pocket Third Party
costs and expenses incurred and not recovered by SAD directly resulting from
such Recall (subject to the limitations set forth in Section 15.2
hereof).

    
       

      
        
          
            
              
                	 	
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    (d)           SAD
Liability.  For all Recalls which result from a breach of SAD’s
warranties provided under Article 10 hereof, unless SAD does not have liability
pursuant to Section 12.2(c), SAD shall: (x) promptly credit Buyer’s account for
SAD’s invoice price to Buyer of the Active Ingredient used in such Recalled
Product; if Buyer shall have previously paid for such Active Ingredient, SAD
shall promptly, at Buyer’ election, either (A) refund the invoice price
thereof, or (B) offset the amount thereof against other amounts then due
SAD hereunder, or (C) replace such Active Ingredient at no additional cost
to Buyer (including shipping costs); and (y) reimburse Buyer for all reasonable
out-of-pocket Third Party costs and expenses incurred and not recovered by Buyer
directly resulting from such Recall (subject to the limitations set forth in
Section 15.2 hereof).

    

    (e)           Independent Laboratory
Costs.  The fees and expenses of any independent laboratory or
consultant engaged by the Parties for purposes of this Section 12.2 shall be
paid by the Party which is determined to bear responsibility for the Recall in
question.

    

    (f)           Limitation.  Notwithstanding
any other provision of this Agreement, the liability of SAD to reimburse Buyer
for Third Party costs and expenses pursuant to Section 12.2(d)(y) hereof related
to any Recall shall not exceed [REDACTED]in
respect of each such Recall.   The Parties shall, to the extent
possible, meet to review, in advance, actions and budgets for any Recall for
which SAD shall have financial responsibility to Buyer pursuant to this Section
12.2.

    

    12.3        Disposition of Nonconforming
or Recalled Product. Buyer shall not dispose of any damaged,
nonconforming or Recalled Product as to which it intends to assert a claim
against SAD without SAD’s written authorization to do so. Alternatively, SAD may
instruct Buyer to return such Product to SAD. SAD shall bear the cost of
disposition (as well as all applicable shipping costs) with respect to any
damaged, nonconforming or Recalled Product as to which it bears responsibility
under Section 12.1 or 12.2 hereof.

    

    ARTICLE
13

    INDEMNIFICATION

    

    13.1        By Buyer. Buyer shall
defend, indemnify and hold harmless SAD, its Affiliates and their respective
officers, directors, shareholders, employees, licensees, agents, successors and
assigns from and against any and all claims, demands, damages, judgments,
settlements and awards made by or asserted by Third Parties (collectively,
“Third Party
Claims”) (including, without limitation, those associated with a Recall)
which any of them may incur or become subject to arising out of or resulting
from (a) Buyer’s use, handling, distribution, marketing or sale of the
Active Ingredient or the Product (subject to Section 13.2 hereof), (b) the
breach by Buyer of any of its representations, warranties, covenants,
obligations, agreements or duties under this Agreement or (c) any claim
that the manufacture, use or sale of the Product infringes a patent or any other
proprietary rights; provided, however, that such
obligation to indemnify shall not extend to any Third Party Claim to the extent
they arise out of or resulting from any negligence, recklessness or wrongful
conduct by SAD or the breach by SAD of any of its representations, warranties,
covenants, obligations, agreements or duties under this Agreement.

    
       

      
        
          
            
              
                	 	
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    13.2        By SAD. SAD shall
defend, indemnify and hold harmless Buyer, its Affiliates and their respective
officers, directors, shareholders, employees, licensees, agents, successors and
assigns from and against any and all Third Party Claims which any of them may
incur or become subject to arising out of or resulting from (a) SAD’s negligent
acts or omissions or willful misconduct in connection with the performance of
the services contemplated by this Agreement, (b) the breach by SAD of any
of its representations, warranties, covenants, obligations, agreements or duties
under this Agreement, or (c) any claim that SAD’s manufacture, use or sale of
the Active Ingredient alone infringes a patent or any other proprietary rights;
provided, however, that such
obligation to indemnify shall not extend to any Third Party Claim to the extent
they arise out of or resulting from any negligence, recklessness or wrongful
conduct by Buyer or the breach by Buyer of any of its representations,
warranties, covenants, obligations, agreements or duties under this
Agreement.

     

    13.3         Procedure. Promptly
after learning of the occurrence of any event which may give rise to its rights
under the provisions of this Article 13, each indemnitee hereunder shall give
written notice of such matter to the indemnitor. The indemnitee shall cooperate
with the indemnitor in the negotiation, compromise and defense of any such
matter. The indemnitor shall have the right to be in charge of and control such
negotiations, compromise and defense and to select and manage counsel with
respect thereto, provided that the indemnitor shall promptly notify the
indemnitee of all developments in the matter.  In no event shall the
indemnitee compromise or settle any such matter without the prior written
consent of the indemnitor, who shall not be bound by any such compromise or
settlement absent its prior written consent, which consent shall not be
unreasonably withheld or delayed

    

    ARTICLE
14

    INSURANCE

    

    Each Party represents that it has and
shall maintain during the Term hereof, as well as after the expiration or
termination of this Agreement, sufficient insurance or an appropriate program of
self insurance, and in particular products liability insurance, with appropriate
policy limits to cover all risks associated with the performance of its
obligations under this Agreement.  Each Party agrees to provide upon
request copies of the relevant certificate(s) of insurance.

    

    ARTICLE
15

    LIMITATION OF
LIABILITY

    

    15.1         DISCLAIMER OF
WARRANTIES. THE WARRANTIES GIVEN BY SAD HEREUNDER ARE IN LIEU OF ALL
OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, AND ALL OTHER
WARRANTIES ARE HEREBY DISCLAIMED AND EXCLUDED BY SAD.

     

    
      
        
          
            
              
                
                  
                    	 	
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    15.2        DAMAGES. NO PARTY
SHALL BE LIABLE FOR ANY INCIDENTAL, INDIRECT, PUNITIVE, SPECIAL OR CONSEQUENTIAL
DAMAGES OF ANY KIND (INCLUDING, WITHOUT LIMITATION, LOST PROFITS AND LOSS OF
GOODWILL) ARISING FROM ANY BREACH OR ALLEGED BREACH OF THIS AGREEMENT (EVEN IF
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES).

    

    15.3        Remedies.  SAD’s
sole obligations, and Buyer’s sole and exclusive remedies, for any breach by SAD
of this Agreement related to nonconforming Active Ingredient or Recalled Product
shall be as set forth in Sections 12.1 and 12.2 hereof,
respectively.

    

    15.4        LIMITATION.  EXCEPT
FOR SAD’S INDEMNIFICATION OBLIGATIONS FOR THIRD PARTY CLAIMS, IN NO EVENT SHALL
SAD’S TOTAL AGGREGATE LIABILITY FOR ALL CLAIMS OR LOSSES ARISING OUT OF OR
RELATED TO THIS AGREEMENT EXCEED THE AMOUNTS PAID TO SAD HEREUNDER DURING THE
TWELVE (12) MONTH PERIOD IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO
LIABILITY.

    

    ARTICLE
16

    CONFIDENTIALITY

    

    16.1       Treatment of Confidential
Information. Except as otherwise provided in this Article 16, during
the Term and for a period of ten (10) years thereafter:

    

    
      	
               
      

            	
              (i)

            	
              SAD
      will retain in confidence and use only for the purposes contemplated
      hereby any Confidential Information disclosed to it by or on behalf of
      Buyer in connection with the performance of this Agreement;
      and

            

    

    

    
      	
               
      

            	
              (ii)

            	
              Buyer
      will retain in confidence and use only for the purposes contemplated
      hereby any Confidential Information disclosed to it by or on behalf of SAD
      in connection with the performance of this
  Agreement.

            

    

    

    16.2        Right to
Disclose.  To the extent it is reasonably necessary or
appropriate to fulfill its obligations or exercise its rights under this
Agreement or any rights which survive termination or expiration hereof, each
Party may disclose Confidential Information to its Affiliates, sublicensees,
consultants, outside contractors, clinical investigators or other Third Parties
on condition that such entities or persons agree (a) to keep the
Confidential Information confidential for the same time periods and to the same
extent as each Party is required to keep the Confidential Information
confidential and (b) to use the Confidential Information only for such
purposes as such Party is entitled to use the Confidential Information. Each
Party or its Affiliates or sublicensees may disclose such Confidential
Information to government or other regulatory authorities to the extent that
such disclosure (i) is reasonably necessary to obtain patents or
authorizations to conduct clinical trials with and to market commercially the
Product, provided such Party is otherwise entitled to engage in such activities
under this Agreement or (ii) is otherwise legally required.

    
       

      
        
          
            
              
                	 	
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    16.3         Confidentiality
Agreement. This Agreement contains the entire understanding of the
Parties with respect to the Confidential Information and supersedes the
Confidentiality Agreement entered into on September 26, 2008.

    

    16.4         Material Transfer
Agreement.  The Material Transfer Agreement executed by the
parties shall remain in effect.

    

    ARTICLE
17

    OWNERSHIP OF
PROPERTY

    

    17.1        Ownership of Rights.
Each Party shall exclusively own and retain all right, title and interest in and
to (i) all intellectual property rights, information, documents and tangible and
intangible materials owned by it as of the Effective Date, and (ii) all
Inventions which are conceived, reduced to practice, or created by such Party
and/or its Affiliates or agents (including without limitation Inventions based
upon any background or preexisting technology of such Party) and which do not
include any intellectual property rights of the other Party from and after the
Effective Date.   Each Party shall be solely responsible for the
conduct and costs of filing, prosecution and maintenance of patents and patent
applications on its own intellectual property rights, including without
limitation its Inventions.

    

    17.2        Trademarks. Buyer
shall retain all right, title and interest arising under the laws of the United
States and Israel and all other applicable laws in the trademarks of Buyer that
may be adopted with respect to the Product.

    

    ARTICLE
18

    FORCE
MAJEURE

    

    18.1         Effects of Force
Majeure. Neither Party shall be held liable or responsible for failure or
delay in fulfilling or performing any of its obligations under this Agreement
(other than the payment of money owed hereunder) to the extent that such failure
or delay results from any cause beyond its reasonable control, including,
without limitation, fire, flood, natural disaster, explosion, war, strike, labor
unrest, riot, embargo, acts or omissions of carriers, or act of God (each, a
“Force Majeure
Event”). Such excuse shall continue as long as the Force Majeure Event
continues, following which such Party shall promptly resume performance
hereunder.

    

    18.2         Effects of Regulatory
Changes. Neither Party shall be held responsible or liable for failure or
delay in fulfilling or performing any of its obligations under this Agreement to
the extent that such failure or delay results from good faith efforts to comply
with the enactment or revision of any law, rule, regulation or regulatory
advisory opinion or order applicable to the manufacturing, marketing, sale,
reimbursement and/or pricing of the Product (a “Regulatory Change”).
Such excuse shall continue as long as performance is prevented by the affected
Party’s good faith efforts to comply with such Regulatory Change, following
which such Party shall promptly resume performance hereunder.

    
       

      
        
          
            
              
                	 	
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    18.3         Notice. The Party
affected by a Force Majeure Event or a Regulatory Change shall notify the other
Party thereof as promptly as practicable after its occurrence. Such notice shall
describe the nature of such Force Majeure Event or Regulatory Change and the
extent and expected duration of the affected Party’s inability to fully perform
its obligations hereunder. The affected Party shall use due diligence, where
practicable, to minimize the effects of or end any such event so as to
facilitate the resumption of full performance hereunder and shall notify the
other Party when it is again fully able to perform such
obligations.

    

    ARTICLE
19

    INDEPENDENT
CONTRACTORS

    

    The relationship between Buyer and SAD
is that of independent contractors and nothing herein shall be deemed to
constitute the relationship of partners, joint venturers, nor of principal and
agent between Buyer and SAD. Neither Party shall have any express or implied
right or authority to assume or create any obligations on behalf of or in the
name of the other Party or to bind the other Party to any contract, agreement or
undertaking with any Third Party.

    

    ARTICLE
20

    MISCELLANEOUS

    

    20.1         General Notices.
Except as otherwise provided in Section 20.2 hereof, all notices, requests,
instructions, consents and other communications to be given pursuant to this
Agreement shall be in writing and shall be deemed received (i) on the same day
if delivered in person, by same-day courier or by facsimile transmission, (ii)
on the next day if delivered by overnight mail or courier, or (iii) on the date
indicated on the return receipt, or if there is no such receipt, on the third
calendar day (excluding Sundays) if delivered by certified or registered mail,
postage prepaid, to the Party for whom intended to the following
addresses:

    

    
      
        
          
            
              	
                      If
      to Buyer:

                    	 
      	 
      
	 
      	 
      	
                      ORAMED
      Ltd.

                    
	 
      	 
      	
                      HI-TECH
      PARK 2/5 GIVAT-RAM

                    
	 
      	 
      	
                      PO
      Box 39098, Jerusalem 91390, Israel

                    
	 
      	 
      	
                      Attention:
      CFO:  Yifat Zommer

                    
	 
      	 
      	
                      Email:
      yifat@oramed.com

                    
	 
      	 
      	
                      Facsimile:
      + 972 2 566 0004

                    
	 
      	 
      	 
      
	
                      If
      to SAD:

                    	 
      	 
      
	 
      	 
      	
                      SANOFI-AVENTIS
      DEUTSCHLAND GMBH

                    
	 
      	 
      	
                      Industriepark
      Hoechst, 65926

                    
	 
      	 
      	
                      Frankfurt
      am Main,
Germany

                    

            

          

        

      

    

    
      
        
           

          
            
              
                
                  
                    	 	
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                  With
      a copy to:

                	 	

                  sanofi-aventis
      US

                
	 
      	 
      	
                  55
      Corporate Drive

                
	 
      	 
      	
                  Bridgewater,
      NJ 08807

                
	 
      	 
      	
                  General
      Counsel

                
	 
      	 
      	
                  Facsimile:
      908-927-8636

                

        

      

    

     

    Each
Party may by written notice given to the other in accordance with this Agreement
change the address to which notices to such Party are to be
delivered.

    

    20.2         Special Notices. Each
Party shall notify the other by telephone as soon as practicable (with written
confirmation within three business days) upon its receipt of any technical
complaint or notice of adverse reaction; provided, however, that
notification of serious, new or unexpected experiences reported with increased
frequency shall be made immediately (but in any event not more than thirty-six
(36) hours after the notifying Party learns of such experiences). All such
notices shall be directed to the Parties at the addresses set forth in Section
20.1 to the attention of the following personnel:

    

    
      
        
          	
                  If
      to Buyer:

                	 
      
	 
      	 
      	 
      
	 
      	
                  Technical complaints: 

                	
                  Quality
      Assurance Specialist

                
	 
      	
                  Adverse
      reactions:

                	
                  Director
      of Product Surveillance

                
	 
      	 
      	 
      
	
                  If
      to SAD:

                	 
      
	 
      	 
      	 
      
	 
      	
                  Technical complaints: 

                	
                  Site
      Quality Manager

                
	 
      	
                  Adverse
      reactions:

                	
                  Site
      Quality Manager

                

        

      

    

    

    20.3         Entire Agreement.
This Agreement contains the entire understanding of the Parties with respect to
the subject matter hereof and supersedes all prior agreements and
understandings, whether written or oral, between them with respect to the
subject matter hereof. Each Party has executed this Agreement without reliance
upon any promise, representation or warranty other than those expressly set
forth herein.

    

    20.4         Amendment. No
amendment of this Agreement shall be effective unless embodied in a written
instrument executed by both of the Parties.

    

    20.5         Waiver of Breach. The
failure of either Party at any time to enforce any of the provisions of this
Agreement shall not be deemed or construed to be a waiver of any such provision,
nor in any way to affect the validity of this Agreement or any provisions hereof
or the right of any Party to thereafter enforce each and every provision of this
Agreement. No waiver of any breach of any of the provisions of this Agreement
shall be effective unless set forth in a written instrument executed by the
Party against whom or which enforcement of such waiver is sought; and no waiver
of any such breach shall be construed or deemed to be a waiver of any other or
subsequent breach.

    
       

      
        
          
            
              
                	 	
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    20.6         Neither
Party shall subcontract any of its obligations under this Agreement; provided, however, that (i)
either party may subcontract to a Third Party any of its obligations under this
Agreement with the prior written approval of the other Party, such approval not
to be unreasonably withheld, and (ii) SAD may subcontract any services to an
Affiliate, or otherwise if permitted in the Specifications or Packaging
Specifications, including without limitation the supply of materials and
components, or pursuant to Section 20.7 hereof.

    

    20.7         Assignment; Requirement to
Assign to Successor to Business.  Neither Party may assign its
rights under this Agreement in whole or in part without the prior written
approval of the other Party (such approval not to be unreasonably withheld or
delayed). Any such attempted assignment without such prior written consent shall
be void and ineffective. Notwithstanding the foregoing: SAD may, without the
other Party’s consent, assign its rights and delegate its duties under this
Agreement in whole or in part to any entity with which it merges or
consolidates, which acquires all or substantially all of its business and
assets, or which otherwise is or becomes an Affiliate of the assigning
Party;

    

    20.8         Governing Law. This
Agreement shall be governed by and construed in accordance with the laws of New
York, USA, without regard to any choice-of-law principle that would dictate the
application of the laws of another jurisdiction. Failing amicable agreement, all
disputes arising in connection with this Agreement shall be settled by the
courts of New York, New York, USA.

    

    20.9         Severability. All of
the provisions of this Agreement are intended to be distinct and
severable.  If any provision of this Agreement is or is declared to be
invalid or unenforceable in any jurisdiction, it shall be ineffective in such
jurisdiction only to the extent of such invalidity or
unenforceability.  Such invalidity or unenforceability shall not
affect either the balance of such provision, to the extent it is not invalid or
unenforceable, or the remaining provisions hereof, nor render invalid or
unenforceable such provision in any other jurisdiction.

     

    20.10       Publicity.  Nothing
in this Agreement shall be deemed to give either Party any rights to use the
other Party’s trademarks or trade names without the other Party's prior
specific, written consent.  The parties agree that except for what has
been provided for herein, neither party will issue any press release or
otherwise make any public statement, advertisement or disclosure with respect to
this Agreement or the transactions contemplated hereby without the prior written
consent of the other Party, which shall not be unreasonably
withheld.  The Parties agree that Exhibit 3 attached hereto represents
a mutually approved announcement and Form 8-K to be released and filed by Buyer
or its Affiliate with the Securities and Exchange Commission upon the full
execution of this Agreement.  In addition, if, in the opinion of the
disclosing Party’s legal counsel, any other announcement is necessary to comply
with applicable law, either Party shall be entitled to make a further public
announcement of this Agreement and/or file forms with the Securities and
Exchange Commission or other regulatory agencies, subject to the prior review
and approval of such press release and/or forms by the other Party or its
Affiliate, which approval will not be unreasonably withheld or
delayed.  In addition, if, in the opinion of Buyer's legal counsel
this Agreement must be filed with the Securities and Exchange Commission,
mutually agreed upon redacted versions of this Agreement may be exhibits to the
Form 8-K Current Report or a periodic report.  In addition, Buyer will
be entitled to make reference to this Agreement in reports filed with the
Securities and Exchange Commission, after providing SAD reasonable advance
notice and a reasonable opportunity to review and comment
thereon.  Finally, Buyer shall be allowed to insert the statement
"The recombinant human insulin
was sourced from Sanofi-Aventis Deutschland GmbH" without any
authorization from SAD in order to specify the SAD as the supplier of the
Active Ingredient only in peer-review papers and posters published
at scientific seminars when the Active Ingredient which was provided
by SAD is used for the studies that are the subjects of the
publication.

    
      
        
           

          
            
              
                
                  
                    	 	
                            MANUFACTURING
      AND SUPPLY AGREEMENT

                          	
                            PAGE
      19

                          

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    20.11       Survival. The
provisions of Article 4 (Cooperation with Governmental Requirements), Section
11.5 (Rights and Duties Upon Termination), Article 12 (Claims; Recalls), Article
13 (Indemnification), Article 14 (Insurance), Article 15 (Limitation of
Liability), Article 16 (Confidentiality), Article 17 (Ownership of Property), ,
Section 20.8 (Governing Law), Section 20.10 (Publicity) and Section 24.11
(Survival) shall survive the expiration or termination of this
Agreement.

    

    20.12       Headings. The
headings of articles and sections have been included for convenience only and
shall not be considered in interpreting this Agreement.

    

    20.13       Counterparts; Facsimile
Signatures. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original, and all of which together shall
constitute one and the same Agreement. This Agreement may be executed and
delivered via facsimile or other electronic means with the same force and effect
as if it were executed and delivered by the Parties simultaneously in the
presence of one another.

    

    20.14       Execution.  At
the time of execution of this Agreement, the Parties shall cause their
authorized officers to execute two original copies of this Agreement, one copy
of which shall be maintained by each Party at that Party’s offices. Each Party
represents that the person who executes this Agreement is authorized and
empowered to obligate and bind his or her Party under this
Agreement.

    

    20.15       Further Actions. The
Parties agree to execute such additional documents and / or agreements as may be
reasonably necessary to perfect the intentions of the provisions contained
herein.

    

    [Remainder
of this page intentionally left blank.]

    
      
        
           

          
            
              
                
                  
                    	 	
                            MANUFACTURING
      AND SUPPLY AGREEMENT

                          	
                            PAGE
      20

                          

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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

    

    ORAMED
LTD.

    

    
      
        
          
            
              
                
                  	
                          By:

                        	 
      	
                            
      

                        
	 
      	 
      	 
      
	
                          Name:

                        	 
      	
                           
      

                        
	 
      	 
      	 
      
	
                          Title:

                        	 
      	
                           
      

                        

                

              

            

          

        

      

    

    

    SANOFI-AVENTIS DEUTSCHLAND
GMBH

    

    
      
        
          
            
              
                	
                        By:

                      	 
      	
                         
      

                      
	 
      	 
      	 
      
	
                        Name:

                      	 
      	
                          
      

                      
	 
      	 
      	 
      
	
                        Title:

                      	 
      	
                          
      

                      

              

            

          

        

      

    

    
      
        
             

          
            
              
                
                  
                    	 	
                            MANUFACTURING
      AND SUPPLY AGREEMENT

                          	
                            PAGE
      21

                          

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Exhibit
1

     

    PACKAGING
SPECIFICATIONS

     

    SAD will
supply the Active Ingredient in packaging units of [REDACTED]
kilograms for a purchased quantity below [REDACTED]kg
and in packaging units of [REDACTED]kilograms
(standard preferred packaging unit) for a purchased quantity higher than [REDACTED]kilograms.

    

    The
following sizes* of stainless steel drums are utilized for packaging and
delivery:

    

                                    1[REDACTED][REDACTED]*
not factoring in the lid

    

    SAD shall
have the right, at its option, to deliver ordered quantities in one drum where
feasible.

    
      
         

        
          
            
              
                
                  	 	
                          MANUFACTURING
      AND SUPPLY AGREEMENT

                        	
                             
      

                        

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
      Exhibit
2

       

      ACTIVE
INGREDIENT SPECIFICATIONS

       

      [REDACTED]

        

      
        	 	
                MANUFACTURING
      AND SUPPLY AGREEMENT

              	
                   
      

              

      

        

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Exhibit
3

       

      Press
Release to be issued by Buyer

       

      [REDACTED]

         

      
        	 	
                MANUFACTURING
      AND SUPPLY AGREEMENT

              	
                   
      

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      Exhibit
4

      

      Territory

      

      [REDACTED]

         

      
        	 	
                MANUFACTURING
      AND SUPPLY AGREEMENTFACTORING
AGREEMENT

    ROSENTHAL
& ROSENTHAL, INC.

    1370
Broadway

    New
York NY 10018

    

    New York,
NY, July 7, 2010

    SOUTHPEAK
INTERACTIVE, L.L.C.

    2900 Polo
Parkway

    Midlothian,
VA 23113

    

    The
following is the Agreement under which we are to act as your sole
factor.  Capitalized terms shall have the meanings set forth in
Section 14 hereof:

    

    
      	
              1.

            	
              Sales
      and Assignment:

            

    

    

    You
hereby sell and assign to us, making us absolute owner thereof, all of your
Receivables, and we shall have the right to collect and otherwise deal therewith
as the sole and exclusive owner thereof. Upon each sale of your Inventory or
rendition by you of services, you shall execute and deliver to us such further
and confirmatory assignments of your Receivables as we require, in form and
manner satisfactory to us, together with copies of invoices or such equivalent
electronic document as we may designate for such use, and all shipping or
delivery receipts and such other proof of sale and delivery or performance as
we, from time to time, may require.  All invoices (and other
statements to Customers) evidencing Receivables shall clearly state, in a manner
satisfactory to us, that each Receivable has been sold and assigned to and is
payable only to us.

    

    
      	
              2.

            	
              Credit
      and Approval:

            

    

    

    You will
submit to us for our credit approval the principal terms of each and every
Order.  We may, in our sole discretion, approve all or a portion of an
Order, by issuing a Credit Approval, withdraw any Credit Approval, withdraw or
adjust any Credit Line, or suspend any Availability under a Credit Line, at any
time before you deliver the Inventory or render the services.  In
addition, we may from time to time establish a Credit Line or Credit Lines
pursuant to which you may ship to Customers. No Credit Approval, including
approval based upon shipment against Availability under a Credit Line shall be
effective unless (i) the Inventory is shipped or the services rendered, within
the time specified therein, or if no time is specified, within thirty (30) days
after the date our Credit Approval is issued or if the Credit Approval specifies
an outside date for delivery or shipment, by such delivery or shipment date;
(ii) the Customer has accepted delivery of the Inventory or performance of the
services; and (iii) a confirmatory assignment of the Receivables(s) which arise
as a result of the Order which is the subject of the Credit Approval has been
delivered to us, within ten (10) days of the delivery of the goods or the
performance of the service.  Upon the effectiveness of a Credit
Approval, we shall be deemed to have accepted the Credit Risk to the extent of
the dollar amount specified in the Credit Approval and the Receivable which is
the subject thereof shall, to the extent of the amount specified in the Credit
approval, be a Credit Approved Receivable.  In no event, however,
shall we have any Credit Risk on any Receivable for freight, samples, or sales
not made in the ordinary course of your business.  We may, in our sole
discretion, withdraw any Credit Approval, or withdraw or adjust any Credit Line,
at any time before you deliver the Inventory or render the
services.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
              3.

            	
              Client
      Risk Receivables:

            

    

    

    All CR
Receivables are with full recourse to you and at your credit risk, but are
otherwise subject to the covenants, terms and conditions provided herein with
respect to Credit Approved Receivables.  We shall have the right to
charge back to your account the amount of CR Receivables at any time either
before or after their maturity and you agree to pay us upon demand the amount
thereof to the extent it was previously the basis for any advances made by us to
you, together with all expenses including collection charges and attorneys’ fees
incurred by us in attempting to collect or enforce any such
payment.  In addition, if we, at your request, and in our discretion,
file a proof of claim in any insolvency proceeding with respect to a CR
Receivable and/or forward a CR Receivable to an attorney or agency for
collection, we shall charge your account with (i) the fees and expenses of such
attorney or collection agency and (ii) a service charge equal to $100 plus 5% of
any amount collected on the CR Receivable.

    

    
      	
              4.

            	
              Returned
      Merchandise/Claims, Disputes and
Chargebacks:

            

    

    

    In the
event of any material breach of any of the representations or warranties
contained herein with respect to a Receivable, or the assertion, with respect to
a Receivable, of a Dispute, or the payment of all or part of a Receivable by the
Customer obligated thereon, to a Person other than us, and any such Receivable
(whether or not a Credit Approved Receivable) shall thereupon become a CR
Receivable.  You shall notify us immediately of any Dispute,
including, a Customer’s return of or desire to return any Inventory purchased
from you.  We may, but are not obligated, to settle, compromise,
adjust or litigate any Dispute, including, a return of the related Inventory
upon such terms as we deem advisable.  We may, at our option, charge
back to you all amounts owing on CR Receivables which are not paid when
due.  We shall have the right to charge back to you the amount of any
payment which we receive with respect to a CR Receivable, if we are subsequently
required to disgorge such payment for any reason, including, such payment being
deemed a preferential transfer.  A chargeback shall not constitute a
resale or reassignment to you of the Receivable which is the subject
thereof.  You agree to indemnify and save us harmless from and against
any and all loss, liability, claim, cost and expense of any kind, caused by or
arising from any Disputes with or claims of your Customers or any Person or
representative thereof, asserting an interest in Receivables or payments
thereon, including:  (i) any disputes or claims with respect to terms,
price, quality or otherwise with respect to Receivables; (ii) any claim for a
return of any payments with respect to Receivables (including alleged
preferential transfers with respect to payments on Receivables that were not
Credit Approved Receivables at the time the payment was received); (iii) any
claims by any governmental authorities (federal, state, municipal or otherwise)
for the turnover or payment to such governmental authority of all or any portion
of any payment received from a Customer which we paid to you and (iv) all
collection expenses and attorney’s (whether in-house or outside) fees incurred
with respect to any of the foregoing.  Your liability under this
paragraph, and that of any Person liable for the Obligations, shall constitute
Obligations but shall nonetheless be independent hereof and continue
notwithstanding any termination hereof.

    

    
      	
              5.

            	
              Representations,
      Warranties and Covenants:

            

    

    

    You
represent, warrant and covenant that:

    

    5.1. you
are fully authorized to enter into this Agreement and perform hereunder and you
will continue to be so authorized for the duration of this
Agreement.

     

    5.2. you
are solvent.

     

    5.3. the
Receivables are, and shall be, at the time of their creation, bona fide,
existing and enforceable obligations of Customers arising out of sales made or
services rendered by you, free and clear of all security interests, liens,
claims and Disputes whatsoever other than Permitted Liens and in the event that
any such Receivables arise from the sale of good, such goods meet all standards
imposed by any governmental agency or authority.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    5.4. the
Inventory is not subject to any security interest, lien or encumbrance
whatsoever, other than Permitted Liens, and you covenant that (i) you shall not
permit the Inventory to become so encumbered without our prior written consent;
and (ii) the Inventory meets all standards imposed by any governmental agency or
authority.

     

    5.5. with
respect to each Receivable as it arises: (i) you will have delivered the
Inventory or rendered the services pursuant to the Order; (ii) the Customer will
accept the Inventory and/or services without any offset or counterclaim; (iii)
no known Dispute will exist in any respect; (iv) you will have preserved, and
will continue to preserve, any liens and any other rights available to us by
virtue of this Agreement; and (v) the Customer will not be your
Affiliate.

     

    5.6. you
will within ten days of our request therefor, provide us with copies of invoices
and shipping or delivery receipts or such equivalent electronic documents as we
may designate or other proof of sale and delivery or performance as we may from
time to time require.

     

    5.7. you
will not, without providing us with thirty (30) days prior written notice
thereof, change your name, your state of organization or your principal place of
business and you are not aware, and will upon your becoming aware, notify us
promptly, of any Person organizing under your name in another
state.

     

    5.8. (i)
you will keep all Inventory at any time owned by you insured under insurance
policies naming us as loss payee and otherwise acceptable to us as to form,
issuer, amount and risks covered; (ii) you shall make no disposition of the
any Inventory except for sales to Customers in the ordinary course of business;
(iii) until sale to a Customer, all Inventory shall be kept only at your
premises set forth above or at Ditan Distribution 909 Whitaker Road, Plainfield,
NJ 46168-7433, or at such other locations as we may approve in writing (it being
understood that any Ditan facility shall be acceptable to us provided you give
us reasonable prior notice thereof); and (iv) you shall from time to time
provide to us reports as to the Inventory owned by you, with such detail and
frequency as we shall require.

     

    5.9. you
do not transact business under any trade names or tradestyles except as set
forth on an Exhibit annexed hereto and with respect to any such tradename or
tradestyles you have (i) caused the same to be registered in accordance with the
laws applicable to the use of such tradenames or tradestyles and have not in any
way assigned or encumbered your interest in such tradenames or tradestyles; or
(ii) obtained a license to use such tradenames or tradestyles from the owner
thereof with respect to the goods or services sold by you under such tradenames
or tradestyles, and in the markets in which such goods or services are sold by
you; and you are not aware, and will upon your becoming aware, promptly notify
us, of any other Person using your name or any of your tradenames or tradestyles
in any similar line of business.

     

    5.10. you
are, and at all times during the term of this Agreement, shall be, duly
organized, existing and in good standing under the laws of the state of your
organization; and you are, and at all times during the term of this Agreement,
shall be, duly qualified, existing and in good standing in every state in which
the nature of your business requires you to be so qualified.

     

    5.11. to
the extent that any advances requested by you under this Agreement shall be used
for paying wages of your employees, you shall withhold and pay over to the
applicable tax authorities any amounts thereof as it shall be so required by
applicable law.

     

    

    
      	
              6.

            	
              Commissions
      and charges:

            

    

    

    6.1. For
our services hereunder, we shall receive a factoring commission (hereinafter
referred to as the “Base Commission”) of (i) 0.60% of the gross invoice amount
of each Receivable assigned to us; plus (ii) on those Receivables due from a
Customer (or any Affiliates or subsidiaries of such Customer) listed on the
Special Accounts Schedule submitted herewith and/or from time to time hereafter,
such percentage of the gross invoice amount thereof as equals the surcharge set
forth on the Special Accounts Schedule, to the extent of the amount credit
approved.  All commissions shall be due and payable and chargeable to
your account with us at the date a Receivable arises.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    6.2. Our
charge specified in Section 6.1 hereof is based upon maximum selling terms of 90
days for any Receivables due from Wal-Mart Stores, Inc., and 60 days for any
Receivables due from any other Customer, and no more extended terms or
additional dating shall be granted by you to any Customer without our prior
written approval.  If such approval is given by us, then for each
additional thirty (30) days or part thereof of such extended terms or additional
dating, our charge with respect to the Receivables covered thereby shall be
increased by an amount equal to the greater of (x) one quarter of one percent
(1/4 of 1%) of the invoice amount of such Receivable; or (y) twenty-five percent
(25%) of the charge specified in Section 6.1 hereof.  In addition, we
shall charge you a fee of $5.00 for each instance in which you change the terms
of sale of any Receivable after you have submitted to us a confirmatory
assignment schedule listing such Receivable.

     

    6.3. The
minimum aggregate Base Commission payable under this Agreement shall be
(i) $360,000 for the consecutive period from the Effective Date through
July 31, 2011, (ii) $210,000 for the consecutive 7 month period thereafter, and
(iii) $360,000 for each Contract Period thereafter, which shall be fully earned
by us at the beginning of each such period, and which to the extent of any
deficiency (after giving effect to the commissions paid under Section 6.1),
shall be chargeable to your account with us on a monthly basis (i.e., such
minimum commissions shall be charged to your account, if at all, each month in
an amount equal to the difference between (x) the product of (A) $30,000 and (B)
the number of months elapsed within the relevant period specified in the
foregoing clauses (i), (ii) and (iii) above, and (y) the cumulative period to
date commissions paid under Section 6.1 during such period).

     

    6.4. You
shall pay to us a closing fee payable on the Effective Date in the amount of
$50,000 due at the closing of this Agreement.

     

    

    
      	
              7.

            	
              Purchase
      Price; Interest Rate, Advances and
Reserves:

            

    

    

    7.1. The
purchase price for each Receivable shall be the invoice amount of the
Receivable, less (i) returns (whenever made); (ii) selling discounts, credits or
deductions of any kind allowed, granted to or taken by the Customer at any time;
and (iii) our commission provided for in Section 6 hereof.  No
discount, credit or allowance with respect to any Receivable shall be granted by
you, other than (provided no Default shall have occurred and be continuing) in
the ordinary course of business for discounts and allowances for slow moving
inventory, and no return of Inventory shall be accepted by you without our prior
written consent.  A discount, credit or allowance may be claimed only
by the Customer.  All amounts collected against the purchase price
shall be credited to your account on the Payment Date.

     

    7.2. In
our sole discretion, in accordance with the terms of this Agreement, we will,
from time to time at your request, advance to you, sums up to the lesser of (a)
65% of the aggregate Net Amount of Eligible Receivables outstanding at the time
any such advance is made less the Reserves, if any (the “Receivable
Availability”); and (b) $10,000,000 (the “Loan Cap”). In our sole discretion the
Loan Cap may be increased by an amount equal to the lesser of (i) an amount
equal to the ratio of two times any increase in your equity above the
shareholders’ equity reflected on your Financial Statement for the Fiscal
Quarter ended March 31, 2010 (in the determination of which, any of your debt
subordinated to us on terms satisfactory to us, shall be deemed stockholders
equity as opposed to a liability; or (ii) $3,000,000.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    7.3.  You
will pay to us interest on the daily balance of all monies, paid or otherwise
advanced to you or for your account net of all payments received from you or on
your behalf.  Interest upon the daily net balance of any monies
remitted, paid or otherwise advanced to or for your account before the Payment
Date (or interest applicable on the charges and expenses hereinabove or
hereinafter referred to) will be charged to you at a rate per annum equal to the
Interest Rate.  Interest will be charged to your account monthly in
arrears.  We may, in our sole discretion, and shall, upon your
request, remit to you, at any time, any amount standing to your credit on our
books.  Interest, as calculated above, will also be charged to you on
all other Obligations, except those specifying a different rate, from the date
incurred through the date paid. That portion of advances made by us to you which
is in excess of the Receivable Availability shall bear interest at the
Overadvance Rate.  Upon the occurrence of a Default, and for so long
as such Default continues, the Obligations shall, at our option, bear interest
at the Default Rate.  Interest shall be calculated on the basis of a
three-hundred-sixty (360) day year for the actual number of days
elapsed.  In no event shall any applicable interest rate under this
Agreement exceed the maximum rate permitted by applicable law and in the event
excess interest is paid, it shall be considered a repayment of
principal.

     

    7.4.
Where the cause of non-payment of a Credit Approved Receivable which has become
more than 120 days past due, is solely the Customer’s financial inability to
pay, then the Receivable, to the extent of the then effective Credit Approval,
shall be deemed to be collected if it is not otherwise subject to chargeback to
you under this Agreement

     

    

    
      	
              8.

            	
              Statement
      Of Account and Expenses:

            

    

    

    8.1. You
shall pay to us any Obligations upon demand. You hereby irrevocably authorize
and direct us to charge at any time to your account any Obligations owing to any
of our Affiliates by charging your account.

     

    8.2. We
will render a statement of account monthly to you, and such statement shall be
binding upon you, except for specific matters which you contest and of which we
are notified in writing to the contrary, within thirty (30) days after the date
of such statement.

     

    8.3. You
shall pay all reasonable expenses (including attorneys, both in-house and
outside, fees) incurred by us in connection with the preparation and execution
of this Agreement and any other documents or agreements in connection with or
related to this Agreement, and the relationship established in connection
herewith and/or the transactions contemplated hereby, including, expenses
incurred in connection with the filing of financing statements under the UCC and
the making of record searches.  We may also charge to your account any
fees, costs or other expenses we incur to eliminate or cure any lack of capacity
that we may now or hereafter have to maintain an action in the courts of any
state to enforce payment or Receivables due from Customers located in such state
by reason of your acts or omissions, including your failure to qualify as a
foreign entity in such state or any other failure on your part to observe the
laws of such state that are applicable to you or your assets. You shall also pay
to us such fees as we may charge from time to time for, among other things, wire
transfers, agings and special reports.  In connection with our
examinations of your books, records and operations you shall pay all of our
out-of-pocket expenses plus for each examiner the Standard Examiner’s Rate in
effect at the time of any such examination, provided that, as long as no Default
shall have occurred and be continuing we shall not conduct more than two such
examinations in any calendar year and you shall not be required to pay any
amounts therefor in excess of $7,500 per calendar year.  In connection
with our administration of this Agreement, our liquidation of any Collateral,
settlement of any Dispute, or enforcement of any Obligation, or our protecting,
preserving and enforcing our security  interests and rights hereunder,
whether through judicial proceedings or otherwise, or in defending or
prosecuting any actions or proceedings arising out of or relating to our
transactions with you, including actions or proceedings that may involve any
Person asserting a priority or claim with respect to the Collateral, all costs
and expenses incurred, including, attorneys’ (both in-house and outside) fees
incurred by us, shall be borne and paid for by you, and may, at our option, be
charged to your account with us.  Your reimbursement obligations
pursuant to this paragraph shall survive termination of this
Agreement.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    8.4. No
delay or failure on our part in exercising any right, privilege, or option
hereunder shall operate as a waiver of such or of any other right, privilege, or
option, and no waiver, amendment, or modification of any provision of this
Agreement shall be valid, unless in a writing signed by us and then only to the
extent therein stated.  Should any provision of this Agreement be
prohibited by or invalid under applicable law, the validity of the remaining
provisions shall not be affected thereby.  Unless otherwise
specifically provided in this Agreement, any notices, requests, demands or other
communications permitted or required to be given under this Agreement shall be
in writing and shall be sent by facsimile, hand delivery or by a nationally
recognized overnight delivery service, to the addresses and facsimile numbers of
the parties set forth below (or to such other address or facsimile number as a
party may hereafter designate by a notice to the other that complies with this
section) and shall be deemed given (a) in the case of a notice sent by
facsimile, when received by the recipient if the sending party receives a
confirmation of delivery from its own facsimile machine;  and (b) in
the case of a notice that is hand delivered or sent by such overnight courier,
when delivered (provided that the sending party retains a confirmation of
delivery).  Any notice which, pursuant to the terms hereof must be
sent by you by certified or registered mail shall be deemed given and effective
when received by us.

     

    
      	
              If
      to us

            	
              If
      to you

            
	
              Rosenthal
      & Rosenthal, Inc.

              1370
      Broadway

              New
      York NY 10018

              Attn:
      David Flaxman, Esq., with a copy to J. Michael Stanley

              Facsimile:
      (212) 356-0989

            	
              SouthPeak
      Interactive, L.L.C.

              2900
      Polo Parkway

              Midlothian,
      VA 23113

               

            
	 
      	 
      

    

    8.5 The
headings used herein are intended to be for convenience of reference only and
shall not define or limit the scope, extent or intent or otherwise affect the
meaning of any portion hereof.

     

    

    
      	
              9.

            	
              Payments:

            

    

    

    9.1. All
remittances obtained by you against Receivables will be received in trust for
us, and you will turn over to us the identical remittances as speedily as
possible; provided, however, that nothing herein authorizes you to collect
Receivables.  You constitute us, or any other entity or person whom we
may designate, as your attorney in fact at your own cost and expense to
exercise, at any time, all or any of the following powers which, being coupled
with an interest, shall be irrevocable until this Agreement has been terminated
and you have fully and indefeasibly paid and discharged all Obligations (a) to
sign and/or endorse your name on all remittances and all papers, bills of
lading, receipts, instruments and documents relating to the Receivables and the
transactions between us; (b) to deposit any checks or other remittances received
relating to the Receivables regardless of notations or conditions placed thereon
by your customers or deductions reflected thereby and to charge the amount of
any such deductions to your account; and (c) to sign your name to any and all
documents necessary to cure or eliminate any lack of capacity that we may now or
hereafter have, by reason of your acts or omissions, to maintain an action in
the courts of any state to enforce payment of Receivables due from Customers
located in such state and to file such documents with the appropriate public
officials or agencies.

     

    9.2. If
any payment or recovery is received from or on behalf of a Customer which is a
Customer on both Credit Approved Receivables and CR Receivables, any such
payment or recovery may be first applied to the Credit Approved Receivables
notwithstanding (i) any notation to the contrary on or with respect thereto;
(ii) the payment terms thereof; (iii) the due date thereof; or (iv) whether such
payments were made in the ordinary course of business or otherwise.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

    
      	
              10.

            	
              Security
      Interest; Financing Statements:

            

    

    

    10.1. To
secure all of the Obligations, you hereby grant to us a security interest in all
of your Accounts, Instruments, Chattel Paper, Documents, Investment property,
General Intangibles, Deposit Accounts, Letter of Credit Rights, Inventory,
property at any time in our possession, and the Reserves (whether or not any of
the foregoing are specifically assigned to us), in each case whether currently
owned or hereafter acquired by you and whether now existing or hereafter arising
(whether before, during the effectiveness of, or after the termination of this
Agreement) and wherever located, any security and guarantees therefor, in any
goods or property represented thereby, in all of your books and records relating
to the foregoing, and any equipment containing such books and records, in all
sums of money at any time to your credit with us, all of your present and future
claims against us under or in connection with this Agreement and in all
Proceeds. For the avoidance of doubt we shall have no interest in that certain
real property owned by you at 2301 Mustang Drive, Grapevine, Texas and 2563 SW
Grapevine Parkway, Grapevine Texas. Without in any way limiting the generality
of the foregoing, you further sell, and assign to us and grant to us a security
interest, in your rights as an unpaid vendor or lienor, all of your rights of
stoppage in transit, replevin and reclamation relating thereto, and all of your
rights against third parties with respect thereto.  You will cooperate
with us in exercising any rights with respect to any of the
foregoing.

     

    10.2. You
authorize us to file financing statements and any and all other documents that
may now or hereafter be provided for by the UCC to reflect and/or perfect any
security interest now or hereafter granted by you to us in any of your presently
owned or hereafter acquired property.  In the event that any
jurisdiction requires a debtor’s signature on such financing statements and/or
such other documents, you authorize us to file such financing statements and/or
other documents on your behalf as your attorney in fact, which such power being
coupled with an interest, shall be irrevocable until this Agreement has been
terminated and you have fully and indefeasibly paid and discharged all of the
Obligations.

     

    

    
      	
              11.

            	
              Books
      and Records/Financial Statements:

            

    

    

    We and
our representatives shall, at all reasonable times, have the right to examine
all of your books and records.  You agree to prepare and furnish to us
within sixty (60) days after the close of each of your fiscal quarters,
financial statements reviewed and in such form and detail as we may reasonably
require.  You also agree to have prepared, and to furnish to us within
ninety (90) days after the close of each of your fiscal years, financial
statements, in accordance with GAAP, which have been reviewed by an independent
certified public accountant satisfactory to us.

    

    
      	
              12.

            	
              Term:

            

    

    

    This
Agreement shall commence on the date hereof, shall continue for one Contract
Period and shall automatically renew at the end of each Contract Period for an
additional Contract Period.  Notwithstanding the foregoing, this
Agreement may be terminated (i) by us at any time, on not less than sixty (60)
days prior written notice to you; or (ii) by you, effective at the end of a
Contract Period provided you give us notice in writing, by registered or
certified mail, not less than thirty (30) days, and not more than sixty (60)
days prior to the expiration of the then effective Contract Period, of your
intention to terminate this Agreement as at the end of such Contract Period; or
(iii) by you, at any time, upon your written request to us to terminate this
Agreement effective as of the date set forth in such request provided that (x)
we in our sole discretion agree to such request and (y) you pay to us an Early
Termination Fee upon the effective date of such termination (unless your request
is solely based upon our having ceased making advances to you altogether such
that the amount of your outstanding Obligations to us has become
$0).  In the event of a Default, we shall have the right to terminate
this Agreement at any time without notice, and you shall owe us an Early
Termination Fee calculated as of the date of such termination. The Early
Termination Fee shall become automatically due and payable in the event a
petition is filed by or against you under any provision of Title 11 of the
United States Code. Our rights and the Obligations arising out of transactions
having their inception prior to the termination date shall not be affected by
any termination or notice thereof, nor shall any transaction which by its terms
survives termination.  Any receivable which is a Credit Approved
Receivable as of the date of Termination and in respect of which such Credit
Approval could not have been withdrawn by us pursuant to Section 2 hereof as of
such date of Termination shall remain a Credit Approved Receivable (except to
the extent a Dispute thereafter arises with respect thereto) notwithstanding
such Termination and our right and obligations in respect thereof shall survive
such Termination. Any other Receivable shall automatically become a CR
Receivable as of the date of such Termination. Termination of this Agreement
shall not become effective in respect of the liens and security interests
granted to us hereunder until you have fully and indefeasibly paid and
discharged all Obligations, and until such time, you shall continue to furnish
confirmatory assignments and  schedules of Receivables to us and
deliver and pay over to us all Proceeds in respect thereof.  After the
giving of any notice of termination hereunder and until the full liquidation of
your account and the indefeasible payment in full of all Obligations, you shall
not be entitled to receive any equities or payments from us, to the extent we
are obligated to make payments to you under this Agreement.  From and
after the effective date of termination, all amounts charged or chargeable to
your account hereunder, and all other Obligations, shall become immediately due
and payable without further notice or demand.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
              13.

            	
              Governing
      Laws/Jury Trial Waiver/Jurisdiction/Venue and Miscellaneous
      Provisions:

            

    

    

    This
Agreement is deemed made in the State of New York and shall be governed,
interpreted and construed in accordance with the laws of the State of New York,
applicable to contracts made and to be performed within such state. No
modification, waiver or discharge of this Agreement shall be binding upon us
unless in writing and signed by us.  Our failure, at any time, to
exercise any right or remedy hereunder, shall not constitute a waiver on our
part with respect to such right or remedy, nor shall such failure preclude us
from exercising the same or any other right or remedy at any subsequent
time.  If any taxes are imposed upon us, or if we shall be required to
withhold or pay any tax or penalty because of or in connection with any
transactions between us under this Agreement, you shall indemnify us and hold us
harmless in respect thereof.  This Agreement embodies our entire
agreement as to the subject matter hereof and supersedes all prior agreements
(whether oral or written) as to the subject matter hereof.  TRIAL BY JURY IS HEREBY WAIVED BY
EACH OF US IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF US
AGAINST THE OTHER ON ANY MATTERS WHATSOEVER ARISING OUT OF OR IN ANY WAY
CONNECTED WITH THIS AGREEMENT OR THE RELATIONSHIP CREATED HEREBY (WHETHER
SOUNDING IN TORT OR CONTRACT).  YOU HEREBY CONSENT TO THE EXCLUSIVE
JURISDICTION OF THE SUPREME COURT OF THE STATE OF NEW YORK (OR THE CIVIL COURT
OF THE CITY OF NEW YORK IF SUCH MATTERS BE WITHIN ITS JURISDICTION), AND OF ANY
FEDERAL COURT IN SUCH STATE, IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR
A DETERMINATION OF ANY DISPUTE AS TO ANY SUCH MATTERS.  IN CONNECTION
THEREWITH, YOU HEREBY WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS AND AGREE THAT SERVICE THEREOF MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL DIRECTED TO YOU AT YOUR ADDRESS SET FORTH ABOVE, OR SUCH OTHER ADDRESS AS
SHALL HAVE PREVIOUSLY BEEN COMMUNICATED TO US BY REGISTERED OR CERTIFIED
MAIL.  WITHIN THIRTY DAYS AFTER SUCH MAILING, YOU SHALL APPEAR OR
ANSWER TO SUCH SUMMONS, COMPLAINT OR OTHER PROCESS.  SHOULD YOU FAIL
TO APPEAR OR ANSWER WITHIN SAID THIRTY DAY PERIOD, YOU SHALL BE DEEMED IN
DEFAULT AND JUIDGMENT MAY BE ENTERED BY US AGAINST YOU FOR THE AMOUNT AS
DEMANDED IN ANY SUMMONS, COMPLAINT OR OTHER PROCESS SO
SERVED.  In the event we shall retain attorneys for the purpose
of enforcing the performance, payment or collection of any of the Obligations,
then and in that event you agree to pay the fees of such attorneys, plus any and
all expenses and disbursements incurred in connection therewith and/or
incidental thereto.  Our books and records shall be admissible as
prima facie evidence of the status of the account between us.  The use
of “including” or “include” means “including (or “include”), without
limitation.”  The use of “or” means “and/or” if the context so permits
or requires.  The term “satisfactory to us” as used herein shall mean
“satisfactory to us in our sole and absolute discretion”. You will not seek
advice or counsel from us or any of our representatives with respect to the
management or operation of your business and if you deem such advice or counsel
to have been offered, directly or indirectly, you will evaluate it and act or
decline to act upon it based upon your own analysis and/or the advice or counsel
of your own independent expert(s) or consultant(s).  You agree that
there is no fiduciary relationship between us or our representatives and you or
any other entity, affiliated or controlled by you, and that you will not seek or
attempt to establish any such fiduciary relationship.  You hereby
expressly waive any right to assert, now or in the future, that there was or is
a fiduciary relationship between you and us and/or our representatives in any
action, proceeding or claim for damages. If any provision of this Agreement
shall for any reason be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions hereof, and this
Agreement shall be construed as if such invalid or unenforceable provision had
never been contained herein.  This Agreement shall be binding upon and
inure to the benefit of each of us and our respective heirs, executors,
administrators, successors and assigns, provided, however, that you may not
assign this Agreement or your rights hereunder without our prior written
consent.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	
              14.

            	
              Definitions:

            

    

    

    As used
in this Agreement, these terms shall have the following meanings which shall be
applicable to both the singular and plural forms of such terms.

    

    “Accounts” shall have the
meaning set forth in Article 9 of the UCC.

    

    “Affiliate” of a Person shall
mean any entity controlling, controlled by, or under common control with, the
Person and the term “controlling” and such variations thereof shall mean
ownership of a majority of the voting power of a Person, or the contractual
power to control such Person’s affairs.

    

    “Agreement” shall mean this
Factoring Agreement, as amended, modified or supplemented.

    

    “Availability under a Credit
Line” shall mean the unused amount of a Credit Line, unless otherwise
suspended by us at any time (e.g., when Receivables due from the Customer under
a Credit Line are a certain number of days past due) and communicated to you in
writing or by such electronic means as may be designated by us to
you.

    

    “Bank” shall mean JPMorgan
Chase Bank or any successor thereto.

    

    “Base Commission” shall have the meaning
set forth in Section 6.1 hereof.

    

    “Business Day” shall mean a day
on which we and major banks in New York City are open for the regular
transaction of business.

    

    “Chattel Paper” shall have the
meaning set forth in Article 9 of the UCC.

    

    “Collateral” shall mean any
property or rights in property whenever arising which now or hereafter secure
any of the Obligations.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Contract Period” shall mean
(i) the consecutive 19 period following the last day of the month in which the
Effective Date falls; and  (ii) each consecutive 12 month period
thereafter.

    

    “Credit Approval” shall mean
either (i) a notice from us to you, in writing or by such electronic means as
may be designated by us, that we have approved all or a portion of an Order; or
(ii) Availability under a Credit Line.

    

    “Credit Approved Receivable”
shall mean a Receivable for which we have assumed the Credit Risk.

    

    “Credit Line” shall mean a line
of credit, established by us and communicated from time to time to you in
writing or by such electronic means as may be designated by us to you, granting
approval for sales by you, or rendition of services by you to a Customer, billed
at a specified location or locations, up to a specified aggregate available
amount.

    

     “Credit Risk” shall mean the
risk of loss resulting from a Customer’s failure to pay a Credit Approved
Receivable on the due date solely because of the Customer’s financial inability
to make such payment.

    

    “CR Receivable” shall mean any
Receivable which is not a Credit Approved Receivable.

    

    “Customer” shall mean any
Person obligated on a Receivable.

    

    “Default” shall mean the
occurrence of any of the following events: (1.) nonpayment when due of any
amount payable on any of the Obligations; (2.) failure to perform any agreement
or meet any obligation in this Agreement or in any agreement out of which any of
the Obligations arose (provided that to the extent that such an event or
occurrence consists of your failure to take, do or perform an act or action
other than making a payment to us when due, then such failure shall not
constitute a Default if no other Default has occurred and if such act or action
is taken, done or performed by you within 5 Business Days after your receipt of
written notice from us that the act or action is required to be taken, done or
performed by you and has not been taken, done or performed); (3.) breach or
failure to continue to be true and accurate in all material respects of any
covenants, representation, warranty or agreement whenever made by you to us,
whether pursuant to this Agreement or otherwise; (4.) default by you in
repayment, when due, of any indebtedness now or hereafter owed for monies
borrowed from anyone other than us (unless the Person to whom such payment is
owed has agreed to a subordination to us, on terms satisfactory to us, of all
such payments, and a standstill of all of their rights and remedies with respect
thereto, until such time as this Agreement has been terminated and the
Obligations to us have been indefeasibly paid in full); (5.) any statement, or
warranty of yours made orally or in writing or in any other writing in or in
connection with this Agreement or statement at any time furnished or made by you
to us is untrue in any respect as of the date furnished or made; (6.) suspension
of the operation of your business; (7.) any Obligor becomes insolvent or unable
to pay debts as they mature (provided that with respect to all of the Obligors
other than you and Terry Phillips, the foregoing shall be determined on a
consolidated basis), makes an assignment for the benefit of creditors, or a
proceeding is instituted by or against any Obligor alleging that such Obligor is
insolvent or unable to pay debts as they mature, or a petition under any
provision of Title 11 of the United States Code, as amended, is brought by or
against any Obligor; (8.) death of any Obligor who was a natural person, or
death or withdrawal of any partner of any Obligor which is a partnership, or
death or withdrawal of any member or any Obligor which is a limited liability
company, or dissolution, merger or consolidation of any Obligor which is a
corporation or limited liability company (unless, with respect to any of the
foregoing pertaining to the death of any individual, a replacement therefor
satisfactory to us is provided within 30 days, it being understood and agreed
that during such time, notwithstanding any requirement under the law or
otherwise that we exercise good faith in exercising our discretion to make
advances to you at any time, we shall not be required to make any advances to
you and shall not be subject to any such good faith requirements during such
time), (9.) sale, transfer or exchange, either directly or indirectly, of a
controlling interest resulting in a change of control in your membership or
Southpeak Interactive Corporation’s stock; (10.) termination or withdrawal of
any guaranty of the Obligations or failure of a Person who has executed such a
guaranty, to provide to us, no later than 5 days following the anniversary of
the Effective Date in each year, a financial statement, signed by such Person,
that is satisfactory to us as to form and that reflects, as of such anniversary
of such Effective Date, a tangible net worth that is not less than 75% of the
tangible net worth shown on the last financial statement provided to us by such
Person (provided that other than with respect to your equity and Terry Phillips’
tangible net worth, the foregoing shall be determined on a consolidated basis
for all other Obligors, and further provided that with respect to determining
your equity, any of your debt subordinated to us on terms satisfactory to us,
shall be excluded from your liabilities); (11.) appointment of a receiver for
any collateral pledged for the Obligations or for any of your property, or the
property of any Obligor, in which we have an interest; (12.) the Pension Benefit
Guaranty Corporation shall commence proceedings under Section 4042 of the
Employee Retirement Income Security Act of 1974 (ERISA) to terminate any of your
employee pension benefit plans; (13.) any litigation shall be commenced against
you that could reasonably be expected to have a material adverse effect on your
business; (14.) we, in good faith, deem the prospect of your payment or
performance of the Obligations to have been impaired; or (15.) we, in good
faith, deem ourselves insecure.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Default Rate” shall mean the
rate which is three percent (3%) per annum in excess of the Overadvance Rate
..

    

    “Deposit Account” shall have
the meaning set forth in Article 9 of the UCC

    

    “Deposit Date” shall mean with
respect to a payment of a Receivable from or on behalf of a Customer, (i) in the
case of a payment that is received by a banking institution and deposited into
our account with it (x) prior to 12:00 noon on any day the date such banking
institution makes such deposit into our account; (y) after 12:00 noon on any
day, the following Business Day; and (ii) in all other cases, the Business Day
following the date that the payment is actually received by us.

    

    “Dispute” shall
mean  (i) any dispute, claim, offset, defense, counterclaim or any
other reason (including, merchandise returns) or no reason for nonpayment of or
any refusal to pay all or a portion of any receivable other than a customer’s
financial inability to pay, regardless of whether the same is in an amount
greater than, equal to or less than the Receivable concerned, whether bona fide
or not, and regardless of whether the same, in part or whole, relates to an
unpaid Receivable or any other Receivable; and (ii) or the payment of all or
part of a Receivable by the Customer obligated thereon, to a Person other than
us, and an act of God, force majeure, the acts of restraint of public
authorities whether domestic or foreign, civil strife, war or currency
restrictions or fluctuations resulting in nonpayment of all or any portion of
any Receivable.

    

    “Documents” shall have the
meaning set forth in Article 9 of the UCC.

    

    “Effective Date” shall mean the
date specified on the upper right portion of the first page of this
Agreement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Early Termination Fee” shall
mean the amount that you and we agree will compensate us for the damages we will
sustain if this contract is terminated by you prior to the end of a Contract
Period or by us due to a Default by you or automatically as the result of the
filing by or against you of a petition under any provision of Title 11 of the
United States Code.  The Early Termination Fee, which you and we have
agreed represents a reasonable approximation of the amount of such damages (due
to the impossibility of calculating such amount in advance), shall be equal to,
whichever is greater, (i) 100% of the average of all fees and charges payable by
you to us under Sections 6.1, 6.2, 6.3,  and 7.3 of this Agreement
each month during the portion of the then current Contract Period that had
elapsed prior to the date of such termination or filing of such petition,
multiplied by the number of whole or partial calendar months remaining during
the unexpired portion of such Contract Period; or (ii) the minimum factoring
commission pursuant to Section 6.3 hereof, for the then current Contract Period
(less the amount of all commissions actually already paid by you pursuant to
such section during such Contract Period), it being understood that the Early
Termination Fee is in lieu of the payment of any minimum aggregate Base
Commission for the unexpired portion of the then current Contract
Period.

    

     “Eligible Receivables” shall
mean, at the time of the calculation thereof all Receivables less (i) any
Receivables subject to a Dispute, (ii) any CR Receivables, (iii) any Receivables
owing from a Customer whose total obligations to you exceed fifty percent (50%)
of all Eligible Receivables; and (iv) any Receivables which we in our sole
discretion deem not to be Eligible Receivables.

    

    “GAAP” shall mean generally
accepted accounting principles in the United States of America as in effect from
time to time as set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
the statements and pronouncements of the Financial Accounting Standards Board
which are applicable to the circumstances as of the date of the determination
consistently applied.

    

    “General Intangibles” shall
have the meaning set forth in Article 9 of the UCC (and shall include
tradenames, trademarks, tradestyles, service marks, copyrights and patents and
all your rights and claims against us hereunder or otherwise).

    

    “Guarantor” shall mean any
Person, other than you, liable primarily or secondarily, directly or indirectly,
on any of the Obligations.

    

    “Instruments” shall have the
meaning set forth in Article 9 of the UCC.

    

    “Interest Rate” shall mean the
greater of (i) the Prime Rate plus 1.5% per annum; or (ii) 6.5% per annum. Any
change in the Interest Rate shall be effective as of the date of any change in
the Prime Rate.

     

    “Inventory” shall have the
meaning set forth in Article 9 of the UCC.

    

    “Investment Property” shall
have the meaning set forth in Article 9 of the UCC.

    

     “Letter of Credit Rights” shall
have the meaning set forth in Article 9 of the UCC.

    

    "Net Amount of Eligible Receivables"
shall mean the Net Amount of Receivables for all Eligible
Receivables.

    

     “Net Amount of Receivables”
shall mean the gross amount of Receivables, less maximum discount, less returns,
less credits or allowances of any nature at any time issued, owing, granted or
outstanding, and less also our commission as set forth herein.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Obligations” shall mean all
obligations, advances, liabilities and indebtedness of you or your Affiliates to
us or any of our Affiliates, however evidenced, arising under this Agreement,
under any other or supplemental financing provided to you or an Affiliate, or
independent hereof or thereof, whether now existing or incurred from time to
time hereafter and whether before or after termination hereof, absolute or
contingent, joint or several, matured or unmatured, direct or indirect, primary
or secondary, liquidated or unliquidated, and whether arising directly or
indirectly or acquired from others (whether acquired outright, by assignment,
unconditionally or as collateral security from another and including,
participations or interest obligations to others), and including, all of our
charges, commissions, fees, interest, expenses, costs and attorneys’ fees
chargeable to you in connection therewith, and all of your obligations to us as
an indemnitor pursuant to the terms of this Agreement.

    

    “Obligor” shall mean you and
each other Person (including, any Guarantor or direct or indirect provider of
collateral) primarily or secondarily, directly or indirectly, liable on, or
providing collateral for, any of the Obligations.

    

    “Order” shall mean any purchase
order or equivalent document for the sale by you of goods or the rendition by
you of services.

    

    “Overadvance Rate” shall mean
the rate which is three percent (3%) per annum in excess of the Interest Rate as
adjusted pursuant to Section 7.3 hereof.

    

    “Payment Date” with respect to
a Receivable shall mean the date which is 5 Business Days after the Deposit Date
thereof.

    

    “Permitted Lien” shall mean (i)
security interests in certain assets of you in favor of your shareholders, who
currently have such security interests to secure the repayment of indebtedness
owned to them by you, which are currently in the aggregate principal amount of
$950,000 with agreements to increase such aggregate principal amounts to up to
$2,000,000, provided that such liens must be subordinated to any and all liens
now or hereafter in our favor and subject to a standstill of all remedies, and
the payment of such indebtedness must be subordinated to the payment of any and
all amounts now or hereafter owing to us, and (ii) any other lien or security
interest to which we have specifically consented in writing, subject to any
limitation set forth in such writing.

    

    “Person” shall mean any
individual, sole proprietorship, partnership, joint venture, trust,
non-registered organization, association, corporation, Limited Liability
Company, government or any subdivision, agency or political subdivision thereof
or any other entity.

    

    “Prime Rate” shall mean the
rate of interest from time to time publicly announced in New York City by the
Bank as its prime rate.  The Prime Rate may not be the lowest or best
rate charged by the Bank.

    

    “Proceeds” shall mean all
proceeds (as set forth in Article 9 of the UCC), products, rents and profits of
or from any and all of the Collateral and, to the extent not otherwise included
in the foregoing; (i) all payments under any insurance, indemnity, warranty or
guaranty with respect to any of the collateral, (ii) all payments in connection
with any requisition, condemnation, seizure or forfeiture with respect to any of
the Collateral, (iii) all claims and rights to recover for any past, present or
future infringement or dilution of or injury to any Collateral; and (iv) all
other amounts from time to time paid or payable under or with respect to any of
the Collateral, including licensing and royalty fees.

    

    “Receivable Availability” shall
have the meaning set forth in Section 7.2 hereof.

    

     “Receivables” shall mean all
Accounts, Instruments, Chattel Paper, Documents, Investment Property and General
Intangibles arising from your sales of Inventory or performance of services
(other than as a result of inter-company receivables, cash-in-advance payments
of receivables and amounts do to you for the licensing of any rights to third
parties), and the Proceeds thereof, and all Supporting Obligations, whether now
existing or hereafter created.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    “Reserves” shall mean any set
asides, reductions or reserves which we may establish, from time to time, in our
sole option and in our sole discretion in connection with any financial
accommodations which we may make available to you in connection with this
Agreement.

    

    “Special Account Schedule”
shall mean a schedule issued, from time to time, listing thereon surcharge
commissions applicable to Receivables owing from the Customers listed
thereon.

    

    “Standard Examiner Rate” shall
mean the per diem rate per examiner established by us from time to
time.  The Standard Examiner Rate on the date hereof is
$850.

    

    “Supporting Obligations” shall
have the meaning set forth in Article 9 of the UCC.

    

    “UCC” shall mean the Uniform
Commercial Code as the same may be in effect (subject to revision, from time to
time) in the State of New York.

    

    YOU
ACKNOWLEDGE THAT WE HAVE ADVISED YOU TO CONSULT WITH AN ATTORNEY PRIOR TO YOUR
EXECUTION OF THIS AGREEMENT.

    

    ROSENTHAL
& ROSENTHAL, INC.

    

    By:______________________

    Name: 
J. Michael
Stanley

    Title:   
Managing
Director

    

    

    AGREED:

    

    SOUTHPEAK
INTERACTIVE, L.L.C.

    

    
      	
              By: 

            	
              SOUTHPEAK
      INTERACTIVE CORPORATION, Sole
Member/Manager

            

    

    

    By:______________________

    Name:
Terry Phillips

    Title:
Chairman

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00175-of-00352.parquet"}]]