Exhibit 10.5

 

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

Execution Copy

CO-DEVELOPMENT AND LICENSE AGREEMENT

This CO-DEVELOPMENT AND LICENSE AGREEMENT (the “Agreement”) is entered into as
of March 11, 2011 (the “Effective Date”) by and between CELL THERAPEUTICS, INC.,
a Washington corporation, with its principal place of business at 501 Elliott
Ave. W. #400, Seattle, Washington 98119, U.S.A. (“CTI”), and CHROMA THERAPEUTICS
LTD, a company registered under the laws of England and Wales, with its
principal place of business at 93 Milton Park, Abingdon, Oxon OX14 4RY, UK
(“Chroma”). Chroma and CTI are sometimes referred to herein individually as a
“Party” and collectively as the “Parties.”

RECITALS

WHEREAS, Chroma is developing its proprietary Tosedostat product for cancer;

WHEREAS, CTI possesses substantial resources and expertise in the development,
marketing, and commercialization of pharmaceutical products for the treatment of
cancer in the Licensed Territory (as defined below); and

WHEREAS, CTI desires to collaborate with Chroma on the further development of
the Product (as defined below) in the Field (as defined below) through
regulatory approval in the Licensed Territory, and to obtain commercialization
rights to the Product in the Field in the Licensed Territory, and Chroma is
willing to so collaborate and to grant such rights on the terms and conditions
hereof.

NOW THEREFORE, in consideration of the foregoing premises and the mutual
promises, covenants and conditions contained in this Agreement, the Parties
agree as follows:

ARTICLE 1

DEFINITIONS

1.1 “Accounting Standards” means US GAAP (United States Generally Accepted
Accounting Principles) as generally and consistently applied throughout each
Party’s organization.

1.2 “Additional Product” means any (a) new formulation, dosage form,
improvement, or mode of administration of the Compound, or (b) pharmaceutical
composition that contains a derivative or modified form of the Compound
including those analogues of the Compound with the structures set forth in
Exhibit A-2.

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.3 “Additional Studies” means, other than the Currently Ongoing Studies,
Licensed Territory Specific Studies, Extraterritorial Studies, and studies that
can be both an Extraterritorial Study and a Licensed Territory Specific Study
agreed to be conducted by the Parties as part of the Development Plan under the
terms and conditions of this Agreement.

1.4 “Affiliate” means, with respect to a particular Party, a person,
corporation, partnership, or other entity that controls, is controlled by or is
under common control with such Party. For the purposes of this definition, the
word “control” (including, with correlative meaning, the terms “controlled by”
or “under the common control with”) means the actual power, either directly or
indirectly through one or more intermediaries, to direct or cause the direction
of the management and policies of such entity, whether by the ownership of fifty
percent (50%) or more of the voting stock of such entity, or by contract or
otherwise.

1.5 “Agreement” has the meaning set forth in the preamble.

1.6 “Applicable Transaction” has the meaning set forth in Section 9.2(a).

1.7 “Approval Date” has the meaning set forth in Section 15.9.

1.8 “Audited Party” has the meaning set forth in Section 4.3(d).

1.9 “Best Knowledge” means, as applied to a Party, that the applicable Party’s
senior management with operational responsibility for the Development or
Commercialization of the Product is actually aware of a particular fact or other
matter following reasonably diligent inquiry of its management employees with
primary responsibility for the applicable subject matter.

1.10 “Chroma” has the meaning set forth in the preamble.

1.11 “Chroma Indemnitees” has the meaning set forth in Section 11.2.

1.12 “Chroma Know-How” means all Know-How that is Controlled by Chroma or its
Affiliates as of the Effective Date or during the Term and is necessary or
reasonably useful for the Development or Commercialization of the Product in the
Field in accordance with the terms of this Agreement. For clarity, Chroma
Know-How includes Know-How relating to previously conducted Non-Clinical Studies
for the Product, Past Studies, and Currently Ongoing Studies, but excludes
Information contained within the Chroma Patents. Chroma Know-How shall not
include any rights to any independent Know-How of any Third Party entity which
obtains “control” (as defined in the definition of Affiliate) of Chroma after
the Effective Date, provided that (i) such transaction is not entered into in an
effort to circumvent the license granted under this Agreement and (ii) any
Know-How constituting “Chroma Know-How” immediately prior to such acquisition of
“control”, or would become “Chroma Know-How” but for such acquisition of
“control”, shall continue to be licensed under the terms of this Agreement.

 

2

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.13 “Chroma Patents” means any Patent that (a) is Controlled by Chroma or its
Affiliates as of the Effective Date or at any time during the Term (including
any Patent arising from Chroma’s Sole Inventions but excluding Joint Patents),
and (b) would, but for the license granted by Chroma hereunder, be infringed by
the Development, Manufacture, have manufacture, use, sale, offer for sale,
having sold, distribution, import, or any other Commercialization of the Product
by or on behalf of CTI or its sublicensee(s) in the Field. Chroma Patents shall
include without limitation those Patents listed on Exhibits B-1 and the
Manufacturing Patent (except that the Manufacturing Patent will be licensed
non-exclusively to CTI under the terms of Section 2.1(a)(ii)), and any patent
issuing from an application claiming priority thereto or otherwise continuing
therefrom. “Chroma Patents” shall not include any rights to any independent
Patents of any Third Party entity which acquires “control” (as defined in the
definition of Affiliate) of Chroma after the Effective Date, provided that
(i) such transaction is not entered into in an effort to circumvent the license
granted under this Agreement and (ii) any Patents constituting “Chroma Patents”
immediately prior to such acquisition of “control”, or would become “Chroma
Patents” but for such acquisition of “control”, shall continue to be licensed
under the terms of this Agreement.

1.14 “Chroma Technology” means the Chroma Patents and Chroma Know-How.

1.15 “Claims” has the meaning set forth in Section 11.1.

1.16 “CMC” means chemistry, manufacturing and controls as specified by the FDA.

1.17 “Commercial Information” means sales call activity reports, listing of
major accounts including addresses, lists and contact details of distributors
and volume of sales activity over the preceding twelve (12) months, list of
reimbursement assistance vendors and contact details, list of ongoing
investigator sponsored trials including study title and location, managed care
and HMO agreements and contact lists, copies of current sales promotional
material as well as master production materials, any other similar general
information that is solely related to the Commercialization of the Product in
the Licensed Territory. Commercial Information expressly excludes any
proprietary CTI Know-How. For the avoidance of doubt, no rights under Patents
Controlled by CTI are licensed to Chroma in connection with any provision of
Commercial Information to Chroma under this Agreement.

1.18 “Commercialization,” with a correlative meaning for “Commercialize” and
“Commercializing,” means all activities undertaken before and after obtaining
Regulatory Approvals relating specifically to the pre-launch, launch, promotion,
Detailing, medical education and medical liaison activities, publication,
marketing, pricing, reimbursement, sale, offering for sale, distribution and
import of the Product, including: (a) strategic marketing, sales force
detailing, advertising, medical education and liaison, and market and Product
support; and (b) all customer support, Product distribution, invoicing and sales
activities.

1.19 “Commercialization Sublicensee” means any Third Party to which CTI or its
Affiliate sublicenses its rights under Sections 2.1(a)(i) and 2.1(a)(ii).

 

3

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.20 “Committee” has the meaning set forth in Section 3.3(a).

1.21 “Competing Product” means any product, other than the Product, containing
tosedostat as an active ingredient, or any other product which has as its
primary mode of action the inhibition of aminopeptidases.

1.22 “Compound” means tosedostat (designated by Chroma as CHR-2797), which has
the structure set forth on Exhibit A-1, its prodrugs and metabolites, as well as
its and their acids, bases, isomers, enantiomers, esters, salts, hydrates,
solvates and polymorphs, in any dosage form or form of administration.

1.23 “Confidential Information” means, with respect to a Party, all non-public
Information of such Party that is disclosed to the other Party under this
Agreement, whether in oral, written, graphic, or electronic form. All non-public
Information disclosed by either Party pursuant to the Mutual Confidential
Disclosure Agreement between the Parties dated October 1, 2010 (the “CDA”), or
the Non-binding Proposal for the Licensing of Tosedostat dated February 2, 2011,
shall be deemed to be such Party’s Confidential Information disclosed hereunder.

1.24 “Control” means, with respect to any material, Know-How, or intellectual
property right, that a Party (a) owns or (b) has a license to such material,
Know-How, or intellectual property right and, in each case, has the ability to
grant to the other Party access, a license, or a sublicense (as applicable) to
the foregoing on the terms and conditions set forth in this Agreement without
violating the terms of any then-existing agreement or other arrangement with any
Third Party.

1.25 “Corresponding Share” has the meaning set forth in Section 4.4(b).

1.26 “CTI” has the meaning set forth in the preamble.

1.27 “CTI Indemnitees” has the meaning set forth in Section 11.1.

1.28 “Currently Ongoing Studies” means, collectively, the following clinical
studies: (a) “Extension Study With Tosedostat in Relapsed/Refractory Acute
Myeloid Leukemia”; NCT01180426 [Recruiting], and (b) “Safety and Anti-Disease
Activity of Oral Tosedostat (CHR-2797) in Elderly Subjects With Refractory or
Relapsed AML (OPAL)”, NCT00780598 [Active, not recruiting], and (c) “A program
of randomized phase II multicenter studies to assess the tolerability and
efficacy of the addition of new drugs to standard induction chemotherapy in AML
and RAEB > 66 years and very poor risk AML > 18 years”, Hovon 103,
2009-014455-68 [Recruiting].

1.29 “Defaulting Party” has the meaning set forth in Section 13.3.

1.30 “Designated Executive” has the meaning set forth in Section 3.1(b).

 

4

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.31 “Detail” means a face-to-face or electronic presentation and any associated
in-service training regarding the features of the Product by a Party’s sales
representative to one or several medical professional(s) having prescribing
authority in the Field (including pharmacists), as well as to other individuals
or entities that have significant impact or influence on prescribing decisions
in the Field.

1.32 “Develop” or “Development” means all research and development activities
relating to preparing and conducting and documenting Non-Clinical Studies, human
clinical studies, CMC development and regulatory activities (e.g., regulatory
applications) with respect to the Product.

1.33 “Development Budget” means the binding annual budget for the Development
activities to be undertaken by the Parties under the Development Plan, which
Development Budget shall be included in and based on the then-current
Development Plan.

1.34 “Development Costs” means reasonable expenses and other costs, including
external regulatory expenses, directly incurred by or on behalf of a Party in
connection with the Development activities to be undertaken by the Parties in
accordance with the approved Development Plan and Development Budget, including,
without limitation, the external costs of clinical trials, the preparation,
collation and/or validation of data from such clinical trials and the
preparation of medical writing and publishing, but excluding any Indirect Costs
and any costs of external fees related to the filing of Regulatory Materials.
Without limitation of the generality of the foregoing, Development Costs shall
include:

(a) all Out-of-Pocket Costs incurred by the Parties or their Affiliates;

(b) the cost of clinical supply, including without limitation (i) costs of
clinical supplies of Product, (ii) expenses incurred to purchase and/or package
comparator drugs, and (iii) costs and expenses of disposal of clinical samples;
and

(c) the costs of consultation and pre-submission meetings with Regulatory
Authorities, including any costs related to pharmacovigilance, to the extent
such costs are to be considered Development Costs in accordance with the
Development Plan.

1.35 “Development Designee” means a Third Party appointed by a Party to conduct
Development activities on behalf of such Party as permitted under Section 4.6.

1.36 “Development Documentation” means all Development Information for the
Product, including any documentation containing test data for the Product
(including pharmacological, biological, chemical, biochemical, clinical study
data and data resulting from Non-Clinical Studies), Regulatory Materials, CMC
information, drug master files, stability data, and other manufacturing or study
data for the Product.

1.37 “Development Plan” has the meaning set forth in Section 4.3(a). For
clarity, the Development Plan includes the Initial Development Plan as well as
any amendments or updates

 

5

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

thereto provided under the terms and conditions of this Agreement, including
those provided under Sections 4.3(a)(iii), 4.4, and 4.9.

1.38 “Diligent Efforts” means, with respect to a Party’s obligation under this
Agreement to Develop or Commercialize the Product, efforts and resources which
would normally be used by a pharmaceutical company in the pharmaceutical
industry for a product owned by or licensed to it, and activities related to the
development and commercialization of such product, which is of similar
commercial potential at a similar stage in its development or product lifecycle,
taking into account various issues, such as its safety and efficacy, product
profile, cost to develop, cost and availability of supply, the time required to
complete development, the competitiveness of the marketplace, the company’s
patent position with respect to such product (including the company’s ability to
obtain or enforce, or have obtained or enforced, such patent rights), the
third-party patent landscape relevant to the product, the regulatory structure
involved, the likelihood of regulatory approval, the anticipated or actual
profitability of the applicable product, and all other relevant factors, all as
measured by the facts and circumstances at the time such efforts are due
provided that in relation to CTI’s obligations under this Agreement CTI shall
not be entitled to factor in sums owed to Chroma under this Agreement or any
sums due to any Third Party licensor of Intellectual Property which CTI licenses
and is used in relation to the Product.

1.39 “Dollar” means a U.S. dollar, and “$” shall be interpreted accordingly.

1.40 “Effective Date” has the meaning set forth in the preamble.

1.41 “Effective Date of Termination” means the date that this Agreement is
terminated under the terms of any of Section 13.2, 13.3, 13.4 or 13.5, as
applicable, including the expiration of any cure period or dispute resolution
provided thereunder.

1.42 “Executive Steering Committee” or “ESC” means the committee formed by the
Parties as described in Section 3.1.

1.43 “Extraterritorial Studies” means all Non-Clinical Studies and clinical
studies wheresoever conducted during the Term, whether conducted prior to or
following Regulatory Approval of the Product, pertaining to the Regulatory
Approval of the Product in the Field solely for the ROW Territory including:
Phase 1, 2, 3 or 4 Clinical Studies or pivotal studies (including studies for
additional indications or label expansion); investigator-sponsored trials,
safety or surveillance studies; pharmacoeconomic studies; pharmacoepidemiology
studies; reimbursement studies; and other studies.

1.44 “FDA” means the U.S. Food and Drug Administration or any successor entity.

1.45 “FD&C Act” means the U.S. Federal Food, Drug and Cosmetic Act, as amended.

1.46 “Field” means cancer therapy (including, without limitation, tumor
metastasis and growth).

 

6

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.47 “First Commercial Sale” means the first sale to a Third Party of a Product
in a given regulatory jurisdiction after Regulatory Approval has been obtained
in such jurisdiction, excluding any pre-regulatory named patient sales, expanded
access sales or MTA sales.

1.48 “First Line” means use of the Product as the initial treatment for a given
condition or indication.

1.49 “Funding Cap” has the meaning set forth in Section 4.3(b)(iii).

1.50 “Generic Version” has the meaning set forth in Section 8.4(c).

1.51 “Good Clinical Practices” or “GCP” means the then-current standards,
practices and procedures for good clinical practice promulgated or endorsed or
required by the Regulatory Authority in the Licensed Territory and the ROW
Territory as applicable including by the FDA as set forth in the guidelines
entitled “Guidance for Industry E6 Good Clinical Practice: Consolidated
Guidance,” including related regulatory requirements imposed by the FDA and
comparable regulatory standards, practices and procedures in jurisdictions
outside the U.S. including the European Union, as they may be updated from time
to time, including applicable quality guidelines promulgated under the
International Conference on Harmonization (“ICH”).

1.52 “Good Laboratory Practices” or “GLP” means the then-current good laboratory
practice standards promulgated or endorsed or required by the Regulatory
Authority in the Licensed Territory and the ROW Territory as applicable
including by the FDA as defined in 21 C.F.R. Part 58, and comparable regulatory
standards in jurisdictions outside the U.S. including the European Union, as
they may be updated from time to time, including applicable quality guidelines
promulgated under the ICH.

1.53 “Good Manufacturing Practices,” “cGMP” or “GMP” means the then-current good
manufacturing practices as required by the Regulatory Authority in the Licensed
Territory and ROW Territory, as applicable, including by the FDA as defined in
the U.S. Current Good Manufacturing Practices, 21 CFR Parts 210 and 211
including related regulatory requirements imposed by the FDA for the manufacture
and testing of pharmaceutical materials, and comparable regulatory standards in
jurisdictions outside the U.S. including the European Union, as they may be
updated from time to time, including applicable quality guidelines promulgated
under the ICH and other applicable regulations.

1.54 “Governmental Authority” means any multi-national, federal, state, local,
municipal, provincial or other government authority of any nature (including any
governmental division, prefecture, subdivision, department, agency, bureau,
branch, office, commission, council, court or other tribunal).

1.55 “HSR Filing Date” has the meaning set forth in Section 15.9.

1.56 “IND” means (a) an Investigational New Drug application as defined in the
FD&C Act and applicable regulations promulgated hereunder by the FDA, or (b) the
equivalent

 

7

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

application to the equivalent Governmental Authority in any other regulatory
jurisdiction outside the U.S., the filing of which is necessary to commence or
conduct clinical testing of a pharmaceutical product in humans in such
jurisdiction.

1.57 “Indemnified Party” has the meaning set forth in Section 11.3.

1.58 “Indemnifying Party” has the meaning set forth in Section 11.3.

1.59 “Indirect Costs” means any indirect costs and expenses incurred by either
Party, including internal personnel costs (such as compensation and benefits) or
other internal overhead costs, rental expenses, lease expenses, utilities,
travel and depreciation.

1.60 “Information” means any data, results, technology, business and financial
information and information of any type whatsoever, in any tangible or
intangible form, including, without limitation, specifications, software,
algorithms, marketing reports, test data (including pharmacological, biological,
chemical, biochemical, clinical study data and data resulting from Non-Clinical
Studies), CMC information, stability data, and other study data.

1.61 “Initial Development Plan” has the meaning set forth in Section 4.3(a)(ii).

1.62 “Initial Notice” has the meaning set forth in Section 9.2(a).

1.63 “Initial Period” has the meaning set forth in Section 9.2(a).

1.64 “Initiation” of a clinical trial shall mean the first dosing of the first
patient in such trial.

1.65 “Joint Development Committee” or “JDC” means the committee formed by the
Parties as described in Section 3.2.

1.66 “Joint Inventions” has the meaning set forth in Section 9.1.

1.67 “Joint Patent” has the meaning set forth in Section 9.4(b).

1.68 “Know-How” means all technical Information and know-how, including
inventions, discoveries, trade secrets, instructions, processes, formulae,
materials, expertise and other technology applicable to formulations,
compositions, products or their Manufacture, Development, registration, use or
Commercialization or methods of assaying or testing them or processes for their
manufacture, formulations containing them, compositions incorporating or
comprising them and including all biological, chemical, pharmacological,
biochemical, toxicological, pharmaceutical, physical and analytical, safety,
quality control, manufacturing, preclinical and clinical data, instructions,
processes, formulae, expertise and information, Regulatory Materials and copies
thereof, relevant to the Development, Manufacture, use or Commercialization of
and/or which may be useful in studying, testing, Development, production or
formulation of products, or intermediates for the synthesis thereof.

 

8

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.69 “Laws” means all laws, statutes, rules, regulations, ordinances and other
pronouncements having the effect of law of any federal, national, multinational,
state, provincial, county, city or other political subdivision, domestic or
foreign, including without limitation 21 CFR part 54, HIPAA.

1.70 “Licensed Territory” means North, Central and South Americas, including
their respective territories and possessions. This includes, without limitation,
the United States, Canada, Mexico, Brazil, Argentina, Venezuela and their
respective territories and possessions.

1.71 “Licensed Territory Specific Studies” means all Non-Clinical Studies and
clinical studies wheresoever conducted during the Term, whether conducted prior
to or following Regulatory Approval of the Product, pertaining to the Regulatory
Approval of the Product in the Field solely for the Licensed Territory
including; Phase 1, 2, 3, 4 Clinical Studies or pivotal studies (including
studies for additional indications or label expansions; investigator sponsored
trials, safety or surveillance studies, pharmacoeconomic studies;
pharmacoepidemiology studies, reimbursement studies; and other studies.

1.72 “Manufacture” with a correlative meaning for “Manufacturing,” means all
activities related to the manufacturing of a pharmaceutical product, or any
ingredient thereof, including manufacturing Product in finished form for
Development, manufacturing finished Product for Commercialization, packaging,
in-process and finished product testing, release of product or any component or
ingredient thereof, quality assurance activities related to manufacturing and
release of product, all stability studies including those for registration, the
development and validation of testing methods used for, but not limited to,
release test, stability test and every testing method for commercial use,
preparation of the documents of any “Manufacture” related reports in “common
technical document” form described in the ICH guidelines, and documents
necessary for clinical and market authorization development including but not
limited to development history reports for drug substance and drug product,
comparability studies and reports, in the Licensed Territory and ROW Territory
and regulatory activities related to any of the foregoing.

1.73 “Manufacturing Patent” means US Patent 5,912,360.

1.74 “Marketing Authorization Application” or “MAA” means an application to the
appropriate Regulatory Authority for approval to market the Product (but
excluding pricing approval) in any particular jurisdiction.

1.75 “Meetings” has the meaning set forth in Section 6.8.

1.76 “NDA” means a New Drug Application in the United States for authorization
for marketing of a pharmaceutical product, as defined in the applicable Laws and
filed with the FDA.

1.77 “Negotiation Period” has the meaning set forth in Section 9.2(a).

 

9

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.78 “Net Sales” means, with respect to a particular time period, the total
amounts invoiced by CTI, its Affiliates and their respective sublicensees for
sales of Products made during such time period to unaffiliated Third Parties,
less the following deductions in each case to the extent reasonable and
customary and actually allowed or incurred with respect to such sales:

(a) **;

(b) **;

(c) **;

(d) **;

(e) **;

(f) **; and

(g) **.

Notwithstanding the foregoing, amounts invoiced by CTI, its Affiliates, or their
sublicensees for the sale of Product among CTI, its Affiliates or their
respective sublicensees for resale shall not be included in the computation of
Net Sales hereunder and such amounts shall be accounted for only once. For
purposes of determining Net Sales, a “sale” shall not include reasonable
transfers or dispositions, at no cost, as samples or for charitable purposes, or
transfers or dispositions at no cost for Non-Clinical Studies, clinical or
regulatory purposes. Net Sales shall be accounted for in accordance with
standard CTI practices for operation by CTI, its Affiliates or sublicensees, as
practiced in the relevant country in the Licensed Territory, but in any event in
accordance with Accounting Standards, consistently applied in such country in
the Licensed Territory. Product sales are recognized when persuasive evidence of
an arrangement with a Third Party at a fixed or determinable price exists, title
and risk of loss has passed to the Third Party (generally upon receipt by the
Third Party, and collectability of amounts billed is reasonably assured).
Provisions for ** shall be recorded at the time of sale.

1.79 “Non-Clinical Studies” means in vivo animal or in vitro pharmacology,
pharmacokinetic, or toxicology testing.

1.80 “Non-Defaulting Party” has the meaning set forth in Section 13.3.

1.81 “Non-Opted In Additional Product Development” has the meaning set forth in
Section 4.9(a).

1.82 “Non-Opted In Study” has the meaning set forth in Section 4.4(a).

1.83 “Non-Proposing Party” has the meaning set forth in Section 4.4(a).

 

10

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.84 “Out-of-Pocket Costs” means reasonable, direct and documented expenses paid
to Third Parties and specifically identifiable and incurred in connection with
the Development of the Product. Such expenses shall have been recorded as income
statement items in accordance with the applicable Accounting Standards and, for
the avoidance of doubt, shall not include **.

1.85 “Party” and “Parties” has the meaning set forth in the preamble.

1.86 “Past Studies” means, collectively, the following clinical studies that
have been completed or terminated prior to the Effective Date: (a) “Clinical
Trial to Test the Safety and Effectiveness of an Investigational Drug CHR-2797
With Erlotinib in Patients With Locally Advanced or Metastatic Non-small Cell
Lung Cancer”, NCT00522938 [Terminated–Poor Recruitment], (b) “Safety Study to
Evaluate CHR-2797 in Patients With Advanced Tumours”, NCT00692354 [Completed],
(c) “A Study of the Safety and Tolerability of the Addition of CHR-2797 to
Paclitaxel in Patients With Advanced or Refractory Tumours”, NCT00737555
[Completed], and (d) “ A Phase I-II Study to Evaluate the Safety, Tolerability
and Anti-Disease Activity of the Aminopeptidase Inhibitor, CHR-2797, in Elderly
and/or Treatment Refractory Patients with Acute Myeloid Leukaemia or Multiple
Myeloma”, NCT00689000 [Completed].

1.87 “Patents” means (a) pending patent applications (and patents issuing
therefrom), issued patents, utility models and designs; and (b) reissues,
substitutions, confirmations, registrations, validations, re-examinations,
additions, continuations, continued prosecution applications,
continuations-in-part, or divisions of or to any patents, patent applications,
utility models or designs, in each case being enforceable within the applicable
territory.

1.88 “Patent Term Extension” means any term extensions, supplementary protection
certificates, and equivalents thereof offering patent or patent-like protection
beyond the initial term with respect to any issued Patents.

1.89 “Phase 1 Clinical Trial” means a clinical trial of a pharmaceutical product
on healthy subjects or patients with the primary purpose of determining safety,
metabolism and pharmacokinetic properties and clinical pharmacology of such
product.

1.90 “Phase 2 Clinical Trial” means a clinical trial of a pharmaceutical product
on patients, including possibly pharmacokinetic studies, the principal purposes
of which are to make a preliminary determination that such product is safe for
its intended use and to obtain sufficient information about such product’s
efficacy to permit the design of a Phase 3 Clinical Trial.

1.91 “Phase 3 Clinical Trial” means a clinical trial on sufficient numbers of
patients, which trial(s) are designed to (a) establish that a drug is safe and
efficacious for its intended use; (b) define warnings, precautions and adverse
reactions that are associated with the drug in the dosage range to be
prescribed; and (c) support approval of an application to a Regulatory Authority
for the commercial marketing of such drug.

1.92 “Phase 4 Clinical Trial” means a clinical trial of a pharmaceutical product
conducted after Regulatory Approval of the product has been obtained from an
appropriate

 

11

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Regulatory Authority, which trial is (a) conducted voluntarily by a Party to
enhance marketing or scientific knowledge of such product (e.g., for expansion
of product labeling or dose optimization), or (b) conducted as a condition for
sale or post-approval commitment to or requirement of a Regulatory Authority.
For clarity, a human clinical trial conducted to support a new Regulatory
Approval for a new indication of a product shall not be considered a Phase 4
Clinical Trial.

1.93 “Product” means (a) the Compound or (b) any Additional Product, in finished
dosage pharmaceutical form, whether administered together as a single
pharmaceutical product or co-administered together with one or more other
biologic or pharmaceutically active products or agents.

1.94 “Product Complaint” means any written, verbal or electronic expression of
dissatisfaction regarding the Product, including without limitation reports of
actual or suspected product tampering, contamination, mislabeling or inclusion
of improper ingredients.

1.95 “Product Infringement” has the meaning set forth in Section 9.6(b).

1.96 “Product Mark” has the meaning set forth in Section 6.6.

1.97 “Proposing Party” has the meaning set forth in Section 4.4(a).

1.98 “Quality Agreement” has the meaning set forth in Section 7.2.

1.99 “Regulatory Approval” means all approvals necessary, excluding price
approval, for the commercial sale of the Product for the Field in a given
country or regulatory jurisdiction.

1.100 “Regulatory Authority” means, in a particular country or jurisdiction, any
applicable Governmental Authority involved in granting Regulatory Approval in
such country or jurisdiction.

1.101 “Regulatory Exclusivity” means any exclusive marketing rights or data
exclusivity rights conferred by any Governmental Authority with respect to the
Product, in a country under the jurisdiction of such Government Agency in the
Licensed Territory, other than a Patent right, including, without limitation,
rights conferred in the U.S. under the Hatch-Waxman Act or the FDA Modernization
Act of 1997, or rights similar thereto outside the U.S.

1.102 “Regulatory Materials” means regulatory applications, submissions,
notifications, communications, correspondence, registrations, Regulatory
Approvals and/or other filings made to, received from or otherwise conducted
with a Governmental Authority in order to Develop, Manufacture, market, sell or
otherwise Commercialize the Product in a particular country, territory or
possession. Regulatory Materials include, without limitation, INDs, NDAs and
MAAs.

 

12

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1.103 “Retained Liabilities” has the meaning set forth in Section 11.4.

1.104 “Reviewing Party” has the meaning set forth in Section 4.3(d).

1.105 “ROFR Notice” has the meaning set forth in Section 9.2(b).

1.106 “ROFR Notice Period” has the meaning set forth in Section 9.2(b).

1.107 “ROW Territory” means worldwide except the Licensed Territory.

1.108 “Royalty Term” means, with respect to a particular Product within a
particular country in the Licensed Territory, the period of time beginning upon
the date of First Commercial Sale of such Product in such particular country and
continuing until the later of: (a) the date of expiration of the last Valid
Claim in such country that would be infringed by the Development, Manufacture,
use or sale of such Product in such country, (b) the expiration of all
Regulatory Exclusivity periods with respect to the Product in such country, or
(c) ten (10) years after the First Commercial Sale in such country. Thereafter,
no further royalties shall be due with respect to such Product in such country.

1.109 “r/r AML” means relapsed/refractory acute myelogenous leukemia.

1.110 “r/r MDS” means relapsed/refractory myelodysplastic syndromes.

1.111 “r/r MM” means relapsed/refractory multiple myeloma.

1.112 “Sales and Marketing Plan” has the meaning set forth in Section 6.2.

1.113 “Sales Event 1” has the meaning set forth in Section 8.3.

1.114 “Sales Event 2” has the meaning set forth in Section 8.3.

1.115 “Sales Event 3” has the meaning set forth in Section 8.3.

1.116 “Sole Inventions” has the meaning set forth in Section 9.1.

1.117 “Study Report IP” means the copyright in study report C09/IIC/001 to
manufacture BB-76163 in accordance with the route described in that study
report.

1.118 “Subject CTI Rights” has the meaning set forth in Section 9.2.

1.119 “Supply Agreement” has the meaning set forth in Section 7.2.

1.120 “Take the Lead” shall mean, with respect to a particular Party, that such
Party is primarily responsible for, and has the authority to make, all
day-to-day decisions (in accordance with the approved Development Plan and Sales
and Marketing Plan) as they relate to such Party’s responsibilities, rights
and/or obligations hereunder; provided, however, the Parties shall

 

13

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

consult with each other with respect to any matters as requested by either Party
or as otherwise required by the terms of this Agreement.

1.121 “Taxes” means taxes (other than income taxes), duties, tariffs or other
governmental charges levied on the sale of Products, including, without
limitation, consumption taxes.

1.122 “Term” means the term of this Agreement, as determined in accordance with
Article 13.

1.123 “Third Party” means any entity other than Chroma or CTI or an Affiliate of
either of them.

1.124 “Third Party Royalties” has the meaning set forth in Section 8.4(d)(ii).

1.125 “Threshold” has the meaning set forth in Section 8.4(c).

1.126 “Transition Development Plan” has the meaning set forth in
Section 13.8(a).

1.127 “Transition Period” has the meaning set forth in Section 13.7(e).

1.128 “Transition Plan” has the meaning set forth in Section 13.7(e).

1.129 “Upstream Agreements” means the agreements listed on Exhibit B-2.

1.130 “Valid Claim” means a pending or issued claim of a Patent within the
Chroma Patents which: (a) has not been held unpatentable, invalid or
unenforceable by a court or other government agency of competent jurisdiction in
a decision from which no appeal can or has been taken; and (b) which has not
been admitted to be invalid or unenforceable through reissue, re-examination,
disclaimer or otherwise. Notwithstanding the foregoing, if a claim of a pending
patent application within the Patents has not issued as a claim of a patent
within five (5) years from first filing of the application, such claim shall not
be a Valid Claim for the purposes of this Agreement, unless and until such claim
issues as a claim of an issued patent (from and after which time the same shall
be deemed a Valid Claim subject to paragraphs (a) and (b) above). With respect
to a Valid Claim of a pending patent application, the phrase to “infringe a
Valid Claim” means to engage in an activity that would infringe (i.e., by either
directly infringing, contributorily infringing, or inducing infringement of)
such Valid Claim if it were contained in an issued patent.

1.131 “Vernalis” means Vernalis (R&D) Limited (formerly Vernalis (Oxford)
Limited) registered in England with number 1985479.

1.132 “Vernalis Agreement” means the agreement between Vernalis and Chroma dated
24 November 2003 as amended by amendment No.1 dated 30 March 2007.

 

14

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

ARTICLE 2

LICENSES AND EXCLUSIVITY

2.1 Licenses to CTI under Chroma Technology.

(a) License Grants.

(i) Subject to the terms and conditions of this Agreement, Chroma hereby grants,
and shall cause each of its Affiliates to grant CTI, a royalty-bearing,
exclusive license under the Chroma Technology, with the right to sublicense as
provided below, to Develop, Manufacture, use, make, and have made the Product in
the Field in the Licensed Territory, in each case in accordance with the
Development Plan and the Supply Agreement and to sell, offer for sale, have
sold, distribute, import and otherwise Commercialize the Product in the Field in
the Licensed Territory.

(ii) Subject to the terms and conditions of this Agreement, Chroma hereby grants
and shall cause each of its Affiliates to grant CTI a royalty-bearing,
non-exclusive license under the Manufacturing Patent and the Study Report IP,
with the right to sublicense as provided below, to Manufacture and have made the
Product in the Field in the Licensed Territory.

(iii) The Chroma Patents identified on Exhibit B-1 are licensed to Chroma by
Vernalis under the Vernalis Agreement. CTI acknowledges and agrees that its
sublicense rights to such Patents under this Agreement are at all times subject
to the applicable terms of the Vernalis Agreement, current copies of which have
been provided to CTI as of the Effective Date, provided that Chroma shall at all
times be responsible for any payment obligations to Vernalis pursuant to the
Vernalis Agreement. Chroma shall provide prior notice to CTI of any proposed
amendment of the Vernalis Agreement and shall not, without CTI’s prior written
consent, amend or terminate the Vernalis Agreement, which consent shall not be
unreasonably withheld, conditioned or delayed. If Chroma becomes aware of any
amendment or termination of any other Upstream Agreement, Chroma shall promptly
notify CTI of the same. If Chroma receives a notice of default or termination
from Vernalis, Chroma shall promptly provide a copy of such notice to CTI.
Chroma will use commercially reasonable efforts to cure any such default to
avoid termination of the Vernalis Agreement. At CTI’s option, but without any
obligation and without limiting any remedies CTI may have against Chroma, CTI
may cure any payment default on behalf of Chroma under the Vernalis Agreement.
Any such payments made by CTI, whether to cure any default of Chroma or to pay
royalties on behalf of Chroma under the Vernalis Agreement, may be deducted from
royalties and milestone payments otherwise due to Chroma under Article 8.

(b) Chroma Retained Rights. Notwithstanding the rights granted to CTI in
Section 2.1(a) and without limiting the generality of Section 2.4, Chroma
retains the right to (i) conduct the Development and Commercialization
activities in the ROW Territory as expressly permitted to be conducted by Chroma
under this Agreement, including the conduct of any

 

15

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Extraterritorial Studies designated to be performed by Chroma under
Section 4.3(c)(ii) of this Agreement; (ii) to Develop, Manufacture, use, make
and have made the Product in the Field in the Licensed Territory for the
purposes of exercising its rights in relation to the Product in the ROW
Territory or to supply Product to CTI in the Licensed Territory; and (iii) the
right to Develop, Manufacture, use make, have made, import and use Product in
the Licensed Territory for the purposes of complying with its obligations under
this Agreement with respect to any Additional Studies, or with the prior written
approval of CTI (such approval not to be unreasonably withheld, conditioned or
delayed), to carry out clinical trials in the Licensed Territory for the
exclusive purpose of supporting regulatory activities in the ROW Territory.

(c) Sublicense Rights. CTI shall have the right to sublicense any of the rights
set forth in Section 2.1(a), subject to Chroma’s prior written approval, which
shall not be unreasonably withheld, delayed or conditioned provided that any
such sublicense which is granted to an Affiliate of CTI shall not require
Chroma’s prior written approval unless and until such Affiliate ceases to be an
Affiliate of CTI. Promptly after the execution of any sublicense agreement, CTI
shall notify Chroma and, if requested in writing by Chroma, provide Chroma with
a copy of such agreement; provided, that any information CTI reasonably deems to
be confidential may be redacted. CTI hereby covenants that it will include in
all agreements granting sublicenses under the rights granted in Section 2.1(a)
provisions consistent with the terms of this Agreement as applicable to a
sublicense, including without limitation those contained in Article 4, Article
5, Article 6 and Article 8. CTI shall be liable to Chroma for all acts or
omissions of any such sublicensee in connection with such sublicense.

2.2 Negative Covenants.

(a) No Grant of Rights. Chroma agrees not to grant to any Third Party (i) any
rights inconsistent with the rights and licenses granted to CTI under this
Agreement, including any rights or licenses in or to the Chroma Technology in
the Licensed Territory, whether under a material transfer agreement or
otherwise; and (ii) subject to Section 2.1(b) above without CTI’s prior written
approval (which shall not be unreasonably withheld, delayed or conditioned), any
rights or licenses in or to the Chroma Technology to any Third Party in the
Field in the ROW Territory. Chroma hereby covenants that it will include in all
agreements granting sublicenses under the Chroma Technology in the Field in the
ROW Territory provisions consistent with the terms of this Agreement as
applicable to a sublicense, including without limitation those contained in
Article 4, Article 5 and Article 6.

(b) Non-Competition.

(i) Chroma shall not during the term of this Agreement anywhere in the Licensed
Territory, Develop, Manufacture, market, promote, advertise, sell or offer to
sell, or otherwise Commercialize (or license or collaborate with a Third Party
to do any of the foregoing) a Competing Product. Chroma shall not, during the
term of this Agreement, Commercialize the Product to or with a particular entity
in the ROW Territory that Chroma knows or reasonably should know will distribute
or sell the Product in the Licensed Territory,

 

16

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

provided that this obligation applies to Chroma only and does not require Chroma
to police its sublicensees in this regard. For the purposes of this
Section 2.2(b)(i), any act or activity undertaken, or failure to act, by an
Affiliate of Chroma, which, if committed by Chroma would constitute a breach of
this Section, shall constitute a breach by Chroma.

(ii) CTI shall not during the term of this Agreement anywhere in the ROW
Territory, Develop, Manufacture, market, promote, advertise, sell or offer to
sell, or otherwise Commercialize (or license or collaborate with a Third Party
to do any of the foregoing) a Competing Product. CTI shall not, during the term
of this Agreement, Commercialize the Product to or with a particular entity in
the Licensed Territory that CTI knows or reasonably should know will distribute
or sell the Product in the ROW Territory, provided that this obligation applies
to CTI only and does not require CTI to police its sublicensees in this regard.
For the purposes of this Section 2.2(b)(ii), any act or activity undertaken, or
failure to act, by an Affiliate of CTI, which, if committed by CTI would
constitute a breach of this Section, shall constitute a breach by CTI.

(c) No Liens. During the Term, Chroma shall not grant any liens, security
interests or other encumbrances on the Chroma Technology, other than security
interest to lenders similar to the one described on Exhibit B-1 that is granted
in Chroma’s ordinary course of business covering Chroma’s assets generally.

2.3 Registration of License. Notwithstanding anything to the contrary in Article
12, CTI, at its expense, may register the licenses granted under this Agreement
in any country of the Licensed Territory. Upon request by CTI, Chroma agrees
promptly to, and to cause each of its Affiliates to, execute any “short form”
licenses consistent with the terms and conditions of this Agreement submitted to
it by CTI, or effect any registrations of its own, which are reasonably
necessary to effect the foregoing registration in such country.

2.4 No Implied Licenses. Except as explicitly set forth in this Agreement,
neither Party grants any license, express or implied, under its intellectual
property rights to the other Party.

ARTICLE 3

OVERVIEW; MANAGEMENT

3.1 Executive Steering Committee.

(a) Formation and Role. The Parties agree to establish and convene a Executive
Steering Committee (or “ESC”) for the overall coordination and oversight of the
Parties’ activities under this Agreement, promptly after the Effective Date.
Each Party shall have an equal number of representatives on the ESC. The ESC
shall operate by the procedures set forth in Section 3.3. Except as otherwise
provided in Section 14.3(b) and subject to Section 14.2(b), the role of the
Executive Steering Committee shall be:

 

17

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(i) For the Licensed Territory and the ROW Territory, to review and discuss the
overall strategy for the Development, Manufacture, Regulatory Approval
(including the initial approval and any supplements and expansions thereof) and
Commercialization of the Product;

(ii) to review, discuss and approve the Development Plans (including the
Development Budget) on or before March 1 of each calendar year;

(iii) to review, discuss and approve any changes or revisions to the Development
Plan (including the Development Budget);

(iv) to review and discuss the Sales and Marketing Plan, and any proposed
amendments or revisions to such plan;

(v) to resolve any disputes arising within the JDC; and

(vi) to establish such subcommittees, including without limitation the
regulatory working group as provided in Section 5.3 and the Publication Team as
provided in Section 6.7, and to perform such other functions as appropriate to
further the purposes of this Agreement, as mutually agreed by the Parties in
writing.

(b) ESC Decisions and Actions. Actions to be taken by the Executive Steering
Committee shall be taken only following unanimous vote, with each Party having
one (1) vote per representative. Except as otherwise provided in
Section 14.3(b), if the Executive Steering Committee fails to reach unanimous
agreement on a matter before it for decision for a period in excess of fifteen
(15) days from the date first presented to the ESC in writing, the matter shall
be submitted immediately to the Chief Executive Officer of each Party (each, the
“Designated Executive”) for resolution in accordance with the decision-making
procedures described in Section 14.2, including the specific decision-making
rights of each Party as described in such section.

3.2 Joint Development Committee.

(a) Formation and Role. The Parties also agree to establish a Joint Development
Committee (or “JDC”) which will monitor and coordinate communication and
operations regarding the Parties’ efforts with respect to the Development,
Manufacture, and Regulatory Approval of the Product in the Field and in the
Licensed Territory and the ROW Territory. Each Party shall have an equal number
of representatives on the Joint Development Committee. The Joint Development
Committee shall operate by the procedures set forth in Section 3.3. The role of
the Joint Development Committee shall be:

(i) to facilitate the exchange of Information between the Parties under this
Agreement with respect to their Product-related activities (including activities
conducted in the Licensed Territory and the ROW Territory), including as and to
the extent necessary for each Party to perform its obligations under this
Agreement;

 

18

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(ii) to review and comment on the Initial Development Plan and all updates
thereto, and to submit such plan to the ESC for approval (it being understood
that the JDC shall submit such plan with sufficient time for the ESC to review
and approve such plan on or before March 1 of each calendar year);

(iii) to review and comment on any proposed changes or revisions to the
Development Plan (including the Development Budget);

(iv) to review and comment on the Sales and Marketing Plans, and CTI’s
Commercialization activities for the Product in the Licensed Territory and
Chroma’s Commercialization activities for the Product in the ROW Territory;

(v) to establish a global branding strategy for the Product at least twelve
(12) months prior to any Product launch in the Licensed Territory or the ROW
Territory, including the determination of ownership rights related to Product
Marks and related trademark registrations.

(vi) to establish such working teams or subcommittees and to perform such other
functions as appropriate to further the purposes of this Agreement, as
determined by the Parties in writing.

(b) JDC Decisions and Actions. Except as expressly provided in this Section 3.2,
actions to be taken by the JDC shall only be taken following unanimous vote,
with each Party having one (1) vote per representative. Except as otherwise
provided in Section 14.3(b), if the Joint Development Committee fails to reach
unanimous agreement on a matter before it for decision for a period in excess of
ten (10) days from the date first presented to the JDC in writing, the matter
shall be referred immediately to the Executive Steering Committee.

3.3 Committee Membership and Procedures.

(a) Membership. Chroma and CTI shall each designate an equal number of
representatives to serve on each of the ESC and JDC (each, a “Committee”) by
written notices to the other Party. Initially, each Party shall designate three
(3) such representatives. Each Committee may elect to vary the number of
representatives from time to time during the Term. Either Party may designate
substitutes for its Committee representatives if one (1) or more of such Party’s
designated representatives is unable to be present at a meeting. From time to
time each Party may replace its Committee representatives by written notice to
the other Party specifying the prior representative(s) and their replacement(s).
Any such substitutes or replacements shall be designated consistent with the
following principles: at least one (1) representative shall have appropriate
expertise in the clinical development of pharmaceutical products; provided, that
each Committee may vary the expertise required for the representatives of each
Party as it deems appropriate as the Parties gain experience with the Product.
Each Committee will have a chairperson, to be designated as described below. The
chairperson shall be responsible for (i) calling meetings, and (ii) preparing
and circulating an agenda for the upcoming meeting, but shall have no special
authority over the other members of the Committee, and shall have no additional

 

19

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

voting rights. The alliance managers described in Section 3.4 shall be
responsible for preparing and issuing minutes of each ESC and JDC meeting within
thirty (30) days thereafter. Such minutes shall not be finalized until each
Committee representative reviews and approves such minutes in writing; provided
that any minutes shall be deemed approved unless a member of the ESC or the JDC
(as applicable) objects to the accuracy of such minutes within fifteen (15) days
after the circulation of the minutes by the chairperson. The chairpersons of
other subcommittees will be responsible for generating minutes from their
respective meetings.

(b) Chairperson.

(i) The chairperson of the ESC shall be appointed for a calendar year, with
Chroma appointing the initial chairperson. On January 1 of each year after the
Effective Date, the Parties shall rotate designation of the chairperson for the
ESC for the commencing year.

(ii) The chairperson of the JDC shall be appointed for a calendar year. The
initial chairperson of the JDC will be designated by CTI. On January 1 of each
year after the Effective Date, the Parties shall rotate designation of the
chairperson for the JDC for the commencing year, provided that promptly
following submission of the first NDA or other Regulatory Approval for a Product
in the Licensed Territory, CTI will be entitled to replace the chairperson with
a CTI representative to serve for at least twelve (12) months after which time
Chroma shall again be entitled to designate the chairperson on the following
January 1. Thereafter, the Parties shall rotate designation of the chairperson
for the JDC for the subsequent years.

(c) Meetings. Meetings of a Committee shall be effective only if at least two
(2) representatives of each Party are present or participating. A Committee may
meet either (i) in person at either Party’s facilities or at such locations as
the Parties may otherwise agree; or (ii) by audio or video teleconference. With
the prior consent of the other Party’s representatives (such consent not to be
unreasonably withheld or delayed), each Party may invite non-members to
participate in the discussions and meetings of a Committee, provided that such
participants shall have no voting rights or powers and shall be subject to the
confidentiality provisions set forth in Article 12. Additional meetings of a
Committee may be held with the consent of each Party, as required under this
Agreement, or to resolve any dispute referred to it and neither Party will
unreasonably withhold or delay its consent to hold such an additional meeting
(and in the case of any dispute referred to the ESC, such meeting shall be held
within five (5) business days following referral to the ESC, or as soon as
reasonably possible). Each Party shall be responsible for all of its own
expenses incurred in connection with participating in the Committees including
expenses associated with an initial alliance kick-off meeting.

(i) The ESC shall hold at least three (3) meetings per year, or as otherwise
agreed to by the Parties, with at least one (1) of such meetings being held in
person.

 

20

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(ii) The JDC shall each hold a meeting at least every other month, or as
otherwise agreed to by the Parties. Unless otherwise agreed to by the Parties,
the JDC shall hold at least four (4) meetings in person each year to facilitate
alignment and communication.

3.4 Alliance Managers. Promptly following the Effective Date, each Party shall
designate in writing an individual to facilitate communication and coordination
of the Parties’ activities under this Agreement relating to Products.

3.5 Authority. The ESC and JDC shall each perform its responsibilities under
this Agreement based on the principles of prompt and diligent Development,
Manufacture and Commercialization of Products in the Licensed Territory and the
ROW Territory. The Committees shall each have only the powers assigned expressly
to it in this Article 3 and elsewhere in this Agreement, and shall not have any
power to amend, modify or waive compliance with this Agreement.

3.6 Collaboration Guidelines. Subject to the terms of this Agreement, the
activities and resources of each Party shall be managed by such Party, acting
independently and in its individual capacity. The relationship between Chroma
and CTI is that of independent contractors and neither Party shall have the
power to bind or obligate the other Party in any manner, other than as may be
expressly set forth in this Agreement.

3.7 Diligence. CTI shall use Diligent Efforts to Develop, to seek Regulatory
Approval for and to Commercialize Products for use in the Field in the Licensed
Territory after receipt of applicable Regulatory Approval in accordance with the
terms of this Agreement and the Development Plan, consistent with good
pharmaceutical practices. Notwithstanding the foregoing sentence, CTI’s
obligation to use Diligent Efforts shall not apply to the extent of any delay or
failure by or on behalf of Chroma to (i) perform its Development obligations or
responsibilities under the Development Plan, (ii) timely supply the Product for
Development purposes pursuant to the terms of the Supply Agreement, or
(iii) timely transfer manufacturing technology to CTI or its designee. Chroma
shall use Diligent Efforts to conduct, in accordance with the terms of this
Agreement, the Development to be performed by it under this Agreement in
accordance with the Development Plan.

3.8 Sublicensing. In the event that either Party sublicenses a material portion
of its rights in the Product to a Third Party in accordance with the terms of
this Agreement, the Parties shall in good faith discuss and, as appropriate,
amend the structures of the ESC, JDC and any subcommittees to reflect the
revised division of responsibilities following execution of such sublicenses.

ARTICLE 4

PRODUCT DEVELOPMENT

4.1 Overview of Product Development. The Parties desire and intend to
collaborate with respect to the Development of the Product in the Field, as and
to the extent set forth in this

 

21

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Agreement. The general allocation of responsibilities for conducting Development
of the Product shall be as follows: (a) CTI will oversee and shall be
responsible for performing the Development activities in the Licensed Territory,
including for the sponsorship of Licensed Territory Specific Studies; and
(b) Chroma will oversee and shall be responsible for performing the Development
activities in the ROW Territory, including for the sponsorship of
Extraterritorial Studies; in each case unless otherwise agreed to by the JDC.

4.2 Principles of Product Development. Each Party’s Development of the Product
in the Field shall be conducted in a manner consistent with the following
principles: (a) seeking Regulatory Approval that includes the appropriate label
for such Product in light of the clinical data, and (b) obtaining Regulatory
Approval for such Product consistent with the preceding clause and in a timely
manner.

4.3 Development Operations and Expenses.

(a) Development Plan.

(i) General. The Parties shall collaboratively conduct the Development of the
Product pursuant to a mutually agreed written development plan (the “Development
Plan”). The Development Plan will contain the following information, to the
extent such information is available:

(1) scope and target timelines for all Development activities in reasonable
detail as agreed by the Parties supporting Regulatory Approvals in the Field for
the Product in the Licensed Territory and the ROW Territory, including the
performance of Currently Ongoing Studies and any Additional Studies as mutually
agreed upon by the Parties under the terms of Section 4.4;

(2) a Development Budget; and

(3) plans and timeline for preparing the necessary Development Regulatory
Materials in support of obtaining Regulatory Approval in the Licensed Territory
and the ROW Territory for the first indication and any label expansion.

(ii) Initial Development Plan. The Parties have agreed upon an initial
Development Plan, which is attached hereto as Exhibit C (the “Initial
Development Plan”).

(iii) Updates to Development Plan. On at least an annual basis and in the
timeframe provided in Section 3.2(a)(ii), commencing in 2012, and at such other
times as deemed necessary by the JDC, the JDC shall update and amend, as
appropriate (taking into account relevant issues, such as safety and efficacy
results, costs of development, the time required to complete development, etc.),
the then-current Development Plan. The JDC shall submit all proposed updates and
amendments to the Development Plan approved by it to the ESC for review and
final approval. Once approved by the ESC, each updated or amended

 

22

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Development Plan shall become effective and supersede the previous Development
Plan as of the date of such approval or at such other time as decided by the
ESC.

(b) Development Costs.

(i) Allocation of Costs. As between the Parties, as outlined in the Initial
Development Plan and subsequent Development Plans, subject to the Funding Cap,
CTI shall be responsible for seventy-five percent (75%) of all Development Costs
in the Licensed Territory and the ROW Territory, and Chroma (or its Development
Designee) shall be responsible for twenty-five percent (25%) of all Development
Costs in the Licensed Territory and the ROW Territory, provided that such cost
sharing shall not apply to development costs related to the Currently Ongoing
Studies incurred prior to April 1, 2011. Each Party will bear their own Indirect
Costs. For clarity, (A) neither Party shall be responsible to the other Party
for any costs or expenses incurred by the other Party for any Development
activities that are not specifically subject to an agreed-upon Development Plan
and Development Budget, and (B) if actual Development Costs for either Party
will exceed the applicable Development Budget, the cost overruns must be
reviewed and approved by the JDC and the ESC as set forth in
Sections 3.1(a)(iii) and 3.2(a)(iii). No Party shall be obliged to fund its
applicable proportion of an overrun unless such overrun has been prior approved
by the JDC and the ESC.

(ii) Quarterly True-up. Within thirty (30) days of the end of each calendar
quarter, each Party will submit to the other Party a report detailing such
Party’s Development Costs incurred during such calendar quarter, including
copies of invoices and any other supporting evidence necessary to substantiate
the actual Development Costs. In the event that a Party’s Development Costs have
exceeded its applicable allocation as set forth in Section 4.3(b)(i), as
evidenced by the report submitted to the other Party, then, within sixty
(60) days of the delivery of the report from such Party, the other Party shall
pay to such Party the difference between the actual Development Costs and the
applicable portion that is allocated to such Party under Section 4.3(b)(i). Any
such difference not paid within such sixty (60) day period will accrue simple
interest until the date of payment at the per annum rate of two percent
(2%) over the then-current prime rate quoted by Citibank in New York City or the
maximum rate allowable by applicable Law, whichever is lower.

(iii) Initial Funding Cap. The total Development Costs under the Initial
Development Plan and subsequent Development Plans, from the period commencing
with the Effective Date and continuing for three (3) years after such date,
shall not exceed $50,000,000 (or such greater amount as the Parties may agree to
in writing) (the “Funding Cap”). For clarity, as between the Parties,
seventy-five percent (75%) of the Funding Cap ($37,500,000) is the
responsibility of CTI, and twenty-five percent (25%) ($12,500,000) is the
responsibility of Chroma.

(c) Conduct of Studies.

 

23

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(i) Currently Ongoing Studies. The Parties intend and agree that any and all
Currently Ongoing Studies shall be conducted by Chroma in consultation with the
JDC, and in accordance with the Development Plan.

(ii) Extraterritorial Studies. The Parties intend and agree that any and all
Extraterritorial Studies shall be conducted by Chroma, in collaboration and
consultation with CTI and in consultation with the JDC, and in accordance with
the Development Plan.

(iii) Licensed Territory Specific Studies. The Parties intend and agree that any
and all Licensed Territory Specific Studies shall be conducted by CTI, in
collaboration and consultation with Chroma and in consultation with the JDC, and
in accordance with the Development Plan.

(iv) Performance. Each Party agrees to conduct the studies allocated to it as
described in this Section 4.3(c) in accordance with the Development Plan. Chroma
and CTI each shall provide the JDC with annual reports detailing its Development
activities under the Development Plan and the results thereof. Where Chroma
licenses any of its rights under the Chroma Technology in the ROW Territory in
accordance with Section 2.2(a)(ii) Chroma will use its Diligent Efforts to
obtain such detailed reports related to the Development activities from the
relevant Third Party on the same basis. However, where Chroma, despite using
such Diligent Efforts, is unable to obtain such reports Chroma will provide CTI
such information as it does receive from the Third Party, provided that this in
no event limits Chroma’s obligation to obtain safety or other pharmacovigilance
related data from its sublicensees.

(v) Phase 4 Clinical Studies. If a Party wishes to carry out Phase 4 Clinical
Studies on a voluntary basis such studies will be carried out by that Party in
consultation with the other Party through the JDC and the Party carrying out
such study shall, unless otherwise agreed by the Parties, be responsible for all
of the Development Costs associated with such study.

(d) Records; Audits. Each Party (the “Audited Party”) will maintain complete and
accurate records in sufficient detail to permit the other Party (the “Reviewing
Party”) to confirm the accuracy of the Development Costs under this Agreement.
Upon reasonable prior notice, such records shall be available during regular
business hours for a period of three (3) years from the end of the calendar year
to which they pertain for examination at the expense of the Reviewing Party, and
not more often than once each calendar year, by an independent certified public
accountant selected by the Reviewing Party and reasonably acceptable to the
Audited Party, for the sole purpose of verifying the accuracy of the financial
reports furnished by the Audited Party pursuant to this Agreement. Any such
auditor shall not disclose the Audited Party’s Confidential Information, except
to the extent such disclosure is necessary to verify the accuracy of the
financial reports furnished by the Audited Party or the amount of Development
Costs allocated under this Agreement.

4.4 Development Opt-In.

 

24

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(a) Prior to Initiation of Development. In the event that either Party proposes
(the “Proposing Party”) to conduct any Extraterritorial Study, any Licensed
Territory Specific Study or any study that is both an Extraterritorial Study and
a Licensed Territory Specific Study (each of the foregoing for the Product but
not an Additional Product) that is not subject to the then-current Development
Plan or Development Budget (including with respect to any additional clinical
studies regarding indications other than r/r AML or r/r MDS), prior to beginning
such Development activities, such Party shall provide notice to the JDC and ESC
of its intensions thereof, and copies of any Information of such Party
reasonably requested by the JDC and/or ESC. Within sixty (60) days of delivery
of such notice, in accordance with the terms of Section 4.3(a)(iii), the JDC and
ESC will review and decide whether such additional Extraterritorial Study or
Licensed Territory Specific Study will become part of and incorporated into the
Development Plan and Development Budget. In the event that the JDC and ESC
approve the proposed amendments to the Development Plan and Development Budget,
then any such additional Extraterritorial Study or Licensed Territory Specific
Study will be performed and paid for subject to the terms and conditions of such
amended Development Plan and the terms and conditions of this Agreement,
provided that if any such study is requested or required by any Regulatory
Authority, the JDC and ESC must include such study in an amended Development
Plan and Development Budget. Subject to the foregoing, in the event that the JDC
and ESC do not approve the proposed amendments to the Development Plan and
Development Budget to include the newly proposed Extraterritorial Study or
Licensed Territory Specific Study, but the Proposing Party proceeds on its own
accord to conduct such additional Extraterritorial Study or any Licensed
Territory Specific Study that it otherwise has the right to conduct under the
terms of this Agreement (“Non-Opted In Study”), then the non-proposing Party
(“Non-Proposing Party”) will not be obligated to pay for or assume any
Development Costs and expenses under Section 4.3(b) related to any Non-Opted In
Study. The Non-Proposing Party will also not be entitled to have access to or
use for any purpose any data, information or results developed by or on behalf
of the Proposing Party as a result of any Non-Opted In Study except for routine
adverse event reporting as provided in Section 5.5.

(b) Subsequent to Initiation of Development. For any Non-Opted In Study as
provided in paragraph (a), the Non-Proposing Party may subsequently provide
written notice to the Proposing Party that it wishes to opt in to the Non-Opted
In Study. If such notice is provided at or prior to the mid point of enrolled
patients as described in the protocol of such Non-Opted In Study, then the
Non-Proposing Party shall pay (i) the Non-Proposing Party’s corresponding share
of the Development Cost up to the effective date of opting in, as provided in
Section 4.3(b), had the Non-Proposing Party opted to participate in such
Non-Opted In Study from day one (“Corresponding Share”) and (ii) an additional
payment of ** of its Corresponding Share. If such notice is provided subsequent
to the mid point of enrolled patients as described in the protocol of such
Non-Opted In Study, then the Non-Proposing Party shall pay (i) its Corresponding
Share and (ii) an additional payment of ** of its Corresponding Share.

(c) After Opting In. Following opt in to any previously Non-Opted In Study as
provided in paragraph (b) above, including payment of the applicable amounts
specified therein, the Non-Proposing Party will have the same rights, as
provided under the terms of this

 

25

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Agreement, to the data, information and results generated from any such
previously Non-Opted In Study as though the Non-Proposing Party had participated
from day one. Within thirty (30) days after the opt in notice and payment by the
Non-Proposing Party as provided in paragraph (b) above, the Parties shall amend
the Development Plan and Development Budget to include the previously Non-Opted
In Study. The Non-Proposing Party shall, from the date of the opt in notice,
also pay for its Corresponding Share of the future Development Costs set out in
such amended Development Plan and Development Budget for such previously
Non-Opted In Study. Each Party acknowledges and agrees that it shall obligate
its sublicensees to agree to comply with the terms and conditions of this
Section 4.4 and provide the other Party the benefits under this Section 4.4.

4.5 Cooperation; Compliance with Laws. Each Party shall conduct its Development
activities under this Agreement in good scientific manner and in compliance in
all material respects with all applicable Laws, including without limitation
applicable national and international (e.g., ICH, GCP, GLP, and GMP) guidelines.

4.6 Subcontracting.

(a) Chroma Development Designees. CTI acknowledges and agrees that portions of
the Development to be performed by Chroma under this Agreement may be performed
on behalf of Chroma by a Development Designee appointed by Chroma, provided that
(i) Chroma shall first have obtained CTI’s prior written consent (which consent
may not be unreasonably withheld, conditioned or delayed) with respect to the
proposed subcontractor, (ii) Chroma shall first have obtained written
confidentiality agreements with any such subcontractor and written assignments
of, or equivalent rights under, all Patent rights and Know-How which relate to
the Product that such subcontractor may develop by reason of work performed
under this Agreement, and (iii) Chroma shall be and remain responsible to CTI
for the performance of its subcontractors.

(b) CTI Development Designees. Chroma acknowledges and agrees that portions of
the Development to be performed by CTI under this Agreement may be performed on
behalf of CTI by a Development Designee appointed by CTI, provided that (i) CTI
shall first have obtained Chroma’s prior written consent (which consent may not
be unreasonably withheld, conditioned or delayed) with respect to the proposed
subcontractor, (ii) CTI shall first have obtained written confidentiality
agreements with any such subcontractor, and (iii) CTI shall be and remain
responsible to Chroma for the performance of its subcontractors.

4.7 Records, Reports and Information. Each Party shall maintain, and cause its
Affiliates and sublicensees to maintain, complete, current and accurate records
of all Development activities conducted by it hereunder, and all data and other
Information resulting from or relating to such activities, including but not
limited to the investigator brochure, IND annual report, and any safety plans
established during Development. Such records shall fully and properly reflect
all work done and results achieved in the performance of the Development
activities in good scientific manner appropriate for regulatory purposes. Each
Party shall document, and cause its Affiliates and sublicensees to document, all
Non-Clinical Studies and

 

26

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

clinical trials in formal written study reports according to applicable national
and international (e.g., ICH, GCP, GLP, and GMP) guidelines. Each Party shall
have the right to review such records maintained by the other Party at
reasonable times, upon written request, which shall not exceed once a year.

4.8 Data Exchange and Use. Each Party shall promptly provide the other Party
with copies of all final reports with respect to the conduct of any Development
of the Product in the Field and with access to, upon request of a Party, all
data with respect to the conduct of any Development of the Product in the Field,
in each case as such data and reports become available to the Party performing
the corresponding studies. Each Party will have the right to (a) use such data
and reports for the purposes of carrying out its obligations and exercising its
rights under this Agreement and (b) to provide all such data and reports
generated by the other Party to such Party’s sublicensees or prospective
sublicensees subject to the applicable provisions of this Agreement. All data
and reports disclosed by one Party to the other under this Agreement shall be
deemed Confidential Information of the disclosing Party and may be used by the
receiving Party for the purposes of this Agreement, subject to the permitted
uses and disclosures described in Section 4.4 and in this Section 4.8 and
disclosure to any Regulatory Authority in connection with a Party’s obligations
under Article 5.

4.9 Designation of Additional Products. If either Party desires to commence
development of an Additional Product in the Field, then such Party shall notify
the JDC and ESC in writing and provide a draft development plan for such
Additional Product to the JDC and ESC. The JDC and ESC shall consider such
development plan in good faith in accordance with the terms of this Agreement.
Upon approval by the JDC and ESC, the Parties shall either amend the
then-current Development Plans and Sales and Marketing Plans to include such
Additional Product or prepare separate plans to include terms relating to such
Additional Product, including allocation of costs and such other terms similar
to those provided in Section 4.3. The Parties shall determine a reasonable
process for the timely delivery of Information regarding any potential
Additional Products by each Party to the JDC and/or ESC.

(a) If Not Approved by ESC. In the event that the JDC and ESC do not approve the
development of any Additional Product after consideration as provided above, the
Proposing Party may pursue any such development on its own (“Non-Opted In
Additional Product Development”). If the Proposing Party proceeds on its own
accord to pursue any Non-Opted In Additional Product Development, then the
Non-Proposing Party will not be obligated to pay for or assume any development
costs and expenses related to such Non-Opted In Additional Product Development.
The Non-Proposing Party will not be entitled to use for any purpose any data,
information or results developed by or on behalf of the Proposing Party as a
result of such Non-Opted In Additional Product Development except for routine
adverse event reporting as provided in Section 5.5.

(b) Subsequent to Initiation of Development. The Non-Proposing Party may,
however, subsequently provide written notice to the Proposing Party that it
wishes to opt in to the Non-Opted In Additional Product Development. If such
notice is provided at or prior to any

 

27

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

clinical studies, then the Non-Proposing Party shall pay (i) its Corresponding
Share of development costs for such Non-Opted In Additional Product Development
under the same terms as those contained in Section 4.3(b) and (ii) an additional
payment of ** of such Corresponding Share. If such notice is provided subsequent
to the Initiation of clinical studies, then the Non-Proposing Party shall pay
(i) its Corresponding Share of development costs for such Non-Opted In
Additional Product Development under the same terms as those contained in
Section 4.3(b) and (ii) an additional payment of ** of such Corresponding Share.

(c) After Opting In. Following opt in to any previously Non-Opted In Additional
Product Development, the Non-Proposing Party will have the same rights, as
provided under the terms of this Agreement, to the data, information and results
generated from any such previously Non-Opted In Additional Product Development
as though the Non-Proposing Party had participated from day one. Within thirty
(30) days after the opt in notice and payment by the Non-Proposing Party as
provided in paragraph (b) above, the Parties shall either amend the then-current
Development Plans and Sales and Marketing Plans to include such Additional
Product or prepare separate plans to include terms relating to such Additional
Product, including allocation of costs and such other terms similar to those
provided in Section 4.3. The Non-Proposing Party shall, from the date of the opt
in notice, also pay for its Corresponding Share of the future development costs
for such Non-Opted In Additional Product Development set out in such plan. Each
Party acknowledges and agrees that it shall obligate its sublicensees to agree
to comply with the terms and conditions of this Section 4.9 and provide the
other Party the benefits under this Section 4.9.

ARTICLE 5

REGULATORY MATTERS

5.1 Initial Transfer. Within sixty (60) days after the Effective Date, Chroma
shall make available to CTI copies of all Development Documentation that are
Controlled by Chroma generated as of the Effective Date and relating to the use
of the Product in the Field, including any drug master files and Regulatory
Materials for the Past Studies. Within ninety (90) days after the Effective
Date, Chroma shall submit to the FDA or equivalent foreign Regulatory Authority
in the Licensed Territory to transfer to CTI ownership of, and CTI shall own in
CTI’s name, any IND, NDA or MAA submissions for the Product in the Licensed
Territory including, IND number 75,503 or any foreign equivalents thereof (as
applicable) in the Licensed Territory, at no additional charge to CTI. Chroma
shall execute and deliver to the applicable Regulatory Authority such documents
as are required to notify such Regulatory Authority of the transfer of such IND
or any foreign equivalent thereof to CTI.

5.2 Preparation of Regulatory Materials.

(a) Licensed Territory.

(i) CTI shall Take the Lead and be the responsible party, in consultation with
Chroma, for preparing, filing and holding any and all Regulatory Materials in

 

28

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

the Licensed Territory associated with any IND, NDA or MAA submissions for the
Product or amendments or supplements thereto. Such Regulatory Materials and
related Regulatory Approvals shall be owned solely by CTI and held in its name,
subject to Chroma’s rights of reference under this Agreement. Except as required
by applicable Law or Regulatory Authority, CTI shall not withdraw any such
Regulatory Materials or Regulatory Approvals without prior consultation with and
approval of Chroma, which shall not be unreasonably withheld, delayed or
conditioned. CTI shall be primarily responsible, in consultation with Chroma,
for performing all activities required by such Regulatory Authority with respect
to (1) maintaining the IND, NDA and MAA submissions, maintaining the Regulatory
Approval following its receipt, safety monitoring as further described in
Section 5.5 below, promotional activities, compliance, and annual reporting to
such Regulatory Authorities, as well as associated document retention, and
(2) filing any and all Regulatory Materials for subsequent indications in the
Licensed Territory, and holding any such Regulatory Materials, amendments or
supplements thereto. CTI shall be responsible for any field alert reporting in
the Licensed Territory and Chroma shall reasonably assist CTI with its annual
reporting obligations.

(ii) Upon the request of Chroma, CTI shall inform each applicable Regulatory
Authority in the Licensed Territory that one (1) or more representatives of
Chroma will attend and, to the extent permitted by applicable Law, participate
in all major meetings between CTI and such Regulatory Authority, subject to the
confidentiality provisions set forth under Article 12. CTI shall timely inform
Chroma of any such scheduled meetings, as soon as practicably possible.

(iii) CTI and Chroma shall as soon as reasonably possible following the
Effective Date, through the JDC establish a plan and schedule of regulatory
activities to be performed by the Parties in connection with obtaining approval
for the first NDA or MAA for the Product in the Licensed Territory and for
amendments or supplements thereto.

(b) ROW Territory.

(i) Chroma shall retain sponsorship of the clinical trial applications currently
active in Europe. Except as required by applicable Law or Regulatory Authority,
Chroma shall not withdraw any Regulatory Materials or Regulatory Approvals
without prior consultation with and approval of CTI, which shall not be
unreasonably withheld, delayed or conditioned.

(ii) Chroma shall Take the Lead and be the responsible party in consultation
with CTI, for preparing, filing, holding and maintaining any and all Regulatory
Materials for the Product in the ROW Territory associated with any IND or MAA
for the Product or amendments or supplements thereto. Such Regulatory Materials
and related Regulatory Approvals shall be owned solely by Chroma and held in its
name, subject to CTI’s rights of reference under this Agreement. Chroma shall be
primarily responsible, in consultation with CTI, for performing all activities
required by such Regulatory Authority with respect to (1) maintaining the MAA
submissions, maintaining the Regulatory Approval following its receipt,

 

29

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

safety monitoring as further described in Section 5.5 below, promotional
activities, compliance, and annual reporting to such Regulatory Authorities, as
well as associated document retention, and (2) filing any and all Regulatory
Materials for subsequent indications in the ROW Territory, and holding any such
Regulatory Materials, amendments or supplements thereto. Chroma shall be
responsible for any field alert reporting in the ROW Territory and CTI shall
reasonably assist Chroma with its annual reporting obligations.

(iii) Upon the request of CTI, Chroma shall inform each applicable Regulatory
Authority in the ROW Territory that one (1) or more representatives of CTI will
attend and, to the extent permitted by applicable Law, participate in all major
meetings between Chroma and such Regulatory Authority, subject to the
confidentiality provisions set forth under Article 12. Chroma shall timely
inform CTI of any such scheduled meetings, as soon as practicably possible.

(iv) The Parties agree and acknowledge that the regulatory strategy for the ROW
Territory shall be coordinated with CTI’s activities in the Licensed Territory
and consistent with the overall objective of facilitating Regulatory Approval in
both the ROW Territory and Licensed Territory.

5.3 Cooperation, Consultation and Review. The Parties shall establish a joint
regulatory working group as soon as reasonably possible following the Effective
Date and shall cooperate with each other to achieve the regulatory objectives
contemplated herein in a timely, accurate and responsive manner. Each Party
shall assist the other Party as such other Party may reasonably request in
connection with the preparation and filing of all Regulatory Materials
contemplated in this Article 5. Each Party shall provide the other Party with
copies of any proposed Regulatory Materials to be submitted by such Party (other
than routine correspondence) and shall reasonably consider any comments thereto
provided by the other Party to the extent practicable.

5.4 Rights of Reference to Regulatory Materials. Subject to the provisions of
Sections 4.4 and 4.9, Chroma hereby grants to CTI a right of reference to all
Regulatory Materials filed by or for Chroma for the Product solely for the
purpose of seeking, obtaining and maintaining Regulatory Approvals for, and the
Commercialization of, the Products in the Licensed Territory, consistent with
the roles of the Parties set forth in this Agreement. Subject to the provisions
of Sections 4.4 and 4.9, CTI hereby grants to Chroma a right of reference to all
Regulatory Materials filed by or for CTI for the Product solely for the purpose
of seeking, obtaining and maintaining Regulatory Approvals for, and the
Commercialization of, the Products in the ROW Territory, consistent with the
roles of the Parties set forth in this Agreement.

5.5 Adverse Event Reporting and Safety Data Exchange.

(a) Licensed Territory. The Parties agree that CTI will be primarily responsible
for (i) maintaining the global safety database and (ii) monitoring of all
clinical experiences in the Licensed Territory and (iii) safety monitoring,
pharmacovigilance surveillance, compliance and filing of all required safety
reports to Regulatory Authorities in the Licensed

 

30

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Territory, including without limitation annual safety reports, throughout the
Development of the Product in the Licensed Territory as and to the extent
required by applicable Law for any study conducted under an IND held by CTI and
in respect of the Commercialization of the Product by CTI in the Licensed
Territory. The Parties shall cooperate to develop methods and/or procedures for
transitioning the activities described in this section to CTI. Chroma will be
responsible for all of such matters (except the global safety database) in the
ROW Territory.

(b) Safety Information Exchange; Agreement. The Parties shall cooperate to
develop methods and/or procedures for sharing information relating to the
clinical experiences and in accordance with safety reporting requirements of the
respective Regulatory Authorities and as necessary for a Party to comply with
applicable Law.

(c) Regulatory Reporting. Each Party shall be permitted, and have the right, to
perform pharmacovigilance activities and/or make such safety reports to
applicable Regulatory Authorities, to comply with applicable Laws, international
best practices for pharmacovigilance activities and/or other activities that the
Party, in its reasonable and good faith judgment, believes necessary for the
health, safety and protection of patients and/or clinical trial subjects. The
Parties shall work together to agree to one opinion with respect to safety
issues and to report said opinion to safety boards of any nature, investigators,
and to applicable Regulatory Authorities. In the event that, after reasonable
medical and scientific consultation, the Parties cannot agree to one opinion
with respect to safety issues to be reported to any applicable Regulatory
Authority, including but not limited to, individual adverse events or other
matters affecting the health, safety or welfare of a patient, then,
notwithstanding the provisions of Article 3, the Parties shall follow the
dispute resolution procedure provided in Section 14.3(b). For clarity, the
obligation to follow such dispute resolution procedure shall not limit either
Party’s right, as provided in the first sentence of this Section 5.5(c), to
report safety matters to Regulatory Authorities that may be necessary prior to
the conclusion of the dispute resolution procedure.

(d) Separate Pharmacovigilance Agreement. Within ninety (90) days of the
Effective Date, the Parties shall negotiate in good faith and enter into a
separate pharmacovigilance agreement to further detail the provisions of this
Section 5.5.

5.6 Recalls. Any decision to initiate a recall of the Product in the Licensed
Territory shall be made by CTI and in the ROW Territory shall be made by Chroma,
in each case subject to the remaining provisions of this Section 5.6. Before
initiating a recall of the Product each Party will consult with the other Party
and shall take into account any reasonable comments made by the other Party. The
costs of any recall in the Licensed Territory shall be borne by CTI and the
costs of any recall in the ROW Territory shall be borne by Chroma, subject to
any provisions to the contrary contained in the Supply Agreement.

5.7 Regulatory Authority Communications Received by a Party. Each Party shall
keep the other Party informed in a timely manner compliant with the reporting
requirements of Regulatory Authorities of notification of any action by, or
notification or other information which it receives (directly or indirectly)
from any Regulatory Authority which: (a) raises any

 

31

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

material concerns regarding the safety or efficacy of the Product; (b) indicates
or suggests a potential material liability of either Party to Third Parties in
connection with the Product; (c) is reasonably likely to lead to a recall or
market withdrawal of the Product; or (d) relates to expedited and periodic
reports of adverse events with respect to the Product, or Product Complaints,
and which may have a material impact on Development of the Product, Regulatory
Approval or the continued Commercialization of the Product. The other Party will
fully cooperate with and assist such Party in complying with regulatory
obligations and communications, including by providing to such Party, in a
timely manner after a request, such information and documentation in the other
Party’s possession as may be necessary or helpful for the Party to prepare a
response to an inquiry from a Regulatory Authority. Each Party will provide the
other Party in a timely manner with a copy of all correspondence received from a
Regulatory Authority specifically regarding the matters referred to above.

5.8 Audit. If a Regulatory Authority desires to conduct an inspection or audit
of a Party’s facility or a facility under contract with such Party with regard
to the Product, then the audited Party shall notify the other Party as soon as
practicably possible after receipt of such notification of such audit or
inspection and provide copies of any materials provided to it by the applicable
Regulatory Authority; provided, that the audited Party shall not be required to
notify the other Party of audits or inspections that are of a routine nature or
that do not relate to the Product, except where such audits result in
communications or actions of such Regulatory Authority which have an impact upon
the Product. In addition, if a Regulatory Authority conducts an unannounced
inspection or audit of a Party’s facility or a facility under contract with such
Party with regard to the Product, then the audited Party shall notify the other
Party within twenty-four (24) hours of commencement of such audit or inspection.
The audited Party shall cooperate, and shall use reasonable efforts to cause the
contract facility to cooperate, with such Regulatory Authority and the other
Party during such inspection or audit. Following receipt of the inspection or
audit observations of such Regulatory Authority (a copy of which the audited
Party will immediately provide to the other Party), the audited Party will also
provide the other Party with copies of any written communications received from
Regulatory Authorities with respect to such facilities in a timely manner after
receipt, to the extent such written communications relate to the Product or the
Manufacture thereof, and will prepare the response to any such observations. The
audited Party will provide the other Party with a copy of any proposed response
to such communications and will implement such other Party’s reasonable comments
with respect to such proposed response. The audited Party agrees to conform its
activities under this Agreement to any commitments made in such a response.

ARTICLE 6

COMMERCIALIZATION

6.1 Overview of Commercialization in the Licensed Territory. Subject to the
other terms and conditions of this Article 6, as between the Parties, CTI
control all aspects of the Commercialization of the Product in the Field in the
Licensed Territory, including, without limitation: (a) developing and executing
a commercial launch and pre-launch plan; (b) marketing

 

32

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

and promotion; (c) booking sales and distribution and performance of related
services; (d) handling all aspects of order processing, invoicing and
collection, inventory and receivables; (e) publications; (f) providing customer
support, including handling medical queries, and performing other related
functions; and (g) conforming its practices and procedures in all material
respects to the applicable Laws relating to the marketing, detailing and
promotion of the Products in the Field in the countries of the Licensed
Territory. Except as otherwise provided in this Article 6, CTI shall bear all of
the costs and expenses incurred in connection with all such Commercialization
activities. For clarity, it is understood that CTI would be not responsible for
any Commercialization of the Product in the ROW Territory, and as between the
Parties, all costs and expenses thereof shall be borne by Chroma and the
responsibility therefore shall be Chroma’s.

6.2 Sales and Marketing Plan. Each Party will Commercialize the Products in its
applicable territory pursuant to a detailed plan prepared by such Party and
submitted to the JDC for review and comment (the “Sales and Marketing Plans”),
but for clarity, not approval or consent. The Sales and Marketing Plans will
include information, budgets and timelines regarding the applicable Party’s
Commercialization activities, including Product life cycle management, market
research, sales training, distribution channels, customer service and sales
force matters related to the launch and sale of the Product in the Field and in
the applicable territory. The initial Sales and Marketing Plan for each Party
shall be delivered to the JDC not later than three (3) months prior to the
planned date for NDA submission to the FDA. On at least an annual basis (no
later than March 1 of each calendar year thereafter), each Party shall update
and amend, as appropriate, its then-current Sales and Marketing Plan. Each Party
shall submit all updates and amendments to the Sales and Marketing Plan to the
JDC for review and comment. The Parties agree that, as between the Parties
(a) CTI will have planning, oversight, and final decision making authority (as
provided expressly in Section 14.2) and responsibility for all sales, marketing,
and promotional activities related to the Product in the Licensed Territory, and
(b) Chroma will have planning, oversight, and final decision making authority
(as provided expressly in Section 14.2) and responsibility for all sales,
marketing, and promotional activities related to the Product in the ROW
Territory, as expressly described in this Agreement. Each Party will have the
opportunity, through the JDC, to confer with the other Party on such sales,
marketing and promotional matters.

6.3 Pricing; Reimbursement.

(a) As between the Parties, CTI shall have the sole right to determine all
pricing of the Product in the Licensed Territory. Notwithstanding anything in
this Agreement express or implied to the contrary, Chroma shall not have any
right to direct, control, or approve CTI’s pricing of Products for the Licensed
Territory.

(b) As between the Parties, CTI shall have the sole right to determine the
reimbursement strategy for the Product in the Licensed Territory. Chroma shall
confer with CTI on the development of the reimbursement strategy for the Product
for the initial indication in the

 

33

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Licensed Territory in order to share the research and planning information
relating to reimbursement processes already developed by Chroma.

(c) Chroma shall have the sole right to determine all pricing and reimbursement
of the Product in the ROW Territory.

6.4 Commercial Diligence. CTI shall devote Diligent Efforts to Commercialize the
Product and to maximize Net Sales of the Product, subject to compliance with
applicable Laws, throughout the Licensed Territory following receipt of
Regulatory Approval, including price approval, of such Product in accordance
with this Agreement. CTI will launch the Product in the United States within
ninety (90) days of receiving Regulatory Approval, including price approval, for
the Product in the United States.

6.5 Compliance.

(a) Licensed Territory. CTI, its Affiliates and sublicensees shall comply with
all applicable Laws and guidelines in the Licensed Territory applicable to the
Commercialization of pharmaceutical products.

(b) ROW Territory. Chroma, its Affiliates and sublicensees shall comply with all
applicable Laws and guidelines in the ROW Territory applicable to the
Commercialization of pharmaceutical products.

(c) No Obligation. No Party shall be required to take any action, undertake any
obligation, or incur any cost or reimbursement obligation, in connection with
any activity under this Agreement that such Party believes, in good faith, may
violate any applicable Laws.

6.6 Trademark Matters.

(a) Product Mark. It is the intention of the Parties that the Product be sold
and marketed under a single worldwide brand, where practicable, legally and
commercially viable, in accordance with the global branding strategy to be
established by the JDC under Section 3.2(a)(v). Notwithstanding the foregoing,
the Parties acknowledge such a single brand approach may not be viable for some
countries. Unless determined otherwise by the JDC in the global branding
strategy, as between the Parties, CTI will own the trademarks for the names of
the Product to be used in the Licensed Territory and Chroma will own the
trademarks for the names of the Products to be used in the ROW Territory (each a
“Product Mark”), provided that in no event shall either Party be permitted to
use the name of the other Party or any brand, logo or trademark of the other
Party not solely used for the Product without such Party’s express prior written
consent. Each Party will be responsible at its own expense to perform any
trademark clearance or registration for any Product Mark in its respective
territory.

(b) Marks. Each Party shall provide the other with samples of any materials that
incorporate the Product Marks prior to distributing such materials for use. Each
Party acknowledges the other’s exclusive ownership of the Product Marks in its
respective territory and

 

34

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

agrees not to take any action inconsistent with such ownership, and any goodwill
arising from the use of the Product Marks shall inure to the benefit of the
owning Party. Neither Party shall use any Product Mark in a way that would
adversely affect its value. Each Party covenants that it shall not use any
trademark confusingly similar to or containing any Product Mark in connection
with any products (including the Product).

6.7 Publication.

(a) Strategy. The Publication Team, established pursuant to Section 6.7(b), in
close cooperation with the JDC will agree in advance on any publication of study
results from the Currently Ongoing Studies, any Additional Studies, Licensed
Territory Specific Studies or Extraterritorial Studies and prepare a joint
publication strategy and publication plan, subject to the provisions of this
Section 6.7.

(b) Publication Team. The ESC shall establish a Publication Team composed of an
equal number of representatives from each of CTI and Chroma with the reasonable
balance of medical and scientific qualifications to agree on the detailed
planning of the publication strategy and publication plan detailing the intended
timing, venue, media, authors etc. for all publications of matters covered under
this Section 6.7 including scientific articles, abstracts and posters intended
for presentation at congresses. All health economic publications and
communication at any congress shall be an integrated part of the publication
strategy and plan. The Publication Team shall be co-chaired by representatives
from both Parties and shall convene as deemed necessary to accomplish the above.
In case of any dispute concerning publication the matter shall be referred to
the ESC for resolution; provided, however, any such resolution shall be
consistent with the guidelines set forth in Section 6.7(d).

(c) Publication Review. Except for disclosures permitted pursuant to
Section 12.1 and consistent with the mutually agreed publication strategy
pursuant to Section 6.7(a), either Party, its employees or consultants wishing
to make a publication of matters covered under this Section 6.7 shall deliver to
the other Party a copy of the proposed written publication or an outline of an
oral disclosure at least sixty (60) days (or earlier if reasonably practicable,
or within forty-five (45) days with respect to agreements existing as of the
Effective Date that Chroma has with a Third Party performing clinical trials,
research or the like in connection with such publication) prior to submission
for publication or presentation. The reviewing Party shall have the right (a) to
propose modifications to the publication or presentation for patent reasons or
trade secret reasons and/or (b) to request a reasonable delay in publication or
presentation in order to protect patentable information. If the reviewing Party
requests a delay, the Parties shall in good faith discuss and agree on the
timing of such publication and if the Parties cannot agree the publishing Party
shall delay submission or presentation for a period of sixty (60) days (or
forty-five (45) days with respect to agreements existing as of the Effective
Date that Chroma has with a Third Party performing clinical trials, research or
the like in connection with such publication) to enable patent applications
protecting each Party’s rights in such information to be filed in accordance
with Article 9 below. Upon expiration of such sixty (60) days (or forty-five
(45) days as provided above), the publishing Party shall be free to proceed with
the

 

35

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

publication or presentation. If the reviewing Party requests modifications to
the publication or presentation, the publishing Party shall edit such
publication to prevent disclosure of trade secret or proprietary business
information prior to submission of the publication or presentation.

(d) Standards. All publications of matters covered under this Section 6.7 shall
be prepared, presented and/or published in accordance with pharmaceutical
industry accepted guidelines including, but not limited to: (i) International
Committee of Medical Journal Editors (ICMJE) guidelines, (ii) Uniform
Requirements for Manuscripts Submitted to Biomedical Journals: Writing and
Editing for Biomedical Publication, (iii) Pharmaceutical Research and
Manufacturers of America (PhRMA) guidelines, and (iv) PhRMA Principles on
Conduct of Clinical Trials and Communication of Clinical Trial Results.

6.8 International Meetings. The Parties shall consult with each other and
coordinate their attendance at meetings, symposia, conferences and the like
(“Meetings”) with regard to the Product. CTI will Take the Lead with regard to
any Meetings with regard to the Product which are held in the Licensed Territory
and Chroma will Take the Lead with regard to any Meetings with regard to the
Product which are held in the ROW Territory.

6.9 Key Opinion Leaders. Each Party shall coordinate its activities with the
other Party with regard to interactions with key opinion leaders in the Field
related to the Product provided that neither Party shall be restricted from
approaching or otherwise dealing with any particular key opinion leader.

ARTICLE 7

MANUFACTURE AND SUPPLY

7.1 General Supply Terms. As between the Parties Chroma will be solely
responsible for the Manufacture of the Product for Development purposes in both
the Licensed Territory and the ROW Territory in accordance with the terms of the
Supply Agreement. As between the Parties, CTI will be solely responsible, by
itself or through one or more Third Party contract manufacturers, for the
Manufacture of the Product for Commercialization in the Licensed Territory. As
between the Parties, Chroma will be solely responsible for the Manufacture of
the Product for Commercialization in the ROW Territory.

7.2 Supply Agreement. The Parties shall decide, through the JDC, and as
reflected in the terms of the Supply Agreement, a mutually acceptable supply
chain for the manufacture of the Product for use in clinical trials, including
which Party will be responsible for oversight, negotiations and management of
Third Party vendors responsible for manufacturing the Product; provided,
however, that neither Party will be obligated to use the same supply chain or to
enter into joint contractual arrangements with one another or Third Parties
relating to the manufacture of the Product. On or before a date to be
established by the ESC but in no event later than ninety (90) days after the
Effective Date, the Parties shall enter into a supply agreement governing the
supply of Product to CTI for Development purposes (the “Supply Agreement”) and
(b) a quality agreement governing the quality control, quality assurance and
validation of such Product (the

 

36

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

“Quality Agreement”). The terms of such Supply Agreement and such Quality
Agreement shall be negotiated in good faith by the Parties and will contain
customary terms and conditions that are consistent with this Agreement. The
purchase price for the Product under the Supply Agreements will be Chroma’s cost
of manufacture and such purchase price will be considered part of the
Development Costs. In the event that CTI wishes to have Chroma supply the
Product for Commercialization purposes, the initial purchase price for such
supply shall not exceed Chroma’s cost of manufacture plus **. The Supply
Agreement will provide appropriate technology transfer provisions (including
provision of DMFs and other customary terms in the industry) sufficient to
enable CTI to Manufacture the Product for Commercialization in the Licensed
Territory in advance of any anticipated Product launch in the Licensed
Territory. The Supply Agreement will provide that such technology transfer may
be initiated by CTI at any time during the term of the Supply Agreement at CTI’s
option by written notice and that Chroma will be obligated to provide such
technology transfer. The Supply Agreement will also provide appropriate
provisions to address supply related issues post termination under each of the
termination scenarios addressed in Sections 13.7 and 13.8.

ARTICLE 8

COMPENSATION

8.1 Upfront Fee. Upon the date this Agreement is signed by both Parties, CTI
shall pay to Chroma a one-time non-creditable, non-refundable (subject to the
provisions of Section 15.9) upfront fee of $5,000,000.

8.2 Development Milestone Payments. CTI shall make non-creditable, non
refundable milestone payments to Chroma based on achievement of certain
milestone events for the Product as set forth in this Section 8.2. CTI shall pay
to Chroma the amounts set forth below within thirty (30) days after receipt of
Chroma’s invoice following the achievement of the corresponding milestone event.
Each milestone payment by CTI to Chroma hereunder shall be payable only once,
regardless of the number of times achieved by the Products, and shall not be
cumulative.

 

Milestone Event

   Milestone Payment   Indication: Acute Myelogenous Leukemia (AML) Milestone
Payments   

Upon Initiation of the first pivotal study (Phase 2 Clinical Trial and/or Phase
3 Clinical Trial) for AML, as set forth in the Development Plan

   $ 5,000,000   

 

37

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

$5,000,000

Upon first successful completion of a first pivotal study (Phase 2 Clinical
Trial and/or Phase 3 Clinical Trial) for AML, as set forth in the Development
Plan (measured by FDA acceptance to file NDA for AML)

   $ * * 

Within 90 days of first Regulatory Approval of an NDA by the FDA in r/r AML

   $ * * 

Upon first Regulatory Approval of an NDA by the FDA in First Line AML

   $ * *  Indication: Myelodysplastic Syndromes (MDS) Milestone Payments   

Upon first successful randomized Phase 2 Clinical Trial safety/efficacy results
in MDS, as set forth in the Development Plan

   $ * * 

Upon first successful completion of Phase 3 Clinical Trial in MDS, as set forth
in the Development Plan (measured by FDA acceptance to file NDA for MDS)

   $ * * 

Upon first Regulatory Approval by the FDA of an NDA in r/r MDS

   $ * * 

Upon first Regulatory Approval by the FDA of an NDA in First Line MDS

   $ * *  Indication: Multiple Myeloma (MM) Milestone Payments   

Upon first successful Phase 2 Clinical Trial safety/efficacy results in MM, as
set forth in the Development Plan

   $ * * 

Upon first successful completion of Phase 3 Clinical Trial in MM, as set forth
in the Development Plan (measured by FDA acceptance to file NDA for MM)

   $ * * 

Upon first Regulatory Approval by the FDA of an NDA in r/r MM

   $ * * 

Upon first Regulatory Approval by the FDA of an NDA in First Line MM

   $ * *  Indication: Solid Tumor Milestone Payments   

 

38

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

$5,000,000

Upon first successful randomized Phase 2 Clinical Trial safety/efficacy results
for solid tumors, as set forth in the Development Plan

   $ * * 

Upon first successful completion of Phase 3 Clinical Trial for solid tumors, as
set forth in the Development Plan (measured by FDA acceptance to file NDA for
the relevant solid tumor indication)

   $ * * 

First Regulatory Approval by the FDA of an NDA in r/r solid tumors affecting
<10,000 pts/yr, as per the FDA approved label indication

   $ * * 

First Regulatory Approval by the FDA of an NDA in First Line solid tumors
affecting > 10,000 <50,000 pts/yr, as per the per FDA approved label indication

   $ * * 

First Regulatory Approval by the FDA of an NDA in First Line solid tumors
affecting > 50,000 pts/yr, as per the per FDA approved label indication

   $ * * 

For the avoidance of doubt, “acceptance” as used above shall mean acceptance for
review of the applicable regulatory filing by the FDA, and “successful
safety/efficacy results” means meeting the primary endpoint(s) of the applicable
protocol as set forth in the final analysis plan submitted to the applicable
Regulatory Authority.

If upon achievement of any development milestone for each indication described
above, a previous development milestone for that indication has not been paid,
then each such previous development milestone for that indication shall be
payable along with the payment for the milestone then achieved for such
indication.

CTI will provide written notice to Chroma of the achievement of any milestone
above within thirty (30) calendar days of such achievement.

8.3 Sales Milestones. CTI shall make the following one-time, milestone payments
to Chroma. Each milestone payment by CTI to Chroma hereunder shall be payable
only once, regardless of the number of times achieved by the Products, and shall
not be cumulative except for last milestone which is payable on cumulative Net
Sales.

 

39

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Milestone Event

   Milestone Payment  

Upon the first achievement of annual Net Sales in the Licensed Territory of
$75,000,000 (“Sales Event 1”).

   $ * * 

Upon the first achievement of annual Net Sales in the Licensed Territory of
$150,000,000 (“Sales Event 2”).

   $ * * 

Upon the first achievement of cumulative Net Sales in the Licensed Territory of
$250,000,000 (“Sales Event 3”).

   $ * * 

If Sales Event 1 and Sales Event 2 are achieved in a single calendar year,
milestone payments for each of such events will be payable in that same calendar
year. However, if Sales Event 2 and Sales Event 3 are achieved in a single
calendar year, only the milestone payment for Sales Event 3 will be due in that
same calendar year and the milestone payment for Sales Event 2 in such case will
not be due until 1 January in the next calendar year.

CTI shall provide written notice to Chroma of the achievement of any sales
milestone above within forty-five (45) calendar days after the end of the
calendar quarter in which such sales milestone was achieved. Except as otherwise
provided above in this Section 8.3, each sales milestone payment will be due
within thirty (30) days of the date of Chroma’s invoice therefor. Each milestone
payment shall be non-refundable and non-creditable.

8.4 Royalties.

(a) Royalty Rates for Licensed Territory. Subject to Sections 8.4(b), 8.4(c) and
8.4(d) below, and during the applicable Royalty Term, CTI shall pay to Chroma a
running royalty at the following incremental royalty rates, on aggregate, annual
Net Sales of the Products in the Licensed Territory.

 

Net Sales in the Licensed Territory

   Royalty Rate  

For that portion of annual Net Sales less than or equal to $150,000,000

     * *% 

For that portion of annual Net Sales greater than $150,000,000 but less than or
equal to $350,000,000

     * *% 

For that portion of annual Net Sales greater than $350,000,000

     * *% 

 

40

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(b) Single Royalty. Royalties payable under Section 8.4(a) will be payable only
once with respect to a particular unit of the Product and will be paid only once
regardless of the number of Chroma Patents applicable to such Product.

(c) Reduction of Royalty Following Entry of Generic Product. Following (i) (1)
expiration of the last-to-expire Chroma Patent or (2) any lack of protection or
enforcement of all non-expired Chroma Patents (as provided in Article 9)
covering the Development, Manufacture, use or sale of Products in a country of
the Licensed Territory (including any Patent Term Extensions thereof) or
(ii) expiration of all Regulatory Exclusivity periods with respect to the
Product in such country, the royalty rates set forth in Section 8.4(a) for Net
Sales during the remainder of the Royalty Term in such country shall be reduced
by ** at the end of the first to occur six (6) month period during which one or
more Third Parties sells a number of equivalent units of a Generic Version of
the Product in such country of the Licensed Territory comprising, during such
time period, ** or more of the aggregate combined number of equivalent units of
such Product and such Generic Version(s) of such Product sold in such time
period in such country (“the Threshold”), provided that in no event shall the
royalty rates set forth in Section 8.4(a) be reduced below a figure which is the
sum of ** and the applicable royalty payable by Chroma to Vernalis under the
Vernalis Agreement for any such period during the Royalty Term. All such
determinations of unit volume shall be based upon a mutually acceptable
calculation method and using market share data provided by a reputable and
mutually agreed upon provider, such as IMS Health. As used in this
Section 8.4(c), “Generic Version” means, with respect to the Product, a product
sold by a Third Party that (A) contains a Compound as an active ingredient, and
(B) has been approved for sales introduction into interstate commerce by
reference to the Product pursuant to (1) Section 505(b)(2) or Section 505(j) of
the United States Food, Drug, and Cosmetic Act (21 U.S.C. 355(b)(2) and 21
U.S.C. 355(j), respectively), or (2) any similar approval in any other country
of the Licensed Territory, which similar approval is based on reference to the
Regulatory Approval for the Product in such country and a demonstration of
bio-equivalence or similarity to the Product. At any time following introduction
of the initial Generic Version of the Product in a country achieving a market
share of at least the Threshold and upon written notice of CTI expressing
concern regarding the continued commercial viability of the Product in such
country, the Parties agree to negotiate in good faith a mutually acceptable
strategy to address CTI’s concerns with a view toward preserving the historic
economic balance and profit splits between the Parties.

(d) Third Party Royalties.

(i) During the Term, Chroma shall remain responsible for the payment of
royalties and other payment obligations, if any, due to Third Parties under any
Chroma Technology which has been licensed to Chroma and is sublicensed to CTI
hereunder, including without limitation any payments due under the Upstream
Agreements.

(ii) Except as set forth in clause (i) or (iii) of this Section 8.4 (d), or to
the extent of any Claim for which Chroma provides indemnification under
Section 11.1, or as the Parties may otherwise agree in writing, CTI shall bear
any payments associated with any

 

41

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

royalties owed to any Third Party for intellectual property that is necessary or
useful for the Development, Manufacture, storage, handling, use, promotion,
sale, offer for sale, importation or other Commercialization of Products for
sale in the Licensed Territory (the “Third Party Royalties”).

(iii) During the Term, if CTI determines, in good faith, that it is necessary to
seek or exercise any license from any Third Party for intellectual property that
is necessary for the Development, Manufacture, storage, handling, use,
promotion, sale, offer for sale, importation of other Commercialization of
Products for sale in the Licensed Territory, CTI may credit up to ** of the
amount of any Third Party Royalties paid by CTI for Third Party intellectual
property pursuant to clause (ii) above against royalties payable to Chroma under
Section 8.4(a) provided that in no event shall the royalty rates set forth in
Section 8.4(a) be reduced below the sum of ** and the applicable royalty rate
payable by Chroma to Vernalis under the Vernalis Agreement. CTI may take such
credit during any calendar quarter for which royalties are payable hereunder;
provided, that in no event will such credit reduce the royalties payable to
Chroma for such calendar quarter by more than **. Any share of such Third Party
Royalties that remains uncredited due to the application of such floor may be
carried forward to subsequent calendar quarters.

8.5 No Projections. Chroma and CTI acknowledge and agree that nothing in this
Agreement shall be construed as representing an estimate or projection of
anticipated sales of any Product, and that the milestones and Net Sales levels
set forth in Sections 8.3 and 8.4 or elsewhere in this Agreement or that have
otherwise been discussed by the Parties are merely intended to define the
milestone payments and royalty obligations to Chroma in the event such
milestones and/or Net Sales levels are achieved.

8.6 Royalty Reports and Payment. Within forty five (45) calendar days following
the end of each calendar quarter during the Term, CTI shall provide Chroma with
a report containing the following information for the applicable calendar
quarter: the amount of gross sales of Product on a country-by-country basis in
the Licensed Territory, an itemized calculation of Net Sales in the Licensed
Territory showing deductions, to the extent practicable, provided for in the
definition of “Net Sales,” a calculation of the royalty payment due on such
sales, an accounting of the number of units and prices for Product sold, the
exchange rate for each country in which Product was sold, the application of the
reductions, if any, made in accordance with the terms of Section 8.4(c) or
Section 8.4(d), and any other information reasonably required by Chroma for the
purpose of calculating royalties and other amounts due under this Agreement. Any
royalty payments due to Chroma will be paid on the date of delivery of such
report. In the event that either party determines that the calculation of Net
Sales for a calendar quarter deviates from the amounts previously reported to
Chroma for any reason (such as, on account of additional amounts collected or
Product returns), CTI and Chroma shall reasonably cooperate to reconcile any
such deviations to the extent necessary under applicable legal or financial
reporting requirements.

 

42

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

8.7 Foreign Exchange. The rate of exchange to be used in computing the amount of
currency equivalent in Dollars owed to a Party under this Agreement shall be the
monthly average exchange rate between each currency of origin and U.S. Dollars
as reported by Bloomberg or an equivalent resource as agreed by the Parties.

8.8 Payment Method; Late Payments. All payments due to Chroma under Article 8
shall be made in U.S. Dollars by wire transfer of immediately available funds
into an account designated by Chroma. If Chroma does not receive payment of any
sum due to it under Article 8 on or before the due date, simple interest shall
thereafter accrue on the sum due to Chroma until the date of payment at the per
annum rate of two percent (2%) over the then-current prime rate quoted by
Citibank in New York City or the maximum rate allowable by applicable Law,
whichever is lower.

8.9 Records; Audits. CTI will maintain complete and accurate records in
sufficient detail to permit Chroma to confirm the accuracy of the calculation of
royalty and milestone payments under this Article 8. Upon reasonable prior
notice, such records shall be available during regular business hours for a
period of four (4) years from the end of the calendar year to which they pertain
for examination at the expense of Chroma, and not more often than once each
calendar year, by an independent certified public accountant selected by Chroma
and reasonably acceptable to CTI, for the sole purpose of verifying the accuracy
of the financial reports furnished by CTI pursuant to this Article 8. Any such
auditor shall not disclose CTI’s Confidential Information. Any amounts shown to
be owed but unpaid shall be paid within thirty (30) days from the accountant’s
report, plus interest (as set forth in Section 8.8) from the original due date.
Any amounts shown to have been overpaid shall be refunded within thirty
(30) days from the accountant’s report. Chroma shall bear the full cost of such
audit unless such audit discloses an underpayment by CTI of more than ** of the
amount due, in which case CTI shall bear the full cost of such audit.

8.10 Taxes.

(a) Cooperation and Coordination. The Parties acknowledge and agree that it is
their mutual objective and intent to appropriately calculate, to the extent
feasible and legal, taxes payable with respect to their collaborative efforts
under this Agreement and that they shall use all commercially reasonable efforts
to cooperate and coordinate with each other to achieve such objective. Without
limiting the foregoing, Chroma agrees to provide to CTI reasonable assistance
and information regarding any Value Added Tax assessments and requirements.

(b) Payment of Tax. A Party receiving a payment pursuant to this Article 8 shall
pay any and all taxes levied on such payment. If applicable Laws require that
taxes be deducted and withheld from a payment made pursuant to this Article 8,
the remitting Party shall (i) deduct those taxes from the payment; (ii) pay the
taxes to the proper taxing authority; and (iii) send evidence of the obligation
together with proof of payment to the other Party within sixty (60) days
following that payment. The paying Party shall cooperate with and provide
reasonable assistance to the receiving Party to prevent the application of any
withholding, to obtain the

 

43

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

benefit of any double taxation treaty or to obtain repayment of any tax which is
required to be withheld.

(c) Tax Residence Certificate. A Party (including any entity to which this
Agreement may be assigned, as permitted under Section 15.5) receiving a payment
pursuant to this Article 8 shall provide the remitting Party appropriate
certification from relevant revenue authorities that such Party is a tax
resident of that jurisdiction, if such receiving Party wishes to claim the
benefits of an income tax treaty to which that jurisdiction is a party. Upon the
receipt thereof, any deduction and withholding of taxes shall be made at the
appropriate treaty tax rate.

(d) Assessment. Either Party may, at its own expense, protest any assessment,
proposed assessment, or other claim by any Governmental Authority for any
additional amount of taxes, interest or penalties or seek a refund of such
amounts paid if permitted to do so by applicable Law. The Parties shall
cooperate with each other in any protest by providing records and such
additional information as may reasonably be necessary for a Party to pursue such
protest.

ARTICLE 9

INTELLECTUAL PROPERTY MATTERS

9.1 Ownership of Inventions. Each Party shall own any inventions made and funded
solely by its or its Affiliates own employees, agents, or independent
contractors in the course of conducting its activities under this Agreement,
together with all intellectual property rights therein (“Sole Inventions”). The
Parties shall jointly own any inventions that are (a) made jointly by employees,
agents, or independent contractors of each Party or their Affiliates or
(b) jointly funded by the Parties (including as a result of any Development
activities jointly funded by the Parties pursuant to Article 4) in the course of
performing activities under this Agreement, together with all intellectual
property rights therein (“Joint Inventions”). Inventorship shall be determined
in accordance with U.S. patent laws. Subject to the terms of this Agreement
(including without limitation the licenses granted in Article 2), each Party may
use and practice the Joint Inventions for any purpose and may assign, license or
otherwise transfer or exploit its rights to the Joint Inventions to an Affiliate
or Third Party, without the other Party’s consent and without a duty of
accounting to the other Party. For the avoidance of doubt, Chroma’s interest in
the Joint Inventions (including its interest in the Joint Patents) will be
exclusively licensed to CTI under the same terms the licenses granted in
Section 2.1 but will not be subject to royalty payments set forth in
Section 8.4. CTI grants to Chroma an exclusive, royalty free, sublicensable (in
accordance with the terms of this Agreement) license under CTI’s interest in any
Joint Invention to Develop, Manufacture, use, make, have made, sell, offer for
sale, have sold, distribute, import and otherwise Commercialize the Product in
the Field in the ROW Territory.

9.2 Right of First Negotiation and Refusal. With respect to CTI’s Sole
Inventions necessary or useful in the Development, Manufacture or
Commercialization of the Product in the Field in the ROW Territory (“Subject CTI
Rights”), Chroma has the following right of first negotiation and right of first
refusal during the Term, subject to any rights CTI has already

 

44

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

granted to Third Parties as of the Effective Date with respect to Patents and
Know-How Controlled by CTI.

(a) CTI shall not propose, negotiate or enter into a contract or arrangement
with any Third Party to license or otherwise dispose of the Subject CTI Rights,
unless CTI has first notified Chroma in writing (“Initial Notice”) of its intent
to license or otherwise dispose of the Subject CTI Rights (“Applicable
Transaction”). The Initial Notice shall provide the material commercially
reasonable terms for the Applicable Transaction. Chroma will have ** days from
the date of the Initial Notice (“Initial Period”) to notify CTI whether Chroma
wishes to engage in negotiations for the Applicable Transaction. If Chroma
elects to proceed with such discussions, Chroma shall so notify CTI in writing
and the Parties will use good faith efforts to enter into the Applicable
Transaction within ** days from the date of Chroma’s notice (“Negotiation
Period”). If Chroma notifies CTI in writing that it does not wish to enter into
the Applicable Transaction or if CTI does not receive a written notice from
Chroma at the end of the Initial Period or if the Parties cannot execute a
definitive agreement for the Applicable Transaction by the end of the
Negotiation Period, CTI will be free to pursue the Applicable Transaction with
any Third Party, subject to Chroma’s right of first refusal below.

(b) Prior to consummating any Applicable Transaction with any Third Party after
Chroma’s right of first negotiation provided in Section (a) above has ceased,
CTI shall provide Chroma written notice of the proposed material terms in any
proposed Applicable Transaction with such Third Party (“ROFR Notice”). If Chroma
notifies CTI within ** business days of the date of the ROFR Notice (“ROFR
Notice Period”) that Chroma wishes to consummate the Applicable Transaction
described in the ROFR Notice, then CTI and Chroma shall enter into a definitive
agreement including the material terms described in the ROFR Notice for the
proposed Applicable Transaction in a period of no greater than ** days.
Subsequent to such ** day time period, or if Chroma does not notify CTI in
writing that it wishes to enter into the Applicable Transaction described in the
ROFR Notice within the ROFR Notice Period, or if Chroma rejects the Applicable
Transaction described the ROFR Notice, then CTI may enter into negotiations
and/or an agreement regarding the Applicable Transaction as described in the
ROFR Notice with the Third Party without further obligations to Chroma.

9.3 Disclosure of Inventions. Each Party shall promptly disclose to the other
any invention disclosures, or other similar documents, submitted to it by its
employees, agents or independent contractors describing inventions that are
either Sole Inventions or Joint Inventions, and all information relating to such
inventions to the extent necessary for the preparation, filing and maintenance
of any Patent with respect to such invention.

9.4 Prosecution of Patents.

(a) Chroma Patents. The Chroma Patents in existence as of the Effective Date are
listed in Exhibit B-1 hereto. The Parties shall update such Exhibit as
appropriate (and at least once per calendar quarter) to add to Exhibit B-1 each
Patent filed after the Effective Date by Chroma or its Affiliates (or any
applicable licensor) which would constitute an Chroma Patent

 

45

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

hereunder. Except as otherwise provided in this Section (a), as between the
Parties, Chroma shall have the sole right and authority to prepare, file,
prosecute and maintain the Chroma Patents on a worldwide basis. Chroma shall
bear all costs of preparation, filing, prosecution and maintenance of Chroma
Patents. Chroma shall provide CTI reasonable opportunity to review and comment
on such efforts regarding such Chroma Patents, including by providing CTI with a
copy of material communications from any patent authority regarding such Chroma
Patent, and by providing drafts of any material filings or responses to be made
to such patent authorities in advance of submitting such filings or responses.
If Chroma determines in its sole discretion to abandon or not maintain any
Chroma Patent(s) that is being prosecuted or maintained by Chroma, then Chroma
shall provide CTI with written notice of such determination within a period of
time reasonably necessary to allow CTI to determine its interest in such Chroma
Patent(s). In the event CTI provides written notice expressing its interest in
obtaining such Chroma Patent(s), Chroma shall free of charge assign and transfer
to CTI the ownership of, and interest in, such Chroma Patent(s), at CTI’s sole
expense, and Chroma shall cooperate with CTI for assignment and transfer of such
Chroma Patent(s) at CTI’s sole expense. CTI shall thereafter bear all costs of
preparation, filing, prosecution and maintenance of such assigned and
transferred Patents. In the event that CTI decides to abandon or not maintain
any such Patent(s), CTI shall promptly provide Chroma with written notice of
such decision. Chroma shall only be obliged to comply with the provisions of
this Section 9.4(a) and 9.4(c) below with respect to any Chroma Patent which is
licensed to Chroma under the Vernalis Agreement to the extent that Chroma is not
prohibited to do so pursuant to the terms of the Vernalis Agreement, provided
that in any event Chroma shall use commercially reasonable efforts to cause
Vernalis to comply with these provisions. If, despite Chroma’s commercially
reasonable efforts, Chroma is not able to cause Vernalis to so comply, CTI’s
commercial diligence obligations under Section 6.4 shall be equitably adjusted
in light of such lack of compliance.

(b) Joint Patents. Except as otherwise provided in this Section 9.4(b), CTI
shall have the primary right and authority to prepare, file, prosecute and
maintain the Patents filed in relation to the Joint Inventions (“Joint Patents”)
on a worldwide basis. Chroma and CTI shall share equally all reasonable costs of
preparation, filing, prosecution and maintenance of the Joint Patents. CTI shall
provide Chroma with the reasonable opportunity (and unless necessary to avoid a
material adverse impact on such Joint Patents, at least thirty (30) days) to
review and comment on such efforts regarding such Joint Patent, including by
providing Chroma with a copy of material communications from any patent
authority in such country(ies) regarding such Joint Patent, and by providing
drafts of any material filings or responses to be made to such patent
authorities in advance of submitting such filings or responses, and CTI shall
give due consideration to any reasonable comments made by Chroma. If CTI
determines in its sole discretion to abandon or not maintain any Joint Patent(s)
in any country(ies) of the world, then CTI shall provide Chroma with written
notice of such determination within a period of time reasonably necessary to
allow Chroma to determine its interest in such Joint Patent(s). In the event
Chroma provides written notice expressing its interest in obtaining such Joint
Patent(s), CTI shall free of charge assign and transfer to Chroma the ownership
of, and interest in, such Joint Patent(s) in such country(ies), at Chroma’s sole
expense, and CTI shall cooperate with Chroma with regard to the assignment and
transfer of such Joint Patent(s) in such country.

 

46

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(c) Cooperation in Prosecution. Each Party shall provide the other Party all
reasonable assistance and cooperation in the Patent prosecution efforts provided
above in this Section 9.4, including providing any necessary powers of attorney
and executing any other required documents or instruments for such prosecution,
as well as further actions as set forth below.

(i) The Parties shall respectively prepare, file, maintain and prosecute the
Chroma Patents and Joint Patents as set forth in this Section 9.4. As used
herein, “prosecution” of such Patents shall include, without limitation, all
communication and other interaction with any patent office or patent authority
having jurisdiction over a patent application in connection with pre-grant
proceedings. Post-grant proceedings shall be governed by Section 9.9(b).

(ii) All communications between the Parties relating to the preparation, filing,
prosecution or maintenance of the Chroma Patents and Joint Patents, including
copies of any draft or final documents or any communications received from or
sent to patent offices or patenting authorities with respect to such Patents,
shall be considered Confidential Information and subject to the confidentiality
provisions of Article 12.

9.5 Patent Term Extensions. The ESC will discuss and recommend for which, if
any, of the Patents within the Chroma Patents and Joint Patents the Parties
should seek Patent Term Extensions. Chroma, in the case of the Chroma Patents,
and CTI in the case of the Joint Patents, shall have the final decision-making
authority with respect to applying for any such Patent Term Extensions, and will
act with reasonable promptness in light of the development stage of Products to
apply for any such Patent Term Extensions, where it so elects; provided,
however, that if in a particular country or jurisdiction only one such Patent
can obtain a Patent Term Extension, then the Parties will consult in good faith
to determine which such Patent should be the subject of efforts to obtain a
Patent Term Extension, and in any event CTI’s decision on such matter will
control in the case of a disagreement with regard to the Licensed Territory and
Chroma’s decision on such matters will control in the case of disagreement with
regard to the ROW Territory. The Party that does not apply for an extension
hereunder will cooperate fully with the other Party in making such filings or
actions, for example and without limitation, making available all required
regulatory data and information and executing any required authorizations to
apply for such Patent Term Extension. All expenses incurred in connection with
activities of each Party with respect to the Patent(s) for which such Party
seeks Patent Term Extensions pursuant to this Section 9.5 shall be entirely
borne by such Party. Chroma shall only be obliged to comply with the provisions
of this Section 9.5 with respect to any Chroma Patent which is licensed to
Chroma under the Vernalis Agreement to the extent that Chroma is not prohibited
to do so pursuant to the terms of the Vernalis Agreement, provided that in any
event Chroma shall use commercially reasonable efforts to cause Vernalis to
comply with these provisions. If, despite Chroma’s commercially reasonable
efforts, Chroma is not able to cause Vernalis to so comply, CTI’s commercial
diligence obligations under Section 6.4 shall be equitably adjusted in light of
such lack of compliance. CTI’s rights under this Section 9.5 will

 

47

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

be correspondingly limited by the rights which Chroma is able to exercise
pursuant to the Vernalis Agreement.

9.6 Infringement of Patents by Third Parties.

(a) Notification. Each Party shall promptly notify the other Party in writing of
any existing or threatened infringement of the Chroma Patents or Joint Patents
of which it becomes aware, and shall provide all evidence in such Party’s
possession demonstrating such infringement.

(b) Infringement of Chroma Patents or Joint Patents in the Licensed Territory.

(i) If a Third Party infringes any Chroma Patent or Joint Patent in the Licensed
Territory by making, using, importing, offering for sale or selling the Product
or a competitive product (a “Product Infringement”), each Party shall share with
the other Party all information available to it regarding such alleged
infringement. CTI shall have the first right, but not the obligation, to bring
an appropriate suit or other action against any person or entity engaged in such
Product Infringement in the Licensed Territory, subject to Section 9.6(b)(ii)
through 9.6(b)(v), below.

(ii) CTI shall have a period of thirty (30) days after the first notice under
9.6(a) to elect to enforce such Chroma Patent or Joint Patent against such
Product Infringement. In the event CTI does not so elect, CTI shall so notify
Chroma in writing, and Chroma shall have the right to commence a suit or take
action to enforce the applicable Patent against such Third Party perpetrating
such Product Infringement in the Licensed Territory at its own cost and expense.
If one Party elects to bring suit or take action against the Product
Infringement, then the other Party shall have the right, prior to commencement
of the trial, suit or action, to join any such suit or action.

(iii) Each Party shall provide to the Party enforcing any such rights under this
Section 9.6(b) reasonable assistance in such enforcement, at such enforcing
Party’s request and expense, including joining such action as a party plaintiff
if required by applicable Law to pursue such action. The enforcing Party shall
keep the other Party regularly informed of the status and progress of such
enforcement efforts, shall reasonably consider the other Party’s comments on any
such efforts, and shall seek consent of the other Party in any important aspects
of such enforcement including, without limitation, determination of litigation
strategy, filing of important papers to the competent court, which shall not be
unreasonably withheld or delayed.

(iv) Each Party shall bear all of its own internal costs incurred in connection
with its activities under this Section 9.6(b); provided, that in the event that
the Parties are joined in suit or action against the Product Infringement and
represented by the same outside counsel, then the Parties shall share equally in
the external costs and expenses for such action.

 

48

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(v) The Party not bringing an action with respect to Product Infringement in the
Licensed Territory under this Section 9.6(b) shall be entitled to separate
representation in such matter by counsel of its own choice and at its own
expense, but such Party shall at all times cooperate fully with the Party
bringing such action.

(c) Settlement. Neither Party shall settle any claim, suit or action that it
brought under this Section 9.6 involving Chroma Patents or Joint Patents without
the prior written consent of the other Party, which consent shall not be
unreasonably withheld or delayed.

(d) Allocation of Proceeds. If either Party recovers monetary damages from any
Third Party in a suit or action brought under Sections 9.6(b) or 9.6(c), whether
such damages result from the infringement of Chroma Patents or Joint Patents,
such recovery shall be allocated first to the reimbursement of any expenses
incurred by the Parties in such litigation and any remaining amounts shall be
split as follows: such amounts shall be allocated ** to Chroma and ** to CTI.

(e) Upstream Agreements. Chroma shall only be obliged to comply with the
provisions of this Section 9.6 with respect to any Chroma Patent which is
licensed to Chroma under the Vernalis Agreement to the extent that Chroma is not
prohibited to do so pursuant to the terms of the Vernalis Agreement, provided
that in any event Chroma shall use commercially reasonable efforts to cause
Vernalis to comply with these provisions. If, despite Chroma’s commercially
reasonable efforts, Chroma is not able to cause Vernalis to so comply, CTI’s
commercial diligence obligations under Section 6.4 shall be equitably adjusted
in light of such lack of compliance. CTI’s rights under Section 9.6 will be
correspondingly limited by the rights which Chroma is able to exercise pursuant
to the Vernalis Agreement.

9.7 Infringement of Third Party Rights. If any Product Developed, Manufactured,
made, have made, stored, handled, used, promoted, sold, offered for sale,
imported or otherwise Commercialized by either Party, its Affiliates, licensees
or sublicensees becomes the subject of a Third Party’s claim or assertion of
infringement of a Patent granted by a jurisdiction within the Licensed Territory
or the ROW Territory, the Party first having notice of the claim or assertion
shall promptly notify the other Party, the Parties shall agree on and enter into
an “identity of interest agreement” wherein such Parties agree to their shared,
mutual interest in the outcome of such potential dispute, and thereafter, the
Parties shall promptly meet to consider the claim or assertion and the
appropriate course of action provided that each Party shall be entitled to
defend any such Third Party claim or assertion made against it as it reasonably
determines.

9.8 Patent Marking. CTI (or its Affiliate, sublicensee or distributor) shall
mark Products marketed and sold by CTI (or its Affiliate, sublicensee or
distributor) hereunder with appropriate patent numbers or indicia at Chroma’s
reasonable request; provided, however, that CTI shall only be required to so
mark such Products to the extent such markings or such notices would impact
recoveries of damages or equitable remedies available under applicable Law with
respect to infringements of Patents in the Licensed Territory.

9.9 Patent Oppositions and Other Proceedings.

 

49

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(a) Third-Party Patent Rights. If either Party desires to bring, anywhere in the
world, an opposition, action for declaratory judgment, nullity action,
interference, declaration for non-infringement, reexamination or other attack
upon the validity, title or enforceability of a Patent owned or controlled by a
Third Party and having one or more claims that covers the Product, or the use,
sale, offer for sale or importation of the Product, such Party shall so notify
the other Party and the Parties shall promptly confer to determine whether to
bring such action or the manner in which to settle such action. CTI shall have
the exclusive right, but not the obligation, to bring at its own expense and in
its sole control such action in the Licensed Territory. If CTI does not bring
such an action in the Licensed Territory, within ninety (90) days of
notification thereof pursuant to this Section 9.9(a) (or earlier, if required by
the nature of the proceeding), then Chroma shall have the right, but not the
obligation, to bring, at Chroma’s sole expense, such action. The Party not
bringing an action under this Section 9.9(a) shall be entitled to separate
representation in such proceeding by counsel of its own choice and at its own
expense, and shall cooperate fully with the Party bringing such action. Any
awards or amounts received in bringing any such action shall be first allocated
to reimburse the initiating Party’s expenses in such action, and any remaining
amounts shall be retained by such Party.

(b) Parties’ Patent Rights. If any Chroma Patent or Joint Patent becomes the
subject of any proceeding commenced by a Third Party within the Licensed
Territory or the ROW Territory in connection with an opposition, reexamination
request, action for declaratory judgment, nullity action, interference or other
attack upon the validity, title or enforceability thereof (except insofar as
such action is a counterclaim to or defense of, or accompanies a defense of, an
action for infringement against a Third Party under Section 9.6, in which case
the provisions of Section 9.6 shall govern), then the Party responsible for
filing, preparing, prosecuting and maintaining such Patent as set forth in
Section 9.4 hereof, shall control such defense at its own cost and expense. The
controlling Party shall permit the non-controlling Party to participate in the
proceeding to the extent permissible under applicable Law, and to be represented
by its own counsel in such proceeding, at the non-controlling Party’s expense.

9.10 Vernalis Agreement. Within ** days after the execution of this Agreement,
Chroma shall use commercially reasonable efforts to either (i) ** or (ii) amend
the Vernalis Agreement to address issues related to **, in each case subject to
CTI’s prior written approval, not to be unreasonably withheld, delayed or
conditioned.

ARTICLE 10

REPRESENTATIONS AND WARRANTIES

10.1 Mutual Representations and Warranties. Each Party hereby represents,
warrants, and covenants (as applicable) to the other Party as follows:

(a) Organization, Existence and Power. As of the Effective Date, it is a company
or corporation duly organized, validly existing, and in good standing under the
laws of the jurisdiction in which it is organized, and has full organizational
(whether corporate or

 

50

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

otherwise) power and authority and the legal right to own and operate its
property and assets and to carry on its business as it is now being conducted
and as contemplated in this Agreement.

(b) Authority and Binding Agreement. As of the Effective Date, (i) it has the
organizational power and authority and the legal right to enter into this
Agreement and perform its obligations hereunder; (ii) it has taken all necessary
organizational action on its part required to authorize the execution and
delivery of the Agreement and the performance of its obligations hereunder; and
(iii) the Agreement has been duly executed and delivered on behalf of such
Party, and constitutes a legal, valid, and binding obligation of such Party that
is enforceable against it in accordance with its terms.

(c) No Conflict; Covenant. It is not a party to any agreement that would prevent
it from granting the rights granted to the other Party under this Agreement or
performing its obligations under the Agreement.

(d) No Debarment. In the course of the development of Products, each Party shall
not use, during the Term, any employee or consultant who has been debarred by
any Regulatory Authority, or, to the best of such Party’s knowledge, is the
subject of debarment proceedings by a Regulatory Authority.

10.2 Additional Representations and Warranties of Chroma. Chroma represents and
warrants, on its behalf and on behalf of each of its Affiliates, to CTI as
follows:

(a) Chroma Patents. Exhibits B-1 sets forth a complete and accurate list of all
Chroma Patents in existence as of the Effective Date. Chroma is the exclusive
licensee of those Chroma Patents listed on Exhibit B-1, free and clear of any
liens, security interests, encumbrances (other than the security interest
described on Exhibit B-1). To Chroma’s Best Knowledge, no party to any Upstream
Agreement has granted any liens, security interests or encumbrances to the
Chroma Technology. Chroma is listed in the records of the appropriate United
States and/or foreign governmental agencies in the Licensed Territory as the
sole and exclusive licensee of record for each registration, grant and
application included in the Chroma Patents.

(b) Chroma Know-How. Chroma is the sole and exclusive owner of all of the Chroma
Know-How, free and clear of any liens, security interests, encumbrances or
claims of ownership of license from a Third Party (other than the security
interest specifically described on Exhibit B-1). Chroma has the right to use and
disclose and to enable CTI to use and disclose (in each case under appropriate
conditions of confidentiality) the Chroma Know-How. Chroma has taken all
reasonable precautions to preserve the confidentiality of the Chroma Know-How,
and has not disclosed to any Third Party any Chroma Know-How that is or was
confidential except under terms which preserved its confidentiality.

(c) Rights to Grant Licenses. Chroma has the right to grant to CTI the licenses
under the Chroma Technology that it purports to grant hereunder.

 

51

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(d) No Out-Bound Agreements. Chroma has not granted any Third Party, including
any academic organization or agency, any rights to the Product other than the
material transfer agreements disclosed to CTI prior to the Effective Date.

(e) Sufficiency of Chroma Technology. As of the Effective Date, to Chroma’s Best
Knowledge, the Chroma Technology constitutes all intellectual property necessary
for, and no Third Party Know-How is needed to, Develop, Manufacture, use, make,
have made, sell, offer for sale, have sold, distribute, import and otherwise
Commercialize the Product in the Licensed Territory. Without limiting the
foregoing, Chroma represents and warrants that the Chroma Patents listed on
Exhibit B-1 have all been licensed to Chroma under the Vernalis Agreement and,
to Chroma’s Best Knowledge, none of the intellectual property (including
Patents) licensed to **, is necessary or useful to Develop, Manufacture, use,
make, have made, sell, offer for sale, have sold, distribute, import and
otherwise Commercialize the Product in the Field in the Licensed Territory.
Chroma further represents and warrants that none of its Affiliates, as of the
Effective Date, have any ownership of or any rights to any intellectual property
(including Patents) in the Licensed Territory relating to the Chroma Technology.

(f) Non-Infringement of Chroma Technology by Third Parties. As of the Effective
Date, to Chroma’s Best Knowledge, there are no ongoing activities by Third
Parties that would constitute infringement or misappropriation of the Chroma
Technology within the Licensed Territory.

(g) Non-Infringement. As of the Effective Date, to Chroma’s Best Knowledge, none
of the manufacture, use or the sale of the Product in the Licensed Territory
infringes any Patent owned by a Third Party or infringes or misappropriates any
other Third Party intellectual property. As of the Effective Date, Chroma has
not received any verbal or written claim or demand of any person or entity that
the manufacture, use, or sale of the Product in the Licensed Territory infringes
a Third Party Patent.

(h) Chroma Patents Not Invalid or Unenforceable. As of the Effective Date, the
Chroma Patents exist, and Chroma has not received any written notice from a
Government Authority or from any Third Party that the Chroma Patents are invalid
or unenforceable, in whole or in part. To Chroma’s Best Knowledge, Chroma has
filed and prosecuted patent applications within the Chroma Patents in good faith
and complied with all duties of disclosure with respect thereto and Chroma is
not aware of any prior art or third party rights that would challenge the
validity of the Chroma Patents. In addition, to Chroma’s Best Knowledge, Chroma
has not committed any act, or omitted to commit any act, that may cause the
Chroma Patents to expire prematurely or be declared invalid or unenforceable.

(i) Disclosure. Prior to the Effective Date, Chroma made available to CTI, or
provided CTI with, copies of all information with respect to the Product as
requested by CTI in writing. In addition, as of the Effective Date Chroma has
disclosed to CTI any material information known to Chroma as of such date with
respect to (i) the safety of the Product, (ii) the efficacy of the Product,
(iii) any then-existing circumstance which would be reasonably likely to

 

52

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

prohibit or prevent the Development, Manufacturing and/or Commercialization of
the Product in the Licensed Territory.

(j) Non-Action or Claim. As of the Effective Date, to Chroma’s Best Knowledge,
there are no actual, pending, alleged or threatened adverse actions, suits,
claims, interferences or formal governmental investigations involving the
Product and/or the Chroma Technology by or against Chroma or any of its
Affiliates in or before any court, governmental or Regulatory Authority. In
particular, as of the Effective Date, to its Best Knowledge, there is no pending
or threatened product liability action involving the Product. As of the
Effective Date, there are no claims, judgments or settlements against or owed by
Chroma relating to the Chroma Technology or the Product.

(k) Regulatory Materials and Studies. To Chroma’s Best Knowledge, all Regulatory
Materials Controlled by Chroma in existence as of the Effective Date and to
which CTI has rights of use or reference hereunder, including the Regulatory
Materials described in Section 5.1, have been prepared, maintained and retained
in accordance with applicable Laws. All preclinical and clinical studies
conducted with respect to the Product, including such studies from which the
data described in Section 5.1 are derived, have to Chroma’s Best Knowledge been
conducted substantially in accordance with applicable Laws by persons with
appropriate education, knowledge and experience.

(l) Upstream Agreements. (i) Chroma has provided CTI with a complete, current
and accurate copy of each of the Upstream Agreements, including all amendments
of each, as such agreements exist on the date hereof; (ii) Chroma has complied
at all times with its obligations under the Vernalis Agreement, (iii) Chroma is
not in default or breach, and there are no circumstances existing on the date
hereof which, with notice or the passage of time or both, could reasonably be
expected to result in a default under the Vernalis Agreement, (iv) the Upstream
Agreements are in full force and effect and are legal, valid and binding
agreements, and enforceable in accordance with their terms, (v) as of the date
hereof, Chroma or its Affiliates have not received any rights to any Chroma
Technology from any Third Party except under the terms of the Vernalis Agreement
provided to CTI and (vi) as of the date hereof, Chroma is not aware of any
agreement related to the ownership or rights in the Chroma Technology other than
the Upstream Agreements. The warranties given in (i) and (iv) of this paragraph
(l) with respect to the other Upstream Agreements that are not the Vernalis
Agreement are given to Chroma’s Best Knowledge, provided that no such knowledge
qualification applies to the Vernalis Agreement.

10.3 No Other Representations or Warranties. EXCEPT AS EXPRESSLY STATED IN THIS
AGREEMENT, NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, WHETHER EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS
FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT, NON-MISAPPROPRIATION OF THIRD PARTY
INTELLECTUAL PROPERTY RIGHTS OR ACHIEVEMENT OF ANY PARTICULAR SALES LEVEL, IS
MADE OR GIVEN BY OR ON BEHALF OF A PARTY. ALL

 

53

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

REPRESENTATIONS AND WARRANTIES, WHETHER ARISING BY OPERATION OF LAW OR
OTHERWISE, ARE HEREBY EXPRESSLY EXCLUDED.

ARTICLE 11

INDEMNIFICATION

11.1 Indemnification by Chroma. Chroma shall defend, indemnify, and hold CTI and
its Affiliates and CTI’s and its Affiliates’ officers, directors, employees, and
agents (the “CTI Indemnitees”) harmless from and against any and all Third Party
claims, suits, proceedings, damages, expenses (including court costs and
reasonable attorneys’ fees and expenses), and recoveries (collectively,
“Claims”) to the extent that such Claims arise out of, are based on, or result
from (a) the Development, Manufacture, storage, handling, use, promotion, sale,
offer for sale, importation or other Commercialization of Products by or on
behalf of Chroma or its Affiliates, distributors (other than CTI), sublicensees
(other than CTI), or contract manufacturers (unless and to the extent such
liability for Manufacturing activities are covered by separate indemnification
pursuant to the Supply Agreement, which in such event will control), or (b) the
breach of any representation, warranty or covenant of Chroma in this Agreement,
or (c) the willful misconduct or negligent acts of Chroma, its Affiliates, or
the officers, directors, employees, or agents of Chroma or its Affiliates. The
foregoing indemnity obligation shall not apply to the extent that (i) the CTI
Indemnitees fail to comply with the indemnification procedures set forth in
Section 11.3 and Chroma’s defense of the relevant Claims is prejudiced by such
failure, or (ii) any Claim arises from, is based on, or results from any
activity for which CTI is obligated to indemnify the Chroma Indemnitees under
Section 11.2.

11.2 Indemnification by CTI. CTI shall defend, indemnify, and hold Chroma and
its Affiliates and Chroma’s and its Affiliates’ officers, directors, employees,
and agents (the “Chroma Indemnitees”) harmless from and against any and all
Claims to the extent that such Claims arise out of, are based on, or result from
(a) the Development, storage, handling, distribution, use, Manufacture (unless
and to the extent liability for Manufacturing activities are covered by separate
indemnification pursuant to the Supply Agreement, which in such event will
control) promotion, sale, offer for sale, importation or other Commercialization
of Products by CTI or its Affiliates, or its or their sublicensees, or
distributors or contract manufacturers, or (b) the breach of any representation,
warranty or covenant of CTI set forth in this Agreement, or (c) the willful
misconduct or negligent acts of CTI or its Affiliates, or the officers,
directors, employees, or agents of CTI or its Affiliates. The foregoing
indemnity obligation shall not apply to the extent that (i) the Chroma
Indemnitees fail to comply with the indemnification procedures set forth in
Section 11.3 and CTI’s defense of the relevant Claims is prejudiced by such
failure, or (ii) any Claim arises from, is based on, or results from any
activity for which Chroma is obligated to indemnify the CTI Indemnitees under
Section 11.1.

11.3 Indemnification Procedures. The Party claiming indemnity under this Article
11 (the “Indemnified Party”) shall give written notice to the Party from whom
indemnity is being sought (the “Indemnifying Party”) in a reasonably timely
manner after learning of such

 

54

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Claim. The Indemnified Party shall provide the Indemnifying Party with
reasonable assistance, at the Indemnifying Party’s expense, in connection with
the defense of the claim for which indemnity is being sought. The Indemnified
Party may participate in and monitor such defense with counsel of its own
choosing at its sole expense; provided, however, the Indemnifying Party shall
have the right to assume and conduct the defense of the claim with counsel of
its choice. The Indemnifying Party shall not settle any claim without the prior
written consent of the Indemnified Party, not to be unreasonably withheld,
unless the settlement involves only the payment of money. So long as the
Indemnifying Party is actively defending the claim in good faith, the
Indemnified Party shall not settle any such claim without the prior written
consent of the Indemnifying Party. If the Indemnifying Party does not assume and
conduct the defense of the claim as provided above, (a) the Indemnified Party
may defend against, and consent to the entry of any judgment or enter into any
settlement with respect to the claim in any manner the Indemnified Party may
deem reasonably appropriate (and the Indemnified Party need not consult with, or
obtain any consent from, the Indemnifying Party in connection therewith), and
(b) the Indemnifying Party will remain responsible to indemnify the Indemnified
Party as provided in this Article 11.

11.4 No Assumed Obligations and Liabilities. Notwithstanding the foregoing and
anything else to the contrary in this Agreement, Chroma expressly acknowledges
and agrees that CTI does not, under the terms of this Agreement or otherwise,
assume any liability or obligation related to the Product to the extent relating
to periods before the Effective Date, including any liability or obligation with
respect to any Products that were used or distributed by or for Chroma,
including any liabilities or obligations with respect to the Past Studies
(collectively, the “Retained Liabilities”). Chroma shall retain and be solely
responsible and liable for all Retained Liabilities.

11.5 Limitation of Liability. NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR INDIRECT DAMAGES ARISING FROM
OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE
POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THE FOREGOING, NOTHING IN THIS
SECTION 11.5 IS INTENDED TO OR SHALL LIMIT OR RESTRICT THE INDEMNIFICATION
RIGHTS OR OBLIGATIONS OF ANY PARTY UNDER SECTION 11.1 OR 11.2, OR DAMAGES
AVAILABLE FOR A PARTY’S BREACH OF CONFIDENTIALITY OBLIGATIONS IN ARTICLE 12, A
PARTY’S LIABILITY FOR FRAUD, DEATH OR PERSONAL INJURY CAUSED BY THEIR NEGLIGENCE
OR ANY OTHER LIABILITY WHICH MAY NOT BE EXCLUDED BY LAW.

11.6 Insurance. Each Party shall procure and maintain insurance, including
product liability insurance, adequate to cover its obligations hereunder and
which are consistent with normal business practices of prudent companies
similarly situated at all times during which any Product is being clinically
tested in human subjects or commercially distributed or sold by such Party. It
is understood that such insurance shall not be construed to create a limit of
either Party’s liability with respect to its indemnification obligations under
this Article 11. Each Party

 

55

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

shall provide the other Party with written evidence of such insurance upon
request. Each Party shall provide the other Party with written notice at least
thirty (30) days prior to the cancellation, non-renewal or material change in
such insurance or self-insurance which materially adversely affects the rights
of the other Party hereunder.

ARTICLE 12

CONFIDENTIALITY

12.1 Confidentiality. Except to the extent expressly authorized by this
Agreement or otherwise agreed in writing by the Parties during a period that is
the longer of (i) the Term, or (ii) fifteen (15) years from the Effective Date,
each Party agrees that it shall keep confidential and shall not publish or
otherwise disclose and shall not use for any purpose other than as provided for
in this Agreement any Confidential Information furnished to it by the other
Party pursuant to this Agreement except for that portion of such information or
materials that the receiving Party can demonstrate by competent written proof:

(a) was already rightfully known to the receiving Party or its Affiliate, other
than under an obligation of confidentiality, at the time of disclosure by the
other Party;

(b) was generally available to the public or otherwise part of the public domain
at the time of its disclosure to the receiving Party;

(c) became generally available to the public or otherwise part of the public
domain after its disclosure and other than through any act or omission of the
receiving Party in breach of this Agreement;

(d) was disclosed to the receiving Party or its Affiliate by a Third Party who
has a legal right to make such disclosure; or

(e) was independently discovered or developed by the receiving Party or its
Affiliate without the aid, application, or use of the disclosing Party’s
Confidential Information, as evidenced by a contemporaneous writing.

12.2 Authorized Disclosure. Each Party may disclose Confidential Information
belonging to the other Party to the extent such disclosure is reasonably
necessary in the following situations:

(a) regulatory filings and other filings with Governmental Authorities,
including filings with the Securities and Exchange Commission, the Commissione
Nazionale per le Società e la Borsa or other securities regulatory authority,
The Nasdaq Stock Market LLC, the Mercato Telematico Azionario or other relevant
exchange on which such Party is listed;

(b) prosecuting or defending litigation;

 

56

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(c) complying with applicable Laws;

(d) disclosure to its employees, agents, consultants, and any bona fide Third
Party potential (sub)-licensees (including potential Third Party contract
manufacturers and other licensees or collaborators) only on a need-to-know basis
and solely as necessary in connection with the performance of or as otherwise
contemplated by this Agreement, provided that in each case the recipient of such
Confidential Information must agree to be bound by similar obligations of
confidentiality and non-use at least as equivalent in scope as those set forth
in this Article 12 prior to any such disclosure; and

(e) disclosure of the material terms of this Agreement to any bona fide
potential investor, investment banker, acquiror, merger partner, licensees,
sublicensees or other potential or actual financial or commercial partner;
provided that in connection with such disclosure, the disclosing Party shall use
all reasonable efforts to inform each recipient of the confidential nature of
such Confidential Information and cause each recipient of such Confidential
Information to treat such Confidential Information as confidential.

Notwithstanding the foregoing, in the event a Party is required to make a
disclosure of the other Party’s Confidential Information pursuant to clause
(a) through (c) of this Section 12.2, it will, except where impracticable, give
reasonable advance notice to the other Party of such disclosure and, if
reasonably requested by the other Party, use diligent efforts to secure
confidential treatment of such information. In any event, the Parties agree to
take all reasonable action to avoid disclosure of Confidential Information
hereunder except as otherwise provided in this Agreement. Each Party will be
responsible for any acts or omissions of any Third Party to which such Party
discloses Confidential Information in accordance with this Section 12.2.

12.3 Publicity.

(a) The Parties shall make a joint public announcement of the execution of this
Agreement in the form attached as Exhibit D, which shall be issued at a time to
be mutually agreed by the Parties. The Parties, will as soon as reasonably
possible following the Effective Date but prior to any required filing
timelines, agree on a redacted version of this Agreement to be filed by CTI on
any public register pursuant to any securities law or regulation, provided that
there is no assurance that such redactions will be acceptable to the applicable
Governmental Authorities.

(b) Neither Party shall issue any additional press release or other publicity
materials, or make any public presentation with respect to the terms or
conditions of, this Agreement (but excluding the timelines for the programs
being conducted pursuant to this Agreement or efforts and progress against such
timelines, which may be the subject of additional press releases, other
publicity materials and public presentations without the need to obtain the
prior written consent of the other Party), in each case without the prior
written consent of the other Party. The restriction in this paragraph (b) shall
not apply to any future disclosures required by Law or regulation, including as
may be required in connection with any filings made with, or by the requirements
of the securities exchange on which such Party’s securities are traded;
provided,

 

57

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

that the disclosing Party uses all reasonable efforts to inform the other Party
at least three (3) business days prior to making any such disclosures and, if
reasonably requested by the other Party, cooperates with the other Party in
seeking a protective order or other appropriate remedy (including redaction). In
addition, where required by Law of the applicable securities exchange upon which
a Party may be listed, such Party shall have the right to make a press release
announcing the achievement of each milestone under this Agreement as it is
achieved, and the achievements of Regulatory Approvals in the Licensed Territory
as they occur, subject only to the review procedure set forth in the preceding
sentence. In relation to the other Party’s review of such an announcement, such
other Party may make specific, reasonable comments on such proposed press
release within the prescribed time for commentary, but shall not withhold its
consent to disclosure of the information that the relevant milestone has been
achieved and triggered a payment hereunder. Neither Party shall be required to
seek the permission of the other Party to repeat any information regarding the
terms of this Agreement that has already been publicly disclosed by such Party,
or by the other Party, in accordance with this Section 12.3.

ARTICLE 13

TERM AND TERMINATION

13.1 Term. This Agreement shall (subject to Section 15.9) become effective on
the Effective Date and, unless earlier terminated pursuant to this Article 13,
shall remain in effect, on a Product-by-Product basis and on a
country-by-country basis, until the expiration of the Royalty Term of such
Product in such country.

13.2 Early Termination. CTI shall have the right to terminate this Agreement for
convenience, upon one hundred and twenty (120) days’ written notice to Chroma.

13.3 Termination for Breach. If either Party is in material breach of the
obligations, covenants and representations contained in this Agreement the other
Party (the “Non-Defaulting Party”) shall be entitled to give to the Party in
default (the “Defaulting Party”) written notice specifying the nature of the
default and requiring it to cure such default. If such default is not cured
(a) in the case of a failure to make any undisputed payment (other than with
respect to any refund contemplated by Section 15.9, which shall be made
immediately upon the occurrence of any such termination) or credit due pursuant
to this Agreement, within thirty (30) days after receipt of such notice, or
(b) in the case of any other default, within ninety (90) days after the receipt
of such notice (or, if such breach is not capable of being cured within such
ninety (90) day period, within such amount of time as may be reasonably
necessary to cure such breach (but no longer than one-hundred and eighty
(180) days), so long as the Defaulting Party is making diligent efforts to do
so), the Non-Defaulting Party shall be entitled, without prejudice to any other
rights conferred on it by this Agreement, and in addition to any other remedies
available to it by law or in equity, immediately to terminate this Agreement by
giving written notice to the Defaulting Party. The right of a Party to terminate
this Agreement, as herein provided, shall not be affected in any way by its
waiver or failure to take action with respect to any previous default.

 

58

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

If either Party disputes the existence of a material breach, then such dispute
shall be resolved under the terms of Article 14 before this Agreement may be
terminated for such material breach.

13.4 Insolvency. Either Party may terminate this Agreement upon written notice
if, at any time, the other Party shall file in any court or agency pursuant to
any statute or regulation of any state or country, a petition in bankruptcy or
insolvency or for an arrangement or for the appointment of a receiver or trustee
of the other Party or of substantially all of its assets, or if the other Party
enters into a written agreement of composition, or if the other Party shall be
served with an involuntary petition against it, filed in any insolvency
proceeding, and such petition shall not be dismissed within ninety (90) calendar
days after the filing thereof, or if the other Party is a party to any
dissolution or liquidation, or if the other Party shall make an assignment of
substantially all of its assets for the benefit of creditors or if the other
Party shall be subject to a procedure which is similar to or the same as any of
the foregoing in any country.

13.5 Termination for Patent Challenge by CTI. If CTI or any of its Affiliates:
(a) commences or otherwise voluntarily determines to participate in (other than
as a response to any action or proceeding initiated by Chroma or its Affiliates
(other than relating to a matter covered under Section 13.3), or as may be
necessary or reasonably required to assert a cross-claim or a counter-claim, or
to respond to a court request or order or administrative law request or order)
any action or proceeding (including any patent opposition or re-examination
proceeding), challenging or denying the validity of any Chroma Patent or any
claim thereof; or (b) actively assists any other person (other than as a
response to any action or proceeding initiated by Chroma or its Affiliates
(other than relating to a matter covered under Section 13.3), or as may be
necessary or reasonably required to assert a cross-claim or counter-claim, or to
respond to a court request or order or administrative law request or order) in
bringing or prosecuting any action or proceeding (including any patent
opposition or re-examination proceeding) challenging or denying the validity of
any of such Chroma Patent or any claim thereof, Chroma shall have the right to
terminate this Agreement on ninety (90) days written notice to CTI unless CTI or
its Affiliates promptly terminates any such challenge within thirty (30) days
after its receipt of such notice from Chroma. CTI shall include this obligation
in its agreements with its sublicensees, provided that if any such sublicense
initiates a patent challenge against Chroma as described above, subject to the
exceptions noted above, CTI’s termination of such sublicense agreement shall be
deemed a cure under this provision and Chroma will not be entitled to terminate
this Agreement under this provision in such instance.

13.6 Continuing Rights of Commercialization Sublicensees. Upon any termination
of any license rights granted to CTI under this Agreement, each sublicense
previously granted by CTI or any of its Affiliates under such license rights to
any Commercialization Sublicensee shall remain in effect and shall become a
direct license or sublicense, as the case may be, of such rights by Chroma to
such Commercialization Sublicensee, provided that such Commercialization
Sublicensee is not in breach of its agreement with CTI, and subject to the
Commercialization Sublicensee agreeing in writing to assume CTI’s terms,
conditions and obligations to Chroma under this Agreement as they pertain to the
sublicensed rights.

 

59

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

13.7 Effect of Termination for CTI. The following provisions shall apply if
(a) CTI terminates this Agreement in its entirety pursuant to Section 13.2, or
(b) Chroma terminates this Agreement due to CTI’s material uncured breach under
Section 13.3 (c) due to CTI’s insolvency under Section 13.4 or, (d) due to CTI’s
patent challenge under Section 13.5.

(a) Termination of Licenses. The licenses granted to CTI under this Agreement
shall terminate, including restriction on Chroma’s right to exercise rights
under the Joint Inventions set forth under Section 9.1. After the Effective Date
of Termination and except as provided below, either Party will be free to use
and practice the Joint Inventions for any purpose on a worldwide basis and may
assign, license or otherwise transfer or exploit its rights to the Joint
Inventions to an Affiliate or Third Party, without the other Party’s consent and
without a duty of accounting to the other Party.

(b) Outstanding Payment Obligations. CTI shall be responsible for any
outstanding payment obligations of CTI under Article 8 that existed or accrued
prior to the Effective Date of Termination.

(c) Transfer of Materials.

(i) Development Documentation. CTI will transfer and assign to Chroma all
Development Documentation related to the Product developed under the Development
Plan.

(ii) Commercial Information. CTI will provide a written and electronic copy of
the Commercial Information, to the extent such information has not already been
provided to Chroma through its participation in the JDC. All Commercial
Information shall be treated as CTI’s Confidential Information under
Sections 12.1 and 12.2 and may only be used by or for Chroma in the
Commercialization of the Product and for no other purpose.

(iii) Inventory. Chroma shall have the option to purchase existing Product
inventories from CTI at the price CTI paid for such inventories.

(iv) Product Marks. For the Product Marks solely used for the Products by or for
CTI in the Licensed Territory at the time of termination, CTI will transfer such
Product Marks to Chroma without additional consideration, including
registrations therefor and any goodwill associated therewith, provided that in
no event will such transfer include any rights in CTI’s name or any brand, logo
or trademark of CTI not solely used for the Product.

(v) Costs. CTI will be responsible for all costs associated with any transfer or
transition pursuant to this paragraph (c) (other than the purchase price for the
inventory as provided above).

(d) Option for Rights Not Transferred.

 

60

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(i) Non-Opted In Study or Non-Opted In Additional Product Development. For any
Non-Opted In Study or any Non-Opted In Additional Product Development for which
Chroma did not opt in under the terms of Sections 4.4 or 4.9, respectively,
Chroma may opt in, during the Transition Period only, to any such Non-Opted In
Study or any Non-Opted In Additional Product Development under the respective
terms in Sections 4.4 and 4.9. If Chroma opts in under such terms, Chroma’s
access to any Regulatory Materials, data, or other information generated from
such studies will be the same under the terms of this Agreement as though Chroma
had opted in to any such Non-Opted In Study or Non-Opted In Additional Product
Development prior to the termination of this Agreement. If Chroma does not opt
in to any Non-Opted In Study or any Non-Opted In Additional Product Development
during the Transition Period, CTI will have no further obligations to Chroma,
and Chroma will not have any right, with respect to such study or product.

(ii) Subject CTI Rights. If Chroma desires to license rights to Subject CTI
Rights after the termination of this Agreement, Chroma may request such rights
with a written notice to CTI and the Parties will enter into good faith
negotiation during the Transition Period to provide such rights to Chroma on
customary industry terms, including milestone and royalty payments. If the
Parties cannot agree on the terms of any such license during the Transition
Period or if Chroma does not request such rights in writing during the
Transition Period, CTI will have no further obligations to Chroma, and Chroma
will not have any right, with respect to Subject CTI Rights.

(e) Transition Plan. Within ninety (90) days after the Effective Date of
Termination, the Parties shall negotiate in good faith and establish a
transition plan to effectuate the transfer and transition provided in this
Section 13.7 (“Transition Plan”) within one hundred and twenty (120) days after
the date of the Transition Plan (“Transition Period”). In addition to the items
described above in this Section 13.7, the Transition Plan will also address the
transition of the following items, including the allocation of cost and
responsibility related to the transition of such items. Other than obligations
expressly set forth in the Transition Plan (some of which may continue after the
Transition Period), CTI will not have any further obligation related to the
Development Manufacture or Commercialization of the Product.

(i) whether and how the existing contracts exclusively related to the supply of
the Product or clinical trials of the Product should be transitioned or
terminated; and

(ii) what Development activities, including any on going clinical trials, set
forth in the then current Development Plan should be continued on the same terms
(including allocation of cost provided that where any clinical trials cannot be
terminated under applicable Law, CTI will continue to be responsible for 75% of
the Development Costs set forth in the then current Development Plan associated
with any such clinical trial contained in an agreed Development Plan until the
completion of such trial, provided that CTI will not be responsible for the
costs associated with the enrollment of additional patients for such trial
unless such additional enrollment is required by applicable Law).

 

61

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

(f) Further Assurances. CTI shall, at Chroma’s request and CTI’s expense, take
such other reasonable and customary actions and execute such other reasonable
and customary instruments, assignments and documents as may be necessary to
effect the transfer of rights and materials expressly provided in this
Section 13.7 above. After the Effective Date of Termination and before such
items are transferred to Chroma or its designated Affiliate, CTI shall hold them
on trust for Chroma, and shall maintain them in force and shall not encumber,
amend, cancel or surrender or take any step in relation thereto unless requested
to do so by Chroma or any applicable government or Regulatory Authority.

13.8 Effect of Termination for Chroma.

(a) Continuation of Rights. If CTI has the right to terminate this Agreement
pursuant to Sections 13.3 or 13.4 and does not exercise such right, CTI will
have the right to retain the licenses and rights granted under this Agreement to
the Chroma Technology existing at the date of CTI’s notice to Chroma that it
wishes to retain such rights and licenses, subject to payment of milestones and
royalties under the terms of Article 8. CTI will also have the right to continue
to use Chroma’s Regulatory Materials, Development Documentation and Confidential
Information existing at the date of CTI’s notice to Chroma that it wishes to
retain its rights and licenses under this Agreement, subject to the terms and
conditions of this Agreement related to such items. Within ninety (90) days
after CTI’s notice that CTI wishes to retain such licenses and rights, the
Parties shall negotiate in good faith and establish a transition plan to address
any ongoing or remaining Development activities under the then current
Development Plan (“Transition Development Plan”). Such activities shall be
conducted under same cost allocation terms as provided under this Agreement for
the Development Plan. After the completion of Development activities provided
under the Transition Development Plan, neither Party will have any further
Development obligations under this Agreement.

(b) Termination of Agreement. If CTI has the right to terminate this Agreement
pursuant to Sections 13.3 or 13.4 and does exercise such right, the provisions
of Sections 13.7(c), 13.7(d), 13.7(e), and 13.7(f) shall apply except that
Chroma will be solely responsible for all costs associated with any transfer or
transition of such items, including all Development Costs for any Development
activities provided to continue in the Transition Plan.

13.9 Rights in Bankruptcy. All rights and licenses granted under or pursuant to
this Agreement by Chroma or CTI are, and shall otherwise be deemed to be, for
purposes of Section 365(n) of the U.S. Bankruptcy Code, licenses of right to
“intellectual property” as defined under Section 101 of the U.S. Bankruptcy
Code. The Parties agree that the licensee of such rights under this Agreement
shall retain and may fully exercise all of its rights and elections under the
U.S. Bankruptcy Code or any other applicable Law. The Parties further agree
that, in the event of the commencement of a bankruptcy proceeding by or against
a Party under the U.S. Bankruptcy Code or any other applicable Law, the other
Party shall be entitled to a complete duplicate of (or complete access to, as
appropriate) any such intellectual property and all embodiments of such
intellectual property, which, if not already in such other Party’s possession,
shall be promptly delivered to it (a) upon any such commencement of a bankruptcy
proceeding

 

62

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

upon the other Party’s written request therefor, unless the Party subject to the
proceeding’s elects to continue to perform all of its obligations under this
Agreement or (b) if not delivered under clause (a), following the rejection of
this Agreement by the Party subject to the proceeding’s upon written request
therefor by the other Party. Notwithstanding anything in this Agreement to the
contrary, it is the intention of the Parties that upon any commencement of a
bankruptcy proceedings, the Party subject to the proceeding shall have the right
to assume and assign this Agreement and its rights and obligations hereunder
pursuant to Section 365 of the U.S. Bankruptcy Code or any other applicable Law.

13.10 Survival. The following provisions shall survive any expiration or
termination of this Agreement for the period of time specified in the applicable
section or, if no time is specified, indefinitely: Article 10, Article 11,
Article 12, Article 14, and Article 15. To the extent Development or
Commercialization obligations or rights survive under the terms of Sections 13.7
or 13.8, Article 4, Article 5 and Article 6 will survive for the duration of
such Development or Commercialization obligations or rights. Termination or
expiration of this Agreement for any reason shall not release a Party from any
liability or obligation that already has accrued prior to such expiration or
termination, nor affect the survival of any provision hereto to the extent it is
expressly stated to survive such termination.

ARTICLE 14

DISPUTE RESOLUTION

14.1 Disputes. The Parties recognize that disputes as to certain matters may
from time to time arise during the Term which relate to either Party’s rights
and/or obligations hereunder. It is the objective of the Parties to establish
procedures to facilitate the resolution of disputes arising under this Agreement
in an expedient manner by mutual cooperation and without resort to litigation.
To accomplish this objective, the Parties agree to follow the procedures set
forth in this Article 14 to resolve any controversy or claim arising out of,
relating to or in connection with any provision of this Agreement, if and when a
dispute arises under this Agreement.

14.2 Referred from Committee.

(a) General. Except for disputes subject to Section 14.3(b), either Party may,
by written notice to the other Party, have any dispute arising from a Committee
pursuant to the terms of Article 3 referred to each Party’s Designated Executive
for attempted resolution by good faith negotiations within thirty (30) days
after such notice is received, or in less time if necessary to ensure patient
safety or compliance with applicable Laws. If the Designated Executives are not
able to resolve such dispute within such thirty (30) day period, either Party
may at any time thereafter pursue binding arbitration under the terms of
Section 14.5.

(b) Specific Decision-Making Rights. Except for disputes subject to
Section 14.3(b), if the Designated Executives of the Parties are not able to
resolve a dispute within the thirty (30) day period described above, and the
dispute is related to one of the areas listed in

 

63

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

the immediate subparagraphs below, then each of Chroma and CTI shall have the
unilateral right to settle such matter as provided below.

(i) CTI Decisions. The Designated Executive of CTI shall have the right to make
the final decision with respect to matters involving the Development,
Manufacture and Commercialization of the Product solely in the Licensed
Territory; provided that such decision shall be made in good faith, cannot be
inconsistent with the terms of this Agreement, and such decision cannot
materially and adversely affect Chroma’s right and ability to Develop,
Manufacture and Commercialize the Product in the ROW Territory.

(ii) Chroma Decisions. The Designated Executive of Chroma shall have the right
to make the final decision with respect to matters involving the Development,
Manufacture and Commercialization of the Product solely in the ROW Territory;
provided that such decision shall be made in good faith, cannot be inconsistent
with the terms of this Agreement, and such decision cannot materially and
adversely affect CTI’s right and ability to Develop, Manufacture and
Commercialize the Product in the Licensed Territory.

(iii) Development Costs. Notwithstanding the above provisions neither Party’s
share of Development Costs can be increased unless both Parties agree to any
such increase as part of the Development Plan or any amendments thereto, subject
to the Development opt in mechanism described in Sections 4.4.

14.3 Arising Between the Parties.

(a) General Matters. Except for disputes subject to Section 14.3(b) below or
referred from Committee and subject to Section 14.2 above, the Parties shall
refer all other disputes arising under or in connection with this Agreement,
including, without limitation, any claim or controversy relating to the
validity, enforceability, interpretation, performance, breach or termination
hereof to the Designated Executive for each Party for attempted resolution by
good faith negotiations within thirty (30) days after such dispute is first
identified by either Party in writing to the other. With respect to any dispute
that is not resolved by such Designated Executives within such period, either
Party may at any time thereafter pursue binding arbitration under the terms of
Section 14.5.

(b) Safety Matters. In the event that the Parties cannot agree to one opinion
with respect to an individual adverse event or other matter affecting the
health, safety or welfare of a patient, then, the Parties shall convene the
relevant Committee to discuss and seek resolution of such matter as
expeditiously as possible to ensure patient safety and compliance with
applicable Laws. In connection with such discussions, the Parties may convene
any joint working groups or outside consultants and/or experts in the subject
matter of the disagreement to assist the Parties to reach one opinion. If such
discussions do not result in one opinion between the Parties in a reasonably
timely fashion, then the most conservative opinion shall prevail.

14.4 Injunctive Relief. Nothing herein may prevent either Party from seeking a
preliminary injunction or temporary restraining order in any court of competent
jurisdiction in

 

64

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

order to prevent any Confidential Information from being disclosed without
appropriate authorization under this Agreement or to prevent any termination of
this Agreement under Section 13.3 if the existence of a material breach is in
dispute.

14.5 Binding Arbitration. Any dispute arising under or in connection with this
Agreement, that is not resolved by the Designated Executives pursuant to
Section 14.3(a) within the time period set forth therein shall be submitted to
binding arbitration under the Rules of Arbitration of the London Court of
International Arbitration before an arbitral tribunal of three arbitrators. Each
Party shall nominate one arbitrator, and the two co-arbitrators, in consultation
with the Party nominating them, shall together nominate the third arbitrator,
who shall serve as the chairperson of the arbitral tribunal. The place of
arbitration shall be New York, New York, and all hearings in the arbitration
shall be conducted there. The arbitral tribunal’s award shall be (i) in writing,
stating the reasons for such decision; (ii) based solely on the terms and
conditions of this Agreement, as interpreted, if applicable, in accordance with
the laws of England and Wales; (iii) final and binding upon the Parties hereto;
and (iv) enforceable in any court of competent jurisdiction.

ARTICLE 15

MISCELLANEOUS

15.1 Entire Agreement; Amendment. This Agreement, including the Exhibits hereto,
sets forth the complete, final and exclusive agreement and all the covenants,
promises, agreements, warranties, representations, conditions and understandings
between the Parties hereto with respect to the subject matter hereof and
supersedes, as of the Effective Date, all prior and contemporaneous agreements
and understandings between the Parties with respect to the subject matter
hereof, including the CDA and term sheet. There are no covenants, promises,
agreements, warranties, representations, conditions or understandings, either
oral or written, between the Parties with respect to the subject matter hereof
other than as are set forth herein. No subsequent alteration, amendment, change
or addition to this Agreement shall be binding upon the Parties unless reduced
to writing and signed by an authorized officer of each Party.

15.2 Force Majeure. Both Parties shall be excused from the performance of their
obligations under this Agreement to the extent that such performance is
prevented by force majeure and the nonperforming Party promptly provides notice
of the prevention to the other Party. Such excuse shall be continued so long as
the condition constituting force majeure continues and the nonperforming Party
takes reasonable efforts to remove the condition. For purposes of this
Agreement, force majeure shall include conditions beyond the control of the
Parties, including without limitation, an act of God, war, civil commotion,
terrorist act, labor strike or lock-out, epidemic, failure or default of public
utilities or common carriers, destruction of production facilities or materials
by fire, earthquake, storm or like catastrophe, and failure of plant or
machinery (provided that such failure could not have been prevented by the
exercise of skill, diligence, and prudence that would be reasonably and
ordinarily expected from a skilled and experienced person engaged in the same
type of undertaking under the same or similar

 

65

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

circumstances). If a force majeure persists for more than ninety (90) days, then
the Parties will discuss in good faith the modification of the Parties’
obligations under this Agreement in order to mitigate the delays caused by such
force majeure.

15.3 Notices. Any notice required or permitted to be given under this Agreement
shall be in writing, shall specifically refer to this Agreement, and shall be
addressed to the appropriate Party at the address specified below or such other
address as may be specified by such Party in writing in accordance with this
Section 15.3, and shall be deemed to have been given for all purposes (a) when
received, if hand-delivered or sent by confirmed facsimile or a reputable
courier service, or (b) five (5) business days after mailing, if mailed by first
class certified or registered airmail, postage prepaid, return receipt
requested.

 

If to Chroma:   

CHROMA THERAPEUTICS LTD

93 Milton Park

   Abingdon, Oxon OX14 4RY, UK    Attn: Chief Executive Officer    Fax: ** with
a copy to:   

CHROMA THERAPEUTICS LTD

93 Milton Park

   Abingdon, Oxon OX14 4RY, UK    Attn: Chief Financial Officer    Fax: ** If to
CTI:   

CELL THERAPEUTICS, INC.

501 Elliott Ave. W. #400

   Seattle, Washington 98119, U.S.A.    Attn: Chief Executive Officer    Fax: **
with a copy to:   

CELL THERAPEUTICS, INC.

501 Elliott Ave. W. #400

   Seattle, Washington 98119, U.S.A.    Attn: General Counsel    Fax: **

15.4 No Strict Construction; Headings. This Agreement has been prepared jointly
and shall not be strictly construed against either Party. Ambiguities, if any,
in this Agreement shall not be construed against any Party, irrespective of
which Party may be deemed to have authored the ambiguous provision. The headings
of each Article and Section in this Agreement have been inserted for convenience
of reference only and are not intended to limit or expand on the meaning of the
language contained in the particular Article or Section. Except where the
context otherwise requires, the use of any gender shall be applicable to all
genders, and the word

 

66

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

“or” is used in the inclusive sense (and/or). The term “including” as used
herein means including, without limiting the generality of any description
proceeding such term.

15.5 Assignment. Neither Party may assign or transfer this Agreement or any
rights or obligations hereunder without the prior written consent of the other
(which shall not be unreasonably withheld, delayed or conditioned), except that
a Party may make such an assignment without the other Party’s prior written
consent to a successor-in-interest to all or substantially all of the assets of
the relevant Party to which this Agreement relates, whether in a merger, sale of
stock, sale of assets or other transaction, provided that such transaction is
not entered into in an effort to circumvent the requirement to obtain the
consent of the other Party. Any successor or assignee of rights and/or
obligations permitted hereunder shall, in writing to the other Party, expressly
assume performance of such rights and/or obligations, and the assigning party
shall remain liable for all obligations of the assignee after the assignment.
Any permitted assignment shall be binding on the successors of the assigning
Party. Any assignment or attempted assignment by either Party in violation of
the terms of this Section 15.5 shall be null, void and of no legal effect.

15.6 Non-Solicitation. While the Parties are performing Development and
Commercialization activities under this Agreement and for a period of two
(2) years thereafter, neither Party shall, without the express written consent
of the other Party, recruit, solicit or induce any employee of the other Party
to terminate his or her employment with such other Party. The foregoing
provision shall not, however, restrict either Party or its Affiliates from
advertising employment opportunities in any manner that does not directly target
the other Party or its Affiliates or from hiring any persons who respond to such
generalized public advertisements.

15.7 Performance by Affiliates. Each Party may discharge any obligations and
exercise any right hereunder through any of its Affiliates. Each Party shall
cause its Affiliates to comply with the provisions of this Agreement in
connection with such performance. Any breach by a Party’s Affiliate of any of
such Party’s obligations under this Agreement shall be deemed a breach by such
Party, and the other Party may proceed directly against such Party without any
obligation to first proceed against such Party’s Affiliate.

15.8 Further Actions. Each Party agrees to execute, acknowledge and deliver such
further instruments, and to do all such other acts, as may be necessary or
appropriate in order to carry out the purposes and intent of this Agreement.

15.9 HSR Filing. Each of CTI and Chroma agrees to prepare and make appropriate
filings under the HSR Act relating to this Agreement and the transactions
contemplated hereby as soon as reasonably practicable after the Effective Date
(the “HSR Filing Date”). The Parties agree to cooperate in the antitrust
clearance process and to furnish promptly to the Federal Trade Commission (FTC),
the Antitrust Division of the Department of Justice and any other agency or
authority, any information reasonably requested by them in connection with such
filings. Other than the provisions of this Section 15.9, Section 8.1 and
Articles 11 and 12, the rights and

 

67

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

obligations of the Parties under this Agreement shall not become effective until
the waiting period provided by the HSR Act shall have terminated or expired
without any action by any government agency or challenge to the transaction (the
date of such termination or expiration shall be the “Approval Date” of this
Agreement), provided that neither Party shall grant any rights to engage in any
act that would conflict with the terms and conditions of this Agreement until
such Approval Date. Upon the occurrence of the Approval Date, all provisions of
this Agreement shall become effective as of the Effective Date automatically
without the need for further action by the Parties. In the event that antitrust
clearance from the FTC and Antitrust Division of the Department of Justice is
not obtained within ninety (90) days after the HSR Filing Date, or such other
date as the Parties may mutually agree, this Agreement may be terminated by
either Party. If this Agreement is terminated for such reason, (a) all rights
granted in this Agreement shall revert back to the grantor , (b) Chroma shall
repay to CTI immediately the upfront fee of $5,000,000 and (c) the Parties will
not have any further rights or obligations to each other under this Agreement
except as provided in Section 13.10. In the event a provision of this Agreement
needs to be deleted or substantially revised in order to obtain regulatory
clearance of this transaction, the Parties will negotiate in good faith in
accordance with Section 15.10.

15.10 Severability. If any one or more of the provisions of this Agreement is
held to be invalid or unenforceable by any court of competent jurisdiction from
which no appeal can be or is taken, the provision shall be considered severed
from this Agreement and shall not serve to invalidate any remaining provisions
hereof. The Parties shall make a good faith effort to replace any invalid or
unenforceable provision with a valid and enforceable one such that the
objectives contemplated by the Parties when entering this Agreement may be
realized.

15.11 No Waiver. Any delay in enforcing a Party’s rights under this Agreement or
any waiver as to a particular default or other matter shall not constitute a
waiver of such Party’s rights to the future enforcement of its rights under this
Agreement, except with respect to an express written and signed waiver relating
to a particular matter for a particular period of time.

15.12 Independent Contractors. Subject to the terms of this Agreement, the
activities and resources of each Party shall be managed by such Party, acting
independently and in its individual capacity. The relationship between Chroma
and CTI is that of independent contractors and neither Party shall have the
power to bind or obligate the other Party in any manner, other than as may be
expressly set forth in this Agreement. Nothing herein shall be construed to
create the relationship of partners, principal and agent, or joint-venture
partners between the Parties.

15.13 English Language; Governing Law. This Agreement, including any dispute,
claim or controversy arising out of or related to validity, enforceability,
interpretation, performance, breach or termination hereof, shall be governed by
and construed under the laws of England and Wales, without giving effect to any
choice of law principles that would require the application of the laws of a
different state, provided that Laws of any governing Regulatory

 

68

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Authority, as well as the intellectual property laws of the jurisdiction in
which any intellectual property rights at issue were granted, shall also govern
to the extent applicable.

15.14 Counterparts. This Agreement may be executed in one (1) or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement shall be
binding upon the delivery by each Party of an executed signature page to the
other Party, which may include by facsimile transmission.

[Signature Page Follows]

 

69

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

IN WITNESS WHEREOF, the Parties have executed this Agreement in duplicate
originals by their duly authorized officers as of the Effective Date.

 

CELL THERAPEUTICS, INC.     CHROMA THERAPEUTICS LTD By:   /s/ James A. Bianco  
  By:   /s/ Ian Nicholson Name:   James A. Bianco, M.D.     Name:   Ian
Nicholson Title:   Chief Executive Officer     Title:   Chief Executive Officer

Signature Page to the Co-Development and License Agreement entered into as of
March 11, 2011

 

S-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT A-1

COMPOUND DESCRIPTION

 

Name    Tosedostat Synonyms   
2S-[2R-(S-Hydroxy-hydroxycarbamoyl-methyl)-4-methylpentanoylamino]-2-phenylethanoic
acid cyclopentyl ester Molecular Structure    LOGO [g178110g82k07.jpg] Molecular
Formula    C21H30N2O6 Molecular Weight    406.47 CAS Registry Number   
238750-77-1

 

A-1-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT A-2

ANALOGUES OF TOSEDOSTAT

****

 

A-2-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT B-1

CHROMA PATENTS

 

BB-76163 (CHR-2797) Patent Portfolio       Patents and Patent Applications
Derived from International Patent       Application WO 98/11063      

Country

   Status    Application No      Patent No   Australia    Granted      41277/97
        718890    Belgium    Granted      EP97939052.3         EP 0925278   
Canada    Granted      2265666         2,265,666    Switzerland    Granted     
EP97939052.3         EP 0925278    Czech Republic    Granted      PV 821-99   
     298048    Germany    Granted      EP97939052.3         EP 0925278    Spain
   Granted      EP97939052.3         EP 0925278    France    Granted     
EP97939052.3         EP 0925278    UK    Granted      EP97939052.3         EP
0925278    Italy    Granted      EP97939052.3         EP 0925278    Japan   
Granted      1988-513347         4238334    Norway    Granted      19991139   
     314227    New Zealand    Granted      333923         333923    Poland   
Granted      P-333369         P-333369    USA    Granted      08/925584        
6169075    USA (divisional)    Granted      09/514083         6790834    Patents
and Patent Applications Derived from International Patent          Application
WO 99/46241         

Country

   Status    Application No      Patent No   Australia    Granted      64106/98
        747977    Canada    Granted      2323414         2,323,414    China   
Granted      98813847.6         ZL 98813847.6    Czech Republic    Granted     
PV 2000-3317         299610    Germany    Granted      EP98 909 620.1        
EP 1062202    France    Granted      EP98 909 620.1         EP 1062202    UK   
Granted      EP98 909 620.1         EP 1062202    Ireland    Granted      EP98
909 620.1         EP 1062202    Israel    Granted      137774         137774   
Japan    Granted      2000-535622         4324324   

 

B-1-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Mexico    Granted    8762    224080 New Zealand    Granted    506293    506293
Poland    Granted    P-342811    190637 USA    Granted    09/100539    6462023

SECURITY INTEREST:

**

 

B-1-2

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT B-2

UPSTREAM AGREEMENTS

 

Other Party(ies)

  

Title of Agreement

  

Effective Date

Vernalis (Oxford) Ltd.    Exclusive License Agreement Covering BB-76163 for Use
in Cancer    November 24, 2003 Vernalis (R&D) Limited (formerly known as
Vernalis (Oxford) Limited    Amendment No. 1 to Exclusive License Agreement
Covering BB-76163 for Use in Cancer    March 30, 2007

1. **

 

2. **

   **    **

1. **

 

2. **

   **    **

 

B-2-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT C

DEVELOPMENT PLAN

****

 

C-1-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

EXHIBIT D

PRESS RELEASE

Cell Therapeutics Acquires Exclusive Marketing and Co-Development Rights

in the Americas to Chroma Therapeutics’ Tosedostat, a First in Class Tumor

Selective Oral Therapy for Treatment of Blood Related and Other Cancers

Phase III Pivotal Trial in Acute Myeloid Leukemia Expected to Start in Q4 2011

Provides Potential Portfolio and Commercial Synergies with Pixantrone

Conference Call and Webcast to be Held on Monday, March 14, 2011 at 8:30 AM
Eastern

time/1:30 PM Central European time/5:30 AM Pacific time

March 14, 2011 Seattle and Oxford, UK—Cell Therapeutics, Inc. (“CTI”) (NASDAQ
and MTA: CTIC) and Chroma Therapeutics Ltd. (“Chroma”) announced today that the
companies have entered into a co-development and license agreement providing CTI
with exclusive marketing and co-development rights to Chroma’s drug candidate
tosedostat in North, Central and South America. Tosedostat is an oral,
aminopeptidase inhibitor that has demonstrated significant anti-tumor responses
in blood related cancers and solid tumors in phase I-II clinical trials. CTI, in
collaboration with Chroma, expects to commence a phase III clinical study in the
United States and Europe in elderly patients with relapsed or refractory acute
myeloid leukemia (“AML”) for potential approval by the U.S. Food and Drug
Administration (“FDA”) and the European Medicines Agency (“EMA”). The FDA and
the EMA have granted tosedostat orphan drug status for AML.

Pursuant to the terms of the agreement, CTI will make an upfront payment of $5
million and a milestone payment of $5 million when the AML pivotal trial is
initiated, which is expected to occur in the fourth quarter of 2011. The
agreement also includes customary development-based milestone payments related
to AML, myelodysplastic syndrome (“MDS”) and certain other indications, as well
as royalties on net sales in CTI’s territories. CTI will oversee development
operations and commercialization activities in its territories and Chroma will
oversee development operations and commercialization activities in the rest of
the world. Subject to a funding cap of $50 million for the first three years,
CTI will be responsible for 75% of development costs and Chroma will be
responsible for 25% of development costs.

“Tosedostat, similar to drugs like bortezomib and lenalidomide, represents a
departure from conventional cytotoxic chemotherapy toward more tumor selective
targeted therapy that interferes with cellular pathways necessary for tumor
survival,” commented James A. Bianco, M.D., CEO of CTI. “In initial clinical
studies, tosedostat was well-tolerated, given orally once a day and produced
encouraging response

 

D-1-1

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

rates in difficult to treat patients with acute leukemia and a variety of blood
related cancers. We are excited to add tosedostat to our late-stage product
pipeline alongside pixantrone as we continue with our strategy of building a
pipeline of novel drugs for treating blood-related cancers.”

Chroma is an Oxford, UK based private company led by a management team with
extensive public biotechnology and large pharmaceutical company experience,
including former executives of Celltech, British Biotech, AstraZeneca and Roche,
and backed by leading specialist investors. Chroma is focused on harnessing
chromatin biology and its novel cell accumulation (ESM) technology to develop
new targeted therapies for cancer and inflammatory disorders.

“We believe that this is a collaboration that should enable the rapid
progression of tosedostat toward seeking regulatory approval, given CTI’s
development and commercialization capabilities and experience in the
blood-related cancer space,” said Ian Nicholson, CEO of Chroma. “In working with
clinicians in developing tosedostat we have clearly identified significant unmet
medical needs where tosedostat could provide an important therapeutic advance
for patients if approved.”

AML is a hematologic cancer that is an aggressive, fast-growing cancer that
starts inside the bone marrow with the production of abnormal blood cells. The
American Cancer Society estimates that 12,330 new cases of AML will be diagnosed
and approximately 8,950 deaths from AML will occur in the U.S. in 2010. AML is
generally a disease affecting older people with the average patient age at onset
of approximately 67 years. There remain a substantial proportion of elderly
patients who do not receive intensive chemotherapy due to their inability to
tolerate such regimens, and other risk factors. Therefore, there is a
significant unmet medical need in developing a well-tolerated and effective
treatment for these patients.

Tosedostat is an orally dosed aminopeptidase inhibitor which blocks the M1/17
family of aminopeptidases. Disrupting aminopeptidases deprives sensitive tumor
cells of amino acids by blocking protein recycling resulting in tumor cell
death. Tosedostat has been studied in Chroma’s phase I-II clinical trials both
as a single agent and in combination with other chemotherapeutic agents. Such
studies have demonstrated significant anti-tumor responses without the typical
side effects of conventional, non-targeted cytotoxic therapies. Initial target
indications include AML, MDS and multiple myeloma.

Conference Call Information

On Monday, March 14, 2011, at 8:30 a.m. Eastern time/1:30 p.m. Central European
time/5:30 a.m. Pacific time, members of CTI’s and Chroma’s management teams will
host a conference call to discuss the co-development and licensing agreement.

Conference Call Numbers

Monday, March 14, 2011 8:30 a.m. Eastern/1:30 p.m. Central European/5:30 a.m.
Pacific Time

 

D-1-2

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

1-877-941-0843 (US Participants – Toll-Free)

1-480-629-9643 (US Participants)

800-149-038 (Italy Participants – Toll-Free)

39-06-45-210-8364 (Italy Participants)

0800 358 0857 (UK Participants – Toll-Free)

44-20-8515-2302 (UK Participants)

Call-back numbers for post-listening available at 11:30 a.m. Eastern Time:

1-800-406-7325 (US Participants)

1-303-590-3030 (International)

Passcode: 4423141#

Live audio webcast at www.celltherapeutics.com will be archived for post-call
listening approximately two hours after call ends.

About Cell Therapeutics, Inc.

Headquartered in Seattle, CTI is a biopharmaceutical company committed to
developing an integrated portfolio of oncology products aimed at making cancer
more treatable. For additional information, please visit
www.CellTherapeutics.com.

Sign up for email alerts and get RSS feeds at our Web site,

http://www.CellTherapeutics.com/investors_alert

About Chroma Therapeutics

Chroma Therapeutics, based in Oxford (UK), is a drug discovery and development
company focused in the fields of oncology and inflammatory disorders. Chroma is
building a broad pipeline of first- or best-in-class treatments utilizing its
expertise in chromatin biology and its novel intracellular accumulation
technologies, which include the ability to selectively target drugs’
tomacrophages. Chroma is backed by a number of leading specialist investors,
including Abingworth, Essex Woodlands, Gilde, Phase4 and The Wellcome Trust.
More information about Chroma can be found at www.chromatherapeutics.com.

This press release includes forward-looking statements that involve a number of
risks and uncertainties the outcome of which could materially and/or adversely
affect actual future results and the market price of the Company’s securities.
Specifically, the risks and uncertainties that could affect the development and
commercialization of tosestodat include risks associated with preclinical,
clinical and sales and marketing developments in the biopharmaceutical industry
in general and in particular, including, without limitation, the potential
failure of tosedostat to prove safe and effective (including complete and
overall response rates) for the treatment of blood related and other cancers as
determined by the FDA and/or the EMA, that the FDA may not accept the proposed
clinical trial design of tosedostat and/or may request additional clinical
trials, that clinical trials may not demonstrate the safety and effectiveness of
tosedostat, that the Company cannot predict or guarantee the pace or geography
of enrollment of clinical trials of tosedostat, including whether or not the
majority of the patients will be enrolled in the U.S., that the phase III
pivotal trial for tosedostat for AML may not start during the fourth quarter of

 

D-1-3

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

2011, that the Company cannot predict or guarantee the outcome or results of
clinical trials of tosedostat, that the Company cannot predict or guarantee
whether the co-development and license agreement will strengthen the Company’s
business, financial condition, operating results and prospects or the trading
price of the Company’s securities, that the Company cannot predict or guarantee
whether milestones will be achieved pursuant to the Agreement, the Company’s
ability to continue to raise capital as needed to fund its operations and make
milestone payments, as applicable, determinations by regulatory, patent and
administrative governmental authorities, competitive factors, technological
developments, costs of developing, producing and selling the Company’s products
under development and co-development, and other economic, business, competitive,
and/or regulatory factors affecting the Company’s business generally, including
those set forth in the Company’s filings with the U.S. Securities and Exchange
Commission, including its Annual Report on Form 10-K for its most recent fiscal
year and its most recent Quarterly Report on Form 10-Q, especially in the
“Factors Affecting Our Operating Results” and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” sections, and its
Current Reports on Form 8-K. Except as may be required by law, the Company does
not intend to update or alter its forward-looking statements whether as a result
of new information, future events, or otherwise.

###

Media Contact:

Dan Eramian

T: 206.272.4343

C: 206.854.1200

E: deramian@ctiseattle.com

www.CellTherapeutics.com/press_room

Investors Contact:

Ed Bell

T: 206.282.7100

Lindsey Jesch Logan

T: 206.272.4347

F: 206.272.4434

E: invest@ctiseattle.com

www.CellTherapeutics.com/investors

Medical Information Contact:

T: 800.715.0944

E: info@askarm.com

Chroma Therapeutics Ltd.:

Ian Nicholson, CEO

Richard Bungay, CFO

T: +44 (0) 1235 829120

Brunswick PR

 

D-1-4

--------------------------------------------------------------------------------

** Indicates that certain information contained herein has been omitted and
filed separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted portions.

**** Indicates that the amount of information omitted was a page or more in
length, and such information has been filed separately with the Securities and
Exchange Commission. Confidential treatment has been requested with respect to
the omitted portions.

 

Jon Coles

Justine McIlroy

T: +44 (0)20 7404 5959

 

D-1-5