Exhibit 10.1

CONFIDENTIAL TREATMENT REQUEST – EDITED COPY

 

*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Manufacturing Services Agreement

(the “Agreement”)

﻿

 

 

by and between

 

 

Lonza Sales Ltd

Münchensteinerstrasse 38

CH-4002 Basel

Switzerland

 

 

﻿

 

-hereinafter “Lonza”-

and

 

 

SciClone Pharmaceuticals International Ltd.

Ugland House

South Church Street

George Town, Grand Cayman

Cayman Islands

 

 

﻿

 

-hereinafter “Customer”-

Effective as of April 30, 2014 (the “Effective Date”)

 

 

﻿

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

﻿

﻿

 

 

 

A.

Table of Contents

 

Page

﻿

 

 

1

Definitions and Interpretation

1 

2

Performance of Services

7 

3

Project Management/Steering Committee

8 

4

Quality

9 

5

Insurance

9 

6

Forecasting, Ordering and Cancellation

9 

7

Deliver and Acceptance

12 

8

Price and Payment

13 

9

Capital Equipment

14 

10

Intellectual Property

14 

11

Warranties

16 

12

Indemnification and Liability

16 

13

Confidentiality

17 

14

Term and Termination

19 

15

Force Majeure

20 

16

Public and Commercial Anti-Bribery and

 

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Anti-Corruption Representations and Warranties

21 

17

Miscellaneous

21 

APPENDIX A

 

24 

APPENDIX B

 

25 

APPENDIX C

 

26 

APPENDIX D

 

27 

APPENDIX E

 

28 

﻿

 

 

 

 

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Recitals

WHEREAS, Customer is engaged in the research, development and sale of certain
products and requires assistance in the development and manufacture of product;

WHEREAS, Lonza and its Affiliates have expertise in the evaluation, development
and manufacture of products;

WHEREAS, Lonza and Customer have previously entered into that certain
Manufacturing Supply Agreement, dated December 31, 2006, as amended (the “2006
Manufacturing Services Agreement”), pursuant to which Lonza has provided certain
services relating to the development and manufacture of Thymosin Alpha 1;

WHEREAS, Customer wishes to engage Lonza for Services relating to the
development and manufacture of the Product as described in this Agreement,
involving a new Manufacturing Process (as defined below) which had been
developed under that certain Feasibility Agreement dated as of March 16, 2011 by
and between Customer and Lonza Ltd. (the “Feasibility Agreement”); and

WHEREAS, Lonza, or its Affiliate, is prepared to perform such Services for
Customer on the terms and subject to the conditions set out herein.

NOW, THEREFORE, in consideration of the mutual promises contained herein, and
for other good and valuable consideration, the parties intending to be legally
bound, and intending to supersede and replace in its entirety, excepting any
obligations previously incurred thereunder, the 2006 Manufacturing Services
Agreement, agree as follows:

1

Definitions and Interpretation

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“Affiliate”

means any company, partnership or other entity

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which directly or indirectly Controls, is Controlled by

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or is under common Control with the relevant Party.

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“Control” means the ownership of more than fifty

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percent (50%) of the issued share capital or the

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legal power to direct or cause the direction of the

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general management and policies of the relevant

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Party.

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“Agreement”

means this agreement incorporating all

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Appendices, as amended from time to time by

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written agreement of the Parties.

﻿

 

1

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

“Applicable Laws”

means all relevant U.S. and European Union

﻿

federal, state and local laws, statutes, rules, and

﻿

regulations which are applicable to a Party’s

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activities hereunder, including, without limitation,

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the applicable regulations and guidelines of any

﻿

Governmental Authority and all applicable cGMP

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together with amendments thereto.

“Background Intellectual Property”

Means any Intellectual Property either (i) owned or

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controlled by a Party prior to the Effective Date or

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(ii) developed or acquired by a Party independently

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from the performance of the Services hereunder

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during the Term of this Agreement.

“Batch”

means the Product derived from [***] of the

﻿

Manufacturing Process.

“Batch Price”

means the Price of each Batch.

“Campaign”

means a series of no less than [***] cGMP Batches

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manufactured consecutively.

“Cancellation Fee”

has the meaning given in Clause 6.6.

“Capital Equipment”

means those certain pieces of equipment described

﻿

in the Project Plan used to produce the Product that

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are purchased by Customer or for which Customer

﻿

reimburses Lonza, including, without limitation, the

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related documentation regarding the design,

﻿

validation, operation, calibration and maintenance

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of such equipment.

﻿

 

“Certificate of Analysis”

means a document prepared by Lonza listing tests

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performed by Lonza or approved External

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Laboratories, the Specifications and test results.

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“cGMP”

means those laws and regulations applicable in the

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U.S. and Europe, relating to the manufacture of

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medicinal products for human use, including,

2

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

﻿

without limitation, current good manufacturing

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practices as specified in the ICH guidelines,

﻿

including without limitation, ICH Q7A “ICH Good

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Manufacturing Practice Guide for Active

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Pharmaceutical Ingredients”, US Federal Food

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Drug and Cosmetic Act at 21 CFR (Chapters 210,

﻿

211, 600 and 610) and the Guide to Good

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Manufacturing Practices for Medicinal Products as

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promulgated under European Directive

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91/356/EEC.  For the avoidance of doubt, Lonza’s

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operational quality standards are defined in internal

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cGMP policy documents.

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“cGMP Batches”

means any Batches which are required under the

﻿

Project Plan to be manufactured in accordance with

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cGMP.

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“Change”

means any change to the Services, pricing or

﻿

Scope of Work incorporated into a written

﻿

amendment to the Agreement in accordance with

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Clause 17.2 or effected in accordance with the

﻿

Quality Agreement.

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“Commencement Date”

means the date of commencement of

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manufacturing activities for a Batch or a series of

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related Batches hereunder.

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“Confidential Information”

means Customer Information and Lonza

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Information, as the context requires.

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“Customer Information”

means all technical and other information not

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known to Lonza or in the public domain relating to

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the Product, from time to time supplied by the

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Customer to Lonza, including any materials

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supplied by Customer to Lonza in accordance with

﻿

the Project Plan.

﻿

 

3

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

“Customer Materials”

means any Raw Materials, components of Product,

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or other materials of any nature provided by

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Customer.

﻿

 

“EMA”

means the European Medicines Agency, or any

﻿

successor agency thereto.

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“External Laboratories”

means any Third Party instructed by Lonza, with

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Customer’s prior consent, which is to conduct

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activities required to complete the Services.

“Facility”

means Lonza’s manufacturing facilities in Braine,

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Belgium or such other Lonza facility as may be

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agreed upon by the Parties.

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“FDA”

means the United States Food and Drug

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Administration, or any successor agency thereto.

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“Governmental Authority”

means any Regulatory Authority and any national,

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multi-national, regional, state or local regulatory

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agency, department, bureau, or other governmental

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entity in the U.S., European Union or the People’s

﻿

Republic of China.

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“Intellectual Property”

means (i) inventions (whether or not patentable),

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patents, trade secrets, copyrights, trademarks,

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trade names and domain names, rights in designs,

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rights in computer software, database rights, rights

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in confidential information (including know-how)

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and any other intellectual property rights, in each

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case whether registered or unregistered, (ii) all

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applications (or rights to apply) for, and renewals or

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extensions of, any of the rights described in the

﻿

foregoing clause (i) and (iii) and all rights and

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applications that are similar or equivalent to the

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rights and application described in the foregoing

﻿

clauses (i) and (ii), which exist now, or which come

﻿

to exist in the future, in any part of the world.

4

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

﻿

 

“Lonza Information”

means all information that is proprietary to Lonza or

﻿

any Affiliate of Lonza and that is maintained in

﻿

confidence by Lonza or any Affiliate of Lonza and

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that is disclosed by Lonza or any Affiliate of Lonza

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to Customer under or in connection with this

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Agreement, including without limitation, any and all

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Lonza know-how and trade secrets.

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“Manufacturing Process”

means the Customer’s [***] manufacturing process

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developed and validated by Lonza’s Affiliate for

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Customer under the Feasibility Agreement for the

﻿

manufacture of Product, as such process may be

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improved or modified from time to time by

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agreement of the Parties in writing.

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“Master Batch Record”

means the document, proposed by Lonza and

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approved by Customer, which defines the

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manufacturing methods, test methods and other

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procedures, directions and controls associated with

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the manufacture and testing of Product.

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“New Customer Intellectual Property”

has the meaning given in Clause 10.2.

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“New General Application Intellectual

 

Property”

has the meaning given in Clause 10.3.

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“Party”

Means each of Lonza and Customer and, together,

﻿

the “Parties”.

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“Price”

means the price for the Services and Products as

﻿

set out in Appendix A.

﻿

 

“Product”

means the proprietary molecule identified by

﻿

Customer as Thymosin Alpha 1 or TA-1, as

5

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

﻿

specified in Appendix C.

﻿

 

“Project Plan”

means the plan(s) describing the Services to be

﻿

performed by Lonza under this Agreement,

﻿

including any update and amendment of the Project

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Plan to which the Parties may agree from time to

﻿

time.  The initial Project Plan is attached hereto as

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Appendix A.

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“Quality Agreement”

means the quality agreement, attached hereto as

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Appendix B, setting out the responsibilities of the

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Parties in relation to quality as required for

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compliance with cGMP.

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“Raw Materials”

means all ingredients, solvents and other

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components of the Product required to perform the

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Manufacturing Process or Services set forth in the

﻿

bill of materials detailing the same (but excluding

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any consumables or wearables).

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“Regulatory Authority”

means the FDA, EMA and any other similar

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regulatory authorities as may be agreed upon in

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writing by the Parties.

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“Release”

has the meaning given in Clause 7.1.

“Services”

means all or any part of the services to be

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performed by Lonza under this Agreement,

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particulars of which are set out in a Project Plan.

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“Specifications”

means the specifications of the Product as

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specified in Appendix C, which may be amended

﻿

from time to time in accordance with this

﻿

Agreement.

﻿

 

“Term”

has the meaning given in Clause 14.1.

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6

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

“Third Party”

means any party other than Customer, Lonza and

﻿

their respective Affiliates.

In this Agreement references to the Parties are to the Parties to this
Agreement, headings are used for convenience only and do not affect its
interpretation, references to a statutory provision include references to the
statutory provision as modified or re-enacted or both from time to time and to
any subordinate legislation made under the statutory provision, references to
the singular include the plural and vice versa, and references to the word
“including” are to be construed without limitation.

2

Performance of Services

2.1       Performance of Services.  Subject to Clause 2.3, Lonza shall itself
and through its Affiliates, diligently carry out the Services as provided in the
Project Plan and use [***] efforts to perform the Services without any material
defect and according to the estimated timelines as set forth in the Project
Plan.  Lonza shall retain appropriately qualified and trained personnel with the
requisite knowledge and experience to perform the Services in accordance with
this Agreement.  Lonza may subcontract or delegate any of its rights or
obligations under this Agreement to perform the Services; provided, that any
External Laboratories shall be subject to the same obligations and other
provisions contained in this Agreement or any applicable Project Plan.  Lonza
shall not be responsible for analytical lab services performed by External
Laboratories that have been selected by Customer.

2.2       cGMP Batches.  Lonza will, in accordance with the terms of this
Agreement and Quality Agreement, manufacture at the Facility and Release to
Customer, cGMP Batches that comply with the Manufacturing Process, cGMP and the
Specifications, together with a Certificate of Analysis.

2.3       Supply of Customer Information and Customer Materials.  Customer shall
supply to Lonza all Customer Information and Customer Materials and other
information or materials that may be reasonably required by Lonza to perform the
Services.  Lonza shall not be responsible for any delays arising out of
Customer’s failure to provide such Customer Information, Customer Materials, or
other information or materials reasonably required to perform the Services to
Lonza, and Customer shall be responsible for all additional costs and expenses
arising out of such delay, including, if applicable, any idle Facility capacity
costs.

2.4       Raw Materials.  Lonza shall procure all required Raw Materials as well
as consumables other than those Raw Materials that are Customer Materials.  Upon
advance payment by Customer, Lonza shall purchase and hold [***] Batch’s
requirements of Raw Materials to serve as safety stock.  Customer shall be
responsible for payment for all consumables and Raw Materials ordered or
irrevocably committed to be procured by Lonza hereunder.  Upon cancellation of
any Batch or termination of the Agreement, all unused Raw Materials

7

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

shall be paid for by Customer within [***] days of invoice and at [***] option
will either be (a) delivered to Customer, or (b) disposed of by Lonza.

2.5       [***] During the Term of this Agreement, Lonza agrees that it will
[***] Product (or any derivative thereof) produced using the Manufacturing
Process [***].

3

Project Management I Steering Committee

3.1       Project Plans.  With respect to a new project to be governed by this
Agreement, a new Project Plan shall be added by agreement in a writing signed by
the Parties and appended to Appendix A.  Each Project Plan shall include a
description of the Services to be provided, the Product to be manufactured,
Specifications, a schedule for completion of the Project Plan (which may be
subject to receipt and confirmation of Purchase Orders), pricing details, and
such other information as is necessary for relevant Services.  In the event of a
conflict between the terms of a Project Plan and this Agreement, the terms of
this Agreement will govern.

3.2       Project Management.  With respect to each Project Plan, each party
will appoint a project manager who will be the party responsible for overseeing
the Project Plan.

3.3       Steering Committee.  Each Party shall name a mutually agreed upon
equal number of representatives for the Steering Committee, which shall meet
twice per calendar year, or as otherwise mutually agreed by the Parties.  In the
event that a Steering Committee dispute cannot be resolved, such dispute shall
be escalated to a senior executive of each of Customer and Lonza.

The primary function of the Steering Committee is to ensure the ongoing
communication between the Parties and discuss and resolve any issues arising
under this Agreement.  In addition to the primary function described above, the
Steering Committee shall also take on the following responsibilities:

3.3.1discuss and seek resolution of issues around management of the Services;

3.3.2agree and monitor deadlines and milestones for the Services; and

3.3.3discuss and recommend any changes to the Services (although such changes
will not take effect until they have been incorporated into a written amendment
to the Project Plan which has been signed by the Parties).

3.4       Person in Plant.  Customer shall be permitted to have, [***] at the
Facility as reasonably requested by Customer, at any time during the
Manufacturing Process for the purpose of observing, reporting on, and consulting
as to the performance of the Services.  Such [***] shall be subject to and agree
to abide by confidentiality obligations to Third Parties and

8

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Lonza’s customary practices and operating procedures regarding persons in plant,
and such [***] to comply with all instructions of Lonza’s employees at the
Facility.

4

Quality

4.1       Responsibility for quality assurance and quality control of Product
shall be allocated between Customer and Lonza as set forth in the Quality
Agreement and in Lonza standard operating procedures.  If there is a conflict
between the terms and conditions of this Agreement and the Quality Agreement,
the terms and conditions of this Agreement shall prevail.  If the Quality
Agreement is not in place at the Effective Date, Lonza and Customer commit to
enter into the Quality Agreement [***].

4.2       Provisions regarding inspections by Regulatory Authorities and audits
shall be set out in the Quality Agreement.

5

Insurance

5.1       Each Party shall, during the Term and for [***] years after delivery
of the last Product manufactured or Services provided under this Agreement,
obtain and maintain at its own cost and expense from a qualified insurance
company, comprehensive general liability insurance including, but not limited to
product liability coverage in the amount of at least [***] United States Dollars
per claim.  Each Party shall provide the respective other Party with a
certificate of such insurance upon reasonable request.

6

Forecasting, Ordering and Cancellation

6.1       Forecasting and Ordering.  No later than the [***], Customer shall
supply Lonza with a [***] forecast showing Customer’s good faith estimated [***]
requirements for Batches for at a minimum the following [***] period (the
“Forecast”).  No later than [***] days following Lonza’s receipt of a Forecast,
Lonza shall provide written notice to Customer of whether it has (as of the date
of receipt of the Forecast) capacity available to manufacture the number of
Batches forecasted therein and shall provide Customer with an estimated
production schedule showing the estimated Commencement Date and delivery date of
each Batch.  The first [***] of any Forecast shall be binding (“Binding
Forecast”).  Binding purchase orders (“Purchase Orders”) for the entire [***]
shall be submitted by Customer on the basis of the Binding Forecast within [***]
business days after receipt of Lonza’s estimated Commencement Data and delivery
date of each Batch.  No Forecast shall amend any previous Binding Forecast.  In
order to ensure optimal production planning, Customer will use its best efforts
to reach an accuracy of [***] of the non-binding portion of any Forecast.

6.2       Order Confirmation.  Lonza shall confirm the delivery date(s) and
quantity of Product to be delivered as set out in each Purchase Order within
[***] business days of receipt from Customer of the relevant Purchase
Order.  Upon confirmation, each Purchase Order will

9

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

be regarded by the Parties as a binding commitment by Lonza to manufacture and
to deliver to Customer the relevant quantity of Product according to the
requirements set out in such Purchase Order.  Subject to Section 6.3 below, any
delivery date set forth in Lonza’s written confirmation of a purchase order
shall be a firm delivery date plus or minus [***] business days.  Any additional
or inconsistent terms or conditions of any Customer purchase order,
acknowledgement or similar standardized form given or received pursuant to this
Agreement shall have no effect and such terms and conditions are hereby
rejected.

6.3       Rescheduling.  [***] shall have the right to reschedule the
Commencement Date and delivery date of any Batch or Campaign upon reasonable
prior written notice to, and consultation with, [***], provided that the
rescheduled Commencement Date is no earlier or no later than [***] days from the
Commencement Date originally estimated at the time of Lonza’s acceptance of the
binding purchase order.  For any Batch whereby a delay of more than [***] days
is imposed by Lonza over Customer’s objection, Customer shall have the right to
cancel such Batch [***].  If the Customer requests to change the Commencement
Date, Lonza will make all reasonable attempts to accommodate the request;
provided, however, in the event that this change would impact other projects
scheduled for occupancy in the designated suite or suites, manufacture of the
Customer’s Batch or Campaign may be delayed until [***] is available in the
Facility schedule.  Any delay requested by Customer of more than [***] days
shall be considered a cancellation pursuant to Section 6.6.

6.4       Minimum Quantity.  During each of the calendar years [***], Customer
undertakes to place Purchase Orders with Lonza (each for delivery during the
following [***]) for a total volume of Product not less than the greater
of:  [***].  Conditioned on Lonza successfully manufacturing and timely
delivering Product for all Purchase Orders placed and during [***] (and duly
accepted by Lonza) within the parameters set forth herein, then during each
[***] thereafter (beginning with the calendar year [***]), Customer undertakes
to place Purchase Orders with Lonza (each for delivery during the following
[***]) for a total volume of Product not less than the greater of [***].  If
Customer fails to purchase such minimums, Customer shall pay the Price per Batch
for the number of Batches below the applicable minimum within [***] days
following the applicable calendar year end.  For the avoidance of doubt,
Purchase Orders cancelled by Customer pursuant to Section 6.6 will not be
considered purchases for purposes of the foregoing sentence, notwithstanding
payment of applicable the Cancellation Fee.

6.5       Product Quantities.  Quantities of Product arising from a Campaign up
to a maximum of [***] above or below the Purchase Order will be invoiced
according to the [***] price as outlined in the Project Plan.  In case of
additional surplus quantities or quantities below [***] of the target quantity,
the Parties will negotiate in good faith a reasonable price.  The Purchase Order
shall be fulfilled if at least [***] of the target quantity is delivered.

10

 

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Maintenance by Lonza of Safety Stock.  At a mutually agreed time, but not later
than [***] months after the Effective Date, Lonza shall keep on hand at all
times a reserve of approximately [***] of Product.  Lonza may use all or part of
such reserve of Product to fulfil a Purchase Order, provided that Lonza shall
promptly produce additional reserve Batches in order to keep the reserve at the
levels described above.  At such time as Lonza schedules production of a reserve
Batch, such Batch will be deemed covered by a binding Purchase Order
hereunder.  Lonza may elect to manufacture a reserve Batch in conjunction with a
Batch subject to a Purchase Order submitted by Customer.  The Product maintained
by Lonza as part of such reserve shall be owned by Lonza and title shall not
pass to Customer until [***], whichever comes first.  Batches produced pursuant
to this Section will be invoiced as follows:  [***] upon the Commencement Date;
and the remainder [***].  Following the date title passes to Customer, Product
held in reserve shall be stored on a bill and hold basis according to Section
7.2.  On termination of this Agreement, Lonza shall deliver, and Customer shall
purchase (at the remaining balance of the regular price), all such reserve of
Product maintained hereunder.

6.6       Cancellation of a Binding Purchase Order.  Customer may cancel a
binding Purchase Order (including with respect to a reserve Batch scheduled for
production pursuant to Section 6.5) upon written notice to Lonza, subject to the
payment of a cancellation fee as calculated below (the “Cancellation Fee”):

6.6.1    In the event that Customer provides written notice of cancellation to
Lonza less than or equal to [***] months prior to the Commencement Date of one
or more Batches, then [***] of the Batch Price of each such Batch cancelled is
payable;

6.6.2    In the event that Customer provides written notice of cancellation to
Lonza more than [***] months but less than or equal to [***] months prior to the
Commencement Date of one or more Batches, then [***] of the Batch Price of each
such Batch cancelled is payable; or

6.6.3    In the event Customer provides written notice of cancellation more than
[***] months prior to the Commencement Date of a Batch, then no Cancellation Fee
is payable.

6.7       Payment of Cancellation Fee.  Any Cancellation Fee shall be payable
within [***] days following the written notice of cancellation associated with
the cancelled Batch.  Any Cancellation Fee shall include all costs associated
with the cancelled Batch, including any Raw Materials.

6.8       Replacement Project.  Notwithstanding the foregoing, Lonza will use
[***] efforts to secure a new project (but excluding any project then under
contract with Lonza) for the cGMP manufacturing space, and for the same dates
and duration that would have been occupied by Customer, and then, in such case,
the Cancellation Fee for each Batch cancelled that is

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

replaced by a Batch of the new project shall be reduced by an amount equal to
[***] of the production fees associated with such replacement Batch.

7

Delivery and Acceptance

7.1       Delivery.  All Product shall be delivered [***].  Lonza shall deliver
to Customer the Certificate of Analysis and such other documentation as is
reasonably required to meet all applicable regulatory requirements of the
Governmental Authorities (the “Release”) not later than [***] business days
prior to the date of delivery of Batches.  With respect to any Customer
Materials, title and risk of loss shall remain with the Customer and shall not
transfer to Lonza.  With respect to Product, title and risk of loss shall
transfer to Customer [***] in accordance with this provision.

7.2       Storage.  Customer shall arrange for shipment and take delivery of
each Batch from the Facility, at Customer’s expense, within [***] days after
title has transferred to Customer.  Lonza shall provide storage on a bill and
hold basis for Batch(es) [***] for up to [***] days after title has transferred
to Customer; provided that any additional storage beyond [***] days will be
subject to availability and, if available, will be charged to Customer and will
be subject to a separate agreement.  In addition to Section 8.2, Customer shall
be responsible for all value added tax (VAT) and any other applicable taxes,
levies, import, duties and fees of whatever nature imposed as a result of any
storage.  Notwithstanding anything to the contrary contained in this Agreement,
in no event shall Lonza be required to store any Batch for more than [***]
calendar days after title has transferred to Customer.  Within [***] days
following a written request from Lonza, Customer shall provide Lonza with a
letter in form satisfactory to Lonza confirming the bill and hold status of each
stored Batch.

7.3       Acceptance/Rejection of Product.

7.3.1    Promptly following Release of Batches, Customer shall inspect such
Batches and shall have the right to test such Batches to determine compliance
with the Specifications.  Customer shall notify Lonza in writing of any
rejection of a Batch based on any claim that it fails to meet Specifications
within [***] days of Release, after which time all unrejected Batches shall be
deemed accepted.

7.3.2    In the event that Lonza believes that a Batch has been incorrectly
rejected, Lonza may require that Customer provide to it Batch samples for
testing.  Lonza may retain and test the samples of such Batch.  In the event of
a discrepancy between Customer’s and Lonza’s test results such that Lonza’s test
results fall within relevant Specifications, or there exists a dispute between
the Parties over the extent to which such failure is attributable to a given
Party, the Parties shall cause an independent laboratory promptly to review
records, test data and perform comparative tests and analyses on samples of the
Product that allegedly fails to conform to Specifications.  Such independent
laboratory shall be mutually agreed

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

upon by the Parties.  The independent laboratory’s results shall be in writing
and shall be final and binding save for manifest error.  Unless otherwise agreed
to by the Parties in writing, the costs associated with such testing and review
shall be borne by the Party against whom the independent laboratory rules.

7.3.3    Lonza shall reprocess any Batch or, if reprocessing is not possible,
replace any Batch that failed to conform with the Specifications (a “Failed
Batch”), in the event that it is determined (by the Parties or the independent
laboratory) that such failure was solely due to Lonza’s material breach of its
obligations hereunder, negligence or intentional misconduct (“Lonza
Responsibility”), without additional expense to Customer.  Such reprocessing or
replacement shall be made as promptly as practicable, in light of available
manufacturing capacity, after the confirmation of Lonza Responsibility, and in
any case as soon as reasonably possible after confirmation of Lonza
Responsibility.  Where possible, any replacement Batch shall be manufactured
with the next scheduled cGMP Batch or Campaign.  Customer acknowledges and
agrees that its sole remedy with respect to a Failed Batch that is a Lonza
Responsibility is as set forth in this Clause 7.3.3, and in furtherance thereof,
Customer hereby waives all other remedies at law or in equity regarding the
foregoing claims.  Lonza shall not be responsible for the cost of Raw Materials
or Customer Materials consumed in any Failed Batch except in the instance of
Lonza Responsibility, herein.  Lonza shall have no liability with respect to,
and Customer shall be required to pay for, any Failed Batch that is not
determined to be a Lonza Responsibility.

8

Price and Payment

8.1       Pricing for the Services provided by Lonza are set out in the
applicable Project Plan.  In the event of changes to the Services based on
Customer’s request, Customer shall bear all additional costs.

8.2       Unless otherwise indicated in writing by Lonza, all Prices and charges
are exclusive of value added tax (VAT) and of any other applicable taxes,
levies, import, duties and fees of whatever nature imposed by or under the
authority of any government or public authority and all such charges applicable
to the Services shall be paid by Customer.

8.3       Lonza shall issue invoices to Customer as follows:  (a) upon
commencement of Services, [***] of the Price for such Services, [***]; and (b)
upon completion of the Services, the remaining amount.  All invoices are
strictly net and payment must be made within [***] days of date of
invoice.  Payment shall be made without deduction, deferment, set-off, lien or
counterclaim.

8.4       If in default of payment of any undisputed invoice on the due date,
interest shall accrue on any amount overdue at the lesser of [***]; and Lonza
shall, at its sole discretion, and without prejudice to any other of its accrued
rights, be entitled to suspend the provision of

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

the Services and or delivery of Product until all overdue amounts have been paid
in full, including interest for late payments.

8.5       Price adjustments.

8.5.1    Not more than once per calendar year, Lonza may adjust the Price in
accordance with [***] increase for the previous calendar year.  The new Price
reflecting such Batch Price adjustment shall be effective for any Batch for
which the Commencement Date is on or after the date of Lonza’s notice to
Customer of the Price adjustment.

8.5.2    In addition to the above, the Price may be changed by Lonza, upon
reasonable prior written notice to Customer (providing reasonable detail in
support thereof), to reflect (i) an increase in variable costs (such as energy
or Raw Materials not reimbursed at cost) by more than [***] (based on the
initial Price or any previously amended Price), or for a process adjustment or
assumption changes, and (ii) any material change in an environmental, safety or
regulatory standard that substantially impacts Lonza’s cost and ability to
perform the Services; provided, however, that, if the Prices are changed by more
than [***] for any of these reasons, Customer shall have the right to change its
forecasts without penalty.

8.5.3    The Prices outlined in the Project Plan are based on the currency
exchange rate of [***] to [***] at the Effective Date.  Lonza shall bear the
risk of any increase or decrease of the [***] exchange rate up to [***] from the
base currency exchange rate.  If the [***] exchange rate is more than [***]
higher or lower than the base currency exchange rate at the date on which the
Prices become due for payment, then the Prices will be adjusted higher or lower
to compensate all exchange rate differences greater than [***].  The currency
adjustments to be made, if any, shall be based on the market rate of exchange as
published by Bloomberg.

9

Capital Equipment

9.1       Any Capital Equipment required for the performance of the Services
shall be acquired on terms to be agreed by the Parties prior to commencement of
the relevant Services, and shall be listed in Appendix D.

10

Intellectual Property

10.1     Except as expressly otherwise provided herein, neither Party will, as a
result of this Agreement, acquire any right, title, or interest in any
Background Intellectual Property of the other Party.

10.2     Subject to Clause 10.3, Customer shall own all right, title, and
interest in and to any and all Intellectual Property that Lonza and its
Affiliates, the External Laboratories or other

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

contractors or agents of Lonza develops, conceives, invents, first reduces to
practice or makes, solely or jointly with Customer or others, that is solely a
direct derivative of or improvement to Customer Information and Customer
Background Intellectual Property (collectively, the “New Customer Intellectual
Property”).  For avoidance of doubt, “New Customer Intellectual Property” shall
include any material, processes or other items that solely embody, or that
solely are claimed or covered by, any of the foregoing Intellectual Property,
but excluding any New General Application Intellectual Property.

10.3     Notwithstanding Clause 10.2, and subject to the license granted in
Clause 10.5, Lonza shall own all right, title and interest in Intellectual
Property that Lonza and its Affiliates, the External Laboratories or other
contractors or agents of Lonza, solely or jointly with Customer, develops,
conceives, invents, or first reduces to practice or makes in the course of
performance of the Services that (i) is generally applicable to the development
or manufacture of chemical or biological products or product components or (ii)
is an improvement of, or direct derivative of, any Lonza Background Intellectual
Property (“New General Application Intellectual Property”).  For avoidance of
doubt, “New General Application Intellectual Property” shall include any
material, processes or other items that embody, or that are claimed or covered
by, any of the foregoing Intellectual Property.

10.4     Lonza hereby assigns to Customer all of its right, title and interest
in any New Customer Intellectual Property.  Lonza shall execute, and shall
require its personnel as well as its Affiliates, External Laboratories or other
contractors or agents and their personnel involved in the performance of the
Services to execute, any documents reasonably required to confirm Customer’s
ownership of the New Customer Intellectual Property, and any documents required
to apply for, maintain and enforce any patent or other right in the New Customer
Intellectual Property.

10.5     Subject to the terms and conditions set forth herein (including the
payment of the Price as required above), Lonza hereby grants to Customer a
non-exclusive, world-wide, fully paid-up, irrevocable, transferable license,
including the right to grant sublicenses, under the New General Application
Intellectual Property, to use, sell and import the Product manufactured under
this Agreement.

10.6     Customer hereby grants Lonza the non-exclusive right to use the
Customer Information, Customer Background Intellectual Property and New Customer
Intellectual Property during the Term solely for the purpose of fulfilling its
obligations under this Agreement.

10.7     Customer will have an irrevocable right to transfer the Manufacturing
Process to itself and any Third Party approved by Lonza in writing for the
manufacture of that Product (but no other product); provided, however, to the
extent such technology transfer is to a Third Party and includes Lonza
Confidential Information, Lonza Background Intellectual Property or New General
Application Intellectual Property, such technology transfer shall be subject to
a reasonable royalty and licensing fee and terms to be agreed upon by the
Parties.  Lonza shall provide reasonably necessary documents to complete such
technology transfer and,

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Customer shall reimburse Lonza for any costs (based on a full-time employee rate
for such support) and expenses.

11

Warranties

11.1     Lonza warrants that:

11.1.1  the Services shall be performed in accordance with all Applicable Laws;

11.1.2  except with respect to any development services, the manufacture of
Product shall be performed in accordance with cGMP and will meet the
Specifications [***];

11.1.3    it or its Affiliate holds all necessary permits, approvals, consents
and licenses to enable it to perform the Services at the Facility; and

11.1.4  it has the necessary corporate authorizations to enter into and perform
this Agreement.

11.2     Customer warrants that:

11.2.1 Customer has all the rights necessary to permit Lonza to perform the
Services without infringing the Intellectual Property rights of any Third Party
and the performance of the Services shall not infringe any Third Party
Intellectual Property rights;

11.2.2  Customer will promptly notify Lonza in writing if it receives or is
notified of a formal written claim from a Third Party that Customer Information
and Customer Intellectual Property or that the use by Lonza thereof for the
provision of the Services infringes any Intellectual Property or other rights of
any Third Party; and

11.2.3  Customer has the necessary corporate authorizations to enter into this
Agreement.

11.3     DISCLAIMER:  THE WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT ARE
IN LIEU OF ALL OTHER WARRANTIES, AND ALL OTHER WARRANTIES, BOTH EXPRESS AND
IMPLIED, ARE EXPRESSLY DISCLAIMED, INCLUDING WITHOUT LIMITATION ANY WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

12

Indemnification and Liability

12.1     Indemnification by Lonza.  Lonza shall indemnify the Customer, its
Affiliates, and their respective officers, employees and agents (“Customer
Indemnitees”) for any loss, damage, costs and expenses (including reasonable
attorney fees) that Customer Indemnitees may suffer as a result of any Third
Party claim arising directly out of any material breach of the warranties given
by Lonza in Clause 11.1 above except to the extent that such claims

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

resulted from the negligence, intentional misconduct or breach of this Agreement
by any Customer Indemnitees.

12.2     Indemnification by Customer.  Customer shall indemnify Lonza, its
Affiliates, and their respective officers, employees and agents (“Lonza
Indemnitees”) from and against any loss, damage, costs and expenses (including
reasonable attorney fees) that Lonza Indemnitees may suffer as a result of any
Third Party claim arising directly out of (i) any material breach of the
warranties given by Customer in Clause 11.2 above; or (ii) any claims alleging
that the performance of Services infringes any Intellectual Property rights of
third parties; or (iii) the manufacture, use, sale, or distribution of any
Product, including any claims of product liability; except, in each case, to the
extent that such claims resulted from the negligence, intentional misconduct or
breach of this Agreement by any Lonza Indemnitees.

12.3     Indemnification Procedure.  If the Party to be indemnified intends to
claim indemnification under this Clause 12, it shall promptly notify the
indemnifying Party in writing of such claim.  The indemnitor shall have the
right to control the defense and settlement thereof; provided, however, that any
indemnitee shall have the right to retain its own counsel at its own
expense.  The indemnitee, its employees and agents, shall reasonably cooperate
with the indemnitor in the investigation of any liability covered by this Clause
12.  The failure to deliver prompt written notice to the indemnitor of any
claim, to the extent prejudicial to its ability to defend such claim, shall
relieve the indemnitor of any obligation to the indemnitee under this Clause 12.

12.4     DISCLAIMER OF CONSEQUENTIAL DAMAGES.  IN NO EVENT SHALL EITHER PARTY BE
LIABLE TO THE OTHER PARTY FOR INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR
CONSEQUENTIAL DAMAGES, LOST PROFITS OR LOST REVENUES ARISING FROM OR RELATED TO
THIS AGREEMENT, EXCEPT TO THE EXTENT RESULTING FROM FRAUD, GROSS NEGLIGENCE OR
INTENTIONAL MISCONDUCT.

12.5     LIMITATION OF LIABILITY.  LONZA’S LIABILITY UNDER THIS AGREEMENT SHALL
IN NO EVENT EXCEED, IN THE AGGREGATE, THE TOTAL AMOUNTS PAID BY CUSTOMER TO
LONZA UNDER THE PROJECT PLAN GIVING RISE TO SUCH CLAIM FOR DAMAGES IN THE [***]
MONTH PERIOD PRECEDING THE FIRST CLAIM FOR DAMAGES, EXCEPT TO THE EXTENT
RESULTING FROM LONZA’S FRAUD, GROSS NEGLIGENCE OR INTENTIONAL MISCONDUCT.

13

Confidentiality

13.1     A Party receiving Confidential Information (the “Receiving Party”)
agrees to strictly keep secret any and all Confidential Information received
during the Term from or on behalf of the other Party (the “Disclosing Party”)
using at least the same level of measures as it uses to protect its own
Confidential Information, but in any case at least [***].  Confidential

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

Information shall include information disclosed in any form including but not
limited to in writing, orally, graphically or in electronic or other form to the
Receiving Party, observed by the Receiving Party or its employees, agents,
consultants, or representatives, or otherwise learned by the Receiving Party
under this Agreement, which the Receiving Party knows or reasonably should know
is confidential or proprietary.

13.2     Notwithstanding the foregoing, Receiving Party may disclose to any
courts and/or other authorities Confidential Information which is or will be
required pursuant to applicable governmental or administrative or public law,
rule, regulation or order.  In such case the Party that received the
Confidential Information will, to the extent legally permitted, inform the other
Party promptly in writing and cooperate with the Disclosing Party in seeking to
minimize the extent of Confidential Information which is required to be
disclosed to the courts and/or authorities.

13.3     The obligation to maintain confidentiality under this Agreement does
not apply to Confidential Information, which:

13.3.1  at the time of disclosure was publicly available; or

13.3.2  is or becomes publicly available other than as a result of a breach of
this Agreement by the Receiving Party; or

13.3.3  as the Receiving Party can establish by competent proof, was rightfully
in its possession at the time of disclosure by the Disclosing Party and had not
been received from or on behalf of Disclosing Party; or

13.3.4  is supplied to a Party by a Third Party which was not in breach of an
obligation of confidentiality to Disclosing Party or any other party; or

13.3.5  is developed by the Receiving Party independently from and without use
of the Confidential Information, as evidenced by contemporaneous written
records.

13.4     The Receiving Party will use Confidential Information only for the
purposes of this Agreement and will not make any use of the Confidential
Information for its own separate benefit or the benefit of any Third Party
including, without limitation, with respect to research or product development
or any reverse engineering or similar testing.  The Receiving Party agrees to
return or destroy promptly (and certify such destruction) on Disclosing Party’s
request all written or tangible Confidential Information of the Disclosing
Party, except that one copy of such Confidential Information may be kept by the
Receiving Party in its confidential files for record keeping purposes only.

13.5     Each Party will restrict the disclosure of Confidential Information to
such officers, employees, consultants and representatives of itself and its
Affiliates who have been informed of the confidential nature of the Confidential
Information and who have a need

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

to know such Confidential Information for the purpose of this Agreement.  Prior
to disclosure to such persons, the Receiving Party shall bind its and its
Affiliates’ officers, employees, consultants and representatives to
confidentiality and non-use obligations no less stringent than those set forth
herein.  The Receiving Party shall notify the Disclosing Party as promptly as
practicable of any unauthorized use or disclosure of the Confidential
Information.

13.6     The Receiving Party shall at any time be fully liable for any and all
breaches of the confidentiality obligations in this Clause 13 by any of its
Affiliates or the employees, consultants and representatives of itself or its
Affiliates.

13.7     Each Party hereto expressly agrees that any breach or threatened breach
of the undertakings of confidentiality provided under this Clause 13 by a Party
may cause irreparable harm to the other Party and that money damages may not
provide a sufficient remedy to the non-breaching Party for any breach or
threatened breach.  In the event of any breach and/or threatened breach, then,
in addition to all other remedies available at law or in equity, the
non-breaching Party shall be entitled to seek injunctive relief and any other
relief deemed appropriate by the non-breaching Party.

14

Term and Termination

14.1     Term.  This Agreement shall commence on the Effective Date and shall
end on the fifth anniversary of the Effective Date unless terminated earlier as
provided herein or extended by mutual written consent of the Parties (the
“Term”).  Notwithstanding the foregoing, each Project Plan may have separate
term and termination provisions so long as the term of any Project Plan does not
extend beyond the Term.

14.2     Termination.  This Agreement may be terminated as follows:

14.2.1  by either Party for any reason upon [***] days prior written notice to
the other Party;

14.2.2  by either Party if the other Party breaches a material provision of this
Agreement or a Project Plan and fails to cure such breach to the reasonable
satisfaction of the non-breaching Party within [***] days ([***] working days
for non-payment) following written notification of such breach from the
non-breaching party to the breaching party; provided, however, that such [***]
day period shall be extended as agreed by the Parties if the identified breach
is incapable of cure within [***] days and if the breaching Party provides a
plan and timeline to cure the breach, promptly commences efforts to cure the
breach and diligently prosecutes such cure (it being understood that this
extended period shall be unavailable for any breach regarding non-payment);

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

14.2.3  by either Party, [***], if the other Party becomes insolvent, is
dissolved or liquidated, makes a general assignment for the benefit of its
creditors, or files or has filed against it, a petition in bankruptcy or has a
receiver appointed for a substantial part of its assets; or

14.2.4  by either Party pursuant to Clause 15.

14.2.5  by Customer at any time on [***] days’ written notice to Lonza if
[***].  Customer shall provide to Lonza written evidence [***] together with any
such written notice.  Such evidence may be audited by Lonza.  In consideration
for Customer’s right to terminate under this Section 14.2.5’ for a period of
[***] following the effective date of termination of this Agreement, Customer
shall not enter into any new agreement with a third party [***] for the supply,
delivery or manufacture of the Product without first giving Lonza a period of
[***] days to review the proposed commercial terms of such proposed arrangement;
provided that if Customer is unable to provide to Lonza terms due to
confidentiality obligations, then Customer shall provide to Lonza terms that are
substantially similar.  If Lonza decides prior to the end of such [***] days to
provide substantially similar or superior commercial terms, Customer shall be
obligated to enter into a new supply agreement with Lonza on such substantially
similar or superior commercial terms proposed by Lonza.

14.3     Consequences of Termination.  In the event of termination hereunder,
Lonza shall be compensated for (i) Services rendered up to the date of
termination, including in respect of any Product in-process; (ii) all costs
incurred through the date of termination, including Raw Materials costs for Raw
Materials used or purchased for use in connection with the Project Plan; (iii)
all unreimbursed Capital Equipment and related decommissioning charges incurred
pursuant to Clause 9; (iv) all amounts due under Clause 6.4, without proration
of the final calendar year (but, excluding payments for minimum amounts not
purchased (under Clause 6.4) in the case of termination for either breach by
Lonza or Force Majeure); and (v) any applicable Cancellation Fees.  In the case
of termination by Lonza for Customer’s material breach, Cancellation Fees shall
be calculated as of the date of written notice of termination.

14.4     Survival.  The rights and obligations of each Party which by their
nature survive the termination or expiration of this Agreement shall survive the
termination or expiration of this Agreement, including Clauses 10-13 and 16 (to
the extent relevant).

15

Force Majeure

15.1     If Lonza is prevented or delayed in the performance of any of its
obligations under the Agreement by Force Majeure and gives written notice
thereof to Customer specifying the matters constituting Force Majeure together
with such evidence as Lonza reasonably can give and specifying the period for
which it is estimated that such prevention or delay will

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

continue, Lonza shall be excused from the performance or the punctual
performance of such obligations as the case may be from the date of such notice
for so long as such cause of prevention or delay shall continue.  Provided that,
if such Force Majeure persists for a period of [***] months or more, Customer
may terminate this Agreement by delivering written notice to Lonza.

15.2     “Force Majeure” shall be deemed to include any reason or cause beyond
Lonza’s reasonable control affecting the performance by Lonza of its obligations
under the Agreement, including, but not limited to, any cause arising from or
attributable to acts of God, strike, lockouts, labor troubles, restrictive
governmental orders or decrees, riots, insurrection, war, terrorists acts, or
the inability of Lonza to obtain any required raw material, energy source,
equipment, labor or transportation, at prices and on terms deemed by Lonza to be
reasonably practicable, from Lonza’s usual sources of supply.

15.3     With regard to Lonza, any such event of Force Majeure affecting
services or production at its Affiliates or suppliers shall be regarded as an
event of Force Majeure, but only to the extent that such event delays or
prevents Lonza’s performance of its obligations hereunder.

16

Public and Commercial Anti-Bribery and Anti-Corruption Representations and
Warranties

Lonza hereby represents and warrants that it has not, and agrees that it will
not, in connection with the transactions contemplated under this Agreement, make
or promise or offer to make any payment or transfer of anything of value,
directly or indirectly:  (i) to any governmental official or government employee
(including employees of government-owned entities or corporations); or (ii) to
any political party, official of a political party or candidate (or to a third
party for payment to any of the foregoing) in connection with the transactions
contemplated under this Agreement in order to obtain or retain business or to
secure any improper advantage.  It is the intent of the parties that no payments
or transfers of value shall be made that have the purpose or effect of public or
commercial bribery, acceptance of or acquiescence in extortion, kickbacks or
other unlawful or improper means of obtaining business.  This Section 16 shall
not, however, prohibit normal and customary business entertainment or providing
business mementos of nominal value; provided, however, that all such payments
shall be lawful, reasonable, directly related to the business of Lonza, and
accurately described in the books and records of Lonza.  At Customer’s request,
Lonza agrees to provide a signed Certification, in the form set forth in
Appendix E hereto, on an annual basis for as long as the Agreement remains in
effect.

17

Miscellaneous

17.1     Severability.  If any provision hereof is or becomes at any time
illegal, invalid or unenforceable in any respect, neither the legality, validity
nor enforceability of the remaining provisions hereof shall in any way be
affected or impaired thereby.  The Parties hereto undertake to substitute any
illegal, invalid or unenforceable provision by a provision

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

which is as far as possible commercially equivalent considering the legal
interests and the Purpose.

17.2     Amendments/Assignment.  Modifications and/or amendments of this
Agreement must be in writing and signed by the Parties.  Lonza shall be entitled
to instruct one or more of its Affiliates to perform any of Lonza’s obligations
contained in this Agreement, but Lonza shall remain fully responsible in respect
of those obligations.  Subject thereto, neither Party may assign its interest
under this Agreement without the prior written consent of the other Party, such
consent not to be unreasonably withheld, conditioned or delayed, provided,
however that (a) either Party may assign this Agreement to (i) any Affiliate of
that Party or (ii) any third party in connection with the sale or transfer (by
whatever method) of, in the case of Customer, all or substantially all of the
assets of Customer’s business or, in the case of Lonza, of all or substantially
all of the assets of the business related to the Facility or providing the
Services.  Notwithstanding the foregoing, Customer may not assign its interest
in this Agreement to any third party that is engaged in contract manufacturing
of biological or pharmaceutical products without Lonza’s prior written consent,
and (b) Lonza shall be entitled to sell, assign and/or transfer its trade
receivables resulting from this Agreement without the consent of the
Customer.  For purposes of this Clause 17.2, the terms “assign” and “assignment”
shall include, without limitation (i) the sale of fifty percent (50%) or more of
the outstanding stock of such Party to an Affiliate of such Party or an
unrelated entity or natural person, (ii) the sale or transfer or other
assignment of all or substantially all of the assets of the Party or the line of
business or Product to which this Agreement relates, and (iii) a merger,
consolidation, acquisition or other form of business combination.  Any purported
assignment without a required consent shall be void.  No assignment shall
relieve any Party of responsibility for the performance of any obligation that
accrued prior to the effective date of such assignment.

17.3     Notice.  All notices must be written and sent to the address of the
Party first set forth above.  All notices must be given (a) by personal
delivery, with receipt acknowledged, (b) by facsimile followed by hard copy
delivered by the methods under (c) or (d), (c) by prepaid certified or
registered mail, return receipt requested, or (d) by prepaid recognized next
business day delivery service.  Notices will be effective upon receipt or at a
later date stated in the notice.

17.4     Governing Law/Jurisdiction.  This Agreement is governed in all respects
by the laws of [***], without regard [***].  The Parties agree to submit to the
jurisdiction of [***].

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
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COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

17.5     Entire Agreement.  This Agreement contains the entire agreement between
the Parties as to the subject matter hereof and supersedes all prior and
contemporaneous agreements with respect to the subject matter hereof.  This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, and all of which together shall constitute one and the
same document.  Each party acknowledges that an original signature or a copy
thereof transmitted by facsimile or by .pdf shall constitute an original
signature for purposes of this Agreement.

IN WITNESS WHEREOF, each of the Parties hereto has caused this Manufacturing
Services Agreement to be executed by its duly authorized representative
effective as of the date written above.

﻿

﻿

 

 

﻿

LONZA SALES LTD

﻿

 

 

﻿

By:

/s/ Daniel Blattler

﻿

 

Daniel Blattler

﻿

 

General Counsel

Head of Legal Team Basel

﻿

 

 

﻿

By:

/s/ Fabrice Gacho

﻿

 

Fabrice Gachot

﻿

﻿

 

 

﻿

SCICLONE PHARMACEUTICALS INTERNATIONAL LTD.

﻿

 

 

﻿

By:

/s/ Friedhelm Blobel

﻿

 

Friedhelm Blobel

﻿

 

Director

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
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COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

APPENDIX A

Project Plan A -1

[***]

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AND EXCHANGE COMMISSION.

 

APPENDIX B

Quality Agreement

[***]

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
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COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

APPENDIX C

Specifications

[***]

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

APPENDIX D

Capital Equipment

[***]

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*** CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS
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COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

APPENDIX E

SciClone Annual Anti-Bribery and Anti-Corrpution Certification

SciClone Pharmaceuticals International Limited
FCPA CERTIFICATION FOR INTERNATIONAL
FCPA 和反腐败证明 
AGENTS, DISTRIBUTORS, VENDORS, CONSULTANTS AND REPRESENTATIVES
国际代理人、经销商、卖方、顾问和代表FCPA证明

I, ____Daniel Blattler__________ a duly authorized representative of Lonza Sales
Ltd., confirm that I my company, and anyone retained by me or my company are
aware of and understand SciClone’s FCPA and Anticorruption Policy based on the
U.S. Foreign Corrupt Practices Act of 1977 as amended, (“FCPA”), and that since
the date of my last certification, I, my company, and everyone retained by me or
my company have not violated, nor caused the Company to violate the FCPA in
connection with my representation of the Company in any country.

本人, _______________________________, _______  [卖方、代理人、顾问或代表名称]合法 授权的[代表]或卖方,
 在此确认,  我公司,  以及本人或我公司聘请的任何人都知晓并了解根据 《1977年美国反海外腐败法》制定的SciClone FCPA和反腐败政策,  并且,
_本人最后一次 证明日期以来,  本人,  我公司,  以及本人或我公司聘请的任何人,  与本人在任何国家中代表 、、公司〃相关,  未曾违反,
 或者导致”公司〃违反FCPA。

I confirm that neither I nor my company is a governmental entity or political
party in the country in which I represent the Company, and that no officer,
director, employee or agent of my company is a government, governmental entity,
or “foreign official”, as that term is defined below.  “Foreign Official” is
defined as:

本人确认,  本人和我公司都不是本人在其中代表”公司”的国家中的政府实体或政党,
 我公司的 高管、董事、股东、雇员或代理人都不是政府、政府实体或、、国外官员〃（按照下文中的定 义）。”国外官员〃,  被定义为：

(i)

any officer or employee of the foreign country’s government, including any
federal, regional or local department， agency, state-owned or state-controlled
enterprise or corporation or other instrumentality thereof;

(ii)

any person acting in an official capacity for or on behalf of any such entities
identified in clause (i);

(iii)

any official of a political party, or candidate or nominee of any political
party in the foreign country or for any position with any entity identified in
clause (i) above; and

(iv)

any official or employee of a public international organization.

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EXHIBIT.  CONFIDENTIAL PORTIONS OF THIS EXHIBIT ARE DESIGNATED BY [***].  A
COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

(i)

国外政府,  包括任何联邦、地区或当地部门、机构、国家所有或国家控 制的企业或公司或其他机构的官员或雇员；

(ii)

以第⑴款中的实体的官方职务或者代表其行事的任何人士；

(iii)

外国政党、政党关于第⑴款中的实体职位的候选人或被提名人；及

(iv)

公共国际组织的官员或雇员 

In connection with services provided for the Company, to the best of my
knowledge, neither I, nor my company, nor any of its officers, directors,
stockholders, employees or agents have offered, paid, promised to pay, or
authorized the payment of any money, or offered, the payment of any money or
anything of value to (a) any “foreign official” as that term is defined above,
or (b) any person, while knowing that all or a portion of such money or thing of
value will be offered or given directly or indirectly to any official, political
party, or to any candidate for political office for any of the prohibited
purposes listed below.  These prohibited purposes are:

与本人代表”公司”或者为”公司”服务相关,  本人,  或者我公司,  或者其高管、董事、股东、雇 员或代理人,  均未为了以下被禁止的目的,
 向以下对象提出、支付、承诺支付,  或授权支付任 何金钱或者提出支付金钱或有价值事物（a）任何”国外官员”（按照上文中对该术语的定 义）,  或（b）任何人,
 知道此类资金或有价值事物的全部或部分将直接或间接地给予官员、 政党或者政治职务候选人。这些被禁止的目的有：

1.

to influence any act or decision of such foreign official, political party,
party official, or candidate in his or its official capacity,

2.

to induce such foreign official, political party, party official, or candidate
to do or omit to do any act in violation of the lawful duty of such foreign
official, political party, party official, or candidate,

3.

to secure any improper advantage; or

4.

to induce such foreign official, political party, party official, or candidate
to use his or its influence with a foreign government or instrumentality thereof
to affect or influence any act or decision of such government or
instrumentality,

1.

影响该国外官员、政党、党派官员或官方职位候选人的行为或决定，

2.

诱导该国外官员、政党、党派官员或候选人违背该国外官员、政党、党派官员 或候选人法定职责而做出或不做出任何行为,

3.

获得不适当的优势；或

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COMPLETE VERSION OF THIS EXHIBIT HAS BEEN FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION.

 

4.

诱导此类国外官员、政党、政党官员或候选人利用其对国外政府或机构的影响 力来影响政府或机构的行为或决定

I agree that should I learn of or have reason to know of any activities in
connection with the representation of the Company which may constitute a
violation of the FCPA or applicable local country anticorruption laws, I will
immediately advise SciClone’s Legal Department at:  本人同意,
 如果本人知悉或有理由了解到与代表公司相关的,  可能违反FCPA或者可适用当地 国家反腐败法律的任何行为,
 本人将立即按以下地址通知SciClone的法律或合规部门：

SciClone Pharmaceuticals International Limited
Attn:  Charles Meng
孟纯才
VP - Legal and Compliance
法务及合规副总裁 
3401A Windsor House
311 Gloucester Road, Causeway Bay, Hong Kong
Phone:  +852 2510 0118
Fax:  +852 2508 1500
Email:  [***]

﻿

﻿

﻿

 

 

Date

 

/s/ Daniel Blattler

日期

 

Authorized Vendor’s Signature

﻿

 

授权卖ガ的签叙

﻿

 

 

﻿

 

Vendor’s Title

卖方的职务

﻿

 

 

﻿

 

Organization

组织或公司

﻿

 

 

﻿

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