CONFIDENTIAL TREATMENT REQUESTED. Confidential portions of this document have
been redacted and have been separately filed with the Commission.

 

Exhibit No. 10.1

 

 

 

 

LICENSING AGREEMENT

 

BY AND BETWEEN

 

TG THERAPEUTICS, INC.

 

AND

 

RHIZEN PHARMACEUTICALS S A

 

 

ConfidentialPage 1 

 

 

This Licensing Agreement is made and entered into on 22 September 2014 (the
“Effective Date”) by and between

 

Rhizen Pharmaceuticals S.A., a Swiss corporation having its principal place of
business at Fritz Courvoisier 40, 2300 La Chaux de Fonds, Switzerland
(“Rhizen”),

 

On the one hand,

 

And

TG Therapeutics, Inc., a Delaware corporation, with a place of business at 787
Seventh Avenue, New York, NY (“TGTX”).

 

On the other hand;

 

WITNESSETH:

WHEREAS, Rhizen is a pharmaceutical company focused on the development of novel
inhibitors of PI3Kδ for the treatment of various B-cell proliferative diseases;

 

WHEREAS, TGTX is a biopharmaceutical company engaged in the development,
manufacturing and marketing of pharmaceutical products directed toward the
treatment of B-cell proliferative diseases;

 

WHEREAS, Rhizen and TGTX are parties to that certain Joint Venture and License
Option Agreement, dated 15th August , 2012 ( the “JV Agreement”).

 

WHEREAS, The development of the Product has, to date, progressed satisfactorily
to each Party to the JV Agreement, and each Party has upheld the
responsibilities delegated to such Party dictated in the JV Agreement;

 

WHEREAS, The JV Agreement affords TGTX the option to license the exclusive
rights to the Product under the terms of Article 6.2 and Exhibit F of such JV
Agreement;

 

WHEREAS, In the interest of continued accelerated development of the Product,
TGTX wishes to execute such license option outside of the terms dictated in
Article 6.2 and Exhibit F of such JV Agreement, and Rhizen is in agreement with
such early execution of the option granted to TGTX

 

WHEREAS, With reference to Article 15.1 of the JV Agreement and pursuant to the
promising progress of RP5264 (now TGR-1202) and recent discussion between the
parties, each of TGTX and Rhizen hereby wishes to execute this Licensing
Agreement.

 

WHEREAS, TGTX pursuant to the JV Agreement wishes to exercise its option to in
license to TGTX all the proprietary rights in and to the compound known as
“RP5264” or any one of the back-up compounds; and Rhizen agrees to out license
to such compound known as “RP5264” or any one of the back-up compounds in order
to develop, manufacture and commercialize Products (as hereinafter defined); and

 

WHEREAS, both TGTX and Rhizen, pursuant to the JV Agreement wish to enter into
this definitive Agreement which provides TGTX with an exclusive license to the
Compound (as hereinafter defined) to develop and commercialize Products (as
hereinafter defined) in the Field of Use (as hereinafter defined) and in the
Territory (as hereinafter defined), under the terms and conditions set forth
below;

  

2

 

 

NOW, THEREFORE, in consideration of the foregoing and the covenants and
obligations set forth herein, including the exhibits or appendices hereto, and
intending to be legally bound , TGTX and Rhizen hereby agree as follows:

 

1. DEFINITIONS AND INTERPRETATIONS

 

Terms, when used with initial capital letters, shall have the meanings set forth
below or at their first use when used in this Agreement:

 

“Active Commercialization”: solely for purposes of Section 3.1.3 hereof, shall
mean TGTX is employing the level of efforts and resources to Commercialize the
Product in a Major Market in a sustained manner that is consistent with the
efforts and resources a biopharmaceutical company typically devotes to a product
that is commercially viable.

 

“Active Clinical Development”: solely for purposes of Section 3.1.3 hereof,
shall mean TGTX is employing the level of efforts and resources to achieve
Regulatory Approval of a Product in a Major Market in a sustained manner that is
consistent with the efforts and resources a biopharmaceutical company typically
devotes to a product that it has determined has positive market potential,
profit potential, and strategic value. If a notice is required to be delivered
by TGTX to Rhizen pursuant to Section 3.2.4 hereof, then the Compound shall no
longer be considered to be in Active Clinical Development. Once the first
Regulatory Approval for a Product in a Major Market is achieved, the Compound
may no longer be considered to be in Active Clinical Development for purposes of
Section 3.1.3.

 

“Agreement”: shall mean this License Agreement

 

“API”: shall mean an active pharmaceutical ingredient.

 

“Backup Compound” means any * compounds other than RP5264 as provided in
Annexure VI Controlled by Rhizen as of the Effective Date and/or developed
during the Term, which (i) falls within the chemical genus provided in Exhibit B
of the JV Agreement, and (ii) has targeted * (≤ *) in an * against the * target
and targeted specificity of * compared to the *. The initial list of the Backup
Compounds is attached hereto as Annexure VI and shall be updated from time to
time by Rhizen and provided to TGTX promptly. The list of the Backup Compounds
thus updated shall include any compound which falls in the above definition
which are discovered or developed by Rhizen during the first two years of the
Term.

 

“Bulk API” shall mean any of the Compounds in bulk form.

 

“Cause” means, for purposes of Section 12.1, any unfavorable result from a
pre-clinical or clinical trial that, as reasonably determined by TGTX, causes
material concerns regarding the tolerability, safety or effectiveness of the
Product.

 

“Change of Control”: means (i) the acquisition, directly or indirectly, by any
person, entity or “group” (within meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended) by means of a transaction or series
of related transactions, of (a) beneficial ownership of fifty percent (50%) or
more of the outstanding voting securities of a Party (or the surviving entity,
as applicable, whether by merger, consolidation, reorganization, tender offer or
other similar means), or (b) all, or substantially all, of the assets of a
Party; or (ii) any consolidation or merger of a Party with or into any Third
Party, or any other corporate reorganization involving a Third Party, in which
those persons or entities that are stockholders of the Party immediately prior
to such consolidation, merger or reorganization (or prior to any series of
related transactions leading up to such event) own fifty (50%) or less of the
surviving entity’s voting power immediately after such consolidation, merger or
reorganization.

  

 

* Confidential material redacted and filed separately with the Commission.

 

3

 

 

“Change of Control Transaction”: shall have the meaning ascribed to this term in
paragraph (a) of Article 19.

 

“Combination” shall mean a Co-administration of Product together with any other
product.

 

“Compound”: shall mean RP5264 as described in Annexure I or one of the * Backup
Compounds.

 

“Commercialization”, with a correlative meaning for “Commercialize”: means all
activities undertaken before and after obtaining Regulatory Approval relating
specifically to the pre-marketing, launch, promotion, marketing, sale, and
distribution of a pharmaceutical product, including: (a) strategic marketing,
sales force detailing, advertising, medical education and liaison, and market
and product support; and (b) any Phase IV Clinical Trials, and (c) all customer
support and Product distribution, invoicing and sales activities.

 

“Confidential Information”: means, with respect to a Party, all confidential
Information of such Party that is disclosed to the other Party under this
Agreement, which may include specifications, know-how, trade secrets, legal
information, technical information, drawings, models, business information,
inventions, discoveries, methods, procedures, formulae, protocols, techniques,
data, and unpublished patent applications, in each case whether disclosed in
oral, written, graphic, or electronic form.  All Confidential Information
disclosed by either Party pursuant to the Mutual Confidential Disclosure
Agreement between the Parties dated April 27, 2012 shall be deemed to be such
Party’s Confidential Information disclosed hereunder.

 

“Control” shall mean,with respect to any material, Information, or intellectual
property right, that a Party owns or has a license to such material,
Information, or intellectual property right and has the ability to grant to the
other Party access, a license, or a sublicense (as applicable) to such material,
Information, or intellectual property right on the terms and conditions set
forth herein without violating the terms of any agreement or other arrangement
with any Third Party existing at the time such Party would be first required
hereunder to grant to the other Party such access, license, or sublicense.

 

“IND/CTA” shall mean(a) an Investigational New Drug application as defined in
the FD&C Act and applicable regulations promulgated thereunder by the FDA or any
successor application or procedure required to initiate clinical testing of a
Product in humans in the Territory; and (b) all supplements and amendments to
the foregoing.

 

“Rhizen Intellectual Property Rights”: shall mean all Rhizen Patents and Rhizen
Know-How.

 

“Rhizen Know-How”: shall mean (i) all Know-How that is Controlled by Rhizen or
its Affiliates on the Effective Date and during the Term, and (ii) Rhizen’s
interest in any Joint Know-How, in each case that is necessary or useful for the
Development, manufacture or Commercialization of the Product. For clarity,
Rhizen Know-How excludes the Rhizen Patents.

 

 

* Confidential material redacted and filed separately with the Commission.

 

4

 

 

“Rhizen Patent(s)”: shall mean any Patent, including Rhizen’s interest in any
Joint Patent, that (a) is Controlled by Rhizen or its Affiliates on the
Effective Date and during the Term, and (b) claims the Product or its
manufacture or its use, or any other invention that is otherwise necessary or
useful for the Development, manufacture, use or Commercialization of the Product
in the Field of the Use, including the patents listed in Annexure IIA, which
shall be from time to time amended and updated during the Term to incorporate
the then-current Rhizen Patents.

 

“Data”: shall mean any and all scientific and research data, technical data,
test and development data, pre-clinical and clinical data (including
pharmacological, biological, chemical, biochemical, toxicological, pre-clinical
and clinical test data, analytical and quality control data, stability data,
results of studies and patient lists), formulations, processes, protocols,
regulatory files and the like which are developed by either Party in connection
with the Compound or the Product.

 

“Joint Know-How”: shall mean all Know-How developed or acquired by either Party
in performing its obligations pursuant to the JV Agreement that is necessary or
useful for the Development, manufacture or Commercialization of the Product.

 

“Know-How”: shall mean any and all technical information, test and development
data and results, formulations, processes, ideas, protocols, regulatory files,
preclinical and clinical data (including, without limitation, Data) and the like
relating to the use, manufacture, Development, or Commercialization of the
Compound or the Product.

 

“TGTX Intellectual Property Rights”: shall mean all TGTX Patents and TGTX
Know-How.

 

“TGTX Know-How”: shall mean (i) all Know-How that is Controlled by TGTX or its
Affiliates on the Effective Date and during the Term, and (ii) TGTX’s interest
in the Joint Know-How, in each case that is necessary or useful for the
Development, manufacture or Commercialization of the Product. For clarity, TGTX
Know-How excludes TGTX Patents.

 

“TGTX Patent(s)”: shall mean any Patent, including TGTX’s interest in any Joint
Patent, that (a) is Controlled by TGTX or its Affiliates on the Effective Date
and during the Term, and (b) claims the Product or its manufacture or its use,
or any other invention that is otherwise necessary or useful for the
Development, manufacture, use or Commercialization of the Product in the Field
of the Use, including the patents listed in Annexure IIB, which shall be from
time to time amended and updated during the Term to incorporate the then-current
TGTX Patents.

 

“Develop or Development”: shall mean all activities relating to preparing and
conducting preclinical testing, toxicology testing, human clinical studies,
regulatory affairs for obtaining the Regulatory Approvals, formulation
development, process development for manufacture and associated validation,
quality assurance and quality control activities (including qualification lots).
Development shall exclude all Phase IV Clinical Trials.

 

“Development Plan”: shall mean plans for development of the Product as outlined
in Annexure III, which shall be provided by TGTX and updated and amended
pursuant to Section 3.

 

5

 

 

“Diligent Efforts”: means, with respect to a Party’s obligation under this
Agreement to Develop or Commercialize a Product, the level of efforts and
resources required to carry out such obligation in a sustained manner consistent
with the efforts and resources a similarly situated biopharmaceutical company
devotes to a product of similar market potential, profit potential or strategic
value within its portfolio, based on conditions then prevailing i.e. it shall
mean the efforts required in order to carry out a task or objective in a
diligent and sustained manner without undue interruption, pause or delay, which
level is at least commensurate with the level of efforts that a pharmaceutical
company would devote to a product of similar potential and having similar
commercial and scientific advantages and disadvantages as compared to the
Product hereunder. Diligent Efforts requires (without limitation) that the Party
exerting such efforts (i) promptly assign responsibility for its obligations to
specific employee(s) or contractor(s) who are held accountable for progress and
monitor such progress, on an ongoing basis, (ii) set and continue to seek to
achieve specific and meaningful objectives for carrying out such obligations,
and (iii) consistently make and implement decisions and allocate resources
designed to advance progress with respect to such objectives, in each case in a
diligent manner.

 

“Major Market(s)”: shall mean any of the following countries or groups of
countries: (i) the United States of America; (ii) Canada; (iii) France, Germany,
Italy, Spain, and the United Kingdom (each, a “Major European Market”); (iv)
Japan; and (v) Russia, Brazil or China (each, a “Major BRIC Market”).

 

“Diligence Failure”: shall mean TGTX does not correct a failure to use Diligent
Efforts within the applicable period specified in, or determined in accordance
with Section 3.2.5(b).

 

“EMEA”: shall mean the European Medicines Agency or any successor agency
thereto.

 

“FDA”: shall mean the United States Food and Drug Administration, or a successor
federal agency thereto.

 

“Field” means the prevention, treatment or amelioration of any disease or
condition in humans.

 

“Field of Use”: shall mean the use of Products in the Field as defined herein.

 

“First Commercial Sale”: shall mean the first commercial sale by TGTX, its
Affiliates and/or Sublicensees to a Third Party of a Product for value in any
country in the Territory following receipt of approval to market such Product
from the relevant Regulatory Authority in the applicable country.

 

“Finished Product” shall mean a Product that has been filled into vials,
syringes or capsules or manufactured into other pharmaceutical presentations for
administration, such as tablets or pills; finished and labeled for use in
clinical trials or for commercial purposes in accordance with the applicable
specifications and legal requirements.

 

“Generic Product” means a drug product that (i) contains the same active
ingredient as the Product where the Product is the reference-listed drug, and
(ii) is approved by a Governmental Authority pursuant to an Abbreviated New Drug
Application, an application under 21 U.S.C. §355(b)(2), or similar application.

 

“Indication”: means any indication for which (a) a Product is developed pursuant
to an IND or CTA (or if no such filing is required, pursuant to the applicable
clinical trial protocol), (b) an NDA for a Product is submitted, or (c) an NDA
for a Product is approved by a Regulatory Authority.

 

6

 

 

“IND”: shall mean (a) an Investigational New Drug application as defined in the
FD&C Act and applicable regulations promulgated thereunder by the FDA or any
successor application or procedure required to initiate clinical testing of a
Product in humans in the Territory; and (b) all supplements and amendments to
the foregoing.

 

“Information” means any data, results, technology, business information, and
information of any type whatsoever, in any tangible or intangible form,
including, without limitation, know-how, trade secrets, practices, techniques,
methods, processes, inventions, developments, specifications, formulations,
formulae, materials or compositions of matter of any type or kind (patentable or
otherwise), software, algorithms, marketing reports, expertise, technology, test
data (including pharmacological, biological, chemical, biochemical,
toxicological, preclinical and clinical test data), analytical and quality
control data, stability data, other study data and procedures.

 

“Sole Inventions”: shall have the meaning ascribed to this term in Section 7.1.

 

“Joint Inventions”: shall have the meaning ascribed to this term in Section 7.1.

 

“Joint Patents”: shall mean any and all patents and patent applications claiming
any Joint Invention, together with any and all patents issued on any such
applications as well as any divisional, continuation, continuation-in-part,
substitution applications, re-issue, re-examination, renewal and extended
patents (including supplementary protection certificates (SPC)) of any of the
foregoing.

 

“JSC”: shall mean the joint scientific committee created by the Parties
according to Section 4.1

 

“Launch”: shall mean the First Commercial Sale in a country.

 

“Milestone(s)”: shall have the meaning ascribed to this term in Section 6.3.

 

“Milestone Payment”: means any of the Primary Indication Milestone Payments, the
Secondary Indication Milestone Payments, and the Non-Oncology Indication
Milestone Payments.

 

“NDA”: shall mean a “New Drug Application” (as more fully defined in 21 C.F.R.
314.5 et seq.) filed with the FDA or the equivalent application filed with any
other Regulatory Authority to obtain marketing approval for a Product in a
country or jurisdiction in the Territory.

 

“Net Sales”: shall mean, with respect to a particular time period, the total
amounts received or invoiced by TGTX, its Affiliates, and sublicensees (subject
to the provisions set forth in Section 6) for sales of Product made during such
time period to unaffiliated Third Parties, less the following deductions to the
extent actually allowed or incurred with respect to such sales:

 

(a)discounts, including cash, trade, and quantity discounts, retroactive price
reductions, charge-back payments, and rebates actually granted or administrative
fees actually paid to trade customers, patients (including those in the form of
a coupon or voucher), managed health care organizations, pharmaceutical benefit
managers, group purchasing organizations, federal, state, or local government
and the agencies, purchasers and reimbursers of managed health organizations,
pharmaceutical benefit managers, group purchasing organizations, or federal,
state or local government;

 

7

 

 

(b)credits or allowances actually granted upon prompt payment, or losses,
actually incurred as a result of damaged goods, rejections or returns of such
Product, including in connection with recalls, and all other reasonable and
customary allowances and adjustments actually credited to customers;

 

(c)packaging, freight, postage, shipping, transportation, warehousing, handling
and insurance charges, credit card processing fees and any customary payments
with respect to the Products actually made to wholesalers or other distributors,
in each case actually allowed or paid for distribution and delivery of Product,
to the extent billed or recognized; and

 

(d)taxes, including sales taxes, excise taxes, value-added taxes, and other
taxes (other than income taxes), duties, tariffs or other governmental charges
levied on the sale of such Product, including, without limitation, value-added
and sales taxes.

 

Notwithstanding the foregoing, amounts received or invoiced by TGTX, its
Affiliates and sublicencees for the sale of Product among TGTX, its Affiliates
and sublicencees shall not be included in the computation of Net Sales
hereunder. In any event, any amounts received or invoiced by TGTX and its
Affiliates or sublicensees shall be accounted for only once. Subject to the
provisions of Section 6, Sublicensee Royalties and Sublicensing Payments shall
not be included in Net Sales. Net Sales shall be accounted for in accordance
with U.S. Generally Accepted Accounting Principles (“GAAP”) consistently
applied. Net Sales shall exclude any samples of Product transferred or disposed
of at no cost for promotional or educational purposes, and the cost for such
samples transferred or disposed of shall be deemed to be included in the
Commercial Expenses.

 

For the purposes of determining royalty rates and the royalties payable on
Combination, Net Sales of Product shall be calculated by multiplying the Net
Sales of the Combination by the fraction A/A+B, where A is the average selling
price, during the royalty paying period in question, of the Product sold
separately in the country in which the sale of the Combination is made, and B is
the average selling price, during the royalty period in question, of the other
active ingredient(s) or component(s) sold separately. In the event that such
average selling price cannot be determined for both Product and all other active
ingredient(s) and component(s) included in the Combination Product, Net Sales
for purposes of determining payments under this Agreement shall be calculated by
multiplying the Net Sales of the Combination by the fraction C/(C+D) where C is
the standard fully-absorbed cost of the portion of the combination, and D is the
standard fully-absorbed cost of the other active ingredient(s) or component(s)
included in the Combination, as determined by TGTX using its standard accounting
procedures consistently applied. In the event that the standard fully-absorbed
cost of the Product and/or the other active ingredient(s) or component(s)
included in such Combination cannot be determined, for the purposes of
determining royalties payable hereunder, the Parties shall negotiate in good
faith to determine an appropriate commercial value for all the components in the
Combination and calculate Net Sales of such Combination accordingly.

 

8

 

 

Further, the Parties agree to negotiate in good faith for an equitable
determination of the Net Sales of the Product in the event TGTX and its
Affiliates sells the Product in such a manner that gross sales of the Product
are not readily identifiable. In addition, for purposes of this Agreement,
“sale” shall mean any transfer or other distribution or disposition, but shall
not include transfers or other distributions or dispositions of Product at no
charge for academic research, preclinical, clinical, or regulatory purposes
(including the use of a Product in Clinical Trials) or in connection with
patient assistance programs or other charitable purposes or to physicians or
hospitals for promotional purposes (including free samples to a level and in an
amount which is customary in the industry and/or which is reasonably
proportional to the market for such Product).

 

“Non-Oncology Indication”: shall mean any Indication other than an oncology
Indication.

 

“Party”: shall mean either TGTX or Rhizen, as the context requires, or both TGTX
and Rhizen when used in the plural form

 

“Patent(s)”: shall mean (a) pending patent applications, including provisional
patents, issued patents, utility models and designs; and (b) extensions,
reissues, substitutions, confirmations, registrations, validations,
re-examinations, additions, continuations, continued prosecution applications,
requests for continued examination, continuations-in-part, or divisions of or to
any patents, patent applications, utility models or designs.

 

“Phase I Clinical Trial”: means a small scale trial of a pharmaceutical product
on subjects that generally provides for the first introduction into humans of
such product with the primary purpose of determining safety, metabolism and
pharmacokinetic properties, clinical pharmacology and any other properties of
such product as per the study protocol design, as required by 21 C.F.R. 312(a)
or a similar study in other countries.

 

“Phase II Clinical Trial”: means a small scale 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 further clinical trials,
as required by 21 C.F.R. 312(b) or a similar study in other countries.

 

“Phase III Clinical Trial”: means one or more clinical trials 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 Regulatory Approval of such drug, as required by 21
C.F.R. 312(c) or a similar study in other countries.

 

“Primary Indications”: means * and *.

 

“Product(s)”: shall mean a pharmaceutical preparation in any formulation that
contains the Compound as an active ingredient.

 

“New Product”: shall mean a pharmaceutical preparation containing Compound which
differs from a previously approved product by at least one active pharmaceutical
ingredient. 

 

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

 

 

* Confidential material redacted and filed separately with the Commission.

 

9

 

 

“Good Clinical Practices” or “GCP” means the then-current good clinical practice
standards, practices and procedures promulgated or endorsed 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., in each case as they may be
updated from time to time.

 

“Good Laboratory Practices” or “GLP” means the then-current good laboratory
practice standards promulgated or endorsed by the FDA as defined in 21 C.F.R.
Part 58, and comparable regulatory standards in jurisdictions outside the U.S.,
in each case as they may be updated from time to time.

 

“Good Manufacturing Practices” or “GMP” means the then-current good
manufacturing practices required by the FDA, as set forth in the FD&C Act and
the regulations promulgated thereunder, for the manufacture and testing of
pharmaceutical materials, and comparable Laws applicable to the manufacture and
testing of pharmaceutical materials in jurisdictions outside the U.S., including
without limitation 21 CFR 211 (Current Good Manufacturing Practice for Finished
Pharmaceuticals) and the guideline promulgated by the International Conference
on Harmonization designated ICH Q7A, entitled “Q7A Good Manufacturing Practice
Guidance for Active Pharmaceutical Ingredients” and associated guidelines and
regulations, in each case as they may be updated from time to time.

 

“Regulatory Approvals” means all approvals (including without limitation
supplements, amendments, and pricing approvals), licenses, registrations or
authorizations of any national, supra-national, regional, state or local
regulatory agency, department, bureau, commission, council or other governmental
entity, necessary for the manufacture, storage, import, transport, distribution,
marketing, use or sale of a pharmaceutical product in a given regulatory
jurisdiction.

 

“Regulatory Authority”: means, in a particular country or jurisdiction, any
applicable Governmental Authority involved in granting Regulatory Approval in
such country or jurisdiction, including without limitation, in the U.S., the FDA
and any other applicable Governmental Authority in the U.S. having jurisdiction
over the Product, and, in the European Union, the EMEA and any other applicable
Governmental Authority having jurisdiction over the Product..

 

“Royalties”: shall mean the royalties to be paid by TGTX to Rhizen (a) on the
basis of Net Sales pursuant to Section 6.3.3 hereof, or (b) on the basis of
Sublicensee Royalties, pursuant to Section 6.4.2 hereof, as applicable.

 

“Royalty Term”: shall mean, on a country-by-country basis, the period beginning
upon the First Commercial Sale of a Product or New Product in a country and
ending on the later of (i) on the expiration of the last to expire issued Valid
Claim within the Licensed Patents covering the sale of the Product or New
Product in such country, or (ii) expiry of any other exclusivity right with
respect to the Product or New Product in a country, including patent term
extensions, marketing exclusivity or any other non-patent exclusivity.

 

“Secondary Indication”: means any oncology indication other than a Primary
Indication.

 

“Subcontractor”: means a Third Party service provider engaged by TGTX to perform
contract services on behalf of TGTX or its Affiliates, where TGTX retains a
meaningful participatory role in the overall development and commercialization
of the Product (e.g., contract research or development organizations, clinical
sites performing clinical trials, universities and scientific institutes,
distributors in certain countries in the Territory, or contract manufacturing
organizations).

 

10

 

 

“Sublicensee(s)”: shall mean any Third Party to whom TGTX, or any of its
Affiliates, has sublicensed any of TGTX’s rights under the license granted to
TGTX pursuant to Section 2.1.

 

“Sublicensee Royalties”: shall mean all royalties paid by any Sublicensee to
TGTX or any of its Affiliates with respect to sales of Products by such
Sublicensee or its further sublicensees.

 

“Sublicensing Payments”: shall mean consideration in any form received by TGTX
or any of its Affiliates in connection with a grant to any Third Party(ies) of a
sublicense or other right, license, privilege or immunity to develop, have
developed, make, have made, use, sell, have sold, distribute, import or export
Products, but excluding Sublicensee Royalties. Sublicensing Payments shall
include, without limitation:

 

(i) any upfront or license signing fee;

 

(ii) any license maintenance fee;

 

(iii) any milestone payments (including, without limitation development,
regulatory and sales-based milestone payments);

 

(iv) the portion of any minimum royalty payment received by TGTX or any of its
Affiliates in excess of Sublicensee Royalties received;

 

(v) if a Sublicensee issues equity or debt securities to TGTX or its Affiliate
in connection with a sublicense grant, the fair market value of such securities
issued to TGTX or its Affiliate (such fair market value to be determined by
agreement of TGTX and Rhizen or by an independent appraiser mutually agreeable
to TGTX and Rhizen), net of any cash consideration paid by TGTX or its Affiliate
for such securities;

 

(vi) any distribution or joint marketing fee;

 

(vii) research and development funding in excess of TGTX’s or its Affiliates’
actual cost of performing such research and development (calculated on a
fully-burdened basis in accordance with TGTX’s or its Affiliate’s project- or
activity-based accounting practices, as applied consistently throughout its
accounting system); and

 

(viii) if TGTX or its Affiliate sells equity or debt securities to a Sublicensee
in connection with a sublicense grant, any consideration received by TGTX or its
Affiliate for such securities to the extent such consideration exceeds the fair
market value of such securities (such fair market value to be determined by
agreement of TGTX and Rhizen or by an independent appraiser mutually agreeable
to TGTX and Rhizen).

 

“Technology Transfer Plan”: shall have the meaning ascribed to this term in
Section 3.1.1.

 

“Territory”: shall mean the entire world excluding India.

 

“TGTX Exercise Fee”: shall have the meaning ascribed to this term in Section
6.2.

 

“Third Party”: shall mean any entity other than TGTX or Rhizen or an Affiliate
of TGTX or Rhizen.

 

11

 

 

“Valid Claim” shall mean (a) any claim of an issued unexpired patent that (i)
has not been permanently revoked, held invalid, or declared unpatentable or
unenforceable in a decision of a court or other body of competent jurisdiction
that is unappealable or unappealed within the time allowed for appeal, and (ii)
is not lost through an interference proceeding that is unappealable or
unappealed within the time allowed for appeal; or (b) provided there is no
Generic Product available in the market, a claim of a pending Patent
application, which claim has not been abandoned or finally disallowed without
the possibility of appeal.

 

2 LICENSE

 

2.1 Subject to the terms and conditions of this Agreement, Rhizen grants to TGTX
an exclusive license under the Rhizen Intellectual Property Rights, to develop,
have developed, use, have used, sell, have sold, offer for sale, register, have
registered, Commercialize, and have Commercialized and import the Product for
any Indication in the Field of Use in the Territory. For avoidance of doubt,
Rhizen does not grant to TGTX any right or license with respect to any API other
than the Compound, as defined herein above. Subject to the terms and conditions
of this Agreement, Rhizen retains the exclusive right to manufacture the
Product, including the Bulk API and Finished Product in the Territory.

 

2.2 The license granted to TGTX by Rhizen under Section 2.1 includes the right
for TGTX to grant sublicenses to its Affiliates and to Third Parties for the
development, manufacture, sale and/or commercialization of the Compound and the
Product. All sublicenses granted by TGTX shall be subject to the terms and
conditions of this Agreement and TGTX shall enter into a written sublicense
agreement with each Sublicensee which will contain terms and conditions fully
consistent with the terms and conditions contained in this Agreement. TGTX shall
use Diligent Efforts to include in any Commercial Sublicense Agreement express
permission to assign all of the rights and obligations under such agreement to
Rhizen without consent from the Sublicensee. TGTX shall provide to Rhizen a
draft copy of each Commercial Sublicense Agreement (as defined below) intended
to be entered into by TGTX or any of its Affiliates and any immediate
Sublicensee, in each case, for a period of 30 (days) days before execution of
such Commercial Sublicense Agreement to allow Rhizen to ascertain if the terms
and conditions set forth therein are fully consistent with the terms and
conditions contained in this Agreement, provided that TGTX may redact in its
entirety from such draft any sensitive, confidential or proprietary information
that is not necessary to ascertain TGTX’s, its Affiliate’s or a Sublicensee’s
compliance with the terms and conditions of this Agreement (including, without
limitation, TGTX’s payment and reporting obligations hereunder). TGTX shall
provide to Rhizen a true and complete copy of each Commercial Sublicense
Agreement entered into by TGTX or any of its Affiliates and any Sublicensee, and
of each amendment to any such Commercial Sublicense Agreement, in each case,
within thirty (30) days after execution of such Commercial Sublicense Agreement
or amendment. For the purpose of this Section 2.2, the term “Commercial
Sublicense Agreement” shall mean any agreement executed by TGTX or any of its
Affiliates under which any of TGTX’s rights under the license granted to TGTX
pursuant to Section 2.1 are sublicensed; provided, however, that the term
Commercial Sublicense Agreement shall exclude any agreement between TGTX or its
Affiliate and a Subcontractor. In addition, TGTX shall notify Rhizen in writing
of the termination of any Commercial Sublicense Agreement within thirty (30)
days after such termination. If TGTX determines that there is a reasonable
likelihood of its execution of a Commercial Sublicense Agreement or an amendment
to, or termination of, an existing Commercial Sublicense Agreement, TGTX shall
use reasonable efforts to provide notice thereof to Rhizen, which notice shall
be provided solely for Rhizen’ information and planning purposes. No sublicense
hereunder shall limit or affect the obligations of TGTX under this Agreement,
and TGTX shall remain fully responsible for each Affiliate’s or Sublicensee’s
compliance with the applicable terms and conditions of this Agreement. TGTX
agrees to take Diligent Efforts to enforce the terms of each Commercial
Sublicense Agreement against the relevant Sublicensee in the event of a material
breach thereof.

 

12

 

 

2.3 TGTX may subcontract certain activities to Subcontractors who will conduct
such activities, or a portion thereof, on behalf of TGTX. TGTX’s execution of a
subcontracting agreement with any Subcontractor shall not relieve TGTX of any of
its obligations under this Agreement. TGTX shall remain directly liable to
Rhizen for any performance or non-performance of a Subcontractor that would be a
breach of this Agreement if performed or omitted by TGTX, and TGTX shall be
deemed to be in breach of this Agreement as a result of such performance or
non-performance of such Subcontractor. TGTX shall use Diligent Efforts to
include in any agreement with a Subcontractor express permission to assign all
of the rights and obligations under such agreement to Rhizen without consent
from the Subcontractor. TGTX agrees to take Diligent Efforts to enforce the
terms of each subcontractor agreement, the breach of which would constitute a
breach of this Agreement if performed or omitted by TGTX, against the relevant
Subcontractor in the event of a material breach thereof.

 

2.4 Except as expressly provided in this Agreement, no license or other right is
or shall be created or granted hereunder by implication, estoppel or otherwise.

 

3 DEVELOPMENT PLAN

 

3.1. Obligations of Rhizen

 

3.1.1 As soon as possible after the Effective Date, Rhizen shall transfer to
TGTX, all Rhizen Intellectual Property (excluding Rhizen Patents) that is
necessary for TGTX to continue the development of the Compound and the Products
in accordance with the Development Plan and transfer the information and
materials set forth in the technology transfer plan attached hereto as Annexure
IV (the “Technology Transfer Plan”) on the timeline set forth in the Technology
Transfer Plan. Rhizen shall supply TGTX at TGTX’s cost, as indicated in this
Section 3.1.1, as soon as possible, but in any event within thirty (30) days,
with the amount of API or Finished Product (qty) for use in clinical studies
that is requested by TGTX, unless the costs associated with the manufacture of
such products were previously shared by both Parties pursuant to the JV
Agreement, in which case TGTX shall reimburse Rhizen that portion of the cost
paid by Rhizen pursuant to the JV Agreement. TGTX shall make payment on Rhizen’
invoices under this Section 3.1.1 within Thirty (30) days of invoice.

 

3.1.2 At no cost to TGTX, Rhizen shall provide a reasonable amount of technical,
scientific and intellectual property support to the Development Plan, as
requested by TGTX, during the first three (3) month period beginning on the
Effective Date unless the costs associated with such support has been already
shared by both Parties pursuant to the JV Agreement.

 

3.1.3 Rhizen agrees that it will not develop, have developed, Commercialize or
have Commercialized the Compound for non-human uses, including without
limitation, veterinary uses, while the Compound is under Active Clinical
Development or, following Regulatory Approval of the Compound in any Major
Market, while the Compound is subject to Active Commercialization; provided,
however, Rhizen shall be free to develop, have developed, Commercialize, or have
Commercialized, the Compound for non-human use, including without limitation
veterinary use, if at the end of the fifth year following the first Regulatory
Approval of a Product in any Major Market TGTX has not paid to Rhizen in the
aggregate at least * Dollars ($ * ) in Royalties hereunder. In addition, and
notwithstanding the foregoing, following the completion of Active Clinical
Development, Rhizen may develop, have developed, Commercialize, or have
Commercialized, the Compound for a non-human use, including without limitation
veterinary use, provided that such development or Commercialization is in the
form of a co-formulation of the Compound with any other active additional
ingredient.

 

 

 

* Confidential material redacted and filed separately with the Commission.

 

13

 

 

3.2 Obligations of TGTX

 

3.2.1 TGTX shall undertake Diligent Efforts to Develop, register and
Commercialize the Product in the Field of Use in the Major Markets and in such
other markets as TGTX deems commercially reasonable. TGTX shall use Diligent
Efforts to maximize Net Sales and shall not take any action with the intent of
reducing or avoiding the Milestone Payments or any royalties hereunder. From and
after the Effective Date, TGTX shall be solely responsible for all the costs
relating to the Development, registration and Commercialization of the Product
in the Field of Use. TGTX shall solely assume the managing and the financing of
the Development Plan, with the objective of verifying the safety, potency and
efficacy of the Product and, if the results of clinical development are
positive, filing applications for NDA approval in an expeditious manner, within
the limits of the demands of the Regulatory Authorities and consistent with
Diligent Efforts, as more fully described below in this Section 3.2. TGTX shall
retain final decision making authority on all Development, Commercialization,
marketing, manufacturing and regulatory matters relating to the Product;
provided, however, that TGTX shall: (i) provide Rhizen the opportunity to review
and comment on protocols for clinical trials of which TGTX or its Affiliate will
be the sponsor and proposed labelling for the Product in each country of the
Territory, in each case, reasonably in advance of submission by TGTX or any of
its Affiliates (but, for the avoidance of doubt, not Sublicensees) to the
applicable Regulatory Authority of any such clinical trial protocol or any
regulatory filing regarding Product labelling, and (ii) consider Rhizen’s
comments with respect to such clinical trial protocols and Product labelling in
good faith, provided such comments are provided in an expeditious manner
consistent with Diligent Efforts by TGTX.

 

3.2.2 TGTX shall conduct the activities set forth in the Development Plan in
accordance with all applicable Laws and current good manufacturing practice
(cGMP), current good laboratory practice (cGLP) and current good clinical
practice (cGCP), where applicable.

 

3.2.3 The Development Plan will be updated from time to time in accordance
herewith and such updates shall be attached hereto as Annexure III. The
Development Plan indicates in reasonable details TGTX’s plans for the
Development of Product in the Field of Use, including regulatory and
registration strategy consistent with Diligent Efforts. Without limiting the
generality of any of the foregoing obligations in this Section 3.2.3, TGTX shall
use Diligent Efforts to Develop the Product. TGTX may reasonably revise and
amend the Development Plan from time to time upon as much advance notice to
Rhizen as is practicable under the circumstances, so long as such amended
Development Plan meets the criteria described above.

 

14

 

 

3.2.4 If at any time TGTX definitively and formally suspends its research or
development efforts for the Product, or definitively and formally makes an
internal determination to suspend research and development of the Product, for a
period exceeding sixty (60) days, TGTX shall notify Rhizen giving reasons and a
statement of its intended actions.

 

3.2.5 TGTX shall be obligated to make Diligent Efforts to Develop, itself or
through Affiliates, subcontractors and/or Sublicensees, at least one (1)
Compound. If Rhizen considers that TGTX has failed to exercise Diligent Efforts,
then Rhizen shall notify TGTX in writing within sixty (60) days of appearance of
such potential failure thereof stating in reasonable detail the particular
alleged failure.

 

(a) If TGTX disagrees with Rhizen’s claim that TGTX has failed to exercise
Diligent Efforts, TGTX shall so notify Rhizen in writing within thirty (30) days
after receipt of Rhizen’s notice, in which event the Parties shall promptly
refer the matter to a Third Party expert in drug development, completely
unaffiliated and independent of the Parties and jointly selected by the Parties,
to determine whether a failure by TGTX to use Diligent Efforts occurred, or if
the related problem was due to some other cause. Neither Party shall
unreasonably withhold or delay its approval of such expert. The Parties shall
initially share equally the fees and costs of such expert, but promptly after
such expert makes a determination regarding the matter, the non-prevailing Party
shall reimburse the prevailing Party for the share of such fees and costs borne
by the prevailing Party. Should it be determined by the expert that such failure
resulted from TGTX’s failure to use Diligent Efforts to Develop the Product,
then the expert shall determine what corrective action by TGTX would best meet
the standard of Diligent Efforts and a timeframe for the completion of such
corrective action by TGTX. The determination of such expert shall be final and
binding on the Parties.

 

(b) If TGTX does not correct such alleged failure either: (i) within ninety (90)
days after notice of such alleged failure from Rhizen; or (ii) if TGTX disputes
Rhizen’s allegation of failure to use Diligent Efforts in accordance with the
preceding paragraph (a), within the period specified by the expert; then, in
each case, subject to Section 14, Rhizen shall have the right to terminate this
Agreement in accordance with Section 12.3.

 

3.2.6 TGTX shall maintain reasonable records of its work, including research,
development, clinical, manufacturing and commercialization activities with
respect to the Product conducted by TGTX under this Agreement, together with all
results, data and developments made or generated in connection with any of the
foregoing. Such records shall fully and properly reflect all work done and
results achieved in the performance of this Agreement in sufficient detail and
in good scientific manner appropriate for patent and regulatory purposes.

 

3.2.7 During the Term, TGTX shall keep Rhizen regularly informed in reasonable
detail regarding TGTX’s worldwide Product development. The detailed minutes of
the JSC shall constitute the written progress report summarizing the status of
the Product development, clinical trial progress, regulatory approval and
commercialization. In addition, throughout the Term, TGTX shall notify Rhizen
promptly of the occurrence of the following with respect to a Product: (i)
initiation of any Phase II Clinical Trial in a Major Market; (ii) initiation of
any Phase III Clinical Trial in a Major Market; (iii) NDA filing in any Major
Market; (iv) NDA approval in any Major Market; and (v) First Commercial Sale in
any Major Market. TGTX shall also respond to reasonable (i.e., not unduly
frequent or burdensome) informal requests from Rhizen for additional information
regarding the development of the Product from time to time.

 

15

 

 

3.2.8 Rhizen agrees that the results of the Development Plan cannot be
accurately predicted, that TGTX’s obligation with respect to the Development
Plan is not an obligation to obtain a particular result and that TGTX does not
warrant or guarantee that the Development Plan will yield any useful or
anticipated results.

 

3.2.9 Before the second anniversary of the Effective Date, TGTX shall select up
to * Backup Compounds for Development and Commercialization hereunder from the
then current list of possible Backup Compounds in Annexure VI. After the second
anniversary of the Effective Date, TGTX shall not be able select any other
Backup Compounds.

 

4 JOINT SCIENTIFIC COMMITTEE

 

4.1 The JSC shall be comprised of a minimum of Four (4) committee members, which
shall consist of two (2) representatives nominated by each Party.
Representatives will include persons having knowledge in the areas of
responsibility of the JSC. The Parties may mutually agree to change the total
number of representatives on the JSC, provided that the Parties always have an
equal number of representatives. Each Party may replace any of its JSC
representatives at any time upon written notice to the other Party. The JSC may
invite non-members to participate in the discussions and meetings of the JSC,
including experts bound by appropriate confidentiality obligations. The JSC
shall continue to exist and meet during the Term or until the Parties mutually
agree that it should disband. Each Party shall be responsible for all travel and
related costs for such Party’s representatives and guests to attend meetings of,
and otherwise participate on, the JSC.

 

4.2 The JSC shall meet at least thrice (3) during the first year of the Term and
twice (2) thereafter at times established by the Parties. Each Party shall also
have the right to request additional meetings of the JSC for good reason.
Meetings will be held in-person, by videoconference or by teleconference. If a
meeting is held in-person, it shall be either (i) in a US city which is hosting
a medical conference that the JSC members are otherwise attending or (ii) at a
mutually agreeable city that is located approximately equidistant from each
Parties principal place of business. In the event that a JSC member of a Party
cannot attend a meeting, such Party shall have the right to nominate another
representative of that Party to attend the meeting.

 

4.3 Throughout the Term, the JSC shall function to facilitate the collaboration
and relationship of the Parties under this Agreement, and facilitate the
communication and exchange of information related to research and development of
Products. In addition, for so long as the JSC is in existence, Rhizen shall
provide reasonable technical and scientific support to the Development Plan
through its participation on the JSC.

 

4.4 The JSC does not have any authority beyond the matters set forth above in
this Article 4, and cannot in any way amend or modify the terms or provisions of
this Agreement, either directly or indirectly. Subject to the terms and
conditions set forth in this Agreement, TGTX shall have the sole and final right
to take decisions with regard to the development of the Product, including,
without limitation, “Go” and “No Go” decisions, which decisions shall be made in
good faith and consistent with the objectives and intentions of this Agreement.
TGTX shall consider the proceedings of the JSC, and the information presented
therein, in good faith, provided, however, that TGTX retains the sole discretion
to make decisions regarding the Product and all matters relevant to this
Agreement and is in no way bound by actions or determinations of the JSC.

 

 

* Confidential material redacted and filed separately with the Commission.

 

16

 

 

4.5 TGTX shall circulate a draft of the minutes of each meeting to all members
of the JSC for comments within fifteen (15) days after such meeting. Such
minutes shall summarize in reasonable detail the discussions at the meeting, a
list of any actions or determinations by the JSC at such meeting, and a
description of any issues within the JSC that were not resolved at such meeting.
Rhizen shall promptly provide to TGTX any comments Rhizen may have regarding the
draft minutes, and the Parties shall discuss the same in good faith and use all
reasonable efforts to finalize the minutes no later than thirty (30) days after
such JSC meeting. All final JSC minutes must be signed by both Parties. In the
event the Parties do not agree, the TGTX version of the minutes shall be
considered final.

 

5. GLOBAL RIGHT FOR MANUFACTURE, RELEASE AND SUPPLY OF THE PRODUCT

 

5.1 Global Material & Supply Rights. Rhizen shall retain exclusive rights for
manufacturing and supply of API and formulations for global development and
commercialization; provided however, that Rhizen’s price is cost competitive (as
described in 5.2(b)) and prior to the First Commercial Sale, the Parties shall
timely negotiate in good faith and enter into a manufacturing and supply
agreement. Such Commercial Supply Agreement shall contain customary terms
governing such manufacturing and supply relationships, and shall provide as
follows:

 

(a) Rhizen shall establish, by itself or through agreements with Third Parties,
an appropriate manufacturing facility or contract manufacturer for the
commercial Finished Product manufacture in a timely manner to ensure that Rhizen
meets its obligation to supply quantities of Finished Product ordered by TGTX
under the Commercial Supply Agreement. As further detailed in the Commercial
Supply Agreement, upon the material and uncured breach by Rhizen of its defined
supply obligations as set forth in the Commercial Supply Agreement, TGTX shall
have the right to obtain transfer and Rhizen shall have the obligation to give
transfer (the distribution of costs for such transfer to be determined by the
parties) unless otherwise determined by JSC to TGTX, without undue delay, of any
and all manufacturing technology necessary to enable it to manufacture or have
manufactured Finished Product to meet its requirements under this Agreement. As
further detailed in the Commercial Supply Agreement, if such transfer occurs,
Rhizen would grant TGTX any additional licenses necessary to enable TGTX to
exercise the foregoing manufacturing right but requiring TGTX to pay any
additional consideration for such licenses.

 

(b) Rhizen shall be responsible for the Finished Manufacture, testing (including
stability testing) and final release of the Finished Product for
Commercialization in the Territory.

 

(c) The Parties each covenant and agree that all supply agreements executed
regarding the provision of any product or material pursuant to this Agreement,
shall contain customary representations and warranties regarding the manufacture
of such products and materials, including, but not limited to, that all
materials shall be manufactured, handled and stored: (i) in accordance with the
agreed upon specification and (ii) in compliance with applicable Laws and
regulations, including, without limitation, the GMP requirements.

 

17

 

 

5.2          Manufacturer Source.

 

(a)The Parties shall establish an appropriate facility or contract manufacturing
organization for handling Finished Manufacture as follows: Rhizen shall be
responsible for screening potential manufacturers, negotiating the applicable
supply agreement, and effecting the technology transfer as necessary to
establish and qualify Bulk API and Finished Product manufacturers, whether those
are Rhizen, its Affiliates, or Third Parties; provided, that, TGTX shall have
the right to provide reasonable input regarding the terms of such agreements (as
well as any amendments thereof), review and comment on agreement drafts and
forms, consult with Rhizen regarding the negotiation of such agreements between
Rhizen and Third Party contract manufacturers, and conduct a general
GMP/regulatory inspection of the proposed manufacturing facilities as the
Parties may agree, it being understood that TGTX shall retain the final
authority over the terms and conditions of any such agreements with such Third
Party contractors..

 

(b)Notwithstanding 5.2(a), Rhizen shall be responsible for using Diligent
Efforts to minimize the manufacturing cost of the Finished Product. In order to
ensure a competitive rate of manufacturing cost is obtained, the facility or
contract manufacturer used by Rhizen to produce the Finished Product must
provide a total manufacturing cost within * % of the cost an alternative
contract manufacturing organization of equal repute and quality, where the
comparative manufacturing cost are measured as an average of such cost over the
immediately preceding Twelve (12) month period. In the event that Rhizen does
not provide manufacturing services at the cost required in this Section 5.2(b),
then TGTX shall have the right to directly procure manufacturing services in its
sole discretion.

 

6 CONSIDERATION

 

6.1 As consideration for the exclusive license rights provided in Section 2.1,
TGTX shall pay to Rhizen the amounts set forth in this Article 6.

 

6.2 Exercise Fee

 

Upon the Effective Date of this Agreement, TGTX shall pay to Rhizen a fully
earned, non-refundable, one-time, up-front license fee equal to the sum of Eight
Million Dollars ($8,000,000) (the “Exercise Fee”), which shall be payable fifty
percent (50%) in cash and fifty percent (50%) in shares of TGTX Common Stock
(the “Exercise Shares”).

 

Upon signature of this Agreement, Rhizen shall provide an original invoice for
the TGTX Exercise Fee to TGTX, who shall pay the cash portion of the Exercise
Fee within fifteen (15) days of receipt of such invoice.

 

For payments made in Exercise Shares pursuant to this Section 6.2, such portion
of the Exercise Fee shall be made through the issuance of that number of shares
of Common Stock of TGTX as shall equal a fraction where the numerator is
FourMillion Dollars ($4,000,000) and the denominator is the Average Closing
Price. For purposes of this Section 6.2, the “Average Closing Price” means the
volume weighted average of the closing prices of TGTX Common Stock on The NASDAQ
Global Market (or, if the Common Stock of TGTX is not listed on the NASDAQ
Global Market, the principal exchange or interdealer quotation system on which
the TGTX Common Stock is listed) for the ten (10) trading days prior to the
Effective Date; provided, however, that in the event that TGTX effects a stock
split, combination or stock dividend at any time during such 10 trading days or
subsequent thereto and prior to the issuance of the Initial Shares, the number
of shares of TGTX Common Stock issuable shall be appropriately adjusted to give
effect to such action. Within five (5) business days of the Effective Date, TGTX
shall issue to Rhizen certificates representing the Initial Shares.

 

 

* Confidential material redacted and filed separately with the Commission.

 

18

 

 

6.3 Milestones and Royalties

 

6.3.1 NDA Filing Payment

 

(a) NDA filing payment: Whether such event is achieved by TGTX, its Affiliates,
its Sublicensees or any Third Party acting on behalf of TGTX, its Affiliates or
its Sublicensees, TGTX shall pay Rhizen a fully earned, non-refundable,
one-time, milestone payment of * Dollars ($ * ) upon the filing an NDA (the “NDA
filing”).”

 

6.3.2 Approval and Sales Milestone:

 

a.         Sales Milestones. TGTX shall pay the sales milestone payments set
forth below (which, when paid, shall be considered fully earned and
non-refundable) for each Product and for each New Product following approval of
such Product or New Product for commercialisation and achievement of the events
set forth in the table below (each, a “Sales Milestone Payment”). The Sales
Milestone Payments shall be paid only once per Product and New Product for each
of the events set forth in this Section 6.3.2(a), whether such milestone event
is achieved by TGTX, its Affiliates, its Sublicensees (but only in the event
that the sublicense is executed subsequent to the NDA filing), or any Third
Party acting on behalf of TGTX, its Affiliates, or its Sublicensees. No payment
shall be due for any milestone event which is not achieved. For clarity, so long
as the Product was approved for commercialization for a first indication, if the
Product is later approved for additional indications, all sales of the Product
for any indication will be counted toward the sales milestone event for such
Product.

 

Sales Milestones $ * on achieving gross sales of $ *   $ * $ * on achieving
gross sales of $ *   $ * $ * on achieving gross sales of $ *   $ *   Sales
Milestones Subtotal   $ *

 

b.         Primary Indication Approval Milestones. TGTX shall pay the milestone
payments set forth below (which, when paid, shall be considered fully earned and
non-refundable) for each Product and for each New Product following approval for
commercialisation for one of the Primary Indications and achievement of the
events set forth in the table below (each, a “Primary Indication Milestone
Payment”). The Primary Indication Milestone Payments shall be paid only once per
Product and once per New Product for each of the events set forth in this
Section 6.3.2(b), whether such milestone event is achieved by TGTX, its
Affiliates, its Sublicensees (but only in the event that the sublicense is
executed subsequent to the NDA filing), or any Third Party acting on behalf of
TGTX, its Affiliates, or its Sublicensees. No payment shall be due for any
milestone event which is not achieved

 

 

* Confidential material redacted and filed separately with the Commission.

 

19

 

  

  Milestone(s)           Milestone For Each Product  approved for Primary
Indication         Approval $ * on US Launch       $ * $ * on EMA Launch       $
* $ * on Japan Launch       $ * $ * on each of China, Russia, Brazil Launch    
  $ *   Approval Subtotal       $ *              

If the milestone events in this Section 6.3.2(b) are achieved for a Product or a
New Product following approval for a Primary Indication, TGTX shall be required
to pay the corresponding approval milestone payments under this Section 6.3.2(b)
for such Product or New Product notwithstanding that an approval milestone was
already paid under Section 6.3.2(c) for a Secondary Indication.

 

c.         Secondary Indication Approval Milestone. TGTX shall pay the milestone
payments set forth below (which, when paid, shall be considered fully earned and
non-refundable) for each Product and for each New Product following approval for
commercialisation for any Secondary Indication and achievement of the events
outlined in the table below (the “Secondary Indication Milestone Payments”). The
Secondary Indication Milestone Payments shall be paid only once per Product and
once per New Product for each of the events set forth in this Section 6.3.2(c),
whether such milestone event is achieved by TGTX, its Affiliates, its
Sublicensees (but only in the event that the sublicense is executed subsequent
to the NDA filing), or any Third Party acting on behalf of TGTX, its Affiliates,
its Sublicensees. No payment shall be due for any milestone event which is not
achieved.

 

  Milestone(s)       Milestone For Each Product  approved for Secondary
Indication     Approval $ * on US Launch   $ * $ * on EMA Launch   $ * $ * on
Japan Launch   $ * $ * on each of China, Russia, Brazil Launch   $ *   Approval
Subtotal   $ *        

If the milestone events in this Section 6.3.2(c) are achieved for a Product or a
New Product following approval for a Secondary Indication, TGTX shall be
required to pay the corresponding approval milestone payments under this Section
6.3.2(c) for such Product or New Product notwithstanding that an approval
milestone was already paid under Section 6.3.2(b) for a Primary Indication.

 

 

* Confidential material redacted and filed separately with the Commission.

 

20

 

 

d.         Non-Oncology Indication Approval Milestone. TGTX shall pay the
milestones payments set forth below (which, when paid, shall be considered fully
earned and non-refundable) for each Product or New Product following approval
for commercialisation for any Non-Oncology Indication and achievement of the
events outlined in the table below (the “Non-Oncology Indication Milestone
Payments”). Each of the Non-Oncology Indication Milestone Payments shall be paid
only once per Product and once per New Product for the events set forth below,
whether such milestone event is achieved by TGTX, its Affiliates, its
Sublicensees (subject to Section 6.4 for post NDA filing), or any Third Party
acting on behalf of TGTX, its Affiliates, or its Sublicensees. No payment shall
be due for any milestone event which is not achieved.

 

  Milestone(s)       Milestone For Each Product  approved for Non-Oncology    
Approval $ * on US Launch   $ * $ * on EMA Launch   $ * $ * on Japan Launch   $
* $ * on each of China, Russia, Brazil Launch   $ *   Approval Subtotal   $ *  
     

If the milestone events in this Section 6.3.2(d) are achieved for a Product or a
New Product following approval for a Non-Oncology Indication, TGTX shall be
required to pay the corresponding approval milestone payments under this Section
6.3.2(d) for such Product or New Product notwithstanding that an approval
milestone was already paid under Section 6.3.2(b) for a Primary Indication or
under Section 6.3.2(c) for a Secondary Indication.

 

TGTX shall provide Rhizen with written notice within ten (10) working days of
the occurrence of any of the foregoing milestone events and the relevant
Milestone Payment is payable by TGTX to Rhizen within Fifteen (15) days of
receipt of a corresponding invoice issued by Rhizen. If TGTX determines that
there is a reasonable likelihood of a particular milestone event being achieved
on or about a particular date, TGTX shall use reasonable efforts to provide
advance notice thereof to Rhizen, which notice shall be provided solely for
Rhizen’ planning purposes and shall not be construed as a representation,
warranty or covenant by TGTX that such milestone event will occur when
anticipated or at all.

 

6.3.3: Royalties on Net Sales.    On a Product(s) by Product(s) basis, TGTX
shall pay to Rhizen royalties based on the aggregate annual Net Sales of each
Product(s) sold in the Territory at the rate shown in the table below during the
Royalty Term for each country.

 

Sales Royalties

 

*% of Net Sales up to $ *

 

 

*%

*% of Net Sales between $ * and $ *   *% *% of Net Sales greater than $ *   *%

         

 

* Confidential material redacted and filed separately with the Commission.

 

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6.4 Revenue Sharing

 

6.4.1 Sublicensing Payments: On a product by product basis, TGTX shall pay to
Rhizen a tiered percentage (ranging from * %) of all Sublicensing Payments (the
“Sublicensing Milestones”) received by TGTX and its Affiliates from each
Sublicensee throughout the term of the applicable Commercial Sublicensing
Agreement, which percentage shall be equal to the percentage set forth on the
chart below corresponding to the number of Patients to whom the Product has been
administered in any Phase I, Phase II or Phase III Clinical Trial on the
effective date of the Commercial Sublicensing Agreement (the “Applicable
Percentage”). Such payments shall be made to Rhizen within forty-five (45) days
following receipt by TGTX of any Sublicensing Payment made from and after the
applicable event. For avoidance of doubt, during the time that such sublicensing
payments are made under this Section 6.4.1, the payments described under Section
6.3.2 and Section 6.3.3 shall not apply in the territory which has been
sublicensed. If at any time a Commercial Sublicensing Agreement is terminated or
expires, Section 6.3.2 and Section 6.3.3 shall apply. “Patients dosed” in the
table below refers to the total patients dosed with the Product, on a
product-by-product basis, after the Effective Date of this Licensing Agreement.

 

 Event Clinical stage(s) % Share on Sublicensing 1 * patients dosed * 2 *
patients dosed * 3 * patients dosed * 4 * patient dosed to NDA filing *

 

6.4.2 Royalties on Sublicensee Royalties: On a product by product basis, TGTX
shall pay to Rhizen the Applicable Percentage of any Sublicensee Royalties
received by TGTX and its Affiliates from each Sublicensee throughout the term of
the applicable Commercial Sublicensing Agreement. Such payments shall be made to
Rhizen within forty-five (45) days as of receipt by TGTX of the related
Sublicensee Royalties. For avoidance of doubt, during the time such Sublicensing
Royalties are paid under this Section 6.4.2, the payments described in Section
6.3.3 shall not apply in the territory which has been sublicensed. If at any
time a Commercial Sublicensing Agreement is terminated or expires, Section 6.3.2
and Section 6.3.3 shall apply.

 

Royalties shall be payable until expiration of the applicable Royalty Term for
each country on a country-by-country basis.

 

6.4.3 Royalties on Net Sales: Subject to Section 6.5.1(a), in the event that
TGTX and/or its Affiliates make direct sales of the Product to Third Parties,
then TGTX shall pay to Rhizen the amounts described in Section 6.3.3. For the
sake of clarity, this Section 6.4.3 refers only to amounts received by TGTX not
resulting from a sublicense agreement with a Sublicensee and such Net Sale
amounts shall be calculated pursuant to section 6.3.3.

 

6.4.4 Milestone Payments: In the event that TGTX and/or its Affiliates
sublicenses its rights under this Agreement in any country where the applicable
Commercial Sublicensing Agreement is entered into subsequent to the filing of
the NDA in such country, then for the purpose of this Section 6.4 it will be
considered as direct sales of the Product, i.e., without involvement of a
Sublicensee, and TGTX shall pay to Rhizen the milestones as defined above in
section 6.3.2. For avoidance of doubt, in such a case the payments under Section
6.4.1 and Section 6.4.2 shall not apply.

 

 

* Confidential material redacted and filed separately with the Commission.

 

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6.4.5 Royalties on Net Sales: Subject to Section 6.5.1(a), in the event that
TGTX and/or its Affiliates sublicenses its rights under this Agreement in any
country where the applicable Commercial Sublicensing Agreement is entered into
subsequent to filing the NDA in such country, then for the purpose of this
Section 6.4 it will be considered as direct sales of the Product, i.e., without
involvement of a Sublicensee, and TGTX shall pay to Rhizen the Royalties as
defined above in Section 6.3.3. For avoidance of doubt, in such a case the
payments under section 6.4.1 and Section 6.4.2 shall not apply.

 

6.5 Payments

 

6.5.1 Timing of Royalty Payments and Sharing of Sublicensing Payments.

 

(a) Royalties on Net Sales pursuant to Section 6.3.3 shall be paid by TGTX to
Rhizen quarterly within forty-five (45) days after the end of calendar quarter
in which such Net Sales are made (as determined by the date of invoice or
billing). Simultaneously with such payment, TGTX shall provide a report to
Rhizen of its calculation of such Royalties, in sufficient detail, including the
amounts of gross revenues and applicable deductions (the “Quarterly Royalty
Report”). Such Royalties shall be subject to a true-up adjustment to take into
account deductions under the definition of Net Sales either (A) allowed during a
calendar quarter that were not accrued during such calendar quarter, or (B)
accrued during a calendar quarter but not taken or later subject to a reversal
following the end of such calendar quarter (each of (A) and (B), a “True-up
Adjustment”). Each Quarterly Royalty Report provided by TGTX shall set forth the
amount of any True-up Adjustment applicable to any prior calendar quarter.

 

(b) Royalties on Sublicensee Royalties shall be paid by TGTX to Rhizen quarterly
within forty-five (45) days after the end of each quarter based upon Sublicensee
Royalties received by TGTX or its Affiliate during such quarter. If such
Sublicensee Royalties are significantly overdue, then upon Rhizen’ request, the
Parties agree to discuss the matter in good faith.

 

(c) Rhizen’s share of Sublicensing Payments shall be paid by TGTX to Rhizen
within forty-five (45) days after such Sublicensing Payments are received by
TGTX or its Affiliate..

 

6.5.2 All payments to Rhizen hereunder shall be made using the bank details
provided by Rhizen. All payments to Rhizen shall be made in US dollars. If
payments of Sublicensee Royalties, Net Sales, or Sublicensing Payments are made
in another currency other than US dollars, TGTX shall convert them into US
dollars for the purpose of the calculation of Royalties and sharing of
Sublicensing Payments by applying the average interbank exchange rate as
published by (OANDA/US treasury) for the last day of each month within the
calendar quarter for which payment to Rhizen is due. All costs associated with
making payments to Rhizen, including the cost of wire transfers, shall be paid
by TGTX and shall not be deducted from the payments to Rhizen.

 

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6.5.3 TGTX shall (and shall require its Affiliates to) prepare and maintain
complete and accurate books and records regarding Net Sales (including gross
sales and applicable deductions from gross sales), Sublicensee Royalties,
Sublicensing Payments and Royalties due hereunder. Rhizen shall have the right
to have such books and records reasonably inspected by an independent certified
auditor selected by Rhizen and accepted by TGTX, whose acceptance shall not be
unreasonably withheld, to confirm Net Sales (including gross sales and
applicable deductions from gross sales), Sublicensee Royalties, Sublicensing
Payments and Royalties due hereunder. Such auditor will execute a written
confidentiality agreement with TGTX and will disclose to Rhizen only such
information as is reasonably necessary to provide Rhizen with information
regarding any actual discrepancies between the amounts reported or paid and the
amounts payable under this Agreement. Such auditor will send a copy of its
report to TGTX within fifteen (15) days of delivery of such report to Rhizen.
Such report will include the methodology and calculations used to determine the
results. Prompt adjustments shall be made by the Parties to reflect the results
of such audit. Records to be available under an inspection shall include all
relevant documents pertaining to payments specified above, including all
relevant documents received by TGTX from Sublicensees. Rhizen shall bear the
fees and expenses of such inspection, provided that, if an underpayment of more
than Five percent (5%) of the payments due for any calendar year is discovered
in any inspection, then TGTX and or its affiliates shall bear all fees and
expenses of that inspection within thirty (30) days after receipt of invoice
from Rhizen.

 

6.5.4 Without limiting any other rights or remedies available to Rhizen, TGTX
shall pay Rhizen interest on any payments that are not paid on or before 15 days
from the due date at the British Bankers Association’s one month LIBOR Rate for
United States Dollar deposits calculated from the due date to the date paid in
full.

 

6.5.5 In the event TGTX fails to pay overdue amounts to Rhizen within the due
date under this Section 6.5, Rhizen shall have the right to terminate this
Agreement upon forty-five (45) days’ prior written notice to TGTX pursuant to
Section 12.4, unless TGTX has cured such failure to pay by the end of such
forty-five (45) day period.

 

6.5.6 TGTX shall make payments to Rhizen under this Agreement withholding any
taxes that may be due with respect to such payments to the extent that such
withholding is required by applicable law. If any taxes are required to be
withheld by TGTX, then TGTX shall (a) deduct such taxes from the payment made to
Rhizen, (b) timely pay the taxes to the proper taxing authority, and (c) send
proof of such tax payments to Rhizen and certify receipt of such payment by the
applicable tax authority within sixty (60) days following such tax payment

 

7 INTELLECTUAL PROPERTY

 

7.1 Ownership of Intellectual Property Rights and Inventions

 

7.1  Ownership of Inventions.

The Rhizen Intellectual Property Rights shall at all times be and remain the
sole property of Rhizen, subject to any limitation on the transfer of such
rights contained herein.

 

Any new invention pertaining to the product made alone or jointly by the parties
shall be owned by both Parties (“Joint Inventions”), unless otherwise determined
by the JSC to be owned by solely by either Party (a “Sole Invention”).

 

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Further, the JSC shall determine:

a) If either party is eligible for any payment or consideration in lieu of the
invention and/or royalty; or

 

b) If the licensing of such Joint Inventions by either Party to a Third Party
could have a material adverse effect on the Product or the Development or
Commercialization of the Product, and if so determined such Party will not be
able to consummate such Third Party licensing.

 

Inventorship shall be determined by the JSC in accordance with U.S. patent Laws.
Sole Inventions owned by TGTX and TGTX’s interest in all Joint Inventions shall
be included in the TGTX Intellectual Property Rights. Sole Inventions owned by
Rhizen and Rhizen’s interest in all Joint Inventions shall be included in the
Rhizen Intellectual Property Rights.

 

7.2 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 may be
either Sole Inventions or Joint Inventions, and all Information relating to such
inventions. Sole Inventions and Joint Inventions required or deemed useful by
the JSC for the development or commercialization of the Product, shall
automatically be included in this Agreement and available for use by the Parties
in the Territory.

 

7.3 Prosecution of Patents.

 

(a)Rhizen Patents Other than Joint Patents. Except as otherwise provided in this
Section 7.3(a), Rhizen shall have the sole right, authority and obligation to
file, prosecute and maintain the Rhizen Patents (other than Joint Patents which
shall be prosecuted and maintained in accordance with Section 7.3(b)) in the
Territory and on a worldwide basis. Rhizen shall provide TGTX reasonable
opportunity to review and comment on such prosecution efforts regarding such
Rhizen Patents in the Territory. Rhizen shall provide TGTX with a copy of
material communications from any patent authority in the Territory regarding
such Rhizen Patents, and shall provide TGTX with drafts of any material filings
or responses to be made to such patent authorities a reasonable amount of time
in advance of submitting such filings or responses. Notwithstanding the
foregoing, if Rhizen desires to abandon or not maintain any Patent within such
Rhizen Patents in the Territory, then Rhizen shall provide TGTX with thirty (30)
days prior written notice of such desire (or such longer period of time as
reasonably necessary to allow TGTX to assume such responsibilities) and, if TGTX
so requests, shall provide TGTX with the opportunity to prosecute and maintain
such Patent in the Territory in place of Rhizen. If TGTX desires Rhizen to file,
in the Territory, a patent application that claims priority from a Patent within
the Rhizen Patents, other than a Joint Patent, in the Territory, TGTX shall
provide written notice to Rhizen requesting that Rhizen file such patent
application in the Territory. If TGTX provides such written notice to Rhizen,
Rhizen shall either (i) file and prosecute such patent application and maintain
any patent issuing thereon in the Territory or (ii) notify TGTX that Rhizen does
not desire to file such patent application and provide TGTX with the opportunity
to file and prosecute such patent application and maintain any patent issuing
thereon in the Territory in place of Rhizen

 

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(b)Joint Patents. Except as otherwise provided in this Section 7.3(b), the JSC
shall entrust one Party with the right and authority, to prosecute and maintain
the Joint Patents on a worldwide basis at its sole discretion herein referred to
as an “Entrusted Party” (subject to this Section 7.3(b)). The Entrusted Party
shall provide the other party reasonable opportunity to review and comment on
such prosecution efforts regarding such Joint Patents. The Entrusted Party shall
provide the other party with a copy of material communications from any patent
authority regarding such Joint Patents, and shall provide the other party with
drafts of any material filings or responses to be made to such patent
authorities a reasonable amount of time in advance of submitting such filings or
responses. If one Party (the “First Party”) determines in its sole discretion to
abandon or not maintain any Patent within the Joint Patents anywhere in the
world, then such Party shall provide the other Party (the “Second Party”) with
thirty (30) days’ prior written notice of such determination (or such longer
period of time reasonably necessary to allow the other party to assume such
responsibilities) and shall provide the Second Party with the opportunity to
prosecute and maintain such Patent at the Second Party’s sole expense, and if
the Second Party so requests, the First Party shall assign such Patent to the
Second Party (if the Second Party is Rhizen, such Patent shall be included in
the Rhizen Patents or if the Second Party is TGTX, in which case such patent
will be included in the TGTX Patents).  If one Party (the “First Party”) desires
to file, in a particular jurisdiction, a patent application that claims priority
from a Patent within the Joint Patents, the First Party shall provide written
notice to the other Party (the “Second Party”) of such desire. Within fifteen
(15) days of such written notice, the Second Party shall provide written notice
to the First Party as to whether the Second Party agrees to file a patent
application in such jurisdiction or not. In the event the Second Party agrees to
such a filing, the Entrusted Party shall file such patent application in such
jurisdiction. In the event the Second Party does not desire to file in such
jurisdiction, the Second Party shall (i) provide the First Party with the
opportunity to file and prosecute such patent application and maintain any
patent issuing therefrom, and (ii) assign such patent application or a right to
file such patent application to the First Party; and the First Party may file
such patent application in such jurisdiction at its sole expense (in which case
such Patent shall be included in the respective Party’s Patents).

 

(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 7.3, including providing any necessary powers of attorney
and executing any other required documents or instruments for such prosecution.

 

(d)Costs of Prosecution. The costs to prosecute and maintain the Rhizen Patents
related to the Product shall be borne by Rhizen. The costs to prosecute and
maintain the Joint Patents related to the Product shall be borne equally by
Rhizen and TGTX. The costs to prosecute and maintain the TGTX Patents related to
the Product shall be borne by TGTX.

 

7.4Infringement 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 Rhizen Patents, Joint Patents or
TGTX Patents of which it becomes aware, and shall provide evidence in such
Party’s possession demonstrating such infringement.

 

26

 

  

(b) Infringement of Patents in the Territory.

 

(i)If a Party becomes aware that a Third Party infringes any Rhizen Patent, TGTX
Patent, or Joint Patent in the Territory by making, using, importing, offering
for sale or selling the Product or any similar PI3Kδ selective inhibitor covered
by any of such Patents (such activities, “Product Infringement”), then such
Party shall so notify the other Party as provided in Section 7.4 (a), which such
notice shall include all information available to the notifying Party regarding
such alleged infringement.

 

(ii)In the Territory, TGTX 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, subject to Section 7.4(b)(iii) below, the
cost and expense will be borne by TGTX. TGTX shall have a period of one hundred
twenty (120) days (or shorter period, if required by the nature of possible
proceeding) after notification by Rhizen or providing notification to Rhizen
pursuant to Section 7.4(a), to elect to so enforce such Patent. In the event
TGTX does not so elect, it shall so notify Rhizen in writing during such one
hundred twenty (120) day time period (or the above-mentioned shorter period),
and Rhizen shall have the right, but not the obligation, to commence a suit or
take action to enforce the applicable Patent against such Third Party
perpetrating such Product Infringement at its sole cost and expense (except as
otherwise expressly provided in this Section 7.4(b)(ii)). Each Party shall
provide to the Party enforcing any such rights under this Section 7.4(b)(ii)
reasonable assistance in such enforcement, at such enforcing Party’s request,
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, and shall
reasonably consider the other Party’s comments on any such efforts. Any
recoveries obtained from a suit or an action commenced by TGTX hereunder shall
first be applied to the recovery of expenses incurred by TGTX or Rhizen (if any)
in bringing the suit or action and the remaining amounts, if any, shall be
deemed additional Net Sales; provided, further, however, if Rhizen proceeds with
the enforcement after TGTX decides not to move forward, then any amounts
recovered shall belong solely to Rhizen.

 

(iii)The Party not bringing an action with respect to Product Infringement in
the Territory under Section 7.4(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.
Additionally, the Party not bringing an action under this Section 7.4(b) may
have an opportunity to participate in such action to the extent that the Parties
may mutually agree at the time the other Party elects to bring an action
hereunder.

 

27

 

  

(e)Settlement. TGTX shall not settle any claim, suit or action that it brings
under this Section 7.4 involving Rhizen Patents (excluding Joint Patents) in any
manner that would have a materially adverse impact on Rhizen Patents anywhere in
the world, or that would materially limit or restrict the ability of either
Party to manufacture, use, sell, offer for sale or import the Product anywhere
in the world, without the prior written consent of Rhizen. Rhizen shall not
settle any claim, suit or action that it brings under this Section 7.4 involving
TGTX Patents (excluding Joint Patents) in any manner that would negatively
impact the TGTX Patents or that would limit or restrict the ability of either
Party to manufacture, use, sell, offer for sale or import the Product anywhere
in the world, without the prior written consent of TGTX. Neither Party shall
settle any claim, suit or action that it brings under this Section 7.4 involving
Joint Patents in any manner that would negatively impact the Joint Patents or
that would limit or restrict the ability of either Party to manufacture, use,
sell, offer for sale or import the Product anywhere in the world, without the
prior written consent of such other Party.

 

(f)Rights to Intellectual Property Outside the Territory.

 

(i)TGTX hereby grants Rhizen a perpetual, exclusive, royalty-free license, with
the right to sublicense, to the Joint Patents and a perpetual, non-exclusive,
royalty-free license to the Joint Know-How to make, have made, use, sell, offer
for sale, and import the Product outside the Territory.  Outside the Territory,
Rhizen shall have the right, but not the obligation, at Rhizen’s sole expense,
to bring an appropriate suit or other action against any person or entity
engaged in Product Infringement of the Joint Patents. TGTX shall provide to
Rhizen when enforcing any such rights under this Section 7.4(f) reasonable
assistance in such enforcement, at Rhizen’s request and cost, including joining
such action as a party plaintiff if required by applicable Law to pursue such
action.

 

(ii)The Parties agree that in the event Rhizen desires to use the TGTX
Intellectual Property Rights, other than the Joint Patents and the Joint
Know-How, for any purpose outside of the Territory, then Rhizen shall pay such
fair market value royalties and/or fees to TGTX that the Parties determine by
future written agreement. Each Party agrees to negotiate in good faith to
execute an agreement regarding the subject matter of this paragraph.

 

(iii)For the purpose of this Section 7.4(f), TGTX Intellectual Property Rights
shall exclude any rights related to Ublituximab.

 

8 REPRESENTATIONS, WARRANTIES AND CERTAIN COVENANTS

 

8.1 Each Party represents, warrants and covenants to the other that:

 

(i)It is a company or corporation duly organized, validly existing, and in good
standing under the Laws of the jurisdiction in which it is incorporated, and has
full corporate 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, including, without limitation, the right
to grant the licenses granted by it hereunder;

 

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(ii)As of the Effective Date, (i) it has the corporate power and authority and
the legal right to enter into this Agreement and perform its obligations
hereunder; (ii) it has taken all necessary corporate 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. The execution, delivery and performance of this Agreement by it does not
conflict with any agreement or instrument, oral or written, to which it is a
party or by which it may be bound;

 

(iii)It has not granted, and shall not grant, any right to any Third Party which
would conflict with the rights granted to the other Party hereunder; and

 

(iv)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 this Agreement. The execution, delivery and performance of
this Agreement shall not violate, conflict with or constitute a default under
any agreement (including its corporate charter or other organizational
documents) to which it is a party or to which it may be bound, or to its best
knowledge, any applicable Laws or order of any court or other tribunal.

 

8.2 Rhizen represents and warrants and covenants to TGTX that as of the
Effective Date:

 

(i)All rights pertaining to the Rhizen Patents are owned by Rhizen;

 

(ii)The Rhizen Patents are not subject to any encumbrance, lien or claim or
ownership by any Third Party that is inconsistent with the rights and licenses
granted to TGTX hereunder;

 

(iii)Rhizen owns or possesses adequate right, title and interest in the Rhizen
Intellectual Property Rights to grant the license thereto to TGTX as provided in
this Agreement;

 

(iv)No claim or litigation has been brought, or is threatened to be brought, by
any person or entity (A) alleging that any of the Rhizen Patents in the
Territory is invalid or unenforceable, (B) relating to the Rhizen Intellectual
Property, or (C) alleging that use of the Rhizen Intellectual Property in the
Territory infringes or otherwise conflicts or interferes with any intellectual
property or proprietary right of any Third Party;

 

(v)No Third Party has infringed or misappropriated any Rhizen Intellectual
Property by making, using, importing, offering for sale or selling the Product
and, as of the Effective Date, there is no actual or threatened infringement or
misappropriation of the Rhizen Technology by any Third Party by making, using,
importing, offering for sale or selling the Product;

 

(vi)Neither A) TGTX’s exercise of its rights hereunder with respect to the
Rhizen Intellectual Property, nor (B) TGTX’s Development or Commercialization of
the Product in the Territory, shall infringe any valid and enforceable Patent of
any Third Party;

 

29

 

  

(vii)This Agreement is consistent with all Third Party license agreements in all
respects and does not conflict with, violate, breach or otherwise give rise to a
default by Rhizen under, any term of any Third Party license agreement;

 

(viii)   Rhizen has obtained any and all consents, if any, required from Third
Parties for Rhizen to enter into this Agreement and to grant to TGTX the
licenses and other rights provided herein and has provided a copy of such
consents to TGTX;

 

(ix)Rhizen has not received any written notice from any Third Party claiming
that the manufacture, use, sale, or importation of the Compound or Product by
Rhizen prior to the Effective Date infringed any patent owned or controlled by
any Third Party;

 

(x)Rhizen has not granted any license or other right to any Third Party
regarding the Product and/or the Rhizen Intellectual Property Rights;

 

(xi)Rhizen has not received any grant from or entered into any agreement with
any government and/or any of its subdivisions or federal governmental bodies, or
any other governmental bodies, regarding the Compound and/or the Rhizen
Intellectual Property Rights; and

 

(xii)  All products and materials supplied by Rhizen to TGTX pursuant to this
Agreement shall be manufactured, handled and stored by Rhizen or its Third Party
contract manufacture(s): (i) in accordance with the agreed upon specification
and (ii) in compliance with applicable Laws and regulations, including without
limitation, the GMP requirements.

8.3.Representations, Warranties, and Covenants of TGTX.

 

8.3.1 TGTX agrees that all of its activities, and the activities of its
Affiliates and Sublicensees related to its use of the Rhizen Patents and Rhizen
Know-How and all Development and Commercialization of the Product including the
transport, storage, sale and promotion thereof, pursuant to this Agreement shall
comply with all applicable legal and regulatory requirements. TGTX, its
Affiliates, and Sublicensees shall not engage in any activities that use the
Rhizen Patents and/or Rhizen Know-How in a manner that is outside the scope of
the license rights granted to TGTX hereunder. TGTX represents and warrants that
it will comply with the U.K. Bribery Act, the United States Foreign Corrupt
Practices Act and any and all other applicable Laws prohibiting corruption or
bribery (collectively referred to as the “Anti-Corruption Laws”).

 

8.3.2   TGTX represents, warrants, and covenants that (i) the issuance of the
Shares has been duly authorized by all necessary corporate action; (ii) upon
issuance, the Shares will be validly issued, fully paid and nonassessable, free
and clear of all liens, encumbrances, restrictions (including under the
Securities Act), charges, security interests, rights of first refusal and
preemptive rights; and (iii) TGTX shall reserve from its authorized and unissued
shares of Common Stock, a sufficient number of shares of Common Stock to issue
Rhizen the shares in accordance with Article 6 hereof.

 

8.4 No Other Representations or Warranties: Except as expressly set forth in
this Agreement, EACH PARTY EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES OF ANY
KIND, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION THE WARRANTIES OF DESIGN,
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THE
INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES, OR ARISING FROM A COURSE OF
DEALING, USAGE OR TRADE PRACTICES

 

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9 INDEMNIFICATION AND INSURANCE

 

9.1 TGTX shall indemnify, defend, and hold harmless Rhizen and its Affiliates
and their respective directors, officers, employees and agents (each, a “Rhizen
Indemnitee”) from and against any and all claims, suits, actions, demands,
liabilities, expenses and/or loss, including reasonable legal expense and
attorneys’ fees (collectively, “Losses”), to which any Rhizen Indemnitee may
become subject as a result of any claim, demand, action or other proceeding
(each, a “Claim”) by any Third Party to the extent such Losses arise out of or
result from (a) any breach by TGTX of its representations, warranties, covenants
or obligations in this Agreement or (b) the gross negligence or wilful
misconduct of TGTX, its Affiliates or Sublicensees; except, in each case, to the
extent such claim is caused by a breach of this Agreement by Rhizen or the gross
negligence or wilful misconduct of Rhizen.

 

9.2 Rhizen shall indemnify, defend, and hold harmless TGTX and its Affiliates
and their respective directors, officers, employees and agents (each, a “TGTX
Indemnitee”) from and against any and all Losses to which any TGTX Indemnitee
may become subject as a result of any Claim by a Third Party to the extent such
Losses arise out of or result from (a) any breach by Rhizen of its
representations, warranties, covenants or obligations in this Agreement, or (b)
the gross negligence or wilful misconduct of Rhizen or its Affiliates; except,
in each case, to the extent such claim is caused by a breach of this Agreement
by TGTX or the gross negligence or wilful misconduct of TGTX.

 

9.3 For purposes of Sections 9.1 and 9.2, the Rhizen Indemnitee or TGTX
Indemnitee (the “Indemnified Party”) shall give prompt written notice to the
other Party (the “Indemnifying Party”) of any claims, suits or proceedings by
Third Parties which may give rise to any claim for which indemnification may be
required under Section 9.1 or 9.2; provided, however, that failure to give such
notice shall not relieve the Indemnifying Party of its obligation to provide
indemnification hereunder except, if and to the extent that such failure
materially and adversely affects the ability of the Indemnifying Party to defend
the applicable claim, suit or proceeding. The Indemnifying Party shall be
entitled to assume the defence and control of any such claim at its own cost and
expense; provided, however, that the Indemnified Party shall have the right to
be represented by its own counsel at its own cost in such matters. Neither the
Indemnifying Party nor the Indemnified Party shall settle or dispose of any such
matter in any manner which would adversely affect the rights or interests of the
other Party (including the obligation to indemnify hereunder) without the prior
written consent of the other Party, which shall not be unreasonably withheld or
delayed. Each Party shall reasonably cooperate with the other Party and its
counsel in the course of the defence of any such suit, claim or demand, such
cooperation to include without limitation using reasonable efforts to provide or
make available documents, information and witnesses.

 

9.4 At and during such time as TGTX, its Affiliates, or its Sublicensees, begins
clinical testing, sale or distribution of Products, TGTX shall (and shall
require its Affiliates and Sublicensees to) at its sole expense, procure and
maintain commercially reasonable insurance policies as would be maintained by
similarly situated pharmaceutical companies consistent with the current industry
standards for similar products, and compliant with any applicable law or
regulation.

 

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9.5 EXCEPT WITH RESPECT TO A BREACH OF SECTION 10 HEREOF, IN NO EVENT SHALL
EITHER PARTY BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL, INDIRECT, PUNITIVE OR
SPECIAL DAMAGES OF THE OTHER PARTY ARISING OUT OF OR RELATED TO THIS AGREEMENT,
HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY EVEN IF ADVISED OF THE POSSIBILITY
OF SUCH DAMAGES.

 

10 CONFIDENTIALITY

 

10.1 Except to the extent expressly authorized by this Agreement or otherwise
agreed in writing by the Parties, each Party agrees that, for the Term and until
the later of (i) the tenth (10th) anniversary of the Effective Date, or
(ii) five (5) years after the expiration or termination of the Term, it shall
keep confidential and shall not publish or otherwise disclose, and shall not use
for any purpose other than as 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 known to the receiving Party or its Affiliate, other than under
an obligation of confidentiality to the disclosing Party, at the time of
disclosure by the other Party, as evidenced by written documentation;

(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 it 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
without obligations of confidentiality with respect thereto; or

(e)was independently discovered or developed by the receiving Party or its
Affiliate without the aid, application, or use of Confidential Information of
the other Party, as evidenced by written documentation; provided, however, that
this exception shall not apply to information or materials consisting of data
and results generated or resulting from Development activities with respect to
the Product, which information and materials shall be deemed Confidential
Information of the Party who has developed such information or materials
regardless of whether such information and materials were independently
discovered or developed by the receiving Party or its Affiliate.

 

10.2 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)filing or prosecuting Patents as permitted in this Agreement;

(b)regulatory submissions and other filings with Governmental Authorities,
including filings with the Securities and Exchange Commission;

(c)prosecuting or defending litigation or other proceedings or regulatory
actions;

(d)complying with applicable Laws;

 

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(e)disclosure to its employees, agents, and consultants, and any Third Parties 
(and potential licensees and) with which a Party is Developing or
Commercializing the Product) only on a need-to-know basis and solely as
necessary in connection with the performance of 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 10 prior to any such disclosure; and

(f)disclosure of the material financial terms of this Agreement to any bona fide
potential investor, investment banker, acquiror, merger partner, or other
potential financial 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 shall cause each
recipient of such Confidential Information to treat such Confidential
Information as confidential.

 

Notwithstanding the foregoing, in the event the Receiving Party is required to
make a disclosure of Confidential Information pursuant to Section 10.2(c) or
10.2(d), the Receiving Party shall, except where not permitted by applicable
Law, give reasonable advance notice to the Disclosing Party of such required
disclosure and, at the Disclosing Party’s request and expense, cooperate fully
with the Disclosing Party’s lawful efforts to contest such required disclosure,
to minimize the scope of such required disclosure, and/or to obtain a protective
order or other confidential treatment of the Confidential Information required
to be disclosed. In any event, the Receiving Party agrees to take all reasonable
action to avoid disclosure of Confidential Information hereunder

 

10.3 The Parties agree that the terms of this Agreement shall be treated as
Confidential Information by both Parties.

 

10.4 The Parties acknowledge that each Party may desire or be required to issue
press releases or to make other public disclosures relating to this Agreement or
its terms. The Parties agree to consult with each other reasonably and in good
faith with respect to the text and timing of such press releases or other public
disclosures prior to the issuance thereof, provided that a Party may not
unreasonably withhold consent to such releases, and that either Party may issue
such press releases as it determines, based on advice of counsel, are reasonably
necessary to comply with laws or regulations. In addition, following an initial
press release announcing this Agreement, each Party shall be free to disclose,
without the other Party’s prior written consent, the existence of this
Agreement, the identity of the other Party and those terms of this Agreement
which have already been publicly disclosed in accordance herewith.

 

10.5 Subject to Section 10.4, TGTX shall not use the name “Rhizen” nor any
variation or adaptation thereof, nor any trademark, tradename or other
designation owned by Rhizen or its Affiliates, nor the names of any of its
officers, employees or agents, for any purpose without the prior written consent
of the other Party in each instance, except that TGTX may state that it has
licensed from Rhizen one or more of the patents and/or applications within the
Rhizen Patents, and TGTX may use Rhizen’s logo on TGTX’s corporate website and
corporate presentation materials for such purpose, subject to Rhizen’s prior
review and approval (not to be unreasonably withheld) of TGTX’s proposed use
thereof.

 

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10.6 Subject to Section 10.4, Rhizen shall not use the name of “TGTX” or its
Affiliates nor any variation or adaptation thereof, nor any trademark, tradename
or other designation owned by TGTX or its Affiliates, nor the names of any of
its officers, employees or agents, for any purpose without the prior written
consent of the other Party in each instance, except that Rhizen may state that
it has licensed to TGTX one or more of the patents and/or applications within
the Rhizen Patents, and Rhizen may use TGTX’s logo on Rhizen’s corporate website
and corporate presentation materials for such purpose, subject to TGTX’s prior
review and approval (not to be unreasonably withheld) of Rhizen’s proposed use
thereof.

 

10.7 Each Party recognizes that the publication by TGTX of Data and other
information regarding Compounds and Products, such as by public oral
presentation, manuscript or abstract, may be beneficial to both Parties provided
such publications are subject to reasonable controls to protect Confidential
Information. Accordingly, Rhizen shall have the right to review and comment on
any material proposed for public oral presentation or publication by TGTX that
includes Data or other results of preclinical or clinical development of the
Compound or any Product and/or includes Confidential Information of Rhizen.
Before any such material is submitted for publication, TGTX shall use reasonable
efforts to deliver a complete copy to Rhizen at least thirty (30) days prior to
submitting the material to a publisher or initiating any other disclosure.
Rhizen shall review any such material and give its comments to TGTX within ten
(10) days of the delivery of such material to Rhizen. With respect to public
oral presentation materials and abstracts, Rhizen shall make reasonable efforts
to expedite review of such materials and abstracts, and shall return such items
as soon as practicable to TGTX with appropriate comments, if any, but in no
event later than ten (10) days from the date of delivery to Rhizen. TGTX shall
comply with Rhizen’s request to delete references to Rhizen’s Confidential
Information in any such material. In addition, if any such publication contains
patentable subject matter, then at Rhizen’s request, TGTX shall either delete
the patentable subject matter from such publication or delay any submission for
publication or other public disclosure for a period of up to an additional sixty
(60) days so that appropriate patent applications may be prepared and filed.

 

10.8 Subject to Section 10.7, TGTX and its contractors, including without
limitation clinical research organizations, shall have the right to publish
results of all clinical trials of the Compound or any Product on TGTX’s clinical
trial register, and such publication will not be a breach of the confidentiality
obligations provided in this Article 10.

 

10.9 All obligations of confidentiality and non-use imposed under this Article
10 shall expire ten (10) years after the date of termination or expiration of
this Agreement

 

11 EXPIRY OF THE AGREEMENT; CONSEQUENCES OF EXPIRY

 

11.1 Unless terminated earlier pursuant to Article 12 or other mutual written
agreement, this Agreement shall commence upon the Effective Date and shall
expire, on a country-by-country basis on the expiration of the Royalty Term (the
“Royalty Term”).

 

12 TERMINATION

 

12.1 TGTX Termination with Cause: TGTX may terminate this Agreement at any time
for Cause upon ninety (90) days’ prior written notice to Rhizen.

 

12.2 TGTX Termination: TGTX may terminate this Agreement at any time for any
reason upon ninety (90) days’ prior written notice to Rhizen.

 

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12.3 Rhizen Termination for TGTX Diligence Failure: If TGTX does not correct a
failure to use Diligent Efforts within the applicable period specified in, or
determined in accordance with, Section 3.2.5 (b) (a “Diligence Failure”), Rhizen
shall have the right to terminate this Agreement on ninety (90) days’ written
notice to TGTX unless TGTX cures such Diligence Failure before the end of such
ninety (90) day period.

 

12.4 Termination for Material Breach: Each Party shall have the right to
terminate this Agreement upon ninety (90) days’ (or forty-five (45) days’ in the
case of failure to make payment of amounts due hereunder) prior written notice
to the other Party in the event of the material breach of any term or condition
of this Agreement by the other Party, unless the breaching Party has cured such
breach by the end of the applicable cure period; provided, however, that:

 

(a) this Section 12.4 shall not apply to any Diligence Failure by TGTX (in which
case, Rhizen’ termination right shall be as set forth in Section 12.3); and

 

(b) any right to terminate under this Section 12.4 shall be stayed and the cure
period shall be stopped in the event that, during any cure period, the Party
alleged to have been in material breach shall have initiated dispute resolution
in accordance with Article 20 with respect to the alleged breach, which stay and
stopping shall last so long as the dispute resolution proceedings are ongoing.

 

13 CONSEQUENCES OF TERMINATION

 

13.1 In the event of

 

(A) termination of this Agreement by TGTX pursuant to Section 12.1 or 12.2:

 

(a) The license granted by Rhizen to TGTX under Section 2.1 shall terminate and
revert to Rhizen on the effective date of termination.

 

(b) Rhizen shall have the right, exercisable upon written notice by Rhizen to
TGTX given within sixty (60) days after the effective date of such termination,
to obtain, and effective upon such notice, TGTX shall, and it hereby does, grant
to Rhizen, a perpetual, exclusive, worldwide, royalty-bearing license, with the
right to sublicense, under TGTX Intellectual Property Rights (which, for
purposes of this Section 13.1 shall not include the Joint Patents or the Joint
Know-How) solely to develop, make, have made, use, sell, offer for sale, have
sold and import the Compound and Products in the Field of Use, subject to the
terms and conditions set forth below in subparagraph (c). TGTX shall provide to
Rhizen when enforcing any such rights under this Section 13.1(A)(b) reasonable
assistance in such enforcement, at Rhizen’s request and cost, including joining
such action as a party plaintiff if required by applicable Law to pursue such
action. In consideration for such exclusive license, Rhizen shall pay to TGTX a
royalty based on the fair market value of such license.  The royalty will be
negotiated in good faith by the Parties within fifteen (15) days following the
effective date of the termination. If the Parties cannot agree on the terms of
the royalty, the parties will select a disinterested Third Party to determine
the fair market value of the license (the “Appraiser”).  Once the Appraiser is
selected, the Appraiser shall be instructed to furnish a written appraisal
within sixty (60) days of it selection. In the event of termination pursuant to
Section 12.2, TGTX shall bear the Appraiser’s reasonable costs and expenses,
otherwise such costs and expenses will be shared equally by the Parties.  The
fair market value royalty will be paid out of Rhizen’s gross profits following
the first commercial sale of the Product, and which gross profits will be based
on all amounts paid to Rhizen from its sublicensing or from sales directly or
indirectly in the particular country or Territory. The term of such royalty will
expire on the expiration of the last to expire issued Valid Claim within the
TGTX Patents covering the Product in the particular country or Territory.

 

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TGTX shall, and it hereby does, upon such Termination grant to Rhizen, (i) a
perpetual, exclusive, worldwide, royalty-free license, with the right to
sublicense, under the Joint Patents; and (ii) a perpetual, non-exclusive,
royalty-free license to the Joint Know-How, in each case solely to develop,
make, have made, use, sell, offer for sale, have sold and import the Compound
and Products in the Field of Use, subject to the terms and conditions set forth
below in subparagraph (c). TGTX shall provide to Rhizen when enforcing any such
rights under this Section 13.1(A)(b) reasonable assistance in such enforcement,
at Rhizen’s request and cost, including joining such action as a party plaintiff
if required by applicable Law to pursue such action.

 

(c) TGTX shall:

 

(i) at no cost to Rhizen transfer to Rhizen as soon as reasonably practicable
all Data and information in TGTX’s or its Affiliates’ Control and possession
relating to the Compound or Products as may be necessary to enable Rhizen to
practice such license,

(ii) at no cost to Rhizen transfer and assign to Rhizen all of its right, title
and interest in and to all INDs, NDAs, drug dossiers and master files with
respect to any and all Products and all regulatory approvals with respect to any
and all Products, and

(iii) Take such other commercially reasonable actions and shall execute such
other instruments, assignments and documents as may be necessary to effect the
transfer of rights under this subparagraph (c) to Rhizen, including without
limitation assignments of any contracts, including sublicensing agreements,
related to the Development and Commercialization of any Product or New Product,
unless such assignment is prohibited by a contract and the applicable consent
cannot be reasonably procured at reasonable cost. TGTX will use reasonable
commercial efforts to obtain the consent of any third-party to any contract or
agreement related to the Development or Commercialization of the Product or a
New Product, which consent is required for the assignment of any such contract
or agreement from TGTX to Rhizen, provided, however, that any cash payment
required by TGTX in order to procure any such consent shall be deemed not
commercially reasonable. Prior to receipt of such consent, TGTX shall make
available to Rhizen all rights and other benefits of such contracts, on a
subcontract or sublease basis or in some other appropriate manner to the fullest
extent reasonably practicable and permitted by the terms of the contract or
otherwise consented to by the other party to such contract, and Rhizen shall be
considered an independent subcontractor or sublessee of TGTX, with respect to
all matters concerning such contracts.

 

(B) termination of this Agreement by TGTX pursuant to Section 12.4:

 

(a) the license granted by Rhizen to TGTX pursuant to Section 2.1 remains in
full force and effect in accordance with its terms and until such time on a
country-by-country basis (i.e. partial) as the expiration of the Royalty Term or
Entire territory , subject to TGTX’s compliance with Article 6;

 (b) all JSC participation rights of Rhizen shall terminate and be of no further
force or effect;

 

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(c) pending the outcome of arbitration proceedings pursuant to Article 20, TGTX
shall have the right to pay all amounts that become due under Article 6 after
such termination into an escrow account with a reputable bank, and to the extent
the arbitrators award damages to TGTX, the arbitrators shall be authorized, in
their discretion, (i) to cause the release to TGTX of all or any part of the
escrowed funds in partial or full satisfaction of such award, and/or (ii) to
adjust the amounts payable by TGTX to Rhizen under this Agreement to compensate
TGTX for damages suffered by TGTX as a result of Rhizen’ material breach.

 

(C) termination of this Agreement by Rhizen pursuant to Section 12.3, or
termination of this Agreement by Rhizen pursuant to Section 12.4 (subject to
paragraph (b) thereof):

 

(a) The license granted by Rhizen to TGTX under Section 2.1 shall terminate and
revert to Rhizen on the effective date of termination.

 

(b) Rhizen shall have the right, exercisable upon written notice by Rhizen to
TGTX given within sixty (60) days after the effective date of such termination,
to obtain, and effective upon such notice, TGTX shall, and it hereby does, grant
to Rhizen, a perpetual, exclusive, worldwide, royalty-bearing license, with the
right to sublicense, under TGTX Intellectual Property Rights (which, for
purposes of this Section 13.1 shall not include the Joint Patents or the Joint
Know-How) solely to develop, make, have made, use, sell, offer for sale, have
sold and import the Compound and Products in the Field of Use, subject to the
terms and conditions set forth below in subparagraph (c). TGTX shall provide to
Rhizen when enforcing any such rights under this Section 13.1(C)(b) reasonable
assistance in such enforcement, at Rhizen’s request and cost, including joining
such action as a party plaintiff if required by applicable Law to pursue such
action. In consideration for such exclusive license, Rhizen shall pay to TGTX a
royalty based on the fair market value of such license.  The royalty will be
negotiated in good faith by the Parties within fifteen (15) days following the
effective date of the termination. If the Parties cannot agree on the terms of
the royalty, the parties will select a disinterested Third Party to determine
the fair market value of the license (the “Appraiser”).  Once the Appraiser is
selected, the Appraiser shall be instructed to furnish a written appraisal
within sixty (60) days of it selection. TGTX shall bear the Appraiser’s
reasonable costs and expenses.  The fair market value royalty will be paid out
of Rhizen’s gross profits following the first commercial sale of the Product,
and which gross profits will be based on all amounts paid to Rhizen from its
sublicensing or from sales directly or indirectly in the particular country or
Territory. The term of such royalty will expire on the expiration of the last to
expire issued Valid Claim within the TGTX Patents covering the Product in the
particular country or Territory.

 

TGTX shall, and it hereby does, upon such Termination grant to Rhizen, (i) a
perpetual, exclusive, worldwide, royalty-free license, with the right to
sublicense, under the Joint Patents; and (ii) a perpetual, non-exclusive,
royalty-free license to the Joint Know-How, in each case solely to develop,
make, have made, use, sell, offer for sale, have sold and import the Compound
and Products in the Field of Use, subject to the terms and conditions set forth
below in subparagraph (c). TGTX shall provide to Rhizen when enforcing any such
rights under this Section 13.1(C)(b) reasonable assistance in such enforcement,
at Rhizen’s request and cost, including joining such action as a party plaintiff
if required by applicable Law to pursue such action.

 

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(c) TGTX shall:

 

(i) at no cost to Rhizen , transfer to Rhizen as soon as reasonably practicable
all Data and information in TGTX’s or its Affiliates’ Control and possession
relating to the Compound or Products as may be necessary to enable Rhizen to
practice such license.

(ii) at no cost to Rhizen, transfer and assign to Rhizen all of its right, title
and interest in and to all INDs, NDAs, drug dossiers and master files with
respect to any and all Products and all regulatory approvals with respect to any
and all Products, and

(iii) Take such other commercially reasonable actions and shall execute such
other instruments, assignments and documents as may be necessary to effect the
transfer of rights under this subparagraph (c) to Rhizen, including without
limitation assignments of any contracts, including sublicensing agreements,
related to the Development and Commercialization of any Product or New Product,
unless such assignment is prohibited by a contract and the applicable consent
cannot be reasonably procured at reasonable cost. TGTX shall use reasonable
commercial efforts to obtain the consent of any third-party to any contract or
agreement related to the Development or Commercialization of the Product or a
New Product, which consent is required for the assignment of any such contract
or agreement from TGTX to Rhizen, provided, however, that any cash payment
required by TGTX in order to procure any such consent shall be deemed not
commercially reasonable. Prior to receipt of such consent, TGTX shall make
available to Rhizen all rights and other benefits of such contracts, on a
subcontract or sublease basis or in some other appropriate manner to the fullest
extent reasonably practicable and permitted by the terms of the contract or as
consented to by the other party to the contract, and Rhizen shall be considered
an independent subcontractor or sublessee of TGTX, with respect to all matters
concerning such contracts.

(d) all JSC participation rights of TGTX shall terminate and be of no further
force or effect;

(e) pending the outcome of arbitration proceedings pursuant to Article 20, TGTX
shall pay all amounts that become due under Article 6 after such termination
into an escrow account with a reputable bank, and to the extent the arbitrators
award damages to Rhizen, the arbitrators shall be authorized, in their
discretion, (i) to cause the release to Rhizen of all or any part of the
escrowed funds in partial or full satisfaction of such award, and/or (ii) to
adjust the amounts payable to Rhizen under this Agreement to compensate Rhizen
for damages suffered by Rhizen as a result of TGTX’s material breach.

 

13.2 Any termination of this Agreement shall be without prejudice to any rights
or obligations which have accrued to any Party prior to such termination.
Without limiting the generality of the foregoing, termination of this Agreement
shall not preclude either Party from claiming any other damages, compensation or
relief that it may be entitled to hereunder.

 

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14 FALLOW

 

14.1. If at any time the development program has not made any significant
progress during any 6 month period during the Term (prior to the First
Commercial Sale), the licensing shall be deemed to be fallow and liable to
additional consequences. The JSC shall decide whether TGTX has made significant
progress pursuant to this Section 14.1, provided that if Rhizen disagrees with
the determination of the JSC, Rhizen may submit such dispute to an independent
Third Party analyst pursuant to the process set forth in Section 3.2.5(a)
hereof, and the decision of such analyst as to whether significant progress has
been made shall be binding on the Parties. On determination of such an event,
the JSC may have an option to provide TGTX with an extension of 12 months if
TGTX pays Rhizen a maintenance fee. For the avoidance of doubt, the Development
of a Product shall be considered as not making significant progress under this
Section 14.1 if the aggregate amount spent by TGTX or its Sublicensee(s) on the
Development activities for each of two consecutive three (3) month periods prior
to the filing of an NDA is less than an amount to be specified by the Parties
within thirty (30) days following the effective date hereof, except in specific
circumstances where such level of development expenses is warranted, as mutually
agreed by the Parties.

 

14.2. The Maintenance Fee as per section 14.1 shall be calculated by the Parties
in good faith considering the anticipated loss to Rhizen of various milestone(s)
& other payments (under Article 6 above) expected based on the then-current
stage(s) of the Development Plan.

 

15 SURVIVING PROVISIONS

 

Sections 6.5 and Articles 1, 8, 9, 10, 13, 14, 15, 16, 18, 19, 20 and 22 shall
survive termination or expiration of this Agreement. In addition, if the license
granted to TGTX under Section 2.1 survives termination as set forth in Section
13.3, Sections 6.3, 6.4 and 6.5 shall survive such termination.

 

16 NOTICES

 

Notices required or permitted to be made or given to either Party hereto
pursuant to this Agreement shall be sufficiently made or given on the date of
mailing if sent to such Party by certified or registered mail, postage prepaid,
addressed to it at its address set forth or to such other address as it shall
designate in the course of this Agreement by written notice to the other Party
as follows:

 

If to Rhizen: If to TGTX:   Rhizen   TGTX.       Attention:   Attention:  
  Rhizen Pharmaceuticals S A   TG Therapeutics, Inc.   Fritz-Courvoisier 40,
  787 Seventh Avenue   CH-2300 La Chaux-de-Fonds,   New York, NY 10019
  Switzerland.   U.S.A.   Email- us@rhizen.com   Email – hm@tgtxinc.com    

 

17 INDEPENDENT CONTRACTOR

 

The relationship of TGTX and Rhizen under this Agreement is intended to be that
of an independent contractor. Nothing contained in this Agreement is intended or
is to be construed so as to constitute the Parties as partners or joint ventures
or either Party as an agent or employee of the other. Neither Party has any
express or implied right or authority under this Agreement to assume or create
any obligations on behalf of or in the name of the other, or to bind the other
Party to any contract, agreement or undertaking with any Third Party.

 

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 18 COMPLETE AGREEMENT

 

The Parties hereto acknowledge that this Agreement sets forth the entire
agreement and understanding of the Parties, and supersedes all prior written or
oral agreements or understandings with respect to the subject matter hereof,
including JV Agreement, but excluding:

 

(a) that certain Confidentiality Agreement between the Parties dated April 27,
2012 (the “Original Confidentiality Agreement”), which shall remain in full
force and effect in accordance with its terms; provided, however, that all
“Confidential Information” (as defined by the Original Confidentiality
Agreement) of Rhizen relating to its single targeted Pi3K Delta kinase Inhibitor
programs, including, without limitation, RP5264, shall be deemed Confidential
Information for purposes of this Agreement; and

(b) In the event of any conflict between the provisions of this Agreement and
the provisions of the Original Confidentiality Agreement, this Agreement shall
control. No modification of this Agreement shall be deemed to be valid unless in
writing and signed by both Parties

 

19 ASSIGNMENT

 

Except as expressly provided hereunder, neither this Agreement nor any rights or
obligations hereunder may be assigned or otherwise transferred by either Party
without the prior written consent of the other Party (which consent shall not be
unreasonably withheld); provided, however, that either Party may assign this
Agreement and its rights and obligations hereunder without the other Party’s
consent: (a) in connection with the transfer or sale of all or substantially all
of the business of such Party to which this Agreement relates to a Third Party,
whether by merger, sale of stock, sale of assets or otherwise (each, a “Change
of Control Transaction”), provided that in the event of a Change of Control
Transaction in which the acquiring party is a Third Party, intellectual property
rights of the acquiring party to such Change of Control Transaction that exist
prior to the effective time of such Change of Control Transaction shall not be
included in the technology licensed hereunder or otherwise subject to this
Agreement; or (b) to an Affiliate, provided that no such assignment to an
Affiliate shall relieve the assigning Party of its obligations hereunder. The
rights and obligations of the Parties under this Agreement shall be binding upon
and inure to the benefit of the successors and permitted assigns of the Parties.
Any assignment not in accordance with this Agreement shall be void.

 

20 GOVERNING LAW AND DISPUTE RESOLUTION

 

20.1English Language; Governing Law. This Agreement was prepared in the English
language, which language shall govern the interpretation of, and any dispute
regarding, the terms of this Agreement.  This Agreement and all disputes arising
out of or related to this Agreement or any breach hereof shall be governed by
and construed under the Laws of the State of New York without giving effect to
any choice of law principles that would require the application of the Laws of a
different state.

20.2Disputes.

(a)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 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 Section 20.2 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.  With respect to all disputes arising
between the Parties, including, without limitation, any alleged failure to
perform, or breach, of this Agreement, or any issue relating to the
interpretation or application of this Agreement, if the Parties are unable to
resolve such dispute within sixty (60) days after such dispute is first
identified by either Party in writing to the other, the Parties shall refer such
dispute to the senior executive officers for each Party for attempted resolution
by good faith negotiations within thirty (30) days after such notice is
received.  If the senior executive officers designated by the Parties are not
able to resolve such dispute within such thirty (30) day period, either Party
may submit such dispute in accordance with Section 20.2(b).

 

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(b)Arbitration. Any dispute arising out of or relating to this Agreement,
including the breach, termination or validity thereof, which has not been
resolved by the executives of the Parties as provided herein will be finally
resolved by arbitration in accordance with the CPR Rules for Non-Administered
Arbitration then currently in effect, by three arbitrators of whom each party
will appoint one in accordance with the ‘screened’ appointment procedure
provided in Rule 5.4, provided, however, that if one party fails to participate
in either the negotiation or mediation as agreed herein, the other party can
commence arbitration prior to the expiration of the time periods set forth
above. The arbitration will be governed by the Federal Arbitration Act, 9 U.S.C.
§§1 et seq., and judgment upon the award rendered by the arbitrator(s) may be
entered by any court having jurisdiction thereof. The place of arbitration will
be New York, NY. The award may be made a judgment by any court of competent
jurisdiction pursuant to the New York Convention, 9 U.S.C. § 201 et seq., and
for this purpose the Party against whom the award is made will agree to the
personal jurisdiction of the court in which recognition is sought and will not
raise any argument of forum non conveniens.

(c)Notwithstanding anything to the contrary in this Article 20, either Party may
seek injunctive relief in any court in any jurisdiction where appropriate.

 

21 FORCE MAJEURE

 

21.1 Neither Party shall be liable for a failure to comply with a provision
herein, if it is prevented from performing the said provision because of force
majeure, this notion being defined as an event beyond the control of the Parties
and independent from their will including, but not limited to, strikes or other
labor trouble, war, insurrection, fire, flood, explosion, discontinuity in
supply of power, court order or governmental interference

 

21.2 Despite the event of force majeure, either Party hereto shall undertake
reasonable efforts to comply to the extent possible with its obligations towards
the other Party, pursuant to this Agreement.

 

21.3 The Party invoking an event of force majeure shall notify it forthwith to
the other Party, and must specify which one or ones of its obligations it is
being prevented from complying with, and the nature of force majeure, and must
give an estimate of the period during which it is likely that it shall be
prevented from complying with the said obligation or obligations

 

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22 MISCELLANEOUS

 

22.1 If any provision of this Agreement should be or become fully or partly
invalid or unenforceable for any reason whatsoever or should violate any
applicable law, this Agreement is to be considered divisible as to such
provision and such provision is to be deemed deleted from this Agreement, and
the remainder of this Agreement shall be valid and binding as if such provision
were not included therein. There shall be substituted for any such provision
deemed to be deleted a suitable provision which, as far as is legally possible,
comes nearest to the sense and purpose of the stricken provision

 

22.2 Failure by any Party to enforce any term or provision of this Agreement in
any specific instance or instances hereunder shall not constitute a waiver by
such Party of any such term or provision, and such Party may enforce such term
or provision in any subsequent instance without any limitation or penalty
whatsoever.

 

22.3 This Agreement is neither expressly nor impliedly made for the benefit of
any entity other than the Parties.

 

22.4 The headings set forth in this Agreement are for convenience only and do
not qualify or affect the terms or conditions of this Agreement. Ambiguities and
uncertainties in this Agreement, if any, shall not be interpreted against either
Party, irrespective of which Party may be deemed to have caused the ambiguity or
uncertainty to exist. This Agreement has been prepared in the English language,
and the English language shall control its interpretation. In addition, all
notices required or permitted to be given hereunder, and all written,
electronic, oral or other communications between the Parties regarding this
Agreement shall be in the English language.

 

22.5 No waiver of any right or remedy hereunder shall be effective unless
provided in writing executed by the waiving Party.

 

22.6 The agreement survives in case either Party is acquired or goes bankrupt.

 

22.7 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 by facsimile or
electronic transmission. If signature pages are so delivered by facsimile or
electronic transmission, each Party shall also immediately deliver an executed
original counterpart of this Agreement to the other Party by courier delivery
service.

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date

 

TG THERAPEUTICS, INC.   RHIZEN Pharmaceutials SA             Name:   Name: Title
  Title:       Date:   Date:

 

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