Research and Development Services Terms and Conditions

These RESEARCH AND DEVELOPMENT SERVICES TERMS AND CONDITIONS (the “Terms”) are applicable to any proposal or equivalent document issued by Phlow Corporation for its provision of certain research and development services (the “Proposal”). Phlow Corporation shall be referred to as “Supplier” throughout these Terms, while the party receiving and paying for such Services shall be referred to herein as “Company”. Company and Supplier may be referred to individually as a “Party” and collectively as the “Parties” throughout these Terms. These Terms shall constitute an integral part of the Proposal and shall be the only terms and conditions applicable thereto. Supplier hereby rejects any terms and conditions submitted by Company in any manner whatsoever different to the Terms contained herein.

Article 1 RESEARCH AND DEVELOPMENT SERVICES

1.1   Supplier shall provide the research and development services as specified in a Proposal signed by both Parties (“Services”) and attached The Terms together with the Proposal shall be referred to herein as the “Agreement”. Supplier shall perform all Services in accordance with the Agreement, including but not limited to, meeting all timelines, milestones, and other requirements as mutually agreed upon between the Parties. In addition to the foregoing, Supplier will furnish to Company such other reasonable assistance as is specifically and reasonably requested by Company from time to time; provided that such other requested services shall be approved in writing by Supplier.

1.2   Supplier shall cooperate with Company and shall promptly transfer the data, materials, and results of the Services to Company upon its completion or as otherwise specified under the applicable Proposal. Supplier will provide the written or oral reports as reasonably requested by Company relating to the status of the Services.

1.3   Supplier shall provide the Services through the assignment of its own personnel and the personnel of its Affiliated companies, if applicable. Supplier shall bear the costs of all of its personnel and Affiliates, if applicable, and all related operating expenses, including, but not limited to, salaries, benefits, facilities, and For the purposes of these Terms, “Affiliate” shall mean, with respect to either Party, all entities which, directly or indirectly, are controlled by, control or are under common control with such Party. For purposes of this definition, the word “control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, including through ownership of more than fifty percent (50%) of the voting shares or interest of an entity.

1.4   In addition to Company’s payment of Supplier’s fees for its performance of Services, Supplier shall charge Company the sourcing and handling fee set forth in the applicable Proposal for all supplies, materials, and services acquired from a third party specifically for or on behalf of Company to satisfactorily complete Services. Alternatively, if so noted on the applicable Proposal, Company shall supply the required materials to Supplier.

1.5   The Parties understand that there are inherent risks associated with the Services. Company will pay Supplier for Services performed in accordance with the applicable Proposal, even if any or all of such Services fail to meet Company’s specifications, unless such failure is attributable to Supplier’s material breach of the applicable Proposal, or Supplier’s gross negligence or willful misconduct in performance of such Services Supplier agrees to perform the Services, but nothing herein shall bind Supplier to any guarantees of success at any stage of Services, and absent a showing of gross negligence or willful misconduct, Supplier shall have no liability hereunder or otherwise for any failure to achieve the goals set out in the applicable Proposal.

ARTICLE 2 COMPANY’S OBLIGATIONS

2.1   Company will: (a) cooperate with Supplier in all matters relating to the Services; (b) respond promptly to any Supplier request to provide any direction, information, approval, authorization or decision reasonably necessary for Supplier to perform the Services; (c) provide such Company property, materials, documentation, formulations, API (as defined below), specifications and any other information Supplier may request to timely perform the Services and ensure such materials and information are accurate; and (d) obtain and maintain all necessary licenses and consents and comply with all Applicable Laws in relation to the “Applicable Law” shall mean the United States Food, Drug and Cosmetic Act together with any applicable United States Food and Drug Administration regulations, policies and guidelines promulgated thereunder and all other laws, regulations, rules and guidelines of any governmental authority in the United States of America and the country where the Product is manufactured (whether Federal, State, municipal or other) pertaining to the development, manufacture, packaging, labeling, storage, import, export, distribution, marketing, sale and/or intended use of the Active Pharmaceutical Ingredients (“API”) in unfinished form any other product manufactured by Supplier that is set forth on the Proposal to be mutually agreed upon between the Parties (“Product”). If Supplier’s performance is prevented or delayed by any act or omission of Company or its agents, subcontractors, consultants or employees, Supplier will not be in breach of this Agreement, or otherwise liable for any costs, charges or losses sustained or incurred by Company arising from such prevention or delay.

ARTICLE 3 PROPOSAL PRICE AND INVOICING

3.1   The prices that Company shall pay Supplier for its performance of Services pursuant to the Agreement shall be stated on the applicable Proposal in accordance with the rates, fees and or prices provided by Supplier in its proposal on a scope-by-scope basis. Notwithstanding anything herein to the contrary, price adjustments may be made by Supplier as mutually agreed upon between the Parties.

3.2   Supplier will invoice Company for the Services in accordance with the payment terms as mutually agreed upon between the Parties and as specified in the applicable Each invoice shall reference the Proposal to which the invoice relates, the rates and/or fees of the Services and any applicable quantity and price per unit of the materials, goods and/or Products provided. All pricing, invoicing and payments under this Agreement shall be in United States Dollars (USD $). Company shall pay the undisputed portions of a properly submitted invoice thirty (30) calendar days from Company’s receipt of such invoice. If any portion of an invoice is reasonably disputed, the Parties will use best efforts to reconcile the disputed amount as soon as practicable. Supplier shall promptly inform Company of its failure to pay any undisputed amounts of any invoice and if Company fails to pay such amount within fifteen (15) days of receipt of such notice, Supplier reserves the right to (a) charge interest on any such unpaid amounts at a rate of 1.5% per month, or, if lower, the maximum amount permitted under Applicable Law, from the date such payment was due until paid; (b) suspend or cease all Services (and any other obligations to Company hereunder) until payment has been made in full; and/or (c) terminate the Services in accordance with Section 8.1. Company shall be responsible for all taxes imposed on the provision of Services hereunder by any federal, state, or local governmental entity.

ARTICLE 4 REPRESENTATIONS AND WARRANTIES

4.1   Supplier represents and warrants, or covenants, as applicable, to Company that (a) it shall obtain and maintain necessary permits, registrations and licenses required to perform the Services as specified under the Proposal; (b) Supplier’s performance of the Services as contemplated hereunder will comply with this Agreement and Applicable Laws; (c) Supplier has the full power, right and authority to execute and deliver and to enter into this Agreement without the consent or approval of any third party; and (d) Supplier will perform its obligations contemplated hereunder with professional personnel, qualified to perform the process procedures consistent with the technical requirements of the Proposal; and none of Supplier personnel to be assigned to the Services have or shall have been subject to debarment under the United States Generic Drug Enforcement Act or any other penalty or sanction by United States Food and Drug Administration.

4.2   Company represents, warrants and covenants to Supplier that (a) Company is a corporation in good standing under the laws of the jurisdiction of its organization and authorized to do business wherever necessary to perform the Services; (b) Company has the full power and authority to execute and deliver this Agreement and perform its covenants, duties and obligations described herein without the consent or approval of any third party; (c) To the actual knowledge of Company, Company warrants that none of the Company materials and/or manufacturing formulation, processes, or methods or documentation provided by Company violates or infringes upon Intellectual Property Rights of any other natural person, corporation, unincorporated organization, partnership, association, joint stock company, joint venture, limited liability company, trust or government, or any agency or political subdivision of any government, or any other entity (collectively, “Person”); and (d) The Agreement is a valid, legal and binding obligation of Company, enforceable in accordance with these terms.

4.3   EXCEPT FOR THE EXPRESS REPRESENTATIONS AND WARRANTIES CONTAINED HEREIN, (A) NEITHER PARTY, NOR ANY OTHER PERSON ON THE PARTY’S BEHALF, HAS MADE OR MAKES ANY EXPRESS OR IMPLIED REPRESENTATION OR WARRANTY, EITHER ORAL OR WRITTEN, WHETHER ARISING BY LAW OR OTHERWISE, ALL OF WHICH ARE EXPRESSLY DISCLAIMED, INCLUDING BUT NOT LIMITED TO THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY EXPRESSLY DISCLAIMED AND (B) EACH PARTY ACKNOWLEDGES THAT IT HAS NOT RELIED UPON ANY REPRESENTATION OR WARRANTY MADE BY THE OTHER PARTY, OR ANY OTHER PERSON ON THE PARTY’S BEHALF, EXCEPT AS SPECIFICALLY PROVIDED IN THE TERMS HEREOF. WITH RESPECT TO THE SERVICES, COMPANY ACKNOWLEDGES THAT THE POTENTIAL OUTCOMES AND RESULTS OF ANY SUCH SERVICES ARE INHERENTLY UNKNOWN, THERE ARE INHERENT RISKS TO SUCH SERVICES, AND SUPPLIER HAS MADE NO PROMISE, COMMITMENT, GUARANTEE, WARRANTY OR OTHER ASSURANCE OF ANY POSITIVE OR BENEFICIAL RESULTS FROM ANY SERVICES.

ARTICLE 5 INDEMNIFICATION

5.1   Supplier shall indemnify, defend and hold harmless Company, its Affiliates and their respective employees, servants and agents (“Company Indemnitees”) against any and all claims, losses, damages and liabilities, and other expenses, including reasonable attorney’s fees, that arise out of or result from (a) the breach of a representation, warranty or covenant hereunder by Supplier or (c) any grossly negligent or intentionally wrongful act or omission by Supplier in connection with its performance of the Services hereunder.

5.2   Company shall indemnify, defend and hold Supplier, its Affiliates and their respective officers, directors, employees and agents (“Supplier Indemnitees”) harmless against all claims, losses, damages, liabilities and other expenses, including reasonable attorneys’ fees, that arise or result from (a) the breach of any representation, warranty or covenant hereunder by Company, (b) any grossly negligence or intentionally wrongful act or omission in the in the design or development of the Product; and (c) Company’s failure to fully conform to all Applicable Laws which affect the Products, their use, or any part thereof.

5.3   Any person that intends to claim indemnification under Sections 5.1, 5.2 or 5.4 (the “Indemnitee”) hereof shall as soon as practicable notify the indemnifying Party (the “Indemnitor”) in writing of any claim, lawsuit or other action in respect of which the Indemnitee, or any of its directors, officers, employees, agents and Affiliates intend to claim such indemnification. The Indemnitor shall have the right to control the defense or settlement of such claim, lawsuit or other action with counsel of its choice. The Indemnitor shall not be responsible for any legal fees or other costs incurred other than as provided herein. The Indemnitor shall not have indemnification obligations with respect to any claim or demand which is settled by the Indemnitee without the prior written consent of the Indemnitor. The Indemnitee shall cooperate fully with the Indemnitor and its legal representatives in the investigation and defense of any claim, lawsuit or other action covered by this indemnification, including, without limitation, upon reasonable notice, by having any of its employees, officers, directors, agents and other representatives testify when necessary, and on reasonable notice making available to Company as necessary all relevant records, specimens, samples and other information in its possession. The Indemnitee shall have the right, but not the obligation, to be represented by counsel of its own selection and at its own expense.

5.4   EXCEPT FOR LIABILITY FOR INDEMNIFICATION, INFRINGEMENT, LIABILITY FOR BREACH OF CONFIDENTIALITY OR FRAUD, IN NO EVENT WILL EITHER PARTY BE LIABLE UNDER THE PROPOSAL AND/OR THESE TERMS TO THE OTHER PARTY FOR CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, PUNITIVE OR ENHANCED DAMAGES, ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH, SERVICES, REGARDLESS OF (A) WHETHER THE DAMAGES WERE FORESEEABLE, (B) WHETHER OR NOT IT WAS ADVISED OF THE POSSIBILITY OF THE DAMAGES, AND (C) THE LEGAL OR EQUITABLE THEORY (CONTRACT, TORT OR OTHERWISE) UPON WHICH THE CLAIM IS BASED. NOTWITHSTANDING ANY OTHER PROVISION CONTAINED TO THE CONTRARY HEREIN, SUPPLIER’S TOTAL CUMULATIVE LIABILITY ARISING OUT OF OR RELATED TO THE PERFORMANCE OR NON-PERFORMANCE OF THE SERVICES, WHETHER UNDER CONTRACT OR AT LAW, UNDER STRICT LIABILITY OR NEGLIGENCE IN ANY FORM, WHETHER TERMINATED OR NOT, SHALL BE LIMITED TO THE APPLICABLE TOTAL PROPOSAL VALUE AND COMPANY SHALL INDEMNIFY SUPPLIER FROM ALL AMOUNTS AND LIABILITY IN EXCESS OF THE STATED LIMITATION.

ARTICLE 6 CONFIDENTIALITY

6.1   The information shared under this Agreement is confidential information subject to the Confidentiality and Non-Disclosure Agreement between the Parties as referenced in the Proposal attached hereto.

ARTICLE 7 INTELLECTUAL PROPERTY

7.1   “Intellectual Property Rights” shall mean all intellectual property and proprietary rights of any nature or kind, anywhere in the world, whether protected, created or arising under any Applicable Law, and all worldwide common law, statutory, and other rights in, arising out of, or associated therewith, including the trademarks, service marks, trade dress, logos, copyrights, rights of authorship, inventions, patents, rights of inventorship, moral rights, rights of publicity and privacy, trade secrets, whether or not such rights are registered or perfected, the rights under unfair competition and unfair trade practices laws, and all other intellectual and industrial property rights related thereto.

7.2   Nothing in this Agreement shall affect the ownership of any works, inventions, discoveries, ideas, processes, formulas, source and object codes, data, programs, know-how, developments, designs, techniques and improvements, and other intellectual property that were conceived, written, created, made, learned, reduced to practice, discovered, developed or generated by the applicable party, whether alone or jointly with others, prior to the effective date of the Proposal (collectively, “Background Technology”), and all Intellectual Property Rights

7.3   Expressly excluding any Confidential Information of Supplier and Supplier’s Background Technology, Company will own (a) all data and written reports arising out of the Services and all chemical entities supplied by Company or prepared for Company in accordance with this Agreement, and (b) any patent or other Intellectual Property Rights resulting from the performance of the Services related to the Products using any information supplied by or on behalf of Company to Supplier, or indicated as a deliverable in the Supplier shall assign and hereby assigns and conveys to Company from the moment of creation all of Supplier’s right, title and interest in and to all information and data relating to the Products, including but not limited to formulae, methods of manufacture, product descriptions, test methods, validation of test methods, specifications, and all other supporting documentation, data and reports developed or acquired by Supplier or its Affiliates during the term hereof in connection with the Services, including all enhancements, improvements and derivatives thereof, and to all Intellectual Property Rights therein; provided, however, that Supplier shall own, and continue to own and possess, all right, title and interest in and to Supplier Background Technology that may be contained in therein.

ARTICLE 8 TERMINATION

8.1   Either Party may terminate the Services thirty (30) days after the non-breaching Party provides notice to the breaching Party of its material breach of this Agreement, unless the breaching Party cures such breach before the expiry of the aforementioned thirty (30) day period; or Supplier may terminate the Services for Company’s non-payment of any undisputed portion of a properly submitted invoice fifteen (15) days from Supplier’s notice of such failure to pay. If either Party shall (a) become bankrupt or insolvent, (b) file for a petition thereof, (c) make an assignment for the benefit of creditors, or (d) have a receiver appointed for its assets, which appointment shall not be vacated within sixty (60) days after the filing, then the other Party shall be entitled to terminate the Services forthwith by written notice to such Party.

8.2   The Services may be terminated by either Party, upon thirty (30) days’ prior written notice, in the event of the other Party’s inability to substantially perform its obligations hereunder for more than thirty (60) consecutive days due to an event of Force Majeure (as defined below). Such termination shall be treated as a termination for convenience and Supplier shall be compensated by Company in accordance with Section 4 below.

8.3   In the event of termination (a) Supplier shall stop its performance of the Services and (b) each Party shall return to the other Party all such other Party’s Property (including Confidential Information) in its possession, except to the extent required to be retained by law or to comply with such Party’s continuing obligations hereunder.

8.4   If either Party terminates the Services and/or this Agreement for its convenience, Company shall pay Supplier for any unpaid amounts owed to Supplier prior to such termination, the rates and/or fees specified in the applicable Proposal for any Services performed prior to such termination, the price for any materials, goods and/or Products ordered and/or utilized by Supplier pursuant to its performance of the Services prior to such termination and all direct and documented costs incurred by Supplier due to such

8.5   If Company terminates the Services due to Supplier’s default as described under Section 1, Company shall pay Supplier the amounts owed to Supplier prior to such termination, for all Services in progress prior to the date of termination and for any materials, goods and/or products ordered and/or utilized by Supplier pursuant to its performance of the R& Services prior to such termination.

ARTICLE 9 MISCELLANEOUS

9.1   All notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered by messenger or courier service, sent by facsimile (with confirmation received of recipient’s number) to the number set forth in the Proposal, or mailed by registered or certified mail (postage prepaid), return receipt requested, or delivered by overnight delivery service, addressed to the Party’s relevant contact information provided in the Proposal. Each such notice shall be deemed delivered (a) on the date delivered if by personal delivery (including by an overnight delivery service, with proof of delivery), (b) on the date telecommunicated if by facsimile (with confirmation of receipt), and (c) on the date upon which the return receipt is signed or delivery is refused, as the case may be, if mailed. Either Party may change the information provided in any Proposal by providing written notice to the other Party.

9.2   The inability of any Party to commence or complete its obligations hereunder by the dates herein required resulting from delays caused by strikes, insurrection, acts of God, war, acts of terror, emergencies, or other causes beyond the Party’s reasonable control (“Force Majeure”) which shall have been timely communicated to the other Party, shall extend the period for the performance of the obligations for the period equal to the period(s) of any such delay(s) and shall not be cause for termination; provided, that such Party shall continue to perform to the extent reasonably If such Force Majeure shall continue for a period of thirty (30) consecutive days, the Party that is not subject to the Force Majeure event shall have the right to terminate the Services and this Agreement, pursuant to Section 8.2.

9.3   Each Party shall obtain and keep in force during the duration of the Services to be provided hereunder general liability insurance with a well-established insurance carrier that generally does business in the United States of America and is reasonably acceptable to the other Party for all claims in an amount of not less than $10,000,000 USD combined single limit per year. Each Party shall have the right to request from the other Party certificates of insurance and shall require at least thirty (30) days written notice to such Party prior to any cancellation, nonrenewal or material change in coverage.

9.4   Neither Party may assign or transfer its rights and obligations under this Agreement without the express written consent of the other Party, which consent may be withheld or given in the other Party’s sole reasonable discretion; provided, however, that this Agreement may be assigned to a successor in interest of substantially all of the assets of a Party, by way of merger, consolidation or asset purchase if the successor in interest agrees in writing to be bound by the Terms. Any permitted assignment shall not relieve the assigning Party of any of its obligations herein and the assigning Party shall be liable for any failure of its assignee to comply with the Terms Subject to the foregoing, these Terms shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns.

9.5   Any representation, warranty, covenant, term or condition contained herein which may legally be waived, may be waived, or the time of performance thereof extended, at any time by the Party hereto entitled to the benefit as evidence in writing. No failure by any Party to take any action against any breach or default by another Party shall constitute a waiver of the former Party’s right to enforce any provision hereof or to take action against such breach or default of any subsequent breach or default by such other Party.

9.6   This Agreement and attachments hereto and made a part hereof, contain every obligation and understanding between the Parties relating to the subject hereof and merges all prior discussions, negotiations and agreements, if any, between them, and none of the Parties shall be bound by any conditions, definitions, understandings, warranties or representations other than as expressly provided or referred to herein.

9.7   In the event that any one or more of the provisions contained herein shall be declared invalid, void or unenforceable, the reminder of the provisions of this Agreement shall remain in full force and effect, and such invalid, void or unenforceable provision shall be interpreted in such country in a manner which accomplishes, to the extent possible, the original purpose of such provision.

9.8   The termination of the Services shall not relieve Company of its obligation to pay any payments due to Supplier under this Agreement which have accrued prior to the effective date of such termination. Notwithstanding anything to the contrary that may be contained herein, in the event of the termination of the Services, the provisions of Sections 4 – 9 and any other clauses which is implied to survive the termination thereof, shall survive and continue in full force and effect.

9.9   The Agreement shall not constitute or be construed as creating a partnership or joint venture between Company and Supplier, and neither Party shall be liable for any debts or obligations of the other Neither Party shall in any way be considered as being an agent or Representative of the other Party in any dealings with any third party, and neither Party may act for, nor bind, the other Party in any such dealings.

9.10   Neither Party may use the name of the other Party for any advertisement, publicity or any other reason unless such use has been approved in writing by the other Party prior to use or

9.11   This Agreement shall be governed by and shall be construed in accordance with the law of the State of New York.

9.12   Any dispute, controversies, or difference which may arise between the Parties hereto, out of or in relation to or in connection with this Agreement, or for the breach thereof, shall be amicably solved by both Parties If the Parties hereto fail to do so, then such matter shall be finally settled under the Rules of Arbitration of the American Arbitration Association (“AAA”), by a single arbitrator appointed in accordance with said Rules. The arbitration shall be conducted in English. Such arbitration shall be held in New York, New York. The fees and expenses of the arbitrator and AAA administrative expenses shall be split equally between the Parties; provided that the arbitrator shall apportion such fees and expenses (and the reasonable expenses of the successful Party) pro rata in proportion to the success of each Party in the arbitrator’s final ruling. Judgment upon the award may be entered into any court having jurisdiction, or application may be made to such court for a judicial acceptance of the award and an order of enforcement, as the case may be. The provisions of this provision shall not apply in the event any claim for which the remedy sought is an injunction or other equitable relief, in which event the parties may bring a claim in any court of competent jurisdiction.