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

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Exhibit  10.5
 
**CONFIDENTIAL PORTIONS HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT AND HAVE BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE “COMMISSION”).**
 
UTC Pluristem Exclusive License Agreement
 
between
 
Pluristem Ltd.
 
and
 
United Therapeutics Corporation
 
Dated: June 19, 2011
 
 
 

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Summary of Contents
 
Article 1 Definitions
1
Article 2 Grant of Rights
11
Article 3 Governance
13
Article 4 Joint Obligations and Diligence
18
Article 5 Development and Regulatory Activities
21
Article 6 Manufacturing and Supply
25
Article 7 Commercialization
30
Article 8 Payment
33
Article 9 Inventions and Patents
36
Article 10 Representations and Warranties
40
Article 11 Confidentiality
44
Article 12 Indemnification
47
Article 13 Term and Termination
49
Article 14 Dispute Resolution
52
Article 15 Condition to Closing: R&D Act
55
Article 16 Miscellaneous
56

 
 
 

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Table of Contents
Article 1 Definitions
1
 
1.1
Definitions
1
 
1.2
Interpretation
10
Article 2 Grant of Rights 11  
2.1
License Grant to UTC
11
 
2.2
Restrictions on Sublicensing
11
 
2.3
No Implied License
12
 
2.4
Non Compete
12
 
2.5
Right of First Negotiation for Tissue Engineering
12
Article 3 Governance 13  
3.1
General
13
 
3.2
Joint Steering Committee
13
 
3.3
Areas Outside the JSC’s Authority
15
 
3.4
Operating Principles
15
 
3.5
Alliance Managers
17
 
3.6
Independence
18
Article 4 Joint Obligations and Diligence 18  
4.1
Conduct of the Parties
18
 
4.2
Commercially Reasonable Efforts to Develop
18
 
4.3
Determination of Diligence
18
 
4.4
Initial Transfer of Know-How
19
 
4.5
Sharing of Development and Commercialization Information
20
 
4.6
Duty to Confer and Consult
20
 
4.7
Quality Agreement
20
 
4.8
Product Handling
20
Article 5 Development and Regulatory Activities 21  
5.1
Development Activities
21
 
5.2
Regulatory Matters in Pluristem’s Domain
21
 
5.3
Notice of Regulatory Filings
21
 
5.4
Regulatory Matters in the Field
21
 
5.5
Ownership of Regulatory Filings; Right of Cross-Reference
22
 
5.6
Interactions with Authorities; Regulatory Inquiries
22
 
5.7
Drug Safety
23
 
5.8
Product Withdrawals and Recalls
24
 
5.9
PLX Development Generally
24
 
5.10
PLX Development for Tissue Engineering
25
Article 6 Manufacturing and Supply 25  
6.1
Development Supply By Pluristem
25
 
6.2
Commercial Manufacturing and Supply Agreement
26
 
6.3
Commercial Supply Price
27
 
6.4
Supply of Product Samples
27
 
6.5
Non-Discrimination
27
 
6.6
Commercial Supply Capacity
28
 
6.7
Failure to Supply
28
 
6.8
R&D Law and the OCS
28
 
6.9
Access to Manufacturers
29

 
 
 

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Article 7 Commercialization 30  
7.1
Commercialization Activities
30
 
7.2
Compensation for Sales Outside the Selling Party’s Domain
31
 
7.3
Commercialization Costs
31
 
7.4
Complaints and Inquiries
31
 
7.5
Product Integrity
31
Article 8 Payment 33  
8.1
Upfront Payment
33
 
8.2
Milestones
33
 
8.3
Royalty Payments
34
 
8.4
Payments and Reports
35
 
8.5
Taxes
35
 
8.6
Wire Transfers
35
 
8.7
Audit Rights
35
 
8.8
Exchange Rate
36
 
8.9
Blocked Currency
36
 
8.10
Late Payments
36
Article 9 Inventions and Patents 36  
9.1
Inventions Respecting Development
36
 
9.2
Inventions Respecting PLX Development
37
 
9.3
Other Inventions
37
 
9.4
Patent Prosecution
37
 
9.5
Enforcement of Patent Rights
38
 
9.6
Further Assurances
39
 
9.7
Enforcement of Other Government-Conferred Rights
39
 
9.8
Infringement Defense
39
 
9.9
Information and Updates
40
 
9.10
Patent Challenges
40
 
9.11
Invention Assignment
40
Article 10 Representations and Warranties 40  
10.1
Representations, Warranties and Covenants
40
 
10.2
Representations and Warranties of Pluristem
41
 
10.3
Disclaimer
44
Article 11 Confidentiality 44  
11.1
Treatment of Confidential Information
44
 
11.2
Exceptions
44
 
11.3
Authorized Disclosures
45
 
11.4
Securities Filings
45
 
11.5
Publicity
46
 
11.6
Publication
46
 
11.7
Patient Information
46
 
11.8
Confidentiality Agreement
47
Article 12 Indemnification 47  
12.1
Indemnification by UTC
47
 
12.2
Indemnification by Pluristem
47
 
12.3
Allocation of Responsibility
48
 
12.4
Procedure
48
 
12.5
Insurance
49
 
12.6
No Consequential or Punitive Damages
49

 
 
 

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Article 13 Term and Termination 49  
13.1
Term
49
 
13.2
Unilateral Termination by UTC
49
 
13.3
Material Breach
50
 
13.4
Consequences of Expiration or Termination
50
 
13.5
Survival
52
 
13.6
No Waiver of Remedies
52
Article 14 Dispute Resolution 52  
14.1
Disputes
52
 
14.2
Governing Law; Dispute Resolution
53
Article 15 Condition to Closing: R&D Act 55  
15.1
Consent of OCS
55
 
15.2
Satisfaction of Conditions; Effective Date
55
 
15.3
Portions of Agreement Effective as of Execution Date
55
 
15.4
Conduct of Pluristem’s Business
55
 
15.5
Non-Performance of Condition
55
 
15.6
Nature of Conditions
56
Article 16 Miscellaneous 56  
16.1
Entire Agreement
56
 
16.2
Assignment; Change of Control
56
 
16.3
Amendments
57
 
16.4
Bankruptcy
57
 
16.5
Non-Waiver
57
 
16.6
Severability
57
 
16.7
Notice
57
 
16.8
Further Assurances
58
 
16.9
Force Majeure
59
 
16.10
Independent Contractors
59
 
16.11
Performance by Affiliates
59
 
16.12
Guarantee of Certain Obligations
59
 
16.13
No Third Party Beneficiaries
60
 
16.14
Counterparts
60

 
 
 

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Exhibits
 
Exhibit ‎1.1(www): Safety Agreement Table of Contents
 
Exhibit ‎6.2: Commercial Supply Terms
 
Exhibit ‎6.8: Funded Technology
 
Exhibit ‎8.6: Wire Instructions
 
Exhibit ‎11.5: Press Release
 
 
 

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UTC Pluristem Exclusive License Agreement
 
This Exclusive License Agreement (the “Agreement”) is made and entered into as
of June 19, 2011 (the “Execution Date”) by and between Pluristem Ltd. an Israel
corporation, having its principal place of business at MATAM Advanced Technology
Park, Building No. 20, Haifa 31905 Israel (“Pluristem”), and United Therapeutics
Corporation, a Delaware corporation, having its principal place of business at
1040 Spring Street, Silver Spring, MD, 20910, USA (“UTC”).  Pluristem and UTC
are referred to individually as a “Party” and collectively as the “Parties.”
 
WHEREAS, Pluristem has developed and owns or controls certain proprietary
technology, patents, patent applications, and know-how relating to Pluristem’s
proprietary PLX (PLacental eXpanded) cells, as well as expertise and know-how
relating to the use and manufacture of the Product;
 
WHEREAS, Pluristem is developing and seeking regulatory approval for, and
intends to manufacture and sell, the Product under a separate Pluristem brand
name for various indications, and owns or otherwise controls certain related
intellectual property rights;
 
WHEREAS, UTC has developed proprietary methods and know-how regarding the
development, marketing, promotion, and commercialization of pharmaceutical
products for the treatment of pulmonary hypertension;
 
WHEREAS, Pluristem wishes to grant to UTC, and UTC wishes to accept, certain
rights to market, promote, and commercialize the Product under a separate UTC
brand name solely for the Field; and
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Parties agree as follows:
 
Article 1 Definitions
 
1.1
Definitions

 
The following terms shall have the following meanings as used in this Agreement:
 
 
(a)
“AAA” shall have the meaning set out in Section ‎14.2(f).

 
 
(b)
“Adverse Event” shall mean any undesirable medical occurrence in a patient or
clinical investigation subject administered a pharmaceutical product and which
does not necessarily have to have a causal relationship with the treatment,
including any variant of an “adverse drug experience” as those terms are defined
at either 21 C.F.R. Section 312.32 or 21 C.F.R. Section 314.80 and the relevant
non-FDA equivalents, whether arising in or outside of a clinical study.

 
 
(c)
“Affiliate” shall mean (a) an entity that owns directly or indirectly a
controlling interest in a Party, by stock ownership or otherwise, (b) any entity
in which a Party owns a controlling interest, by stock ownership or otherwise,
or (c) any entity under common control with a Party, directly or indirectly.
Solely for purposes of the foregoing sentence, “controlling interest” and
“control” shall mean the power, whether or not exercised, to direct the
management and affairs of a Party, directly or indirectly, whether through the
ownership of voting securities, by contract, or otherwise. The direct or
indirect ownership of fifty percent (50%) or more of a Party’s outstanding
voting securities shall in any case be deemed to confer “control.”

 
 
1

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

 
 
 
(d)
“Alliance Manager” shall have the meaning set out in Section ‎3.5(a).

 
 
(e)
“Applicable Law” shall mean all laws, statutes, ordinances, codes, rules, and
regulations that have been enacted by a Regulatory Authority in any jurisdiction
in the Territory and which are in force as of the Effective Date or come into
force during the Term, in each case to the extent that the same are applicable
to the performance by the Parties of their respective obligations under this
Agreement, including, with respect to the United States, the Prescription Drug
Marketing Act, the Federal Food, Drug and Cosmetics Act of 1938, as amended, the
Health Insurance Portability and Accountability Act, the Federal Anti-Kickback
Statute, and any applicable regulations relating to sampling practices.

 
 
(f)
“Arbitration Request” shall have the meaning set out in Section ‎14.2(d).

 
 
(g)
“Business Day” shall mean any day that is not a Saturday or a Sunday in the
United States or a day on which the New York Stock Exchange is closed.

 
 
(h)
“Calendar Quarter” shall mean each of the three (3) month periods ending on
March 31, June 30, September 30, and December 31.

 
 
(i)
“Calendar Year” shall mean each twelve (12) month period beginning on January 1
and ending on December 31.

 
 
(j)
“Change of Control” shall mean (a) the acquisition of control of Pluristem Ltd.
or Pluristem Therapeutics Inc. by a Third Party or (b) the sale or other
disposition of all or substantially all of the assets of Pluristem Ltd. or
Pluristem Therapeutics Inc. to a Third Party. The direct or indirect ownership
of fifty percent (50%) or more of Pluristem’s outstanding voting securities
shall in any case be deemed to confer “control.”

 
 
(k)
“Claims” shall have the meaning set out in Section ‎12.1.

 
 
(l)
“CMC” shall mean chemistry, manufacturing and controls.

 
 
(m)
“Commercialize” (and, with correlative meanings, the terms “Commercializing” and
“Commercialization”) shall mean any and all activities relating to the
commercialization of the Product, including the Promotion, Detailing,
distribution, sale, offer for sale, and importation of the Product after
Regulatory Approval of the Product, excluding any and all Manufacturing of the
Product.

 
 
(n)
“Commercially Reasonable Efforts” shall mean with respect to each Party,
commercially reasonable efforts in accordance with the business, legal, medical
and scientific judgment of a similarly situated company, and in accordance with
the efforts and resources a similarly situated company would use for a product
owned by it or to which it has rights, which is of similar market potential, at
a similar stage in its product life, taking into account the competitiveness of
the marketplace, the proprietary position of the product, the regulatory
structure involved, the profitability of the product and other relevant factors.

 
 
2

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

 
 
 
(o)
“Competing Product” shall mean any product, other than the Product, comprising
of PLX and/or any mesenchymal or mesenchymal-like cells.

 
 
(p)
“Confidential Information” of a Party shall mean all Information disclosed by
such Party to the other Party during and/or prior to the Term, including any and
all Information exchanged between the Parties under the Manufacturing and Supply
Agreement or the Confidentiality Agreement.

 
 
(q)
“Confidentiality Agreement” shall mean the Confidentiality Agreement between the
Parties effective April 8, 2011.

 
 
(r)
“Control” shall mean, with respect to any information or intellectual property
right, possession by a Party of the ability (whether by ownership, license, or
otherwise) to grant access, a license, or a sublicense to such information or
intellectual property right without violating the terms of any agreement or
other arrangement with any Third Party as of the time such Party would first be
required hereunder to grant the other Party such access, license or sublicense.

 
 
(s)
“Corporate Marks” shall mean, with respect to each of the Parties, the corporate
name of such Party or those of Affiliates of such Party, and its and their trade
names, trademarks, service marks, domain names, and associated logos and
designs.

 
 
(t)
“Cost of Goods Sold” shall mean, unless otherwise agreed between the Parties:

 
 
(i)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**

 
 
(ii)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**

 
all the foregoing as calculated in accordance with GAAP for by the Manufacturing
Party.
 
 
(u)
“Cover” shall mean, in respect of any Product, that a Valid Claim encompasses a
particular process, machine, article of manufacture or composition of matter
respecting the Product such that any making, using, offering to sell, selling,
supplying, importing or exporting of the Product would constitute an
infringement of the patent claim.

 
 
(v)
“Detail” or “Detailing” shall mean, with respect to Promotion of the Product in
the Field, the activity undertaken by a UTC Sales Representative with respect to
a target physician or other individuals or entities with prescribing authority
involved or potentially involved in prescribing the Product in the Field, to
provide information about the benefits and features of the Product in the Field
in an effort to increase the number of physicians or other individuals or
entities with prescribing authority prescribing the Product in the Field, and/or
the number of prescriptions for the Product in the Field.

 
 
(w)
“Development” (and, with correlative meanings, the terms “Develop” and
“Developing”) shall mean the non-clinical development, clinical development, and
regulatory activities with respect to seeking Regulatory Approval of the Product
for any indication, and post-approval studies, including label extensions in
support of the Product in the Field and any studies required by a Regulatory
Authority, and excluding any and all Manufacturing of the Product. For the
avoidance of doubt, Development shall not include PLX Development.

 
 
3

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

 
 
 
(x)
“Disclosing Party” shall have the meaning set out in Section ‎11.1.

 
 
(y)
“Dollar” or “$” shall mean the legal tender of the United States of America.

 
 
(z)
“Domain” shall mean, with respect to UTC, Products for any indication or use in
the Field and, with respect to Pluristem, Products for any indication or use
outside the Field.

 
 
(aa)
“Effective Date” shall have the meaning set out in Section ‎15.2.

 
 
(bb)
“Failure to Supply” shall mean the occurrence of one of the following events and
the giving of notice by UTC to Pluristem of the occurrence thereof:

 
 
(i)
Pluristem has elected by a written notice to discontinue supplying Product to
UTC without the prior written approval of UTC;

 
 
(ii)
with respect to Development activities, the failure by or on behalf of Pluristem
to supply on a timely basis of at least **THE CONFIDENTIAL PORTION HAS BEEN SO
OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED
SEPARATELY WITH THE COMMISSION.** of the quantity of Product ordered by or on
behalf of UTC or its Representatives (acting reasonably or in accordance with
the Manufacturing and Supply Agreement, if such agreement is in effect) in
accordance with Section ‎6.1 provided that such failure was not remedied within
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** days
of the date on which such supply was due thereunder and provided further that
such failure occurred more than **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY
WITH THE COMMISSION.** during the Term;

 
 
(iii)
with respect to Commercialization activities, the failure by or on behalf of
Pluristem to supply on a timely basis of at least **THE CONFIDENTIAL PORTION HAS
BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN
FILED SEPARATELY WITH THE COMMISSION.** of the quantity of Product ordered by or
on behalf of UTC or its Representatives in accordance with the Manufacturing and
Supply Agreement, provided that such failure was not remedied within **THE
CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** days of the date
on which such supply was due thereunder (without such period being extended by
any cure period in the Manufacturing and Supply Agreement) and provided further
that such failure occurred more than **THE CONFIDENTIAL PORTION HAS BEEN SO
OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED
SEPARATELY WITH THE COMMISSION.** during the Term;

 
 
4

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

 
 
 
(iv)
Pluristem has terminated the Manufacturing and Supply Agreement other than as a
result of a breach by UTC of the Manufacturing and Supply Agreement or the
insolvency of UTC; or

 
 
(v)
termination of the Manufacturing and Supply Agreement by UTC due to material
breach by Pluristem that is jeopardizing the supply of Product or insolvency of
Pluristem;

 
provided however that, upon the occurrence of any one of the foregoing events,
if Pluristem facilitates the procurement of Product for UTC from a Third Party
Manufacturer acceptable to UTC, acting reasonably, under substantially similar
terms as supplied pursuant hereto, including, if then in effect, the
Manufacturing and Supply Agreement, so that the uninterrupted supply of Product
is otherwise as contemplated by this Agreement (without the occurrence of such
Failure to Supply), then the occurrence of such event shall not be a Failure of
Supply.
 
 
(cc)
“FDA” shall mean the United States Food and Drug Administration, or any
successor organization.

 
 
(dd)
“Field” shall mean the treatment, amelioration, and prevention of any kind or
nature and by any route of administration of pulmonary hypertension including
all WHO classifications of pulmonary hypertension in the Venice 2003 Revised
Classification system.

 
 
(ee)
“GAAP” shall mean generally accepted accounting principles in the United States,
consistently applied.

 
 
(ff)
“GMP” shall mean the current Good Manufacturing Practices of the FDA and other
Regulatory Authorities, as applicable, as then in effect.

 
 
(gg)
“Gross Profits” shall mean the amount billed for sales of the Product by UTC,
its Affiliates and any sublicensees to Third Parties (excluding such
sublicensees), less:

 
 
(i)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
(ii)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
(iii)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
5

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

 
 
 
(iv)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
(v)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**; and

 
 
(vi)
taxes or other governmental charges levied on or measured by the billing amount
whether absorbed by the billing or billed party.

 
Such amounts shall be determined from the books and records of Pluristem and UTC
and its Representatives, respectively (as the case maybe), maintained in
accordance with GAAP. Each Party agrees that the determination of such amounts
will be made using such Party’s then-current standard procedures and
methodologies for external reporting of financial results in reports filed with
the US Securities and Exchange Commission.
 
 
(hh)
“Gross Profits Report” shall have the meaning set out in Section ‎8.4(a).

 
 
(ii)
“Indemnitee” shall mean, with respect to a Party, such Party and its Affiliates,
and their respective directors, officers, employees, agents, contractors,
licensees and sublicensees.

 
 
(jj)
“Indemnified Party” shall have the meaning set out in Section ‎12.4(a).

 
 
(kk)
“Indemnifying Party” shall have the meaning set out in Section ‎12.4(a).

 
 
(ll)
“Information” shall mean (a) technical or economic information, techniques and
data relating to the Product, including inventions, practices, methods,
knowledge, know-how, skills, SOPs, methods, experience, test data, including
pharmacological, toxicological, safety, non-clinical and clinical test data,
results, protocols, data, formulations, specifications, analytical and quality
control data, regulatory strategies, regulatory submissions, correspondence and
communications, marketing, pricing, distribution, cost, sales, patent and legal
data or descriptions, and strategies relating to the Product and (b)
compositions of matter, devices, assays and biological, chemical or physical
materials relating to the Product.

 
 
(mm)
“Invention” shall mean any invention or discovery, whether or not patentable,
made or acquired or Controlled:

 
 
(i)
by UTC pursuant to its activities under to this Agreement performed on or after
the Effective Date;

 
 
(ii)
by Pluristem on or after the Effective Date;

 
that is necessary or useful in the Development, Manufacture, use, or
Commercialization of the Product.
 
 
(nn)
“Joint Inventions” shall have the meaning set out in Section ‎9.1(e).

 
 
(oo)
“Joint Patents” shall have the meaning set out in Section ‎9.1(e).

 
 
6

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

 
 
 
(pp)
“JSC” or “Joint Steering Committee” shall have the meaning set forth in
Section ‎3.1.

 
 
(qq)
“Losses” shall have the meaning set out in Section ‎12.1.

 
 
(rr)
“Manufacture” shall mean the storage, handling, assembly, fill, production,
processing, Labeling, testing, disposition, packaging and quality control of raw
materials and components and the Product, and supply of the resulting Product.

 
 
(ss)
“Manufacturing and Supply Agreement” shall mean that certain Manufacturing and
Supply Agreement entered into by Pluristem and UTC, pursuant to which Pluristem
shall supply to UTC, and UTC shall purchase from Pluristem, all of UTC’s
requirements for the commercial supply of Product, subject to, and in accordance
with, the terms and conditions set forth in this Agreement and such
Manufacturing and Supply Agreement.

 
 
(tt)
“Negotiation Period” shall have the meaning set out in Section ‎7.5(h) and
Section ‎6.2(c).

 
 
(uu)
“Non-Publishing Party” shall have the meaning set out in Section ‎11.6(a).

 
 
(vv)
“Notification Period” shall have the meaning set out in Section ‎2.5(c).

 
 
(ww)
“OCS” shall mean the Office of the Chief Scientist of the Ministry of Industry
and Trade, or any replacement therefore.

 
 
(xx)
“OCS Consent” shall have the meaning set out in Section ‎6.8(a)(i).

 
 
(yy)
“Offered Indication” has the meaning set out in Section ‎2.5(a).

 
 
(zz)
“Patents” shall mean (a) unexpired letters patent (including inventor’s
certificates) in the Territory that have not been held invalid or unenforceable
by a court of competent jurisdiction from which no appeal can be taken or has
been taken within the required time period, including any substitution,
extension, term restoration, registration, confirmation, reissue,
re-examination, renewal or any like filing thereof and (b) pending applications
for letters patent in the Territory, including any continuation, division or
continuation-in-part thereof and any provisional applications.

 
 
(aaa)
“Phase II” trial means a clinical trial on sufficient numbers of patients that
is designed to establish the safety and biological activity of the Product for
its intended use before the FDA or a Regulatory Authority in a jurisdiction for
which the EMA is responsible, which does not include a trial powered to support
(without additional trials) an application for Regulatory Approval for the
Commercialization of the Product in the United States or in a jurisdiction for
which the EMA is responsible, respectively.

 
 
(bbb)
“Pluristem Commercialization Activities” shall have the meaning set forth in
Section ‎7.1(b).

 
 
(ccc)
“Pluristem Development Activities” shall have the meaning set out in Section
‎5.1(b).

 
 
(ddd)
“Pluristem Know-How” shall mean all Information that (a) is Controlled by
Pluristem at any time during the Term and (b) is Useful in the Development, use
or Commercialization of the Product in the Field, all as modified pursuant to
‎Article 9. In the event of a Failure to Supply, “Pluristem Know-How” shall
include all of the foregoing that is Useful in the Manufacture of the Product
for use in the Field.

 
 
7

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

 
 
 
(eee)
“Pluristem Patents” shall mean all Patents that claim the Development, use or
Commercialization of the Product that are Controlled by Pluristem at any time
during the Term, including any Patents claiming Inventions Controlled by
Pluristem in accordance with ‎Article 9, including composition and method of use
of the PLX, all as modified pursuant to ‎Article 9. In the event of a Failure to
Supply, “Pluristem Patents” shall include all Patents that claim the Manufacture
of the Product for use in the Field that are Controlled by Pluristem at any time
during the Term. As of the Effective Date, the Pluristem Patents (including
those claiming the Manufacture of the Product for use in the Field) are as set
forth on Exhibit ‎1.1(eee).

 
 
(fff)
“Pluristem Product Marks” shall mean the certain, separate Pluristem brand name
to be used in connection with marketing and sale of the Product in Pluristem’s
Domain, distinct from the UTC Product Marks, and all other trademarks used or
intended for use by Pluristem during the Term in connection with the marketing
or sale of the Product in Pluristem’s Domain.

 
 
(ggg)
“Pluristem Technology” shall mean the Pluristem Patents and Pluristem Know-How.

 
 
(hhh)
“PLX” or “PLacental eXpanded cells” shall mean mesenchymal-like adherent stromal
cells (ASCs) **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE
COMMISSION.**.

 
 
(iii)
"PLX Development" shall mean **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY
WITH THE COMMISSION.**.

 
 
(jjj)
“PLX Development IP” shall have the meaning set out in Section ‎9.2(b).

 
 
(kkk)
“Product” shall mean that pharmaceutical product of which the active ingredient
of which includes PLX, in any finished form and formulation.

 
 
(lll)
“Promotion” or “Promote” shall mean the marketing and advertising of the Product
in the Field, including medical education, information and communication, market
development and medical liaison activities.

 
 
(mmm)
“Publishing Party” shall have the meaning set out in Section ‎11.6(a).

 
 
(nnn)
“Quality Agreement” has the meaning set forth in Section ‎4.7.

 
 
(ooo)
“R&D Law” means the Law for the Encouragement of Industrial Research and
Development, 5744-1984 (as amended).

 
 
(ppp)
“Reasonable Cost” shall mean, with respect to a Party, the reasonable costs and
expenses (including full time equivalent costs and Third Party costs) as then
calculated, from time to time, by such Party for its internal accounting
purposes in accordance with GAAP, such calculation performed consistently with
the practice across such Party’s organization. In any circumstance where
Reasonable Costs are expected to exceed **THE CONFIDENTIAL PORTION HAS BEEN SO
OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED
SEPARATELY WITH THE COMMISSION.**, the Parties will develop a budget for such
circumstance and agree upon a full time equivalent rate that is appropriate for
such circumstance.

 
 
8

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(qqq)
“Receiving Party” shall have the meaning set out in Section ‎11.1.

 
 
(rrr)
“Regulatory Approval” shall mean any approvals, licenses, registrations or
authorizations of any Regulatory Authority, whether or not conditional, that are
necessary for the Development, Manufacture, use or Commercialization of the
Product any regulatory jurisdiction in the Territory in accordance with
Applicable Law and obtained as a result of activities under this Agreement,
including receipt of pricing and reimbursement approvals, where applicable.

 
 
(sss)
“Regulatory Authority” shall mean any and all supranational, national, or
regional, state, provincial or other local government, court, governmental
agency, authority, board, bureau, instrumentality, regulatory agency,
department, bureau, commission, council or other government entity, whose
approval or authorization is necessary for, or to whom notice must be given
prior to, the Development, Manufacture, use or Commercialization of the Product
in the Territory or the designation of the Product as an orphan drug (or
equivalent designation) in the Territory, including, with respect to the United
States, the FDA.

 
 
(ttt)
“Regulatory Exclusivity Rights” shall have the meaning set out in Section ‎9.7.

 
 
(uuu)
“Regulatory Filings” shall mean all applications, filings, dossiers and the like
(excluding routine Adverse Event expedited or periodic reporting), submitted to
a Regulatory Authority in the Territory for the purpose of obtaining Regulatory
Approval from that Regulatory Authority in the Territory with respect to the
Product, but do not include submission of promotional materials to Division of
Drug Marketing, Advertising, and Communications of the FDA (DDMAC) and
international equivalents.

 
 
(vvv)
“Representatives” shall mean, with respect to a Party, its Affiliates,
contractors, licensees and sublicensees.

 
 
(www)
“Safety Agreement” shall have the meaning set forth in Section ‎5.7(a). An
example of the table of contents of a Safety Agreement is attached hereto as
Exhibit ‎1.1(www).

 
 
(xxx)
“Specifications” shall have the meaning set out in Section ‎6.1(a).

 
 
(yyy)
“Supply Terms Schedule” shall have the meaning set out in Section ‎6.2.

 
 
(zzz)
“Term” shall have the meaning set forth in Section ‎13.1.

 
 
(aaaa)
“Territory” shall mean the entire universe.

 
 
(bbbb)
“Third Party” shall mean any entity other than a Party or its Affiliates.

 
 
9

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(cccc)
"Tissue Engineering" shall mean the ex-vivo regeneration or replacement of
portions or functions of the lung or the whole lung.

 
 
(dddd)
“Useful” shall mean, with respect to UTC, necessary or useful in the Development
or Commercialization of the Product in the Field, and, with respect to
Pluristem, necessary or useful in the Manufacture, Development or
Commercialization of Products in Pluristem’s Domain. In the event that UTC
exercises its rights under Section ‎2.1(b), in respect of UTC, “Useful” shall
include necessary or useful in the Manufacture of the Product for use in the
Field.

 
 
(eeee)
“UTC Commercialization Activities” shall have the meaning set forth in
Section ‎7.1(a).

 
 
(ffff)
“UTC Development Activities” shall have the meaning set out in Section ‎5.1(a).

 
 
(gggg)
“UTC Know-How” shall mean all Information that (a) is Controlled by UTC at any
time during the Term and (b) arises from the Development, Manufacturing or
Commercialization of Product at any time during the Term and (C) is Useful in
the Development, Manufacture, use, or Commercialization of the Product in the
Field, all as modified pursuant to ‎Article 9.

 
 
(hhhh)
“UTC Patents” shall mean all Patents that claim the Development, Manufacture,
use or Commercialization of the Product in the Field that are Controlled by UTC
at any time during the Term, and arise from the Development, Manufacturing or
Commercialization of Product at any time during the Term, including any Patents
claiming Inventions Controlled by UTC in accordance with ‎Article 9, including
composition and method of use Patents, all as modified pursuant to ‎Article 9.

 
 
(iiii)
“UTC Product Marks” shall mean the certain, separate UTC brand name to be used
in connection with marketing and sale of the Product in the Field, distinct from
the Pluristem Product Marks, and all other trademarks used or intended for use
by UTC during the Term in connection with the marketing or sale of the Product
inside the Field.

 
 
(jjjj)
“UTC Sales Representative” shall mean an employee of UTC or its permitted
contractors and a member of UTC’s sales force engaged in the conduct of Details
of the Product and trained as provided under this Agreement.

 
 
(kkkk)
“Valid Claim” shall mean a claim within an issued Pluristem Patent that has not
expired, lapsed, or been cancelled or abandoned, and that has not been dedicated
to the public, disclaimed, or held unenforceable, invalid, or been cancelled by
a court or administrative agency of competent jurisdiction in an order or
decision from which no appeal has been or can be taken, including through
opposition, re-examination, reissue, or disclaimer.

 
1.2
Interpretation

 
 
(a)
Captions & Headings. The captions and headings of clauses contained in this
Agreement preceding the text of the articles, sections, subsections and
paragraphs hereof are inserted solely for convenience and ease of reference only
and shall not constitute any part of this Agreement, or have any effect on its
interpretation or construction.

 
 
10

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(b)
Singular & Plural. All references in this Agreement to the singular shall
include the plural where applicable, and all references to gender shall include
both genders and the neuter.

 
 
(c)
Articles, Sections & Subsections. Unless otherwise specified, references in this
Agreement to any article shall include all sections, subsections, and paragraphs
in such article; references in this Agreement to any section shall include all
subsections and paragraphs in such sections; and references in this Agreement to
any subsection shall include all paragraphs in such subsection.

 
 
(d)
Days. All references to days in this Agreement shall mean calendar days, unless
otherwise specified.

 
 
(e)
Clarification. The word “including” shall be deemed to mean “including without
limitation” and “including, but not limited to”. A consent that is identified in
this Agreement as not “to be unreasonably withheld” shall not be unreasonably
withheld, delayed or conditioned.

 
 
(f)
Ambiguities. 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.

 
 
(g)
Priority. In the event of any inconsistency between the provisions of this
Agreement and the Manufacturing and Supply Agreement, the provisions of this
Agreement shall control.

 
Article 2 Grant of Rights
 
2.1
License Grant to UTC

 
Subject to the terms and conditions of this Agreement, Pluristem hereby grants
to UTC during the Term an exclusive (even as to Pluristem), non-transferable
(subject to Section ‎16.2), sublicenseable (subject to Section ‎2.2) license,
under the Pluristem Know-How and the Pluristem Patents, to:
 
 
(a)
Develop, use and Commercialize the Product in the Field; and

 
 
(b)
in the event of the occurrence of a Failure to Supply, Manufacture and have
Manufactured the Product solely for Development, use and Commercialization in
the Field.

 
2.2
Restrictions on Sublicensing

 
The license granted to UTC in Section ‎2.1 to Develop and Commercialize the
Product is not sublicenseable without the prior written consent of Pluristem
(which consent shall not be unreasonably withheld). Notwithstanding the
preceding sentence, UTC may sublicense without consent Development or
Commercialization activities in specific countries in the Territory. UTC shall
provide written notice to Pluristem of such sublicenses, which will include the
name of the sublicensee and the scope of the activities which are sublicensed.
Notwithstanding the foregoing, all times during the Term, UTC shall perform the
substantial portion of the Development and Commercialization of Product not
through a sublicense (except as will be otherwise agreed by Pluristem). A
distributor is not a sublicensee for the purpose hereof. Any such permitted
sublicense (A) if granted to a UTC’s Affiliate, shall terminate, with respect to
such Affiliate, upon such Affiliate ceasing to be an Affiliate of UTC; and (B)
shall be consistent with and subject to the terms and conditions of this
Agreement. UTC shall be liable to Pluristem for any breach of the terms of this
Agreement by such sublicensees, whether such sublicensees are approved by
Pluristem or otherwise. UTC shall remain responsible for any breach of the terms
of this Agreement by any such sublicensee in accordance with the terms of
Section ‎12.1(f).
 
 
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2.3
No Implied License

 
Except for the licenses and other rights granted to UTC herein, all right, title
and interest in and to the Pluristem Technology and Pluristem Product Marks
shall remain solely with Pluristem, whether developed or conceived prior, during
or after the Term of this Agreement. Except as expressly provided in this
Agreement, neither Party will be deemed by this Agreement to have been granted
any license or other rights to the other Party’s intellectual property rights,
either expressly or by implication, estoppel or otherwise.
 
2.4
Non Compete

 
Except for the activities conducted pursuant to this Agreement:
 
 
(a)
during the Term, neither UTC nor any of its Affiliates shall, directly or
indirectly, alone or in collaboration, partnership or any other form of
engagement with any Third Party (including joint ownership or otherwise),
Develop or Commercialize in any country in the Territory any Competing Product
in the Field.

 
 
(b)
During the Term, neither Pluristem nor any of its Affiliates shall, directly or
indirectly, alone or in collaboration, partnership or any other form of
engagement with any Third Party (including joint ownership or otherwise),
Develop or Commercialize in any country in the Territory any product in the
Field, unless such Development or Commercialization is the result of a Change of
Control of Pluristem where Pluristem’s aquiror was, at the time of such Change
of Control or at any time thereafter, directly or indirectly, alone or in
collaboration, partnership or any other form of engagement with any Third Party
(including joint ownership or otherwise), Developing or Commercializing in any
country in the Territory any product in the Field.

 
2.5
Right of First Negotiation for Tissue Engineering

 
 
(a)
During the Term, if Pluristem is approached by a Third Party regarding, or
enters into bona fide discussions with a Third Party for, the opportunity to
collaborate on, or decides to exploit itself, the Development or
Commercialization of products Covered by the PLX Development solely for Tissue
Engineering (the “Offered Indication”), Pluristem will provide written notice of
same to UTC.

 
 
(b)
Such notice will include:

 
 
(i)
information possessed by Pluristem that supports the Development or
Commercialization of Product for the Offered Indication and is reasonably
necessary for UTC to assess the commercial potential of same;

 
 
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(ii)
if Pluristem was approached by a Third Party or entered into bona fide
discussions with a Third Party, the same information presented by Pluristem to
the Third Party, subject to any bona fide obligations of confidentiality and
limited use owed to such Third Party; and

 
 
(iii)
a proposal respecting same that Pluristem would be prepared to accept.

 
 
(c)
Within 30 days of receipt of such notice (the “Notification Period”), UTC will
provide written notice to Pluristem indicating whether it is interested in
negotiating with Pluristem to obtain the rights in question from Pluristem.

 
 
(d)
If UTC fails to respond to Pluristem’s notification within the Notification
Period or indicates that it is not interested in the Offered Indication,
Pluristem will thereafter be free to enter into discussions and a binding
transaction with one or more Third Parties regarding the rights offered to UTC
in the Offered Indication.

 
 
(e)
If UTC indicates its interest in obtaining such rights to the Offered Indication
on or before the expiry of the Notification Period, the Parties will negotiate
in good faith the terms of a separate development and commercialization
agreement, which terms will be commercially reasonable, including without
limitation license fees, milestone payments, and royalties, during the period up
to ninety (90) days following receipt of UTC’s notice (the “Negotiation
Period”). If the Parties are unable to execute such an agreement within such
time period, despite good faith negotiations by each Party, Pluristem will
thereafter be free to enter into a definitive agreement to develop and
commercialize such rights in the Offered Indication with one or more Third
Parties in the two (2) years following the expiry of the Negotiation Period,
provided that the terms agreed to with such Third Party include financial terms
are no more favorable to such Third Party than the last terms offered by
Pluristem to UTC. In the event that Pluristem and a Third Party are unable to
execute such a definitive agreement within such time period, the Offered
Indication shall again be subject to the terms of this Section ‎2.5. If such a
definitive agreement for the Offered Indication terminates for any reason, such
Offered Indication shall again be subject to the terms of this Section ‎2.5.

 
 
(f)
Pluristem will not exploit Product for Tissue Engineering unless it has first
offered the opportunity to UTC in accordance with this Section ‎2.5.

 
Article 3 Governance
 
3.1
General

 
The Parties desire to establish a joint steering committee (the “Joint Steering
Committee” or “JSC”), which shall oversee the Parties’ activities under this
Agreement and facilitate communications between the Parties.
 
3.2
Joint Steering Committee

 
 
(a)
Formation and Purpose. Within forty-five (45) days after the Effective Date,
each Party shall appoint up to three (3) members of its management to be its JSC
representatives. Each Party may replace its JSC representatives by written
notice to the other Party. The purpose of the JSC shall be to provide a forum
for joint discussion between the Parties in order to (i) coordinate the
Manufacture of the Product for the Development, use or Commercialization of the
Product in the Field, (ii) keep each Party generally advised of the other
Party’s activities that would be Useful to the other Party, and (iii) identify
activities that would be of mutual benefit with respect to the Product that
would be Useful to the other Party. The JSC shall have the membership and shall
operate by the procedures set forth in Section ‎3.4.

 
 
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(b)
Specific Responsibilities of the JSC. In addition to its overall responsibility
for coordinating the Parties’ activities under this Agreement, the JSC shall, in
particular and in a timely manner:

 
 
(i)
monitor progress of the Development of the Product in the Field as same may be
made in accordance with this Agreement;

 
 
(ii)
review and comment upon plans for and results of any and all clinical trials
conducted by UTC with respect to the Field and conducted in Pluristem’s Domain
to the extent such information is Useful to UTC, including clinical trial
protocols, monitoring plans, and data disclosure plans included with each such
protocol, and updates or amendments thereto;

 
 
(iii)
facilitate the flow of information with respect to the Commercialization of the
Product in the Field by UTC;

 
 
(iv)
facilitate mechanisms for discussion between the Parties with respect to
Development of the Product in the Field and in Pluristem’s Domain, including the
contents and submission of Regulatory Filings, to the extent such Development
and such Regulatory Filings are Useful to the other Party;

 
 
(v)
facilitate communication between the Parties with respect to all serious adverse
events or significant safety issues for Products in all fields throughout the
world to the extent such information is Useful to UTC or to Pluristem,
consistent with the terms of the Safety Agreement and coordinate efforts of the
Parties to ensure proper reporting of all Adverse Events for the Product in the
Field in accordance with Applicable Law and consistent with the terms of the
Safety Agreement;

 
 
(vi)
subject to any obligations of confidence owed to a Third Party, facilitate the
flow of information with respect to any material new studies of which either
Party becomes aware which relate to the Product to the extent such information
is Useful to the other Party;

 
 
(vii)
implement policies and procedures for providing each Party with copies of all
correspondence and communications with Regulatory Authorities relating to
Products, to the extent such correspondence and communications are Useful to the
other Party;

 
 
(viii)
coordinate the availability, timing, and amount of Product and placebo to be
supplied by Pluristem to UTC for the sale of the Product in the Field, and
procedures for forecasting and ordering such placebo and Product pursuant to the
Manufacturing and Supply Agreement;

 
 
14

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(ix)
monitor Pluristem’s Manufacturing capacity for the Product including the
requirement for safety stock as and to the extent agreed by the Parties from
time to time;

 
 
(x)
consultation between the Parties regarding the Detailing of the Product in UTC’s
Domain and the detailing of Pluristem’s Product(s) in Pluristem’s Domain to the
extent Useful in respect of the Domain of either Party; and

 
 
(xi)
perform such other functions as the Parties may agree in writing.

 
3.3
Areas Outside the JSC’s Authority

 
The JSC shall have no authority other than that expressly set forth in
Section ‎3.2. In no event shall the JSC have the right to modify or amend, or
waive the terms of, or either Party’s compliance with, this Agreement.
 
3.4
Operating Principles

 
The Parties hereby acknowledge and agree that the deliberations and
decision-making of the JSC, and any subcommittee established by the JSC, shall
be in accordance with the following operating principles:
 
 
(a)
Chairpersons. The JSC shall have co-chairpersons. Each of UTC and Pluristem
shall select from their representatives a co-chairperson for the JSC. The
co-chairpersons of the JSC shall be responsible for calling meetings, preparing
and circulating an agenda in advance of each meeting of the JSC, and preparing
and issuing minutes of each meeting within thirty (30) days thereafter. The JSC
co-chairperson of a Party shall call a meeting of the JSC promptly upon the
written request of the other co-chairperson to convene such a meeting. Such
minutes will not be finalized until both chairpersons review and confirm the
accuracy of such minutes in writing.

 
 
(b)
Meetings. The JSC shall hold meetings at such times as it elects to do so, but
in no event shall such meetings be held less frequently than once every Calendar
Quarter during the first 12 months following the date hereof and thereafter at
least twice per Calendar Year unless otherwise agreed by the JSC. The JSC shall
meet alternately at Pluristem’s facilities in Haifa, Israel, and UTC’s
facilities in the United States, or at such locations as the Parties may
otherwise mutually agree. Other employees of each Party (including the Alliance
Managers, as defined in Section ‎3.5(a)) involved in the Development,
Manufacture, or Commercialization of the Product in the Field may attend
meetings of the JSC as nonvoting participants, and, with the consent of each
Party, consultants, representatives, or advisors involved in the Development,
Manufacture, or Commercialization of the Product may attend meetings of the JSC
as nonvoting observers; provided that such Third Party representatives are under
obligations of confidentiality and non-use applicable to the Confidential
Information of each Party and that are at least as stringent as those set forth
in ‎Article 11; and provided that the term of such obligations may be reduced by
mutual agreement of the Parties so as to be commercially reasonable based on the
circumstances. Each Party shall be responsible for all of its own expenses
associated with participating in the JSC. Meetings of the JSC may be held by
audio or video teleconference with the mutual consent of the Parties; provided
that one (1) JSC meeting per Calendar Year shall be held in person.

 
 
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(c)
Decision Making.

 
 
(i)
The JSC is an advisory body only, and the rights and authorities of the Parties
are set forth in this Agreement, including Section ‎3.4(c)(ii) and ‎3.4(c)(iii).
The Parties shall use Commercially Reasonable Efforts to cause their respective
members of the JSC to act in good faith and cooperate with one another. Any
disagreement between the Parties shall be first submitted to the Alliance
Managers in order to facilitate a resolution and then, if not resolved, at the
election of either Party, be referred for resolution pursuant to ‎Article 14.
Notwithstanding the foregoing, each Party has final decision-making authority
with respect to certain matters pursuant to ‎3.4(c)(ii) and ‎3.4(c)(iii), and no
decision made in accordance with such final decision-making authority shall be
subject to any dispute resolution mechanism or procedure under ‎Article 14.
Notwithstanding anything else in this Agreement or the Manufacturing and Supply
Agreement, in no event shall either Party exercise its final decision-making
authority in a manner that would have the effect of modifying, or would
otherwise be in conflict with, the terms of this Agreement or the Manufacturing
and Supply Agreement.

 
 
(ii)
Except as otherwise set out in this Agreement, Pluristem shall have final
decision-making authority regarding any and all matters relating to:

 
 
1.
the Development and Commercialization of Products in Pluristem’s Domain; and

 
 
2.
Manufacture of Products, subject to the terms of the Manufacturing and Supply
Agreement;

 
provided that, if Pluristem exercises its decision-making authority under this
Agreement, including under this Section ‎3.4(c)(ii) , Pluristem will make a good
faith effort to consult with UTC prior to making any decision that is reasonably
likely to be material to UTC, and, if UTC requests, provide to UTC a reasonably
detailed written explanation of the basis for such decision. If the Parties
disagree on such decision, Pluristem agrees, at UTC’s request, to make available
a member of Pluristem’s Executive Committee within ten (10) business days to
discuss such matter; provided, however, that such a discussion will not affect
Pluristem’s right to exercise its final decision-making authority with respect
to such decision.
 
 
(iii)
Except as otherwise set out in this Agreement, UTC shall have final
decision-making authority regarding any and all matters relating to the
Development and Commercialization of Products in the Field, provided that, if
UTC exercises its decision-making authority under this Agreement, including
under this Section ‎3.4(c)(iii), UTC will make a good faith effort to consult
with Pluristem prior to making any decision that is reasonably likely to be
material to Pluristem, and, if Pluristem requests, provide to Pluristem a
reasonably detailed written explanation of the basis for such decision. If the
Parties disagree on such decision, UTC agrees, at Pluristem’s request, to make
available an executive officer of UTC within ten (10) business days to discuss
such matter; provided, however, that such a discussion will not affect UTC’s
right to exercise its final decision-making authority with respect to such
decision.

 
 
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(iv)
When exercising its decision-making authority under this Agreement, each Party
shall:

 
 
1.
keep the other Party closely informed about its activities related to the
decision;

 
 
2.
closely consult with the other Party on such activities and the possible
decision(s) to be made and confer in good faith with the other Party respecting
same;

 
 
3.
exercise its decision-making authority in accordance with the principles set
forth in Section ‎4.1.

 
 
(d)
Meeting Agendas. Each Party shall disclose to the other Party proposed agenda
items along with appropriate information at least ten (10) Business Days in
advance of each meeting of the JSC; provided that, under exigent circumstances
requiring JSC input, a Party may provide its agenda items to the other Party
within a lesser period of time in advance of the meeting, or may propose that
there not be a specific agenda for a particular meeting, so long as such other
Party consents to such later addition of such agenda items or the absence of a
specific agenda for such JSC meeting.

 
3.5
Alliance Managers

 
 
(a)
Each of the Parties shall appoint a single individual to act as that Party’s
point of contact for communications between the Parties relating to the
activities conducted under this Agreement (each, an “Alliance Manager”). Each
Party may change its designated Alliance Manager from time to time upon written
notice to the other Party. Any Alliance Manager may designate a substitute to
temporarily perform the functions of that Alliance Manager by written notice to
the other Party.

 
 
(b)
Each Alliance Manager shall be charged with creating and maintaining a
collaborative work environment between the Parties and within the JSC. Each
Alliance Manager will also: (i) be the point of first referral in all matters of
conflict resolution; (ii) coordinate the relevant functional representatives of
the Parties in developing and executing strategies and plans for the Product;
(iii) provide a single point of communication for seeking consensus both
internally within the respective Parties’ organizations and between the Parties
regarding key strategy and plan issues; (iv) identify and bring disputes to the
attention of the JSC in a timely manner; (v) plan and coordinate cooperative
efforts and internal and external communications; and (vi) take responsibility
for ensuring that governance activities, such as the conduct of required JSC
meetings and production of meeting minutes occur as set forth in this Agreement,
and that relevant action items resulting from such meetings are appropriately
carried out or otherwise addressed.

 
 
(c)
The Alliance Managers shall use good faith efforts to attend all JSC meetings
and support the co-chairpersons of the JSC in the discharge of their
responsibilities. Alliance Managers shall be nonvoting participants in JSC
meetings, unless they are also appointed members of the JSC pursuant to
Section ‎3.2(a); provided, however, that an Alliance Manager may bring any
matter to the attention of the JSC in order to facilitate a resolution of such
matter.

 
 
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3.6
Independence

 
Subject to the terms of this Agreement, the activities and resources of each
Party shall be managed by such Party, acting independently and in its individual
capacity. The relationship between the Parties is that of independent
contractors, and neither Party shall have the power to bind or obligate the
other Party in any manner, other than as is expressly set forth in this
Agreement.
 
Article 4 Joint Obligations and Diligence
 
4.1
Conduct of the Parties

 
The Parties’ mutual objective is to permit each Party, pursuant to and in
accordance with the terms of this Agreement, to Develop and Commercialize the
Product in such Party’s Domain while not taking any action that would be
reasonably likely to adversely affect development and commercialization of
Products in the other Party’s Domain. Each Party shall conduct itself and its
activities hereunder consistent with that understanding, consistent with sound
and ethical business and scientific practices.
 
4.2
Commercially Reasonable Efforts to Develop

 
UTC shall use Commercially Reasonable Efforts to conduct the Development to
obtain Regulatory Approval for the Product for use in the Field at its own
expense.
 
4.3
Determination of Diligence

 
If Pluristem is of the view that UTC is in breach of Section ‎4.2, Pluristem
shall notify UTC in writing and, in the absence of an agreement between the
Parties as to how to proceed within twenty (20) days of such notice, at the
request of either Party, the Parties shall appoint a mutually acceptable person
as an independent evaluator (the “Evaluator”) to conduct the evaluation set
forth in this Section 5.5. If the Parties cannot agree on such an evaluator,
then a Party may so notify the arbitral body referred to in Section ‎14.2(f) of
this Agreement and the evaluator will be appointed within ten days by such body.
Unless the Parties mutually agree otherwise, the following rules and procedures
shall govern the conduct of the Parties and the Evaluator before and during the
investigation by the Evaluator:
 
 
(a)
Each Party shall promptly provide to the Evaluator and the other Party copies of
all documents, statements and records on which the Party intends to rely in
presenting its position to the Evaluator, and in any event, shall provide same
no later than thirty (30) days of the appointment of the Evaluator.

 
 
(b)
Both Parties shall promptly provide to the Evaluator a written summary of their
respective positions, and in any event, shall provide same no later than 45 days
of the appointment of the Evaluator.

 
 
(c)
On receipt of the documents, statements, records and summaries submitted by the
Parties the Evaluator shall have thirty (30) days within which to conduct such
further inquiries as he or she may deem necessary for the purpose of reviewing
the efforts made by UTC with respect to the Development of the Product in
compliance with the requirements of Section ‎4.2.  For the purpose of conducting
such an inquiry, the Evaluator shall have the right to:

 
 
(i)
require either Party to disclose any further documents or records which the
Evaluator considers to be relevant;

 
 
18

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(ii)
interview or question either orally (or by way of written questions) one or more
representatives of either Party on issues deemed to be relevant by the
Evaluator;

 
 
(iii)
make an "on site" inspection of UTC's facilities; and

 
 
(iv)
obtain if necessary, the assistance of an independent expert to provide
technical information with respect to any area in which the Evaluator does not
have a specific expertise.

 
 
(d)
The Evaluator shall within thirty (30) days of starting the inquiry, prepare a
report setting their findings and conclusions as to whether or not UTC has used
Commercially Reasonable Efforts as specified in Section ‎4.2. If the Evaluator
determines that UTC has failed to use Commercially Reasonable Efforts as
specified in Section ‎4.2, then the Evaluator shall specify in their report
their conclusions as to what would constitute such Commercially Reasonable
Efforts, and UTC shall thereafter either:

 
 
(i)
perform in a timely manner the actions specified by the Evaluator in the
Evaluator’s report as to what would constitute such Commercially Reasonable
Efforts; or

 
 
(ii)
give notice to Pluristem of termination of this Agreement under Section ‎13.2.

 
 
(e)
If UTC elects to perform the actions specified by the Evaluator in the
Evaluator’s report and thereafter fails to execute such actions in a timely
manner, after notice of breach provided in accordance with the terms of Section
‎13.3, then Pluristem may terminate this Agreement in accordance with Section
‎13.3 with the consequences set out in Section ‎13.4(b).

 
 
(f)
The report and conclusions of the Evaluator shall be delivered to UTC and
Pluristem, and shall be accepted by both Parties as final and binding.

 
 
(g)
Pluristem may not call for more than one evaluation pursuant to this Section
‎4.3 in any two Calendar Year period.  The Evaluator shall require the
non-prevailing Party to pay the Evaluator’s full fees and expenses or, if in the
Evaluator’s opinion there is no prevailing Party, the Evaluator’s fees and
expenses will be borne equally by the Parties. At the request of UTC, Pluristem
will consent to the participation in any evaluation made pursuant hereto of
UTC’s sublicensee(s).

 
4.4
Initial Transfer of Know-How

 
Upon UTC’s reasonable request, such request to be made after the Effective Date,
Pluristem will provide or make available to UTC, or will have provided or made
available to UTC the following Information  on a timely basis, to the extent
such Information is Useful to UTC:
 
 
(a)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
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(b)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
(c)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
Pluristem shall use reasonable efforts to provide such data and Information in
finalized format as soon as practicable.
 
4.5
Sharing of Development and Commercialization Information

 
 
(a)
From time to time during the Term, UTC, acting reasonably, may request access to
any Pluristem Know-How that is Useful to UTC, and Pluristem shall provide such
access. From time to time during the Term, Pluristem, acting reasonably, may
request access to any UTC Know-How that is Useful to Pluristem or is necessary
or useful to Pluristem in respect of Pluristem’s rights and obligations under
this Agreement, and UTC shall provide such access.

 
 
(b)
During the Term, each Party shall use Commercially Reasonable Efforts to make
available to the other Party Information that is Useful to the other Party
relating to the Development or Commercialization of the Product at no cost to
such other Party.

 
 
(c)
As requested or required by a Regulatory Authority, Pluristem will make
available to UTC the Pluristem Know-How Useful in the Manufacture of the Product
for use in the Field solely for the purpose of submitting such Information (to
the extent required) to Regulatory Authorities.

 
4.6
Duty to Confer and Consult

 
The Parties shall confer in good faith regarding their respective activities
under this Agreement and the strategies for pursuing same. Each Party shall
closely consult with the other Party on its activities under this Agreement, and
shall keep the other Party closely informed where such Information is Useful to
the other Party.
 
4.7
Quality Agreement

 
At the request of either Party, acting reasonably, the Parties will negotiate
the terms and conditions of an agreement regarding quality-related aspects of
the relationship between Pluristem and UTC including quality assurance
procedures (the “Quality Agreement”).
 
4.8
Product Handling

 
Unless and until superseded by the terms of the Quality Agreement or otherwise
agreed between the Parties, acting reasonably, UTC will comply with Pluristem’s
reasonable procedures for the storage, handling, transfer, delivery methods,
testing, disposition, and quality control of Product from the time of transfer
from Pluristem to UTC of the Product until completion of use of such Product.
 
 
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Article 5 Development and Regulatory Activities
 
5.1
Development Activities

 
 
(a)
As between UTC and Pluristem, UTC shall be responsible for carrying out all
activities relating to Development other than those limited activities set forth
in Section ‎5.1(b) as “Pluristem Development Activities” (the “UTC Development
Activities”). Without limiting the foregoing, UTC Development Activities shall
include preparation of Regulatory Filings in UTC’s name in the Field and
conducting (or having conducted) all clinical trials (including Phase IV
studies) for the Field. UTC will consult with Pluristem in respect of such UTC
Development Activities in accordance with ‎2.5(b).

 
 
(b)
As between UTC and Pluristem, Pluristem shall be responsible for (i) supplying
information to UTC as described in this Agreement; (ii) processing safety
reports and notifying UTC of any Product withdrawals or recalls, and providing
safety data to UTC, in each case as further described in this Agreement; (iii)
supplying Product to UTC for Development at Pluristem’s expense, as further
described in Section ‎6.1; (iv) performing the intravenous toxicology study in
accordance with Section Error! Reference source not found.; (v) such other
activities proposed by UTC and agreed to by Pluristem, acting reasonably
(collectively, the “Pluristem Development Activities”).

 
 
(c)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**

 
 
(d)
If the Parties agree in advance in writing that Pluristem shall conduct any
Development activities on behalf of UTC in the Field, then the Parties, acting
reasonably, shall agree upon a protocol and the remuneration for each such
activity.

 
5.2
Regulatory Matters in Pluristem’s Domain

 
As between Pluristem and UTC, Pluristem shall be solely responsible for any and
all regulatory activities with respect to Products in Pluristem’s Domain,
including filing of all Regulatory Filings for such products, maintenance of all
Regulatory Approvals, any reports or submissions required to be made to any
non-governmental Third Party payors, and any and all regulatory matters arising
after obtaining Regulatory Approval, including post-marketing inquiries and
safety surveillance activities.
 
5.3
Notice of Regulatory Filings

 
UTC will provide Pluristem with prompt detailed written notice of all updates
and revisions to the Regulatory Filings in the Field that are Useful to
Pluristem, or are necessary or useful to Pluristem in the Field. Pluristem will
provide UTC with prompt detailed written notice of all updates and revisions to
the Regulatory Filings that are Useful to UTC. In either event, a Party, at the
other Party’s reasonable request, shall provide the requesting Party with all
Information and documentation relating to any such Regulatory Filings.
 
5.4
Regulatory Matters in the Field

 
 
(a)
As between Pluristem and UTC, UTC shall be responsible for regulatory activities
with respect to Products in the Field, including filing of all Regulatory
Filings for the Product in the Field, maintenance of all Regulatory Approvals in
the Field, any reports or submissions required to be made to any
non-governmental Third Party payors, and any and all regulatory matters arising
after obtaining Regulatory Approval, including post-marketing inquiries and
safety surveillance activities in the Field. Pluristem will be responsible for
the CMC regulatory submission.

 
 
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(b)
UTC will be responsible for all obligations with respect to providing pricing
reports to government authorities having responsibility for pricing matters.

 
 
(c)
UTC anticipates seeking Regulatory Approval for registration of a separate UTC
Product Mark for the Product in the Field.

 
5.5
Ownership of Regulatory Filings; Right of Cross-Reference

 
As between the Parties, each Party shall own all Regulatory Approvals and
Regulatory Filings relating to the Product in such Party’s Domain and held in
the name of such Party or its designated Affiliates or licensees. Each Party
shall ensure that the other Party may, in preparing its Regulatory Filings in
its own Domain, as appropriate, include a cross-reference or cross-references to
any Regulatory Filings related to PLX or Products in other Party’s Domain.
 
5.6
Interactions with Authorities; Regulatory Inquiries

 
 
(a)
To the extent possible, UTC shall provide to Pluristem reasonable written notice
of all meetings and conference telephone calls with any Regulatory Authority
related to the Product in the Field. Pluristem shall have the right to have one
or more representatives attend each such meeting and each such call, in each
case to the extent permitted by the relevant Regulatory Authority.

 
 
(b)
The JSC shall implement policies and procedures for providing to each Party a
copy of all correspondence or communications with Regulatory Authorities
relating to the Product that are Useful to the other Party.

 
 
(c)
If requested by Pluristem, UTC shall allow Pluristem to have one or more
representatives acceptable to UTC, acting reasonably, attend any meeting or call
with a Regulatory Authority respecting the Field, in each case to the extent
permitted by the relevant Regulatory Authority, at UTC’s expense.

 
 
(d)
Pluristem shall:

 
 
(i)
notify UTC on a timely basis of any meetings and conference telephone calls with
any Regulatory Authority related to the Product; and

 
 
(ii)
make available to UTC on a timely basis any minutes of any such meetings or
calls with a Regulatory Authority;

 
where same is Useful to UTC.
 
 
(e)
UTC shall promptly provide Pluristem with copies of all written or electronic
correspondence or communications received by UTC from Regulatory Authorities to
the extent such correspondence or communications are Useful to Pluristem or are
necessary or useful to Pluristem in the Field. Pluristem shall promptly provide
UTC with copies of all written or electronic correspondence or communications
received by Pluristem from Regulatory Authorities to the extent such
correspondence or communications are Useful to UTC. If such correspondence or
communication requires a response, the Parties shall consult with each other as
appropriate to prepare a draft response, and the response shall be filed by the
Party from whom the Regulatory Authority requested a response.

 
 
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(f)
Each Party shall notify the other Party within one (1) Business Day after it
receives information about the initiation of any investigation or inquiry by any
Regulatory Authority concerning the Development, Manufacture, use or
Commercialization of the Product in the notifying Party’s Domain to the extent
such investigation or inquiry would be reasonably likely to adversely affect the
other Party’s Domain.

 
 
(g)
If a Regulatory Authority desires to conduct an inspection or audit with regard
to the Product of a Party’s facility or a facility under contract with a Party
with respect to the activities of either Party relevant to this Agreement, such
Party shall permit and cooperate with such inspection or audit, and shall cause
the contract facility to permit and cooperate with such Regulatory Authority
during such inspection or audit.

 
5.7
Drug Safety

 
 
(a)
Adverse Event Reporting. Except as set forth below, Pluristem shall be
responsible for all activities related to the timely processing, evaluation, and
reporting of Adverse Events to appropriate authorities, in accordance with local
requirements, for the Product for all indications (including the Field) in the
world. UTC shall be responsible for the surveillance, receipt, evaluation, and
reporting of Adverse Events for the Product in UTC’s Domain. UTC and Pluristem
shall enter into a safety agreement setting forth a process regarding compliance
with all Applicable Laws and both Parties’ obligations related to such Adverse
Event responsibilities for the Product (the “Safety Agreement”). In addition,
the Safety Agreement will set forth procedures for sharing information between
the Parties regarding Adverse Events. The Parties shall commence negotiation of
such safety agreement within thirty (30) days after written request from either
Party to the other Party.

 
 
(b)
Safety Database. Unless otherwise required by Applicable Law or a Regulatory
Authority, Pluristem shall create and maintain and exclusively own a single
global safety database relating to the Product and **THE CONFIDENTIAL PORTION
HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND HAS
BEEN FILED SEPARATELY WITH THE COMMISSION.**. UTC will cover the reasonable
incremental costs of such database related to the performance of UTC’s
activities under this Agreement. If Applicable Law or a Regulatory Authority
requires otherwise, the Parties shall cooperate to collect and share such safety
data as so required.

 
 
(c)
Right to Audit. Each Party shall have the right to perform audits of the other
Party’s pharmacovigilance activities relating to the Parties’ activities under
the terms of this Agreement including compliance by the other Party with
Applicable Law. The notification of one Party’s intent to conduct such an audit
will be provided in writing to the other Party within a reasonable time period
in advance, based upon the particular circumstances of the situation.

 
 
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5.8
Product Withdrawals and Recalls

 
 
(a)
In the event that (a) an event, incident, or circumstance has occurred which may
result in the need for a recall or other removal of the Product or any lot or
lots thereof from the market in the Field; (b) any Regulatory Authority in the
Territory threatens or initiates any action to remove the Product from the
market in the Field; or (c) any Regulatory Authority in the Territory requires
distribution of a “Dear Doctor” letter or its equivalent, regarding use of the
Product in the Field, the Party having knowledge of such event shall promptly
advise the other Party in writing with respect thereto, and shall provide the
other Party copies of all relevant correspondence, notices, and any other
related documents. Unless otherwise agreed by the Parties, UTC shall be
responsible for conducting the recall. Pluristem shall, upon reasonable request
by UTC assist UTC in the conduct of any such recall or withdrawal in the
Territory. Each Party will cooperate with the other Party in the performance of
any recall or withdrawal.

 
 
(b)
To the extent any recall of the Product is implemented as a result of the
occurrence of an activity identified in Sections ‎12.2(a) through ‎12.2(e)
inclusive by the Pluristem Indemnitees, Pluristem shall (i) bear all of
Pluristem’s costs and all Reasonable Costs incurred by UTC in connection with
such recall and (ii) either, at UTC’s option, replace or credit UTC for the cost
of the relevant lots of the Product subject to the recall.

 
 
(c)
To the extent any recall of the Product is implemented as a result of the
occurrence of an activity identified in Sections ‎12.1(a) through ‎12.1(f)
inclusive by the UTC Indemnitees, UTC shall (i) bear all of UTC’s costs and all
Reasonable Costs incurred by Pluristem in connection with such recall and (ii)
if not already paid for by UTC, pay Pluristem for the cost of the relevant lots
of the Product subject to the recall.

 
 
(d)
Section ‎12.3 shall apply to the allocation of responsibility set out in this
Section, mutatis mutandis.

 
5.9
PLX Development Generally

 
UTC may perform PLX Development. UTC shall provide prior written notice and
consult with Pluristem regarding the PLX Development which notice shall include
the scope of such PLX Development and keep Pluristem reasonably informed of the
status and results of such development. Neither Party shall, without the written
agreement of the other Party, conduct any clinical trials for or Commercialize
any products incorporating the results of the PLX Development or exploiting PLX
Development IP in the Field. Notwithstanding the foregoing, if Pluristem
conducts any clinical trials for or Commercializes any products incorporating
the results of the PLX Development or PLX Development IP outside the Field, then
UTC may conduct any clinical trials for or Commercialize any products
incorporating such results of the PLX Development or exploiting such resulting
PLX Development IP in the Field. In the event that the Parties agree in writing
to conduct any clinical trials or to Commercialize any products incorporating
the result of PLX Development or exploiting PLX Development IP, then:
 
 
(a)
UTC may Develop, Manufacture (in the event of a failure to supply such product
by Pluristem, and the definition of “Failure to Supply” in this Agreement shall
apply in respect of such product, as if such product were Product hereunder) use
and Commercialize such product in the Field; and

 
 
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(b)
Pluristem may UTC may Develop, Manufacture, use and Commercialize such product
in Pluristem’s Domain;

 
and no consideration shall be payable by either Party to the other Party in
respect of same except that UTC will be required to make the royalty payments as
set forth in Section ‎8.3 and pay for any supply of such product by or on behalf
of Pluristem on the terms set out in this Agreement as if such product were
Product hereunder. The provisions of this ‎Article 8 shall apply to the extent
applicable to such royalty payments.
 
5.10
PLX Development for Tissue Engineering

 
 
(a)
UTC may conduct PLX Development for the purposes of Tissue Engineering. UTC
shall provide prior written notice and consult with Pluristem regarding such PLX
Development which notice shall include the scope of such PLX Development and
keep Pluristem reasonably informed of the status and results of such
development.

 
 
(b)
In the event that a Regulatory Authority requires any PLX Development as part of
the UTC Development Activities, and provided that Pluristem has the capabilities
to perform such PLX Development on behalf of UTC, UTC will give Pluristem a
first opportunity in writing to conduct such development and the Parties will
use good faith efforts to collaborate and agree on the terms of such development
as soon as reasonably possible. If the Parties fail to agree on the terms of
such development within a reasonable time, such period to be determined based on
all the surrounding circumstances, including the requirements and timing of the
relevant Regulatory Authority, UTC may conduct such development itself or with a
Third Party.

 
Article 6 Manufacturing and Supply
 
6.1
Development Supply By Pluristem

 
 
(a)
Pluristem Obligations. Subject to the terms set forth below, Pluristem shall
supply to UTC all Product and placebo reasonably requested by UTC for
Development, pursuant to the terms of this Section ‎6.1. Pluristem warrants that
all Product supplied by Pluristem hereunder: (i) shall meet all then-applicable
specifications for the Product at the time of delivery (the “Specifications”);
and (ii) shall be Manufactured in accordance with GMP and all other Applicable
Laws. From time to time at JSC meetings, the Parties shall discuss availability
and timing of delivery of clinical supplies of the Product and placebo
hereunder.

 
 
(b)
Development Supply at No Cost. Pluristem shall supply the Development supplies
of the Product and placebo supplied under this Section ‎6.1 at no cost to UTC;
provided that, in respect of any supply of Products and placebo required due to
loss of prior supply by UTC resulted from non-compliance by UTC with its
obligations under the Quality Agreement or Section ‎4.8, UTC shall reimburse
Pluristem for the Cost of Goods Sold for same.

 
 
(c)
Purchase Orders. From time to time at JSC meetings, the Parties shall discuss
(i) the amount of Product and placebo to be supplied by Pluristem to UTC during
each Calendar Year, and (ii) the procedures for UTC to submit its requirements
and Pluristem to supply such requirements. Such procedures shall include (i)
annual forecasts of UTC’s requirements, (ii) firm purchase commitments no less
than ninety (90) days prior to the time the order must be delivered to UTC by
Pluristem, and (iii) procedures for return and replacement of Product that does
not substantially meet the Specifications or is in breach of the warranty set
forth in Section ‎6.1(a). Any purchase orders, purchase order releases,
confirmations, acceptances, invoices, and similar documents submitted by either
Party shall be for administrative purposes only and shall not add to or modify
the terms of this Agreement, except for the specification of quantities or
delivery dates to the extent that with respect to such terms and agreement was
reached between the Parties.

 
 
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(d)
Development Costs. Except for ex-factory delivery of Product by Pluristem, all
other direct and indirect costs and expenses related to the Development shall be
borne by UTC.

 
6.2
Commercial Manufacturing and Supply Agreement

 
 
(a)
The Parties shall, commencing at least two (2) years prior to the anticipated
date of Commercialization of the Product, as determined by the JSC, in good
faith negotiate the terms of a Manufacturing and Supply Agreement such that it
reflects the terms set out in the schedule attached hereto as Schedule ‎6.2 (the
“Supply Terms Schedule”).

 
 
(b)
Except for UTC’s rights in the event a Failure to Supply pursuant to
Section ‎6.7, UTC will procure all of its requirements for commercial sales of
Product for use in UTC’s Domain from Pluristem pursuant to the Manufacturing and
Supply Agreement.

 
 
(c)
The Parties shall negotiate the Manufacturing and Supply Agreement in good faith
and with sufficient diligence as is required to execute and deliver the
Manufacturing and Supply Agreement within one hundred and eighty (180) days
after the commencement of the negotiation of such agreement (the “Negotiation
Period”).

 
 
(d)
In the event the Parties fail to execute and deliver the Manufacturing and
Supply Agreement within the Negotiation Period, then each of the Parties shall
produce a list of issues on which the Parties have failed to reach agreement and
submit any then-existing draft(s) of the Manufacturing and Supply Agreement and
the list(s) of issues to be resolved by a mutually acceptable person determined
by the Parties to be competent in the drafting, structuring and negotiating of
Manufacturing and Supply Agreements in the life sciences context as an
independent evaluator to resolve the remaining issues in the Manufacturing and
Supply Agreement.

 
 
(e)
In the event that the Parties cannot agree on such evaluator, the appointing
authority shall be the arbitral body referred to in Section ‎14.2(f) of this
Agreement. The evaluator shall review the Manufacturing and Supply Agreement
drafts and issues lists proposed by each Party. Each Party shall have the right
to make written submissions regarding its position on each issue and to respond
in writing to the submissions of the other Party. The evaluator shall prepare a
commercially reasonable Manufacturing and Supply Agreement incorporating the
terms set out in this Article and the Supply Terms Schedule and other customary
and appropriate terms and conditions, taking into full consideration the
position of the Parties on the unresolved issues. The evaluator shall complete
his/her preparation of the draft Manufacturing and Supply Agreement pursuant to
this Section ‎6.2 within ninety (90) days of his/her appointment, or within such
further period as is mutually agreed upon by the Parties. It is hereby clarified
that other than as set forth herein, the Evaluator shall not be authorized to
grant Manufacturing rights to UTC, its Affiliates or any other Third Parties.

 
 
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(f)
The completed Manufacturing and Supply Agreement shall be executed by the
Parties as the Manufacturing and Supply Agreement and the Parties shall perform
their respective obligations in accordance with such agreement.

 
 
(g)
One half of the cost of any appointment or determination pursuant to this
Section ‎6.2 shall be borne by UTC and one half shall be borne by Pluristem.

 
6.3
Commercial Supply Price

 
UTC shall pay to Pluristem an amount equal to the Cost of Goods Sold plus **THE
CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** for commercial
supplies of the Product and placebo supplied pursuant to Section ‎6.2 and the
Manufacturing and Supply Agreement.
 
6.4
Supply of Product Samples

 
Pluristem shall provide UTC with Product Samples for UTC’s use in the UTC
Commercialization Activities at Pluristem’s Cost of Goods Sold plus **THE
CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** for such Product
Samples. Product Samples will be provided in such amounts and in such
configurations as reasonably designated by UTC in accordance with the terms of
the Manufacturing and Supply Agreement.
 
6.5
Non-Discrimination

 
If the available supply of PLX or other inputs to the Product, including
production time, for purposes of Manufacturing the Product is in short supply
such that Pluristem is unable to supply the quantity of Product ordered by or on
behalf of UTC or its Representatives in accordance with Section ‎6.1 or the
Manufacturing and Supply Agreement, unless otherwise agreed in writing by the
Parties and subject to Section ‎6.5(a), the Parties will allocate Product
between themselves pro rata based on each such Party’s sales of same in the
Calendar Quarter prior to the quarter in which such shortage occurs. Pluristem
shall inform UTC of the expected duration of the shortage of PLX or other inputs
to the Product and shall keep UTC informed on a timely basis of the status of
the supply of PLX or other such inputs to the Product while such shortage is
occurring. The Parties shall cooperate to expedite the manufacture of the
Product by Pluristem when the shortage of PLX or other inputs to the Product has
been alleviated.
 
 
(a)
in the event of a shortage of PLX or other inputs to the Product, favor the
supply of the Product for use in those indications where the greatest harm will
occur in the absence of such supply.

 
 
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6.6
Commercial Supply Capacity

 
 
(a)
On a quarterly basis, Pluristem shall provide to the JSC (or to a duly formed
subcommittee) forecast data showing expected worldwide Manufacturing capacity
and demand for the Product for the subsequent twelve (12) months, and the JSC
shall consider whether or not Pluristem will have adequate Manufacturing
capacity to fulfill such demand for Product for such twelve (12) month period.
In the event that the JSC concludes that a Manufacturing shortfall is reasonably
possible, it shall inform the Parties and the Parties shall discuss in good
faith ways of avoiding this shortfall. The determination of whether Pluristem
shall increase its Manufacturing capacity shall be made by Pluristem in its
absolute discretion. To the extent that a Failure of Supply is due in part to a
failure by Pluristem to increase its Manufacturing capacity, the foregoing
sentence will not relieve Pluristem of the consequences provided for in this
Agreement in the event of a Failure to Supply.

 
 
(b)
At the end of a successful Phase II clinical trial in the Field, UTC and
Pluristem may discuss the construction of a GMP manufacturing facility in North
America, the cost of which will be shared by UTC and Pluristem with UTC’s
commitment not to exceed $10 million. To the extent applicable the manufacturing
facility may be used by Pluristem for Manufacturing of any products in Pluristem
Domain.

 
6.7
Failure to Supply

 
In the event of the occurrence of a Failure to Supply, in addition to any other
rights of UTC:
 
 
(a)
UTC shall be relieved of its obligation to procure all of its requirements for
Product for use in the Field from Pluristem pursuant to the Manufacturing and
Supply Agreement;

 
 
(b)
the licenses set out in Section ‎2.1(b) shall be effective;

 
 
(c)
Pluristem shall immediately provide, or cause to be provided, reasonable
technical assistance at its own expense to UTC or its designee to the Pluristem
Know-How necessary to permit UTC or its designee to Manufacture the Product,
solely for use in the Field;

 
 
(d)
nothing in this Agreement shall prevent UTC from making itself, having made and
procuring, Product for use in the Field from any source, including any contract
manufacturing organization or other manufacturer used by Pluristem for same;

 
 
(e)
Pluristem shall use Commercially Reasonable Efforts to facilitate procurement of
Product for UTC for use in the Field; and

 
 
(f)
If Pluristem gives notice to UTC that Pluristem has restored Pluristem’s supply
and manufacturing capabilities, the Parties may negotiate in good faith
regarding purchase of supplies of Product from Pluristem.

 
6.8
R&D Law and the OCS

 
 
(a)
Pluristem warrants to UTC that:

 
 
(i)
certain Pluristem Technology was developed with funding provided by the OCS and
is identified in Exhibit ‎6.8‎0 (the “Funded Technology”), and the provision of
same to UTC for the purpose of Manufacturing as set forth herein is subject to
the provisions of and restrictions imposed by the R&D Law and the approval
letters issued to Pluristem under such R&D Law before the Execution Date, and
the consent of the OCS to the waiving of same to the extent required to permit
the exercise by UTC of its rights under Section ‎2.1(b) in respect of this
Agreement and the Manufacturing and Supply Agreement (the “OCS Consent”); and

 
 
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(ii)
Pluristem has delivered to UTC a true copy of all such approval letters.

 
 
(b)
Pluristem shall not agree with the OCS to any terms for the obtaining of the
consent of the OCS to the grant of Manufacturing rights set out in this
Agreement that are more onerous than those set out in such approval letters.
Pluristem shall not enter into an agreement with any other Regulatory Authority
or any other person that would make the warranties of Pluristem set out in this
Agreement untrue.

 
 
(c)
UTC undertakes and confirms that:

 
 
(i)
the receipt of Manufacturing rights and Pluristem Know-How in connection
therewith pursuant to this Agreement shall be in accordance with the applicable
Israeli laws and regulations; and

 
 
(ii)
receipt and/or transfer of the Funded Know-How shall be subject to the OCS
Consent and Pluristem’s undertakings towards the OCS contained in the approval
letters issued to Pluristem under such R&D Law before the Execution Date.

 
 
(d)
Pluristem shall not take any action that will render the OCS Consent invalid.

 
6.9
Access to Manufacturers

 
 
(a)
Pluristem shall use Commercially Reasonable Efforts to, either directly or
through one or more Third Party(ies), timely:

 
 
(i)
Manufacture, or have Manufactured, sufficient supplies of the Product as
required for Development of the Product in the Field;

 
 
(ii)
Manufacture, or have Manufactured, sufficient commercial supplies of the Product
as required use in the Field; and

 
 
(iii)
conduct process development and scale-up work to develop a commercial process
for the Manufacture and supply of Product for use in the Field, including
related analytical and stability work.

 
 
(b)
Pluristem shall use its Commercially Reasonable Efforts to resolve any
shelf-life, regulatory and other Manufacturing issues respecting the Product in
the Field.

 
 
(c)
In the event that UTC exercises its rights under Section ‎6.7, Pluristem agrees
that: (i) UTC and its Representatives shall be entitled to contract directly
with any Third Party with whom Pluristem has entered into such definitive
agreement(s) under Section ‎6.9(a) and (ii) such definitive agreement(s) shall
not contain any contractual provision that would prohibit UTC and its
Representatives from contracting directly or otherwise having access to any such
Third Party(ies) for the Manufacture of Product for use in the Field.

 
 
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(d)
Pluristem will use Commercially Reasonable Efforts not to limit or restrict
Pluristem’s ability to grant UTC license as provided for herein without
violating the terms of any agreement or other arrangement with any such Third
Party. The Parties acknowledge that if Pluristem is required to pay license fees
or royalties to any such Third Party(ies) in order to grant UTC such license to
use any Pluristem Technology for the Manufacture of Product for use in the
Field, then Pluristem shall in a timely fashion offer to UTC in writing a
license or sublicense to such Pluristem Technology. Within a reasonable period
of time (but not to exceed sixty (60) days after receipt of Pluristem’s offer,
UTC shall either accept the license or sublicense of same and pay to Pluristem
the amount of such material licensing fees or royalties, or advise Pluristem
that UTC does not wish to obtain such rights. Nothing in this Section ‎6.9(d)
applies to the OCS Consent, which is dealt with in Section ‎6.8.

 
 
(e)
If Pluristem Manufactures the Product itself, rather than through Third
Part(ies), Pluristem will timely provide reasonable technical assistance to UTC
and its Representatives with respect to the technology and Know How necessary to
permit UTC or its Representatives to Manufacture or have Manufactured the
Product for use in the Field as permitted by this Agreement. Each Party shall
bear its own cost and expense of such assistance.

 
 
(f)
It is hereby clarified that, whether or not UTC exercises any of its rights
pursuant to the provisions of Sections ‎6.7 or ‎6.9, Pluristem and/or any of its
successors and assignees will be entitled to the consideration set forth in
‎Article 8.

 
Article 7 Commercialization
 
7.1
Commercialization Activities

 
 
(a)
Except as otherwise provided herein, UTC shall use Commercially Reasonable
Efforts to Commercialize the Product in the Field (the “UTC Commercialization
Activities”).

 
 
(b)
Except as provided otherwise in the Manufacturing and Supply Agreement or this
Agreement, Pluristem shall: (i) Manufacture and supply to UTC reasonable
quantities of Product and Product Samples for use in the Field as reasonably
requested by UTC; and (ii) grant and hereby grants to UTC a nonexclusive license
to reproduce and publish, distribute or display Pluristem’s promotional
materials used in Pluristem’s Domain (as same may be modified by UTC, subject to
Pluristem prior written approval, acting reasonably) solely in UTC’s Domain for
the enjoyment of UTC’s rights under this Agreement.

 
 
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7.2
Compensation for Sales Outside the Selling Party’s Domain

 
 
(a)
If Pluristem believes that there are any sales of the Product in Pluristem’s
Domain originating directly or indirectly from UTC, Pluristem shall be permitted
to implement and conduct procedures under which material sales and purchases of
the Product in the Territory and other related market research data shall be
audited and monitored, using for example IMS Health and PDDA data and
information, and UTC agrees to cooperate with Pluristem in the implementation
and conduct of such procedures. In the event that such an audit and monitoring
procedure determines that sales of the Product in Pluristem’s Domain have been
or are being made originating directly or indirectly from UTC, then **THE
CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** consideration
received by UTC from such sales shall be immediately paid to Pluristem.
Notwithstanding anything to the contrary, the remedy to Pluristem set forth in
the previous sentence will not be the exclusive remedy available to Pluristem
under this Section ‎7.2(a).

 
 
(b)
If UTC believes that there are sales of Product in the Field originating
directly or indirectly from Pluristem, UTC shall be permitted to implement and
conduct procedures under which material sales and purchases of the Product in
the Territory and other related market research data shall be audited and
monitored, using for example IMS Health and PDDA data and information, and
Pluristem agrees to cooperate with UTC in the implementation and conduct of such
procedures. In the event that such an audit and monitoring procedure determines
that material sales of Product in the Field have been or are being made
originating directly or indirectly from Pluristem, then **THE CONFIDENTIAL
PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND
HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** consideration received by
Pluristem from such sales shall be immediately paid to UTC. Notwithstanding
anything to the contrary, the remedy to UTC set forth in the previous sentence
will not be the exclusive remedy available to UTC under this Section ‎7.2(b).

 
7.3
Commercialization Costs

 
UTC shall bear all costs and expenses incurred by UTC in connection with the UTC
Commercialization Activities.
 
7.4
Complaints and Inquiries

 
The Parties shall mutually develop a protocol, under the Quality Agreement, for
responding to any and all complaints, medical questions, or other inquiries
relating to each Party’s Domain, which are directed to such Parties’ respective
sales representatives.
 
7.5
Product Integrity

 
 
(a)
The Parties acknowledge and agree that all Product supplied to UTC under the
Manufacturing and Supply Agreement is intended to be sold to end-users under a
separate UTC Product Mark for use in the Field, and that Pluristem intends to
sell the Product under a separate Pluristem Product Mark for use in Pluristem’s
Domain.

 
 
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(b)
UTC agrees that it will Promote the Product to healthcare professionals for use
only in the Field, and will not, directly or indirectly, promote, disseminate
information about or seek reimbursement for the Product in Pluristem’s Domain.
In the event that UTC discovers that the Product is being distributed in
Pluristem’s Domain, UTC shall notify Pluristem, and the provisions set forth in
Section ‎7.2(a) shall apply.

 
 
(c)
Pluristem agrees that it will not promote the Product to healthcare
professionals for use in the Field and will not, directly or indirectly,
promote, disseminate information about or seek reimbursement for the Product in
the Field. In the event that Pluristem discovers that a Product is being
distributed in Field, Pluristem shall notify UTC, and the provisions set forth
in Section ‎7.2(b) shall apply.

 
 
(d)
The Parties shall implement reasonable anti-counterfeiting and field restriction
practices, and cooperate fully with each other by taking any and all reasonable
steps to protect the safety of patients, maintain the loyalty of physician
customers, preserve value, and ensure that safe Product is available to patients
seeking treatment and appropriately handled for safe and effective treatment.

 
 
(e)
The Parties have entered into this Agreement with the expectation that each
Party undertake the effort, expense and risks associated with the Development
and Commercialization of Product in the Parties’ respective Domains and that the
opportunity in each Domain give rise to a return commensurate with the effort,
expense and risks associated with same.

 
 
(f)
To the extent permissible under Applicable Law, each Party will make
commercially reasonable efforts to ensure that nothing done a Party’s Domain
adversely affects the other Party’s Domain, including taking reasonable steps to
discourage or prevent “off-label” or out-of-Domain use. In this regard, and
without limiting the generality of the foregoing:

 
 
(i)
each Party will ensure that differentiated Products will be developed
respectively for the Field and for Pluristem’s Domain;

 
 
(ii)
where reasonably feasible to do so, each Party will formulate, package and fix
the dosage of each Product in such a way so that it will not be useful for the
other Party’s Domain;

 
 
(iii)
each Party shall share with the other Party any creditable information as to
off-label or out-of-Domain use of the former Party’s Product;

 
 
(iv)
each Party shall discontinue sales to any Third Parties selling the Product for
off-label or out-of- Domain use; and

 
 
(v)
the Parties shall implement a policy addressing the appropriate handling of
unsolicited requests and dissemination of information about “off-label” or
out-of- Domain use.

 
 
(g)
Upon the written request of either Party, the Parties shall meet and in good
faith endeavor to reach further agreement on means of avoiding, correcting or
abating off-label or out-of- Domain uses and addressing the consequences of such
uses in a fair and reasonable manner, including incorporating in detail the
issues contemplated in this Section ‎7.5 and any other matters necessary or
useful to discourage or prevent “off-label” or out-of- Domain use.

 
 
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(h)
In the absence of the agreement contemplated by Section ‎7.5(g), either Party
may give notice to the other Party triggering the process for reaching an
agreement set out in Section ‎6.2(c), ‎6.2(d), ‎6.2(e), ‎6.2(f) and ‎6.2(g),
except that, for the purposes of this Section‎7.5(h), the “Negotiation Period”
shall be ninety (90) days and the references to the “Manufacturing and Supply
Agreement” shall mean the “Product Integrity Agreement” contemplated by this
Section.

 
 
(i)
Each Party shall ensure that any agreement it enters into with a licensee or
sublicensee of its rights to the Product in its own Domain shall include
provisions substantially similar to those set out in this Section ‎7.5.

  
Article 8 Payment
 
8.1
Upfront Payment

 
In consideration for the rights granted to UTC under this Agreement, UTC, within
fifteen (15) days following the Effective Date, shall pay to Pluristem:
 
 
(a)
a one-time-only, nonrefundable, non-creditable payment of Five Million Dollars
($5,000,000); and

 
 
(b)
a refundable, creditable payment of Two Million Dollars ($2,000,000) as an
advance against the reasonable and direct cost to Pluristem of the completion of
the intravenous toxicology studies required for IND filing as approved in
advance by UTC.

 
8.2
Milestones

 
 
(a)
UTC shall pay to Pluristem the nonrefundable, non-creditable milestone payments
set forth in the table below within thirty days of the first achievement of each
of the following events with respect to a Product in the Field:

 
Milestone Event
Amount
(i)**        THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
(ii)           **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE
COMMISSION.**
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
(iii)          **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE
COMMISSION.**
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**

 
 
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(b)
Each of the foregoing milestones shall be payable only once. It is further
agreed between the Parties that any of the milestone payments set forth above
are attributed to Pluristem's development services provided to UTC in connection
with the achievement of such milestone.

 
 
(c)
Occurrence of the foregoing milestones and payments made on account of the
occurrence of the foregoing milestones will not be publicly announced by a Party
without the express written consent of the other Party, unless that announcement
or disclosure of such payment is required by Applicable Law.

 
 
(d)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**

 
8.3
Royalty Payments

 
UTC shall pay Pluristem a royalty in an amount equal to **THE CONFIDENTIAL
PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND
HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** of Gross Profits.  In the event
UTC receives any non-monetary consideration in connection with the sale of the
Product, UTC’s payment obligation under this Section ‎8.3 shall be based on the
fair market value of such other consideration. In such case, UTC shall disclose
to Pluristem the terms of any such arrangement, and the Parties shall endeavor
in good faith to agree on the fair market value of the consideration received by
UTC under such arrangement.
 
 
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8.4
Payments and Reports

 
 
(a)
UTC shall keep (and shall cause its Affiliates and shall require its
sublicensees to keep) complete and accurate books and records that are necessary
for Pluristem to ascertain and verify the payments owed hereunder.

 
 
(b)
UTC shall provide a report to Pluristem within sixty (60) days after the end of
each Calendar Quarter that summarizes all Gross Profits, including, if
applicable, the fair market value of all non-monetary consideration received by
UTC in exchange for the Product, during such Calendar Quarter and contains
detailed information regarding the calculation of amounts due to Pluristem
pursuant to Section ‎8.3, including allowable deductions in the calculation of
Gross Profits, in a manner sufficient to enable Pluristem to determine amounts
due to Pluristem under Section ‎8.3 (“Gross Profits Report”). UTC will mail the
Gross Profits Report to the attention of: Chief Financial Officer.
Contemporaneously with the delivery of each Gross Profits Report, UTC shall make
all payments due to Pluristem pursuant to Section ‎8.3 with respect to the
Calendar Quarter corresponding to such Gross Profits Report by wire transfer in
immediately available funds in accordance with the terms of Section ‎8.6.

 
 
(c)
Any payment required under this Agreement to be made to Pluristem by UTC shall
be made to an Affiliate of Pluristem if designated in writing by Pluristem as
the appropriate recipient. Any report required under this Agreement to be made
to Pluristem by UTC shall be made by an Affiliate of UTC if designated in
writing by UTC as the appropriate reporting entity.

 
8.5
Taxes

 
If Applicable Law requires that taxes be deducted and withheld from any payment
to be made by UTC to Pluristem pursuant to this Agreement, and unless Pluristem
provides a valid exemption from tax deduction or withholding UTC shall
(a) deduct those taxes from the payment; (b) pay the taxes to the proper taxing
authority; and (c) send evidence of the obligation together with proof of
payment to Pluristem within sixty (60) days following that payment. UTC agrees
to cooperate with Pluristem in its efforts to obtain appropriate exemptions.
 
8.6
Wire Transfers

 
All payments hereunder shall be made to Pluristem by bank wire transfer in
immediately available funds to Pluristem in accordance with the wire
instructions set forth in Exhibit ‎8.6, which may be changed by written notice
to UTC in accordance with Section ‎16.7.
 
8.7
Audit Rights

 
Pluristem shall have the right to have an independent certified public
accountant selected by Pluristem and approved by UTC, such approval not to be
unreasonably withheld, along with members of its internal finance team inspect
the books and records of UTC and Affiliates of UTC for the purpose of
determining the accuracy of (i) Gross Profits Reports provided by UTC to
Pluristem pursuant to Section ‎8.4, and (ii) royalties due and paid by UTC to
Pluristem pursuant to Sections ‎8.3 and ‎8.4. Pluristem may exercise such right
within the Term and during a period of two (2) years after expiration or
termination of this Agreement, but not more frequently than once in any Calendar
Year period, for any period up to three (3) Calendar Years prior to such
inspection. The independent certified public accountants shall keep confidential
any information obtained during such inspection and shall report to UTC and
Pluristem only the amounts of Gross Profits and the amounts due and payable
under the terms of this Agreement. If it is determined that additional amounts
are owed to Pluristem during any period, UTC will pay Pluristem the additional
amounts within thirty (30) days after the date the independent certified public
accountant’s written report is received by UTC, together with any additional
amount owed pursuant to Section ‎8.10 (namely, any such discrepancies shall be
considered due on the time the payment in respect of such Gross Profits ought to
have been made). If it is determined that UTC has overpaid any amount during any
period, the overpayment shall be credited toward future royalty payments to be
paid by UTC pursuant hereto; provided, however, that, in the event no further
royalty payment shall become due, said overpayment shall be paid to UTC within
thirty (30) days after the date the independent certified public accountant’s
written report is received by UTC. The fees charged by such independent
certified public accountant will be paid by Pluristem unless any additional
amount owed to Pluristem (excluding any amount owed pursuant to Section ‎8.10)
exceeds **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** of
the amount paid for the annual period subject to the audit, in which case UTC
will pay the reasonable costs of such independent certified public accountant.
 
 
35

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8.8
Exchange Rate

 
All payments hereunder shall be payable in United States dollars. Whenever
conversion of payments from any foreign currency shall be required, such
conversion shall be made in accordance with GAAP.
 
8.9
Blocked Currency

 
If by reason of Applicable Law, UTC is unable to convert to US Dollars a portion
of the amount due by UTC under this Agreement, then UTC shall notify Pluristem
in writing and Pluristem shall have the right to receive such portion and UTC
shall have the right to pay to Pluristem such portion, in the currency of any
other country designated by Pluristem and legally available to UTC.
 
8.10
Late Payments

 
Subject to the terms of this Agreement, payments not made to Pluristem within
the time period set forth in this ‎Article 8 shall bear interest at a rate of
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.** per
month or the highest rate allowed under Applicable Law, whichever is lower,
until paid in full. The payment of such interest shall not limit Pluristem from
exercising any other rights it may have as a consequence of the lateness of any
payment.
 
Article 9 Inventions and Patents
 
9.1
Inventions Respecting Development

 
As between the Parties and subject to the licenses granted and assignments made
in this Agreement:
 
 
(a)
Pluristem shall retain exclusive ownership of all intellectual property rights
in Pluristem Technology existing as of the Effective Date;

 
 
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(b)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
 
(c)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
 
(d)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
 
(e)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
9.2
Inventions Respecting PLX Development

 
Notwithstanding anything in Section ‎9.1, Pluristem shall own:
 
 
(a)
any and all intellectual property rights in Inventions invented and Information
created, either solely or jointly with Third Parties, by the employees or agents
of UTC arising from the activities of UTC carried out under this Agreement and
Controlled by UTC or Pluristem which cannot be used or practised without a
licence of the Pluristem Patents or the Pluristem Know-How, without regard to
how such Inventions were invented and such Information was created;

 
 
(b)
any and all intellectual property rights in Inventions invented and Information
created, either solely or jointly with Third Parties, by the employees or agents
of UTC arising from the PLX Development and Controlled by UTC or Pluristem
arising from the PLX Development, including PLX Development as a component of
Tissue Engineering (the “PLX Development IP”);

 
(and any Patents that claim such Inventions shall be deemed Pluristem Patents
and any such Information shall be Pluristem Know-How and such patents and
know-how shall be licensed to UTC on the terms set out in this Agreement (to the
extent same are relevant to the Field, including Tissue Engineering in respect
of the Field)).
 
9.3
Other Inventions

 
Notwithstanding anything in Section ‎9.1, but subject to Section ‎9.2, UTC shall
own any and all intellectual property rights in Inventions invented and
Information arising from the Development and the non-PLX Development components
of Tissue Engineering and not otherwise assigned to Pluristem in accordance with
this ‎Article 9.
 
9.4
Patent Prosecution

 
 
(a)
UTC Patents. UTC shall retain control and ownership over, and bear all expenses
associated with, the filing, prosecution, and maintenance of any UTC Patents.
UTC shall confer in good faith with Pluristem regarding UTC’s patent strategy
for the Field. Pluristem shall have the right to comment upon UTC’s strategy and
to propose additional countries in the Territory where it believes UTC should
seek Patent protection. In the event UTC decides not to file an application for
a UTC Patent Covering the Product in the Field in a country, UTC shall promptly
notify Pluristem of such decision and Pluristem shall have the right to file,
prosecute, and maintain such UTC Patent in UTC’s name at Pluristem’s sole
expense and absolute discretion. UTC shall not abandon any patents or patent
claims in the UTC Patents Covering the Product in the Field without prior
written notice to Pluristem and Pluristem shall have the right to maintain such
patent claim or patent in UTC’s name at Pluristem’s sole expense and absolute
discretion.

 
 
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(b)
Pluristem Patents. Pluristem shall retain control and ownership over, and bear
all expenses associated with, the filing, prosecution, and maintenance of any
Pluristem Patents. Pluristem shall confer in good faith with UTC regarding
Pluristem’s patent strategy, including those countries in the Territory in which
Pluristem intends to file applications for Pluristem Patents that claim the
Development, Manufacturing or Commercialization of a Product in the Field. UTC
shall have the right to comment upon Pluristem’s strategy and to propose
additional countries in the Territory where it believes Pluristem should seek
Patent protection. In the event Pluristem decides not to file an application for
a Pluristem Patent Covering the Product in the Field in a country, Pluristem
shall promptly notify UTC of such decision and UTC shall have the right to file,
prosecute, and maintain such Pluristem Patent in Pluristem’s name at UTC’s sole
expense and absolute discretion and such patent application or Patent issuing
therefrom shall be deemed included in the scope of the Pluristem
Patents licensed hereunder. Pluristem shall not abandon any patents or patent
claims in the Pluristem Patents Covering the Product in the Field without prior
written notice to UTC and UTC shall have the right to maintain such patent claim
or patent in Pluristem’s name at UTC’s sole expense and absolute discretion.

 
 
(c)
Joint Patents. The JSC shall determine the Parties’ rights and obligations with
respect to the filing, prosecution, maintenance and enforcement of Joint Patents
and the costs associated therewith, on a case-by-case basis.

 
9.5
Enforcement of Patent Rights

 
 
(a)
Notice.  If either Party becomes aware of any Third Party activity that
infringes a Pluristem Patent or a UTC Patent or a Joint Patent, then that Party
shall give prompt written notice to the other Party within thirty days after
gaining knowledge of such infringement or violation.

 
 
(b)
Primary Right to Bring Action. Each Party shall have the primary right, but not
the obligation, to institute, prosecute or control any action or proceeding,
with respect to such Third Party activity, by counsel of its own choice, in its
own Domain. If a Party brings an action or proceeding under this Section
‎9.5(b), the other Party shall have the right (at its own expense, which shall
not be reimbursed out of any damages or monetary award recovered) to participate
in such action and to be represented by counsel of its own choice; furthermore,
the other Party hereby agrees to be joined as a party to the action or
proceeding, at the request and expense of the Party bringing such action or
proceeding, and to provide reasonable assistance in any such action or
proceeding, at the requesting Party’s expense.

 
 
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(c)
Allocation of Recovery. In the event that UTC initiates an action solely in
respect of the Field, any damages or monetary awards recovered by UTC shall
first be applied to reimburse UTC an amount equal to the reasonable costs and
expenses of UTC in connection with such litigation, and the balance shall be
allocated **THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST
FOR CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
9.6
Further Assurances

 
The Parties shall assign and hereby assigns, and shall cause any and all such
employees or agents to assign, to the other Party, free of charge, all rights of
intellectual property assigned pursuant to the terms hereof. Each Party agrees
to assist the other Party in any manner as shall reasonably be requested to
evidence, perfect and protect the assignee’s rights with respect to the forgoing
and to execute and deliver such legal instruments and other documents as the
assignee may reasonably request in connection therewith, including, but not
limited to, declarations of inventorship, powers of attorney and assignment
documents.
 
9.7
Enforcement of Other Government-Conferred Rights

 
If either Party becomes aware of any Third Party activity in the Territory that
is in violation of government-conferred exclusivity (e.g., an Orphan Drug
designation) with respect to the Product in the Field (the “Regulatory
Exclusivity Rights”), then that Party shall give prompt written notice to the
other Party within ten days after gaining knowledge of such infringement or
violation.
 
9.8
Infringement Defense

 
 
(a)
If a Third Party asserts that a Patent owned or otherwise controlled by it is
infringed by the Development, Manufacture, use or Commercialization of the
Product in the Field, the Party first obtaining knowledge of such a claim shall
immediately provide the other Party notice of such claim, along with the related
facts in reasonable detail.

 
 
(b)
Neither Party shall agree to any settlement of such an action or proceeding that
would have an adverse effect on the other Party’s Domain without the prior
written consent of the other Party, which consent shall not be unreasonably
withheld.

 
 
(c)
Subject to Section ‎9.8(d), if a Third Party asserts that any intellectual
property, including any Patent, owned or otherwise controlled by it is infringed
by the Manufacture of the Product, or by the Development or Commercialization of
the Product in the Field, then

 
 
(i)
Subject to Section ‎9.8(c)(ii), Pluristem will assume the defense and the
expense of defending and/or settling such suit;

 
 
(ii)
if such infringement arises solely due to:

 
 
1.
any change to the Product arising from UTC’s activities under this Agreement; or

 
 
39

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2.
the fact that such Patent Covers the use of the Product in the Field, and does
not otherwise Cover the Development, Manufacture, use or Commercialization of
the Product;

 
then UTC will assume the defense and the expense of defending and/or settling
such suit.
 
 
(d)
If the basis of such assertion is also a breach of a warranty made by Pluristem
under this Agreement, then such defense and the expense of defending and/or
settling such suit shall be borne solely by Pluristem pursuant to Section ‎12.2.

 
9.9
Information and Updates

 
Pluristem recognizes that UTC will have a legitimate business interest in
obtaining and maintaining patent protection with respect in UTC’s Domain. As a
result, Pluristem will timely keep the JSC informed as to such patent
protection. In addition, on UTC’s request, Pluristem will provide updates to the
JSC regarding the status of Pluristem’s efforts to obtain and maintain patent
protection, and other patent-related activities, with respect to UTC’s Domain.
 
9.10
Patent Challenges

 
 
(a)
During the Term of this Agreement, UTC and its Affiliates hereby covenant and
agree not to, directly or indirectly, commence any legal proceeding that
challenges the validity, enforceability or ownership of any Pluristem Patents (a
“Patent Challenge”).

 
 
(b)
If UTC or its Affiliate directly or indirectly commences any Patent Challenge,
Pluristem shall have the right to immediately terminate this Agreement by
written notice effective upon receipt by UTC.

 
9.11
Invention Assignment

 
Each Party undertakes, at the other Party's expense, to take all reasonable
measures, and execute all documents, in a timely fashion, that are, or will be,
necessary to fulfill and secure the ownership of Inventions by the Party who is
the owner of any such Invention in accordance with the provisions of this
‎Article 9, including the execution by such Party and/or its Representatives, of
any written assignment of rights for the benefit of the other Party. Such
assignment of Invention shall be without any consideration to the assigning
Party. In the event that the assigning Party does not execute the required
documents for perfecting the assignment in a timely manner, such assigning Party
hereby irrevocably designates and appoints the assignee hereunder and its duly
authorized officers and agents as assigning Party’s agent and attorney-in-fact,
to act on behalf and instead to execute and file any such application and to do
all other lawfully permitted acts to further the prosecution and issuance of
Patents or copyright registration thereon with same legal force and effect as if
executed by the assigning Party.
 
Article 10 Representations and Warranties
 
10.1
Representations, Warranties and Covenants

 
Each Party represents, warrants and covenants to the other Party the following:
 
 
(a)
it is duly organized and validly existing under the laws of its jurisdiction of
incorporation or formation, and has full corporate power and authority to enter
into this Agreement and to carry out the provisions hereof;

 
 
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(b)
it is duly authorized to execute and deliver this Agreement and to perform its
obligations hereunder, and the person or persons executing this Agreement on its
behalf has been duly authorized to do so by all requisite corporate action;

 
 
(c)
this Agreement is legally binding upon it and enforceable in accordance with its
terms. The execution, delivery, and performance of this Agreement by it does not
conflict with any agreement, instrument, or understanding, oral or written, to
which it is a Party or by which it is bound, nor violate any material law or
regulation of any court, governmental body, or administrative or other agency
having jurisdiction over it;

 
 
(d)
it has not granted and will not during the Term grant any right to any Third
Party that would conflict with the rights granted to the other Party hereunder.
It has (or will have at the time performance is due) maintained and will
maintain and keep in full force and effect all agreements (including license
agreements) and filings (including patent filings) necessary to perform its
obligations hereunder;

 
 
(e)
it shall comply and cause its employees and consultants who will be undertaking
any activities related to this Agreement or the Product to comply, with all
Applicable Laws respecting such activities; and

 
 
(f)
neither its name nor the name of any of its employees or consultants who will be
undertaking any activities related to this Agreement or the Product are listed
on the debarment list maintained by the FDA pursuant to 21 U.S.C.
Sections 335(a) and Section 335(b) and published on the internet at the
following address (or any successor address):
http://www.fda.gov/ora/compliance_ref/debar/default.htm. In the course of the
Development of the Product prior to or pursuant to this Agreement, it has not
used, and during the Term will not use, any employee or consultant that is
debarred by any Regulatory Authority or, to the best of its knowledge, is the
subject of debarment proceedings by any Regulatory Authority. If it learns that
its employee or consultant performing on its behalf under this Agreement has
been debarred by any Regulatory Authority, or has become the subject of
debarment proceedings by any Regulatory Authority, it shall so promptly notify
the other Party and shall prohibit such employee or consultant from performing
on its behalf under this Agreement.

 
10.2
Representations and Warranties of Pluristem

 
Pluristem hereby represents and warrants to UTC that, as of the Effective Date
other than information set forth in Pluristem's public filings filed with the US
Securities and Exchange Commission:
 
 
(a)
Pluristem has received no communication from a Regulatory Authority to cause
Pluristem, acting reasonably, to expect the denial of a Regulatory Approval for
the Product in any indication;

 
 
(b)
to Pluristem’s knowledge, there are no FDA “field alerts” (or the equivalent in
countries outside the United States) pending with respect to the Product;

 
 
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(c)
Pluristem is and was, at all times prior to the Effective Date, the lawful
holder of all rights under the Regulatory Approvals and the Regulatory Filings
for the Product in the Territory in existence as of the Effective Date;

 
 
(d)
Pluristem has complied in all material respects with all Applicable Laws in
connection with the preparation and submission to the relevant Regulatory
Authorities of the Regulatory Approvals and the Regulatory Filings for the
Product in existence as of the Effective Date;

 
 
(e)
nothing has come to the attention of Pluristem which has, or reasonably should
have, led Pluristem to believe that either of the Regulatory Approvals or the
Regulatory Filings for the Product in the Territory in existence as of the
Effective Date are not in good standing with relevant Regulatory Authorities;

 
 
(f)
Pluristem has filed with the relevant Regulatory Authorities all required
notices, amendments and annual or other reports, including Adverse Event
reports, with respect to the Regulatory Approvals and the Regulatory Filings for
the Product in existence as of the Effective Date;

 
 
(g)
to Pluristem’s knowledge, there is no pending action by relevant Regulatory
Authorities in respect of the Regulatory Approvals or the Regulatory Filings for
the Product in existence as of the Effective Date;

 
 
(h)
neither Pluristem nor any of its Affiliates has granted any licenses to, agreed
not to sue, or otherwise authorized, any person or entity, under the Pluristem
Technology to Develop or Commercialize the Product in the Field, or Manufacture
the Product for use in the Field;

 
 
(i)
Pluristem has granted UTC a license as of the Effective Date to all intellectual
property rights that Pluristem Controls that are necessary or useful to Develop,
use or Commercialize the Product in the Field, and, subject to the conditions
set out herein for the grant of the license set out in Section 2.1(b), to
Manufacture the Product for use in the Field, in each case subject to and in
accordance with the terms and conditions of this Agreement;

 
 
(j)
Pluristem owns all right, title and interest in and to the Pluristem Technology
free and clear of all encumbrances, security interests, options and licenses,
other certain rights of the OCS and under the R&D Law as set forth in this
Agreement;

 
 
(k)
Pluristem is not aware of any claims, actions, suits or proceedings that are
pending or threatened, challenging Pluristem’s rights to the Product in the
Territory, in the Pluristem Technology that is necessary or useful to Develop,
Manufacture, use or Commercialize the Product in the Field;

 
 
(l)
Pluristem has not given any notice in writing to any Third Party asserting
infringement by such Third Party with respect to the Product in the Territory of
any of the Pluristem Patents or the Pluristem Know-How, and Pluristem is not
aware of any such infringements;

 
 
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(m)
other than as disclosed in writing to UTC’s counsel prior to the Execution Date,
to Pluristem’s knowledge, there is no claim, action, suit, or proceeding,
pending or threatened by a Third Party alleging that the Development,
Manufacture or Commercialization of the Product in the Field infringes or
misappropriates any patents or other intellectual property rights of any Third
Party;

 
 
(n)
to Pluristem’s knowledge, the Development, Manufacture and Commercialization and
use of the Product does not infringe or misappropriate any patents or other
intellectual property rights of any Third Party;

 
 
(o)
Pluristem is not aware of any inventors of Pluristem Patents other than those
listed as inventors on applications filed for such Pluristem Patents, and, to
Pluristem’s knowledge, all inventors listed on Pluristem Patents have assigned
all their rights and interest therein to Pluristem or, with respect to any
Pluristem Patents licensed by Pluristem from any Third Party, to such Third
Party;

 
 
(p)
Pluristem is not aware of:

 
 
(i)
any facts that Pluristem believes would result in invalidity or unenforceability
of the Pluristem Patents;

 
 
(ii)
any person (other than persons identified as inventors of inventions disclosed
in the Pluristem Patents) who claims to be an inventor of an invention disclosed
in the Pluristem Patents;

 
 
(iii)
any claim, action, suit, or proceeding, pending or, to Pluristem’s knowledge,
threatened, that any of the Pluristem Patents is invalid or unenforceable; and

 
 
(iv)
the abandonment, disclaimer (other than with respect to terminal disclaimers) or
expiration of any of the Pluristem Patents due to failure to timely pay
applicable maintenance and renewal fees;

 
 
(q)
no patent application within the Pluristem Patents is the subject of any pending
interference, opposition, cancellation, protest, or other challenge or
adversarial proceeding in the Territory;

 
 
(r)
Pluristem has responded in good faith to all inquiries of UTC for information
relating to all toxicology studies, clinical data, manufacturing process data
and other information in its possession or control with respect to the Product
that is material and would be reportable to the FDA under 21 C.F.R. 200 et.
seq., and has not withheld any such information that would have a materially
adverse effect on the Development or Commercialization of the Product in the
Field; and

 
 
(s)
Pluristem Therapeutics Inc. is the sole owner of all legal and beneficial
interests in Pluristem Ltd. free and clear of all encumbrances, security
interests, options and the like.

 
 
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10.3
Disclaimer

 
UTC UNDERSTANDS THAT THE PRODUCT FOR USE IN UTC’S DOMAIN IS THE SUBJECT OF
ONGOING CLINICAL RESEARCH AND DEVELOPMENT AND THAT PLURISTEM CANNOT ENSURE THE
SAFETY OR USEFULNESS OF PRODUCT FOR USE IN UTC’S DOMAIN. PLURISTEM MAKES NO
REPRESENTATION OR WARRANTY EXCEPT AS SET FORTH IN THIS ‎ARTICLE 10 CONCERNING
ITS PATENTS OR INFORMATION, INCLUDING THE VALIDITY OR SCOPE OF ITS PATENTS OR
THAT THE MANUFACTURE, USE, SALE, OFFER FOR SALE, OR IMPORTATION OF PRODUCT WILL
NOT INFRINGE THE PATENTS OF THIRD PARTIES. PLURISTEM MAKES NO WARRANTY OF ANY
PRODUCT’S MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
 
Article 11 Confidentiality
 
11.1
Treatment of Confidential Information

 
Except as provided below, the Parties agree that during the Term, and following
termination or expiration thereof, each Party (the “Receiving Party”) shall
(a) maintain Confidential Information of the other Party (the “Disclosing
Party”) in confidence to the same extent and with the same degree of care as the
Receiving Party maintains its own proprietary industrial information of similar
kind and value (but at a minimum each Party shall use commercially reasonable
efforts), (b) not disclose such Confidential Information to any Third Party
without prior written consent of the Disclosing Party, except for disclosures
permitted by the rest of this ‎Article 11 or as otherwise approved by the JSC,
and (c) not use such Confidential Information for any purpose except those
permitted by this Agreement or the Manufacturing and Supply Agreement.
 
11.2
Exceptions

 
Notwithstanding the foregoing, the Receiving Party shall have no such
confidentiality obligations with respect to any portion of the Confidential
Information of the Disclosing Party that:
 
 
(a)
at the time of disclosure by the Disclosing Party to the Receiving Party, was
generally available to the public, or after such disclosure, becomes generally
available to the public through no fault attributable to the Receiving Party; or

 
 
(b)
was known to the Receiving Party as evidenced by written documents, without
obligation to keep it confidential, prior to when it was received from the
Disclosing Party; or

 
 
(c)
is subsequently disclosed to the Receiving Party, without obligation to keep it
confidential, by a Third Party lawfully in possession thereof and having the
right to so disclose; or

 
 
(d)
has been independently developed by employees of the Receiving Party, as
demonstrated by the Receiving Party by competent written proof, who do not have
access to or knowledge of such Confidential Information.

 
 
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The Receiving Party shall have the burden of proof of qualifying to any of the
foregoing exceptions which should be established by written records.
 
11.3
Authorized Disclosures

 
Nothing in this Agreement shall prohibit the Receiving Party from disclosing
Confidential Information of the other Party, as well as the terms and conditions
of this Agreement:
 
 
(a)
to the Receiving Party’s Affiliates, employees, agents, consultants,
contractors, and distributors, and to the employees, agents, consultants,
contractors, and distributors of the receiving Party’s Affiliates, who have a
need to know such Confidential Information to assist the receiving Party with
the activities contemplated or required of it by this Agreement and who are
subject to obligations of confidentiality and non-use with respect to such
Confidential Information substantially similar to the obligations of
confidentiality and non-use of the receiving Party pursuant to Section ‎11.1;
provided that the term of such obligations may be reduced so as to be
commercially reasonable based on the circumstances; and provided further that
each Party shall each remain responsible for any failure by its Affiliates, and
its and its Affiliates’ employees, agents, consultants, contractors, and
distributors, to treat such Confidential Information as required under this
Section ‎11.3;

 
 
(b)
to professional advisors bound by a duty of confidentiality;

 
 
(c)
to Receiving Party’s investors and potential investors, acquirers, or merger
candidates bound by a duty of confidentiality;

 
 
(d)
to Receiving Party’s clinical investigators and sublicensees and potential
clinical investigators and potential sublicensees bound by a duty of
confidentiality; or

 
 
(e)
to the extent required by court order or Applicable Law, provided that the
Receiving Party provides the other Party prior written notice of the required
disclosure and takes reasonable steps to limit such disclosure to the minimum
required amount and to obtain, or cooperate with the other Party in obtaining, a
protective order or other similar order requiring that such Confidential
Information be used only for the purposes required by such court order, law, or
regulation.

 
Notwithstanding the foregoing, either Party may disclose without any limitation
such Party’s U.S. federal income tax treatment and the U.S. federal income tax
structure of the transactions relating to such Party that are based on or
derived from this Agreement, as well as all materials of any kind (including
opinions or other tax analyses) relating to such tax treatment or tax structure,
except to the extent that nondisclosure of such matters is reasonably necessary
in order for a Party to comply with Applicable Law.
 
11.4
Securities Filings

 
Subject to the Securities Act of 1933, as amended, the Exchange Act, or any
other applicable securities law: (a) if either Party proposes to file with the
US Securities and Exchange Commission or the securities regulators of any state
or other jurisdiction a registration statement or any other disclosure document
which describes this Agreement under the Securities Act of 1933, as amended, the
Exchange Act, or any other applicable securities law, such Party shall notify
the other Party of such intention and shall provide, to the extent practicable,
such other Party with a copy of relevant portions of the proposed filing
reasonably prior to such filing (and any revisions to such portions of the
proposed filing a reasonable time prior to the filing thereof), including any
exhibits thereto; and (b) each Party shall have a right to provide comments in a
timely manner on any portion of any such proposed filing of the other Party that
describes this Agreement prior to the filing thereof.
 
 
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11.5
Publicity

 
The Parties agree that Pluristem’s and UTC's public announcement of the
execution of this Agreement shall be substantially in the form of the press
release attached as Exhibit ‎11.5 and they shall cooperate in the issuance
thereof as soon as practicable after the execution of this Agreement unless they
agree otherwise. In addition, the Parties recognize that each Party may from
time to time desire to issue additional press releases and make other public
statements or disclosures regarding the subject matter of this Agreement. Such
publication shall be permitted without the other Party’s consent to the extent
that such additional releases or statements that do not contain information
beyond that which is included in the press release attached as Exhibit ‎11.5 or
in subsequent press releases approved by both Parties. Any other publication,
news release or other public announcement relating to this Agreement or to the
performance hereunder shall first be reviewed and approved by both Parties,
which approval shall not be unreasonably withheld. Notwithstanding anything else
in this ‎Article 11, any disclosure which is required by law or the rules of a
securities exchange, as advised by the disclosing Party’s counsel, may be made
without the prior consent of the other Party, although the other Party shall be
given prompt written notice of any such legally required disclosure and to the
extent practicable shall provide the other Party an opportunity to comment on
the proposed disclosure.
 
11.6
Publication

 
 
(a)
Each Party agrees that it shall not publish or present to the public the results
of any non-clinical scientific studies or clinical trials related to the Field
without the opportunity for prior review by the other Party. If a Party (the
“Publishing Party”) wishes to publish or to present to the public such results,
then it shall provide the other Party (the “Non-Publishing Party”) the
opportunity to review any of the Publishing Party’s proposed abstracts,
manuscripts or presentations (including verbal presentations) regarding the
Product at least thirty (30) days prior to the intended date of submission for
publication. Neither Party shall have the right to publish or present to the
public Confidential Information of the other Party, except as permitted under
Sections ‎11.2 and ‎11.3.

 
 
(b)
It is understood that a Detail of the Product in the Field shall not be
considered to be publication or presentation to the public and shall therefore
not be subject to the requirements of Section ‎11.6(a).

 
11.7
Patient Information

 
The Parties shall abide by Applicable Laws concerning the confidentiality or
protection of patient identifiable information and/or patients’ protected health
information, as defined by U.S. C.F.R. Part 160 or personal data as defined by
EU Directive 95/46/EC or any other applicable legislation in any jurisdiction of
the Territory, in the course of their performance under this Agreement.
 
 
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11.8
Confidentiality Agreement

 
Disclosures of information made by the Parties pursuant to the Confidentiality
Agreement are deemed to have been made pursuant to this Agreement and subject to
this ‎Article 11. The Confidentiality Agreement is hereby terminated as of the
Effective Date and of no further force or effect, except with respect to any
breach of the Confidentiality Agreement prior to the Effective Date.
 
Article 12 Indemnification
 
12.1
Indemnification by UTC

 
Subject to Section ‎12.4, UTC agrees to defend any and all Pluristem Indemnitees
at UTC’s cost and expense, and shall indemnify and hold harmless the Pluristem
Indemnitees from and against any liabilities, losses, costs, damages, fees, or
expenses (including reasonable legal expenses and attorneys’ fees incurred by
the Pluristem Indemnitees until such time as UTC has acknowledged and assumed
its indemnification obligation hereunder with respect to a Claim) payable to a
Third Party (collectively, “Losses”) arising out of any claim, action, lawsuit,
or other proceeding (collectively, “Claims”) brought against any Pluristem
Indemnitee by a Third Party to the extent resulting directly or indirectly from:
 
 
(a)
the Development, Manufacture, use, or Commercialization of the Product for use
in the Field by the UTC Indemnitees;

 
 
(b)
any infringement of any Third Party intellectual property rights as contemplated
in Section ‎9.8(c)(ii);

 
 
(c)
the negligence or willful misconduct of the UTC Indemnitees;

 
 
(d)
any material breach by UTC of any of its representations, warranties, covenants
or obligations pursuant to this Agreement or the Manufacturing and Supply
Agreement;

 
 
(e)
any violation of Applicable Law by the UTC Indemnitees; or

 
 
(f)
the breach of this Agreement, including the breach of the terms of any licenses
granted by Pluristem and contained herein, by any sublicensee of UTC;

 
except to the extent such Losses result from activities for which Pluristem must
indemnify the UTC Indemnitees pursuant to Section ‎12.2.
 
12.2
Indemnification by Pluristem

 
Subject to Section ‎12.4, Pluristem agrees to defend the UTC Indemnitees, at
Pluristem’s cost and expense, and shall indemnify and hold harmless the UTC
Indemnitees from and against any Losses arising out of any Claims brought
against any UTC Indemnitee by a Third Party to the extent resulting directly or
indirectly from:
 
 
(a)
the Development, Manufacture, use, or Commercialization of the Product by the
Pluristem Indemnitees for use in Pluristem’s Domain and the Manufacture of the
Product by the Pluristem Indemnitees for use in the Field;

 
 
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(b)
any infringement of any Third Party intellectual property rights as contemplated
in Section ‎9.8(c)(i);

 
 
(c)
the negligence or willful misconduct of the Pluristem Indemnitees;

 
 
(d)
any material breach by Pluristem of any of its representations, warranties,
covenants or obligations pursuant to this Agreement or the Manufacturing and
Supply Agreement; or

 
 
(e)
any violation of Applicable Law by the Pluristem Indemnitees;

 
except to the extent such Losses result from activities for which UTC must
indemnify Pluristem pursuant to Section ‎12.1.
 
12.3
Allocation of Responsibility

 
With respect to any Claim for which Pluristem has an obligation to UTC or any
UTC Indemnitee pursuant to Section ‎12.2 and UTC has an obligation to Pluristem
or any Pluristem Indemnitee pursuant to Section ‎12.1, each Party shall
indemnify each of the other Party and any of such Party’s Indemnitees for its
Losses to the extent of its responsibility, relative to the other Party, for the
facts underlying the Claim.
 
12.4
Procedure

 
 
(a)
A Party believing that it is entitled to indemnification under Section ‎12.1 or
Section ‎12.2 (an “Indemnified Party”) shall give prompt written notification to
the other Party (the “Indemnifying Party”) of the commencement of any Claim for
which indemnification may be sought or, if earlier, upon the assertion of any
such Claim by a Third Party (it being understood and agreed, however, that the
failure by an Indemnified Party to give notice of a Third-Party Claim as
provided in this Section ‎12.4 shall not relieve the Indemnifying Party of its
indemnification obligation under this Agreement except and only to the extent
that such Indemnifying Party is actually prejudiced as a result of such failure
to give notice). Within thirty (30) days after delivery of such notification,
the Indemnifying Party shall, upon written notice thereof to the Indemnified
Party, assume control of the defense of such Claim with counsel reasonably
satisfactory to the Indemnified Party. If a Party believes that a Claim
presented to it for indemnification is one as to which the Party seeking
indemnification is not entitled to indemnification under Section ‎12.1 or
Section ‎12.2, it shall so notify the Party seeking indemnification.

 
 
(b)
The Indemnified Party may participate in such defense at its own expense.

 
 
(c)
The Indemnified Party shall cooperate fully with the Indemnifying Party and its
counsel in the defense against any such Claim, including making available to the
Indemnifying Party any books, records or other documents within its control that
are necessary for such defense. All Reasonable Costs incurred in connection with
the Indemnified Party’s cooperation will be borne by the Indemnifying Party.

 
 
(d)
The Indemnifying Party shall keep the other Party advised of the status of such
Claim and the defense thereof and shall consider recommendations made by the
Indemnified Party with respect thereto.

 
 
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(e)
The Indemnified Party shall not agree to any settlement of such Claim without
the prior written consent of the Indemnifying Party, which consent shall not be
unreasonably withheld. The Indemnifying Party shall not agree to any settlement
of such Claim or consent to any judgment in respect thereof that does not
include a complete and unconditional release of the Indemnified Party from all
liability with respect thereto or that imposes any liability or obligation on
the Indemnified Party or adversely affects the Indemnified Party without the
prior written consent of the Indemnified Party, which consent shall not be
unreasonably withheld.

 
12.5
Insurance

 
During the Term and for five (5) years thereafter, each Party shall maintain, at
its sole expense, such types and amounts of insurance coverage as are
appropriate and customary in the pharmaceutical industry in light of the nature
of the activities to be performed by such Party hereunder.
 
12.6
No Consequential or Punitive Damages

 
NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS AGREEMENT, EXCEPT FOR DAMAGES
FOR BREACHES OF OBLIGATIONS OF CONFIDENCE, NEITHER PARTY WILL BE LIABLE FOR
INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, EXEMPLARY OR PUNITIVE DAMAGES
ARISING OUT OF THIS AGREEMENT OR THE EXERCISE OF ITS RIGHTS HEREUNDER, OR FOR
LOST PROFITS ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT,
REGARDLESS OF ANY NOTICE OF SUCH DAMAGES.
 
Article 13 Term and Termination
 
13.1
Term

 
Unless earlier terminated or extended in accordance with the terms of this
‎Article 13, the term of this Agreement shall begin on the Effective Date and
will continue until the last to occur of:
 
 
(a)
the expiration, lapse, cancellation, abandonment or invalidation of the last
Valid Claim covering the Commercialization of the Product in UTC’s Domain;

 
 
(b)
expiration of any government-conferred exclusivity respecting the use of the
Product in UTC’s Domain;

 
 
(c)
the date on which the Parties do not have any Product under Development pursuant
to this Agreement; and

 
 
(d)
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**;

 
(the “Term”).
 
13.2
Unilateral Termination by UTC

 
During the Term, UTC shall have the unrestricted and absolute right to terminate
this Agreement at any time and for any reason or without reason forthwith upon
written notice to Pluristem, which right may be exercised in UTC’s absolute
discretion. In such event, UTC shall pay Pluristem any and all reasonable costs
and expenses of winding down any non-cancellable (without penalties) commitments
made by Pluristem, acting reasonably, solely for the purposes of making possible
Pluristem’s performance of its obligations under this Agreement prior to the
date of termination, including in the performance of Pluristem’s obligations
hereunder for the Development or Manufacture of Products.
 
 
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13.3
Material Breach

 
 
(a)
If a Party believes that the other Party is in material breach of this Agreement
or the Manufacturing and Supply Agreement, then such Party may deliver notice of
such breach to the allegedly breaching Party. In such notice, the non-breaching
Party shall identify the actions or conduct that it wishes the allegedly
breaching Party to take for an acceptable and prompt cure of such breach;
provided that such identified actions shall not be binding upon the allegedly
breaching Party with respect to the actions that it may need to take to cure
such breach. The allegedly breaching Party shall have thirty (30) days either to
cure such breach or, if the cure cannot be reasonably effected within such
thirty (30) day period, to deliver to the non-breaching Party a plan for curing
such breach which is reasonably sufficient to effect a cure. Following delivery
of such plan, the breaching Party shall use Commercially Reasonable Efforts to
carry out the plan and cure the breach in a timely manner.

 
 
(b)
If the Party receiving notice of breach fails to cure such breach within the
thirty (30) day period, or if the proposed corrective plan or the actions being
taken to carry it out are not commercially practicable, the non-breaching Party
may give notice of termination of this Agreement upon fifteen (15) days advance
written notice. Such notice shall effectively terminate this Agreement upon
expiration of such fifteen (15) day period, subject to Section ‎13.3(c).

 
 
(c)
If a Party gives notice of termination under this Section ‎13.3, and the other
Party disputes whether such notice was proper, or the Parties disagree as to
whether the breaching Party has cured such breach within the applicable time
period under Section ‎13.3(a), or if the proposed corrective plan or the actions
being taken to carry it out are not commercially practicable, then the issue of
whether this Agreement has been terminated shall be resolved in accordance with
‎Article 14. If, as a result of such dispute resolution process, it is
determined that the notice of termination was proper and that the breaching
Party failed to cure such breach within the applicable time period under
Section ‎13.3(a), then such termination shall be deemed to have been effective
upon expiration of the time period provided in Section ‎13.3(b). If, as a result
of such dispute resolution process, it is determined that the notice of
termination was improper, or the proposed corrective plan or the actions being
taken to carry it out are commercially practicable, then no termination shall
have occurred and this Agreement shall be deemed to have remained in effect.

 
13.4
Consequences of Expiration or Termination

 
 
(a)
Upon Expiry of the Term Pursuant to Section ‎13.1. Upon expiry of this Agreement
pursuant to Section ‎13.1:

 
 
(i)
the licenses granted to UTC in ‎Article 2 shall remain in effect, but shall
convert to fully paid, non-exclusive, sublicenseable and assignable licenses;

 
 
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(ii)
if Pluristem is continuing to Manufacture the Product for exploitation in
Pluristem’s Domain, the Parties will discuss the possibility of Pluristem
continuing to supply UTC with the Product in the Field under the Manufacturing
and Supply Agreement or a replacement therefor; and

 
 
(iii)
all UTC Confidential Information shall be subject to Section ‎13.4(d).

 
 
(b)
Upon Termination of this Agreement by UTC Pursuant to Section ‎13.2, or by
Pluristem Pursuant to Section ‎13.3. Upon termination of this Agreement by UTC
pursuant to Section ‎13.2 or by Pluristem for material breach by UTC pursuant to
Section ‎13.3:

 
 
(i)
the licenses granted to UTC under this Agreement shall terminate, and, after a
wind-down period to be mutually agreed by the Parties, acting reasonably, UTC
shall cease all Development and Commercialization activities;

 
 
(ii)
UTC shall deliver to Pluristem or destroy any and all promotional materials for
the Product then in possession of UTC and/or its Affiliates. Pluristem shall
have the right to use all aspects of UTC’s promotional materials in connection
with the Commercialization of the Product in UTC’s Domain, other than the
Corporate Marks of UTC;

 
 
(iii)
UTC hereby grants to Pluristem, under any and all UTC Patents and UTC Know-How,
a fully paid, non-exclusive, sublicenseable and assignable license to Develop,
Manufacture, use and Commercialize the Product in the Field in the Territory;

 
 
(iv)
UTC hereby grants to Pluristem full and exclusive ownership any Regulatory
Filings and Regulatory Approvals obtained for the Product in the Field in the
Territory, and, notwithstanding anything else in this Agreement, the full
ownership of all Information Controlled by UTC arising from any clinical trials
conducted as part of the UTC Development Activities, provided that Pluristem
hereby grants UTC a fully paid, non-exclusive, sublicenseable and assignable
license to use and exploit same for all purposes. Nothing in the foregoing
assignment shall assign any rights to any Inventions arising from such
activities or data, or the analysis of same by or on behalf of UTC;

 
 
(v)
if UTC is then a party to any agreements with Third Party independent
contractors for the Product in the Field, it shall cooperate with Pluristem to
enable Pluristem to obtain if it wishes to in its sole discretion, the benefit
of such agreements as necessary to enable Pluristem to exercise its rights under
this ‎Article 13, including by assigning such agreements to Pluristem where
reasonably practicable. Pluristem shall use Commercially Reasonable Efforts to
accept the benefit of such agreements, including by way of assignment; and

 
 
(vi)
all Pluristem Confidential Information shall be subject to Section ‎13.4(d).

 
 
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(c)
Upon Termination of this Agreement by UTC Pursuant to Section ‎13.3 or ‎16.2(b).
Upon Termination of this Agreement by UTC pursuant to Section ‎16.2(b), or by
UTC for material breach of Pluristem pursuant to Section ‎13.3:

 
 
(i)
the consequences set out in Sections ‎13.4(b)(i), ‎13.4(b)(ii) and ‎13.4(b)(v)
shall apply; and

 
 
(ii)
all Confidential Information of both Parties shall be subject to Section
‎13.4(d).

 
 
(d)
Return of Confidential Information. Upon the early termination of this
Agreement, upon the request of the non-defaulting Party, the other Party will
promptly return to the non-defaulting Party or destroy all material embodying
Confidential Information in its possession or under its control, including all
copies thereof, except for a single copy retained solely for the purpose of
ensuring compliance with the terms of this Agreement.

 
13.5
Survival

 
The rights and obligations of the Parties under the following provisions of this
Agreement shall survive any expiration or termination of this Agreement:
‎Article 1, Sections ‎3.6, Section ‎5.6(a), ‎Article 8 (solely to the extent
that any amounts payable at the time of expiry or earlier termination remain
unpaid (provided that Section ‎8.4 shall survive for a period of two years
following expiry or earlier termination of this Agreement; and Section ‎8.7
shall survive only for the period set forth therein) but not including Section
‎8.1(b) if the reason for termination is breach of Section Error! Reference
source not found.), Sections ‎9.1 and ‎9.1(e), ‎Article 10, ‎Article 11 (for the
period set forth in Section ‎11.1), Sections ‎12.1, ‎12.2, ‎12.4, ‎12.5 (for the
period set forth in Section ‎12.5), ‎12.6, ‎13.4 (as applicable), ‎13.5 and
‎13.6, ‎Article 14 and ‎Article 16.
 
13.6
No Waiver of Remedies

 
Expiration or termination of this Agreement shall not preclude either Party from
(a) claiming any other damages, compensation or relief that it may be entitled
to upon such expiration or termination, (b) any right to receive any amounts
accrued under this Agreement prior to the expiration or termination date but
which are unpaid or become payable thereafter and (c) any right to obtain
performance of any obligation provided for in this Agreement which shall survive
expiration or termination.
 
Article 14 Dispute Resolution
 
14.1
Disputes

 
The Parties recognize that disputes as to certain matters may from time to time
arise during the Term that relate to either Party’s rights and/or obligations
hereunder. It is the desire 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 arbitration or litigation. To
accomplish this objective, the Parties agree to follow the procedures set forth
in this ‎Article 14 if and when a dispute arises under this Agreement. Either
Party may refer a dispute under this Agreement to the Parties’ Alliance
Managers. If the Alliance Managers are unable to resolve any such dispute within
sixty (60) days after such dispute is submitted to it, either Party may, by
written notice to the other Party, have such dispute referred to their
respective executive officers designated below or their successors, for
attempted resolution by good faith negotiations within forty-five (45) days
after such notice is received. Such designated officers are as follows:
 

 
For Pluristem:  
Zami Aberman, Chief Executive Officer, or his direct report

 

 
For UTC:  
Roger A. Jeffs, Ph.D., or his direct report

 
In the event the designated officers are not able to resolve such dispute within
such forty-five (45) day period after receipt of written notice, then such
dispute (other than a matter within the final decision-making authority of a
Party as set forth in Section ‎3.4(c)) shall, at the election of either Party,
be decided in accordance with the provisions of Section ‎14.2.
 
 
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14.2
Governing Law; Dispute Resolution

 
 
(a)
This Agreement shall be construed and interpreted in accordance with the laws of
the State of New York, without regard to any conflicts of law principles that
would provide for the application of the laws of another jurisdiction.

 
 
(b)
Unless otherwise agreed by the Parties, all actions and proceedings relating to
Patents and non-disclosure, non-use and maintenance of Confidential Information
shall be heard and determined in any New York State or federal court sitting in
the City of New York, County of Manhattan, and the Parties hereby irrevocably
submit to the exclusive jurisdiction of such courts in any such action or
proceeding and irrevocably waive any defense of an inconvenient forum to the
maintenance of any such action or proceeding.

 
 
(c)
Subject to Section ‎14.2(b), if the Parties are unable resolve a given dispute
pursuant to Section ‎14.1, either Party may have the given dispute settled by
binding arbitration in the manner described below.

 
 
(d)
If a Party intends to begin an arbitration to resolve a dispute arising under
this Agreement, such Party shall provide written notice (the “Arbitration
Request”) to the other Party of such intention and the issues for resolution.
From the date of the Arbitration Request and until such time as the dispute has
become finally settled, the running of the time periods as to which Party must
cure a breach of this Agreement becomes suspended as to the subject matter of
the dispute.

 
 
(e)
Within ten (10) business days after the receipt of the Arbitration Request, the
other Party may, by written notice, add additional issues for resolution.

 
 
(f)
Discovery shall be under the U.S. Federal Rules of Civil Procedure then in
effect in the District Court for the Southern District of New York. The
Arbitration shall be held in the City of New York, under the rules of the
American Arbitration Association (“AAA”). The arbitration shall be conducted by
three (3) arbitrators who are knowledgeable in the subject matter at issue in
the dispute. One (1) arbitrator will be selected by UTC, one (1) arbitrator will
be selected by Pluristem, and the third arbitrator will be selected by mutual
agreement of the two (2) arbitrators selected by the Parties. The arbitrators
may proceed to an award, notwithstanding the failure of either Party to
participate in the proceedings. The arbitrators shall, within fifteen (15)
calendar days after the conclusion of the arbitration hearing, issue a written
award and statement of decision describing the essential findings and
conclusions on which the award is based, including the calculation of any
damages awarded. The arbitrators shall be authorized to grant any temporary,
preliminary or permanent equitable remedy or relief the arbitrators deem just
and equitable and within the scope of this Agreement, including an injunction or
order for specific performance, or relief from the payment or other obligations
hereunder or the escrow of any payments otherwise payable hereunder. The award
of the arbitrators shall be the sole and exclusive remedy of the Parties.
Judgment on the award rendered by the arbitrators may be enforced in any court
having competent jurisdiction thereof, subject only to revocation on grounds of
fraud or clear bias on the part of the arbitrators. Notwithstanding anything
contained in this Section ‎14.2 to the contrary, each Party shall have the right
to institute judicial proceedings against the other Party or anyone acting by,
through or under such other Party, in order to enforce the instituting Party’s
rights hereunder through specific performance, injunction or similar equitable
relief.

 
 
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(g)
Each Party shall bear its own attorneys’ fees, costs, and disbursements arising
out of the arbitration, and shall pay an equal share of the fees and costs of
the arbitrators; provided, however, that the arbitrators shall be authorized to
determine whether a Party is the prevailing Party, and if so, to award to that
prevailing Party reimbursement for its reasonable attorneys’ fees, costs and
disbursements (including, for example, expert witness fees and expenses,
photocopy charges and travel expenses), and/or the fees and costs of the
arbitrators. Absent the filing of an application to correct or vacate the
arbitration award as permitted by applicable law, each Party shall fully perform
and satisfy the arbitration award within fifteen (15) days of the service of the
award.

 
 
(h)
By agreeing to this binding arbitration provision, the Parties understand that
they are waiving certain rights and protections which may otherwise be available
if a dispute between the Parties were determined by litigation in court,
including the right to seek or obtain certain types of damages precluded by this
provision, the right to a jury trial, certain rights of appeal, and a right to
invoke formal rules of procedure and evidence.

 
 
(i)
Subject to the rights of set-off between the Parties set out in this Section, or
as may be otherwise ordered by the arbitrators, during the period while any
dispute is unresolved and subject to arbitration as set forth above, Pluristem
shall continue to be entitled to receive payment in a timely manner and in
accordance with the terms of this Agreement. In the event that Pluristem is in
default of any obligation to pay a Sum Certain to UTC under this Agreement or
any other agreement, absent a Legitimate Dispute, UTC shall be entitled, in
addition to any other remedies available to it, to set-off and deduct an amount
equal to the Sum Certain owing by Pluristem to UTC at such time. For the
purposes of this Section, a “Sum Certain” means an amount of money Pluristem is
obligated to pay UTC under this Agreement or any other agreement, and a
“Legitimate Dispute” means a dispute regarding an obligation of Pluristem to pay
UTC a sum of money under this Agreement or another agreement which Pluristem is
legitimately disputing in good faith, and is pursuing a resolution to such
dispute in good faith pursuant to arbitration as set forth above.

 
 
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Article 15 Condition to Closing: R&D Act
 
15.1
Consent of OCS

 
Pluristem shall, within seven (7) business days after the Execution Date,
request from the OCS any consent required from the OCS pursuant to the R&D Act
and any undertakings required of it under the R&D Act and Pluristem’s
undertakings towards the OCS with respect to the subject matter of this
Agreement, which request shall specifically request consent to the grant of
license to Manufacture Products in the event of a Failure to Supply under this
Agreement or the Manufacturing and Supply Agreement. The Parties will cooperate
with one another to the extent necessary in the preparation of any such
request.  The Parties hereto commit to instruct their respective counsel to
cooperate with each other and use good faith, reasonably diligent efforts to
facilitate and expedite the identification and resolution of any issues arising
with respect to such request, and the obtaining of such consent. Such good
faith, reasonably diligent efforts shall include counsel’s undertaking to keep
each other appropriately informed of communications received from and submitted
to personnel of the OCS; and, on the part of Pluristem, the payment of all fees
and expenses charged or levied by the OCS associated with any consent, and in
particular, the repayment, acceleration or increase in any payments owed to the
OCS by Pluristem as a condition of the granting of such consent.  The costs and
expenses incurred in connection with such request shall be paid by the Party
incurring such costs and expenses, except that Pluristem shall be responsible
for all fees and expenses charged or levied by the OCS.
 
15.2
Satisfaction of Conditions; Effective Date

 
Except for the specific provisions expressly identified in Section ‎15.3, this
Agreement shall not be effective until such time as the consent of the OCS has
been obtained and the Agreement has become effective pursuant to this Section
‎15.2. Immediately at the time when both Parties have notice that all necessary
OCS consents have been obtained, this Agreement shall be effective automatically
in its entirety (the date of such effectiveness, the “Effective Date”).
 
15.3
Portions of Agreement Effective as of Execution Date

 
Notwithstanding Section ‎15.2, the following provisions of this Agreement shall
be in full force and effect in accordance with their terms as of the Execution
Date: ‎Article 1, ‎Article 15 and ‎Article 16.
 
15.4
Conduct of Pluristem’s Business

 
From the Execution Date until the Effective Date, unless this Agreement is
earlier terminated, Pluristem shall: (i) conduct its business in the ordinary
course of business, (ii) shall act reasonably in the prosecution and maintenance
of the Pluristem Patents, and (iii) shall not willfully take any action or
willfully omit any action that would cause any of Pluristem’s representations
and warranties contained in ‎Article 10 to be breached.
 
15.5
Non-Performance of Condition

 
Notwithstanding anything else in this Agreement, if, sixty (60) days after the
Execution Date, the condition set out in Section ‎15.1 shall have been neither
fulfilled nor waived by UTC, then this Agreement shall terminate and neither
Party shall have any rights or obligations hereunder, all to the same effect as
if the Parties had never entered into this Agreement, and all without prejudice
to any rights and obligations of the Parties under any other agreements between
the Parties.
 
 
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15.6
Nature of Conditions

 
The Parties acknowledge and agree that although this Agreement and the rights
and obligations of the Parties under this Agreement are subject to fulfillment
or waiver of the condition set forth in this ‎Article 15, this condition is not
a condition to there being a binding agreement between the Parties, and until
the time limited for the fulfillment or waiver of such condition has expired,
this Agreement is not void, voidable, revocable or otherwise capable of being
terminated, by either of the Parties, by reason only that any such condition has
been neither fulfilled nor waived.
 
Article 16 Miscellaneous
 
16.1
Entire Agreement

 
This Agreement and the Manufacturing and Supply Agreement, including the
exhibits hereto and thereto, constitute the entire understanding between the
Parties with respect to the subject matter contained herein and supersedes any
and all prior and contemporaneous agreements, understandings and arrangements
whether oral or written between the Parties relating to the subject matter
hereof, including the Confidentiality Agreement.
 
16.2
Assignment; Change of Control

 
 
(a)
A Party may not assign this Agreement or any rights or obligations hereunder
without the prior written consent of the non-assigning Party, and any attempted
assignment without such consent shall be null and void. Notwithstanding the
foregoing, and subject to Section ‎16.2(b), either Party may assign this
Agreement to (i) its successor-in-interest in connection with the transfer or
sale of all or substantially all of the business of such Party, whether by
acquisition, merger, sale of stock, sale of assets or similar transaction; or
(ii) to an Affiliate, provided that the assigning Party shall remain liable and
responsible to the non-assigning Party hereto for the performance and
observation by such Affiliate of all such duties and obligations. This Agreement
shall be binding upon and, subject to the terms of this Section ‎16.2, inure to
the benefit of a Party’s successors and permitted assigns.

 
 
(b)
Notwithstanding Section ‎16.2(a), in the event of a Change of Control, Pluristem
shall provide a notice with respect to the consummation of such Change of
Control forthwith following consummation of such event. If UTC gives Pluristem
written notice of termination of this Agreement pursuant to this Section ‎16.2
within six months of the date of such notice, such notice shall terminate this
Agreement effective on such notice with the consequences set out in Section
‎13.4(c). Any public announcement filed by Pluristem with the US Securities and
Exchange Commission shall constitute a notice for the purpose of this Section.
If, at anytime following a Change of Control, Pluristem or any of its Affiliates
shall, directly or indirectly, alone or in collaboration, partnership or any
other form of engagement with any Third Party (including joint ownership or
otherwise), Develop or Commercialize in any country in the Territory any product
in the Field, then UTC shall have the right to terminate this Agreement by
providing written notice to Pluristem, which termination shall thereupon take
immediate effect with the consequences set out in Section ‎13.4(c).

 
 
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(c)
In the event Change of Control, Pluristem shall not be required to share or
disclose any Information that becomes in the Control of Pluristem due to the
event of Change of Control.

 
16.3
Amendments

 
No amendment, change, modification or alteration of the terms and conditions of
this Agreement shall be binding upon either Party unless in writing and signed
by both Parties.
 
16.4
Bankruptcy

 
All rights and licenses granted under or pursuant to this Agreement by Pluristem
or UTC are, and will otherwise be deemed to be, for purposes of Section 365(n)
of the U.S. Bankruptcy Code, licenses of right to “intellectual property” as
defined under Section 101 of the U.S. Bankruptcy Code. The Parties agree that
the Parties, as licensees of such rights under this Agreement, will retain and
may fully exercise all of their rights and elections under the U.S. Bankruptcy
Code. The Parties further agree that, in the event of the commencement of a
bankruptcy proceeding by or against either Party under the U.S. Bankruptcy Code,
the Party hereto that is not a Party to such proceeding will be entitled to a
complete duplicate of (or complete access to, as appropriate) any such
intellectual property and all embodiments of such intellectual property, and
same, if not already in their possession, will be promptly delivered to them
(a) upon any such commencement of a bankruptcy proceeding upon their written
request therefor, unless the Party subject to such proceeding elects to continue
to perform all of its obligations under this Agreement, or (b) if not delivered
under (a) above, following the rejection of this Agreement by or on behalf of
the Party subject to such proceeding upon written request therefor by the
non-subject Party.
 
16.5
Non-Waiver

 
The waiver by either of the Parties of any breach of any provision hereof by the
other Party shall not be construed to be a waiver of any succeeding breach of
such provision or a waiver of the provision itself.
 
16.6
Severability

 
If and to the extent that any court or tribunal of competent jurisdiction holds
any of the terms or provisions of this Agreement, or the application thereof to
any circumstances, to be invalid or unenforceable in a final nonappealable
order, the Parties shall use their best efforts to reform the portions of this
Agreement declared invalid to realize the intent of the Parties as fully as
practical, and the remainder of this Agreement and the application of such
invalid term or provision to circumstances other than those as to which it is
held invalid or unenforceable shall not be affected thereby, and each of the
remaining terms and provisions of this Agreement shall remain valid and
enforceable to the fullest extent of the law.
 
16.7
Notice

 
Any notice to be given under this Agreement must be in writing and delivered
either in person, by any method of mail (postage prepaid) requiring return
receipt, or by international courier or facsimile confirmed thereafter by any of
the foregoing, to the Party to be notified at its address(es) given below, or at
any address such Party has previously designated by prior written notice to the
other. Notice shall be deemed sufficiently given for all purposes upon the
earlier of: (a) the date of actual receipt; (b) if mailed, five (5) calendar
days after the date of postmark; or (c) if delivered by international courier,
the next business day the overnight courier regularly makes deliveries in the
country of the recipient:
 
 
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If to Pluristem, as follows:
 
Pluristem Ltd. c/o
Pluristem Therapeutics Inc.
MATAM Advanced Technology Park
Building No. 20, Haifa, Israel 31905
Facsimile: +972-74-710-7172
Attn: Zami Aberman, CEO
 
With a copy to:
 
Pluristem Therapeutics Inc.
MATAM Advanced Technology Park
Building No. 20, Haifa, Israel 31905
Facsimile: +972-74-710-7173
Attn: Yaky Yanay, CFO
 
If to UTC, as follows:
 
United Therapeutics Corporation
55 T.W. Alexander Drive
P.O. Box 14186
Research Triangle Park, NC 27709
Attention: Roger A. Jeffs, Ph.D.
Facsimile: 919-485-8352
 
With copies to:
 
United Therapeutics Corporation
1040 Spring Street, Silver Spring,
Maryland 20910
Attention: John Ferrari, CFO
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
 
United Therapeutics Corporation
1735 Connecticut Avenue, N.W.
Washington, D.C. 20009
Attention: Paul A. Mahon, General Counsel
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
 
or to such other address as to which the Party has given written notice thereof.
Such notices shall be deemed given upon receipt.
 
16.8
Further Assurances

 
Each Party shall, at its own expense, furnish, execute, and deliver all
documents and take all actions as may reasonably be required to effect the terms
and purposes of this Agreement.
 
 
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16.9
Force Majeure

 
No failure or omission by the Parties in the performance of any obligation of
this Agreement shall be deemed a breach of this Agreement nor shall it create
any liability if the same shall arise from any cause or causes beyond the
reasonable control of the affected Party, including the following, which for
purposes of this Agreement shall be regarded as beyond the control of the Party
in question: acts of nature; fire; storm; flood; earthquake; accident; war;
rebellion; insurrection; riot; invasion; strikes; and lockouts or the like;
provided that the Party so affected shall use its best efforts to avoid or
remove such causes or nonperformance and shall continue performance hereunder
with the utmost dispatch whenever such causes are removed.
 
16.10
Independent Contractors

 
It is understood that both Parties are independent contractors and engage in the
operation of their own respective businesses, and neither Party is to be
considered the agent or partner of the other Party for any purpose whatsoever,
except as otherwise expressly provided in this Agreement. Neither Party has any
authority to enter into any contracts or assume any obligations for the other
Party or make any warranties or representations on behalf of the other Party.
Furthermore, nothing in this Agreement shall be construed as creating a
partnership or joint venture among the Parties.
 
16.11
Performance by Affiliates

 
The Parties recognize that each Party may perform some or all of its
obligations, or exercise some or all of its rights, under this Agreement or the
Manufacturing and Supply Agreement through one or more Affiliates of such Party.
In each such case, the Party permitting such delegation or exercise by such
Affiliate shall remain responsible for and be guarantor of the performance by
such Affiliate. Pluristem and UTC shall each cause its respective Affiliates to
comply with the provisions of this Agreement in connection with such performance
or exercise. In such event, each reference to a Party in this Agreement shall be
deemed to include a reference to each Affiliate engaged in such performance or
exercise.
 
16.12
Guarantee of Certain Obligations

 
Without limiting the effect of Section ‎16.11:
 
 
(a)
Pluristem Therapeutics Inc. (“Guarantor”) hereby unconditionally, absolutely and
irrevocably guarantees, and covenants to UTC the full performance, observance
and satisfaction of any and all obligations, duties and covenants of Pluristem
under this Agreement and any agreements executed in connection herewith (the
“Guaranteed Obligations).

 
 
(b)
If any default shall be made in the performance, observance, satisfaction and
payment of any of the Guaranteed Obligations, Guarantor covenants and agrees
with UTC to perform, observe, satisfy and pay to UTC forthwith any and all of
the Guaranteed Obligations in respect of which such default will have occurred
and any interest that may be payable thereon pursuant hereto.

 
 
(c)
The obligations and liabilities of Guarantor hereunder shall not be subject to
any counterclaim, set-off, deduction or defense based upon any claim Guarantor
may have against Pluristem.

 
 
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(d)
Until there has been full performance, observance, satisfaction and payment of
all of the Guaranteed Obligations, the rights of UTC and the obligations of
Guarantor under this Section shall remain in full force and effect without
regard to, and shall not be released, discharged or in any way affected or
impaired, terminated or prejudiced by, the dissolution, winding-up or other
cessation of existence of Pluristem, the amalgamation of Pluristem with another
corporation, the appointment of a custodian, liquidator, receiver or trustee in
respect of the assets or undertaking, in whole or in part, of Pluristem, any
arrangement, bankruptcy, composition, insolvency, liquidation, readjustment,
receivership, reorganization or other similar proceeding or occurrence relating
to Pluristem, or any assignment by Pluristem for the benefit of creditors.

 
 
(e)
Guarantor shall not take any action that may adversely affect UTC's license
granted by Pluristem under this Agreement.

 
16.13
No Third Party Beneficiaries

 
This Agreement is neither expressly nor impliedly made for the benefit of any
Party other than those executing it.
 
16.14
Counterparts

 
This Agreement may be executed in counterparts, each of which shall be deemed an
original and both of which together shall constitute one and the same
instrument.
 
[The remainder of this page has been intentionally left blank]
 
 
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IN WITNESS WHEREOF, the Parties, intending to be bound hereby, have executed
this License Agreement by their duly authorized representatives as of the
Effective Date.
 
 

Pluristem Ltd.  United Therapeutics Corporation      By: /s/ Zami Aberman By:
/s/ Roger A. Jeffs     Name: Zami Aberman Name: Roger A. Jeffs, Ph.D. Title:
CEO   Title: President & Chief Operating Officer

 
Guarantor (solely with respect to its obligations under section ‎16.12 of the
Agreement and in its capacity as such):
 
Pluristem Therapeutics Inc.
 
By: /s/ Zami Aberman
 
Name: Zami Aberman
 
Title: CEO
 
 
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Exhibit ‎1.1(eee): Pluristem Patents
 
Family  4 Method And Apparatus For Maintenance And Expansion Of Hemopoietic Stem
Cells And/Or Progenitor Cells
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
04-Feb-1999
60/118,789
   
PCT
 
04-Feb-1999
60/118,789
 
04-Feb-2000
PCT/US2000/02688
 
10-Aug-2000
WO00/46349
USA
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
09/890,401
28-Jun-2005
6,911,201
 
USA
NP
04-Feb-1999
60/118,789
02-Sep-2008
11-Apr-2005
12/230,566
   
Japan
NP
04-Feb-1999
60/118,789
06-Aug-2001
04-Feb-2000
2000-597409
04-Jun-2010
4523169
 
Canada
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
2,360,664
   
Mexico
NP
04-Mar-1999
60/118,789
02-Aug-2001
04-Feb-2000
PA/a/2001/007820
03-Dec-2008
262724
 

 
 
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Mexico
DIV
04-Feb-1999
60/118,789
02-Dec-2008
04-Feb-2000
MX/a/2008/015398
   
Australia
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
22314
31-Jul-2003
759719
 
South Africa
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
2001/6483
 
2001/6483
 
Europe
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
00913340.6
16-Dec-2009
1147176
 
Europe
DIV
04-Feb-1999
60/118,789
 
04-Feb-2000
10184233.4
   
Europe
DIV
04-Feb-1999
60/118,789
 
04-Feb-2000
09174118.1
   
USA
NP
04-Feb-1999
60/118,789
 
11-Apr-2005
11/102,623
16-Mar-2010
7,678,573
 
USA
NP
04-Feb-1999
60/118,789
 
11-Apr-2005
11/102,625
19-May-2009
7,534,609
 

 
 
63

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

 
 
Israel
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
144629
05-Aug-2009
144629
 
Russian Federation
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
2001124399
27-Mar-2005
2249039
 
New Zealand
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
513303
07-Jul-2003
513303
 
India
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
2001/01131
07-Oct-2007
211173
 
China
NP
04-Feb-1999
60/118,789
 
04-Feb-2000
00806007.X
16-Jul-2008
ZL00806007.X
1346403
24-Feb-2002
Hong Kong
NP
04-Mar-1999
60/118,789
24-Oct-2002
04-Feb-2000
02107728.2
 
HK1046154
 

 
 
64

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

 
 
Family 5 Methods For Cell Expansion And Uses Of Cells And Conditioned Media
Produced Thereby For Therapy
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
23-Mar-2006
60/784,769
   
USA
PRO
   
26-Sep-2006
60/847,088
   
PCT
 
23-Mar-2006
60/784,769
 
22-Mar-2007
PCT/IL2007/000380
 
27-Sep-2007 WO/2007/108003
USA
NP
22-Mar-2006
60/784,769
14-Oct-2009
22-Mar-2007
12/225,478
   
Mexico
NP
23-Mar-2006
60/784,769
22-Sep-2008
22-Mar-2007
MX/a/2008/012085
   
Australia
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
2007228341
   
South Africa
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
2008/09038
 
2008/09038
 
Europe
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
07713395.7
 
101861156
13-Oct-2010
Israel
NP
23-Mar-2006
60/784,769
21-Sep-2008
22-Mar-2007
194232
   
China
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
200780018851.7
 
101558151
14-Oct-2009
Hong Kong
NP
23-Mar-2006
60/784,769
08-Apr-2010
2-Mar-2007
10103472.9
   

 
 
65

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

 
 
Russian Federation
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
2008141894
   
Brazil
NP
23-Mar-2006
60/784,769
23-Sep-2008
22-Mar-2007
PI0709349-7
   
India
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
02256/MUMNP/2008
   
Singapore
NP
23-Mar-2006
60/784,769
 
22-Mar-2007
200807095-5
   
Korea, Republic of
NP
23-Mar-2006
60/784,769
17-Oct-2008
22-Mar-2007
2008-7025460
   
USA
CIP
22-Mar-2006
60/784,769
 
22-Mar-2007
13/069,130
   
Japan
NP
23-Mar-2006
60/784,769
24-Sep-2008
22-Mar-2007
2009-502327
04-Jun-2010
4523169
 
Canada
NP
23-Mar-2006
60/784,769
18-Sep-2008
22-Mar-2007
2,646,384
   

 
 
66

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

 
 
Family  6 Methods for Cell Expansion and Uses of Cells and Conditioned Media
Produced Thereby for Therapy
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
19-Sep-2007
60/960,184
   
PCT
 
   
02-Sep-2008
PCT/IL2008/001185
 
26-Jun-2009
WO/2009/037690
Israel
NP
19-Sep-2007
60/960,184
17-Mar-2010
02-Sep-2008
204566
   
USA
NP
19-Sep-2007
60/960,184
18-Mar-2010
02-Sep-2008
12/678,756
   
Japan
NP
19-Sep-2007
60/960,184
19-Mar-2010
02-Sep-2008
2010-525491
   
Canada
NP
19-Sep-2007
60/960,184
15-Mar-2010
02-Sep-2008
2,699,664
   
Mexico
NP
19-Sep-2007
60/960,184
18-Mar-2010
02-Sep-2008
MX/a/2010/003019
   
Australia
NP
19-Sep-2007
60/960,184
 
02-Sep-2008
2008300185
   

 
 
67

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

 
 
South Africa
NP
19-Sep-2007
60/960,184
 
02-Sep-2008
2010/01929
23-Feb-2011
2010/01929
 
Europe
NP
19-Sep-2007
60/960,184
 
02-Sep-2008
08789856.5
   
Hong Kong
NP
   
29-Dec-2010
10112211.6
   
China
NP
19-Sep-2007
60/960,184
 
02-Sep-2008
200880116645.4
   
Russian Federation
NP
19-Sep-2007
60/960,184
16-Mar-2010
02-Sep-2008
2010109698
   
Brazil
NP
19-Sep-2007
60/960,184
19-Mar-2010
02-Sep-2008
PI08159467
   
India
NP
19-Sep-2007
60/960,184
16-Mar-2010
02-Sep-2008
519/MUMNP/2010
   
Singapore
NP
19-Sep-2007
60/960,184
 
02-Sep-2008
201001822-4
   
Korea, Republic of
NP
19-Sep-2007
60/960,184
15-Apr-2010
02-Sep-2008
2010-7008253
   
USA
NP
19-Sep-2007
60/960,184
       

 
 
68

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

 
 
Family  7 Methods of Treating Crohn's Disease
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
27-May-2008
61/071,944
   
PCT
 
27-May-2008
61/071,944
 
26-May-2009
PCT/IL2009/000527
 
03-Dec-2009
WO2009/144720
China
NP
27-May-2008
61/071,944
 
26-May-2009
200980129576.5
   
Russian Federation
NP
27-May-2008
61/071,944
 
26-May-2009
2010153362
   
Australia
NP
27-May-2008
61/071,944
09-Dec-2010
26-May-2009
2009252722
   

 
 
69

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

 
 
South Africa
NP
27-May-2008
61/071,944
 
26-May-2009
2010/09030
   
Europe
NP
27-May-2008
61/071,944
 
26-May-2009
09754339.1
   
Canada
NP
27-May-2008
61/071,944
 
26-May-2009
2,725,637
   
Brazil
NP
27-May-2008
61/071,944
29-Nov-2010
26-May-2009
PI09095411
   
USA
NP
27-May-2008
61/071,944
01-Feb-2011
26-May-2009
12/994,603
   
Israel
NP
27-May-2008
61/071,944
28-Nov-2010
26-May-2009
209603
   

 
 
70

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

 
 
Family  8 Methods Of Selection Of Cells For Transplantation
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
02-Sep-2008
61/136,374
   
PCT
 
02-Sep-2008
61/136,374
 
01-Sep-2009
PCT/IL2009/000844
 
11-Mar-2010
WO/2010/026573
Israel
NP
02-Sep-2008
61/136,374
01-Mar-2011
01-Sep-2009
211500
   
Europe
NP
02-Sep-2008
61/136,374
 
01-Sep-2009
09737160.3
   
USA
NP
02-Sep-2008
61/136,374
01-Mar-2011
01-Sep-2009
13/061,605
   

 
Family 9 Adherent Cells From Placenta Tissue And Use Thereof In Therapy
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
02-Sep-2008
61/136,375
   
USA
PRO
   
23-Jan-2009
61/202,050
   
PCT
 
02-Sep-2008
61/136,375
 
01-Sep-2009
PCT/IL2009/000846
 
11-Mar-2010
WO2010/026575
Europe
NP
02-Sep-2008
61/136,375
 
01-Sep-2009
09737162.9
   

 
 
71

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

 
 
India
NP
02-Sep-2008
61/136,375
24-Mar-2011
01-Sep-2009
2200/DELNP/2011
   
Mexico
NP
02-Sep-2008
61/136,375
01-Mar-2011
01-Sep-2009
MX/a/2011/002328
   
Singapore
NP
02-Sep-2008
61/136,375
 
01-Sep-2009
NYD
   
China
NP
02-Sep-2008
61/136,375
29-Apr-2011
01-Sep-2009
NYD
   
Australia
NP
02-Sep-2008
61/136,375
31-Mar-2011
01-Sep-2009
2009288781
   
Israel
NP
02-Sep-2008
61/136,375
02-Mar-2011
01-Sep-2009
211525
   
Brazil
NP
02-Sep-2008
61/136,375
03-Mar-2011
01-Sep-2009
NYD
   
Russian Federation
NP
02-Sep-2008
61/136,375
 
01-Sep-2009
NYD
   
South Africa
NP
02-Sep-2008
61/136,375
03-Mar-2011
01-Sep-2009
2011/01750
   
Canada
NP
02-Sep-2008
61/136,375
01-Mar-2011
01-Sep-2009
NYD
   
USA
NP
02-Sep-2008
61/136,375
01-Mar-2011
01-Sep-2009
13/061,538
   

 
 
72

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

 
 
Family 10 Adherent Cells From Placenta Tissue And Use Thereof In Therapy
 
USA
PRO
   
02-Sep-2008
61/136,377
   
USA
PRO
   
23-Jan-2009
61/202,049
   
PCT
 
02-Sep-2008
61/136,377
 
01-Sep-2009
PCT/IL2009/000845
 
11-Mar-2010
WO/2010/026574
Europe
NP
02-Sep-2008
61/136,377
 
01-Sep-2009
09737161.1
   
Israel
NP
02-Sep-2008
61/136,377
01-Mar-2011
01-Sep-2009
211501
   
USA
NP
02-Sep-2008
61/136,377
01-Mar-2011
01-Sep-2009
13/061,656
   

 
 
73

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

 
 
Family 11-  Adherent Cells From Placenta And Use Of Same In Disease Treatment
 
Country
Earliest Priority
Entry Date
Filing Date
 Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA PRO
   
06-Aug-2010
61/371,459
   
PCT
 
30-Nov-2009
61/272,985
 
29-Nov-2010
TBA
   
USA PRO
   
30-Nov-2009
61/272,985
   

 
Family  12 Adherent Stromal Cells Derived From Plancentas Of Multiple Donors And
Uses Thereof
 
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
23-Apr-2010
61/327,330
   
Country
Earliest Priority
Entry Date
Filing Date
Application No.
Issue Date
Patent No.
Publication Date
Publication No.
PCT
 
23-Apr-2010
61/327,330
 
21-Apr-2011
NYD
   

 
 
74

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Family 13- Methods And Systems For Harvesting Adherent Stromal Cells
 
Country
Earliest Priority
Entry Date
Filing Date
 Application No.
Issue Date
Patent No.
Publication Date
Publication No.
USA
PRO
   
15-Apr-2011
61/475,761
   

 

 
75

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Exhibit ‎1.1(www): Safety Agreement Table of Contents
 
A. 
Background

 
B. 
General Considerations

Management of a Single Global Safety Database
Adherence to Standard Operating Procedures
Qualified Persons for Pharmacovigilance
Rights of Pharmacovigilance Audit
Records Retention
Data Reconciliation
 
C. 
Adverse Event Reporting and Exchange

Clock Start Date for Expedited Reporting
Regulatory Reporting Responsibilities
Language, Format and Mode for Information Exchange
Timing Requirements
Assessing Listedness
Responsibilities for Obtaining Follow-Up Information
Literature Review
Collection of Lot Numbers
Data Required for Internal Committees
 
D. 
Risk Management

Risk Management Plan Development and Maintenance
Safety Signal Detection and Surveillance
 
E. 
Periodic Reports

 
F. 
Regulatory Inquiry from Health Authorities

 
G. 
Regulatory Inspections

 
H. 
Dispute Resolution

 
I. 
Safety Agreement Termination

 
Attachment 1: Contacts
Attachment 2: Adverse Event Reporting Contacts
Attachment 3: Territories
Attachment 4: AE Process Flow and Case Receipt Reconciliation
 
 
76

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Exhibit ‎6.2: Commercial Supply Terms
 
1.
Unless otherwise specified in the Agreement, this Exhibit sets forth material
terms and conditions which shall be incorporated into a Manufacturing and Supply
Agreement to be negotiated and entered into by the Parties for the Product in
accordance with Section ‎6.2 of the Agreement.

 
2.
Capitalized terms used but not defined in this term sheet shall have the
meanings assigned to them in the Agreement.

 
3.
Pluristem will sell, and UTC will buy, UTC’s requirements of Product for
commercial supply.

 
4.
Supply of Product would be provided in the form of the supply of PLX in
accordance with the Specifications, which UTC may finish or have finished by a
Representative.

 
5.
The Manufacturing and Supply Agreement will set forth a forecast procedure for
Product to be provided thereunder. The forecast procedure will contemplate UTC’s
needs for reasonable flexibility in forecasting and Pluristem’s needs for
sufficient information and certainty to reasonably enable it to timely supply
UTC.

 
6.
Orders will be placed at a reasonable in advance, given the needs for the
Product, the shelf-life of the Product, and the time necessary to obtain raw
materials and manufacture Product. UTC will only order Product as it reasonably
anticipates it will need for its purposes.

 
7.
The Parties shall adopt a reasonable procedure for arriving at binding
commitments for the supply and purchase of the Product.

 
8.
Pluristem will ensure all such Product complies with the Specifications. The
Manufacturing and Supply Agreement shall specify the remaining shelf-life upon
delivery of Product.

 
9.
The Price of all Product shall be Cost of Goods Sold plus **THE CONFIDENTIAL
PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND
HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**.

 
10.
In the event of any shortage of Product, Pluristem will allocate product such in
accordance with the Agreement.

 
11.
Any changes to the Product in the Field or its Manufacture, including those
specific to a particular indication or Applicable Laws or the requirements of
any Regulatory Authority shall be agreed to in writing between the Parties,
acting reasonably.

 
12.
Pluristem will be responsible for obtaining and maintaining all necessary
approvals, licenses and documentation related to the export of Product,
including all necessary approvals and documentation related to the master file
and the accreditation of manufacturers. Each Party shall provide copies thereof
to the other as requested at least 60 days prior to the first scheduled delivery
of Product, such provision to be commensurate with the Agreement.

 
13.
UTC will have a reasonable period to test Product for conformance with the
Specifications. In the event of any disagreement as to compliance with the
Specifications upon delivery, such matter will be determined by an independent
third party.

 
 
77

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14.
Pluristem will have sole regulatory responsibility for all manufacturing matters
and will cooperate with UTC with respect thereto.

 
15.
Confidentiality provisions will be included commensurate with those contained in
the Agreement.

 
16.
Concurrently with the negotiation of the Manufacturing and Supply Agreement, the
parties will develop and agree upon a quality agreement governing the quality
and specifications of Product, which agreement shall form a part of the
Manufacturing and Supply Agreement and be subject to settlement of its terms in
the same manner as the Manufacturing and Supply Agreement.

 
17.
The insurance and indemnity provisions shall be commensurate with the Agreement.

 
18.
The term and termination provisions shall be commensurate with Agreement.

 
19.
The Manufacturing and Supply Agreement shall contain other customary and
appropriate provisions including provisions for representations and warranties,
and the like, and, subject to the specifics set out in this Exhibit, all such
terms to be commercially reasonable and customary for supply agreements in the
life sciences context.

 
 
78

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

 
 
Exhibit ‎6.8: Funded Technology
 
Any and all Pluristem Technology related to PLX.
 
 
79

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

 
 
Exhibit ‎8.6: Wire Instructions
 
**THE CONFIDENTIAL PORTION HAS BEEN SO OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT AND HAS BEEN FILED SEPARATELY WITH THE COMMISSION.**
 
 
80

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Exhibit ‎11.5: Press Release
 
[pluristem.jpg]`

 
Pluristem and United Therapeutics Enter into an Exclusive License
Agreement to Develop and Commercialize PLX Cells for the Treatment of
Pulmonary Hypertension
 
HAIFA, ISRAEL, June 20, 2011 -- Pluristem Therapeutics Inc. (NasdaqCM: PSTI;
TASE: PLTR) today announced that its wholly owned subsidiary, Pluristem Ltd.,
has entered into an exclusive out-license agreement with United Therapeutics
Corporation (NasdaqGS: UTHR) for the use of Pluristem’s PLacental eXpanded (PLX)
cells to develop and commercialize a cell-based product for the treatment of
Pulmonary Hypertension (PH).
 
Under the terms of the agreement, United Therapeutics will receive exclusive
worldwide licensing rights for the development and commercialization of the
future product for treating PH patients. Pluristem will retain all manufacturing
rights; participate in the pre-clinical and clinical trial activities as well as
provide the commercial grade product.
 
Under the terms of the agreement, United Therapeutics will make an upfront
payment of $7 million to Pluristem. Pluristem is eligible to receive regulatory
milestone payments and other payments accumulating together with the upfront
payment to a total of approximately $55 million and reimbursement of costs of
its development and clinical activities. United Therapeutics will bear all the
costs of conducting the clinical trials for this indication.  Following
commercialization, United Therapeutics shall purchase commercial supplies from
Pluristem at a specified margin over Pluristem’s cost. In addition, United
Therapeutics will pay Pluristem specified royalties as a percentage from its
gross profits generated from the developed product.
 
"This is an important milestone for our company, as it exemplifies our belief
that Pluristem's PLX cells are a platform technology that can be used for the
treatment of numerous diseases. This agreement is in line with our strategy of
being a state of the art cell manufacturer while maintaining all the production
and Intellectual Property rights for future product candidates", said Zami
Aberman, Chairman and CEO of Pluristem. "We are very pleased to partner with
United Therapeutics, an expert and a leader in the area of PH, and to cooperate
with their talented team to quickly bring this product to market and improve the
quality of life of Pulmonary Hypertension patients."
 
 
81

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

 
 
"Our mission to help patients suffering from Pulmonary Hypertension has led us
to seek companies exhibiting innovative approaches and cutting edge technology,
with whom we could partner for developing new therapies. Pluristem's impressive
results of their current clinical trials, their strong intellectual property and
unique manufacturing capabilities, convinced us to select Pluristem as our
partner in developing an important cell therapy for treating PH", said Roger
Jeffs, President and Chief Operating Officer of United Therapeutics. "We are
excited to enter into this partnership and to work alongside Pluristem in
advancing this exciting platform."
 
The signing ceremony will be held tomorrow, June 21st at 09:30 Israel time at
the Tel Aviv Stock Exchange in the presence of Dr. Roger Jeffs, President and
Chief Operating Officer of United Therapeutics, and Mr. Zami Aberman, Chairman
and CEO of Pluristem Therapeutics.
 
Closing of the agreement is subject to certain closing conditions and is
expected by the end of August 2011.
 
# # #
 
About Pulmonary Hypertension (PH)
 
Pulmonary Hypertension is the damage that occurs to the pulmonary vessels
(leading from the heart to the lungs) when the blood pressure in those vessels
is abnormally high. The disease can be secondary to other conditions or
unrelated to any identifiable disorder. Approximately 1,000 new cases of this
catastrophic disorder are diagnosed annually in the US*.
 
*National Library of Medicine
 
About United Therapeutics Corporation
 
United Therapeutics Corporation (NasdaqGS: UTHR) is a biotechnology company
focused on the development and commercialization of unique products to address
the unmet medical needs of patients with chronic and life-threatening
conditions, including cardiovascular, cancer, and infectious diseases.  
 
About Pluristem Therapeutics
 
Pluristem Therapeutics Inc. (NasdaqCM: PSTI; TASE: PLTR) is a leading developer
of placenta-based cell therapies. The company's patented PLX (PLacental
eXpanded) cells drug delivery platform releases a cocktail of therapeutic
proteins in response to a host of local and systemic inflammatory diseases. PLX
cells are grown using the company’s proprietary 3D micro-environmental
technology and are an off-the-shelf product that requires no tissue matching
prior to administration. Data from two phase I studies indicate that Pluristem’s
first PLX product candidate, PLX-PAD, is safe and potentially effective for the
treatment of end stage peripheral artery disease. Pluristem’s pre-clinical
animal models have demonstrated PLX cells are also potentially effective in
nerve pain and muscle damage, when administered locally, and in inflammatory
bowel disease, MS and stroke, when administered systemically.
 
 
82

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

 
 
Pluristem has a strong patent portfolio, GMP certified manufacturing and
research facilities, strategic relationships with major research institutions
and a seasoned management team.
 
For more information visit www.pluristem.com, or follow us on Twitter
@Pluristem, the content of which is not part of this press release.
 
Investor Relations Contact:
 
Pluristem:
 
William Prather R.Ph., M.D.
Sr. VP Corporate Development
1-303-883-4954
William.PratherMD@pluristem.com
 
Daya Lettvin
Investor & Media Relations Director
+972-54-647-5580
daya@pluristem.com
 
Media Contact:
 
Pluristem:
 
Matthew Krieger
Ruder Finn – for Pluristem
+972-54-467-6950
matthew@ruderfinn.co.il
 
 
83

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Safe Harbor Statement
 
This press release contains forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of 1995
and federal securities laws. For example, we are using forward looking
statements when we discuss thebelief that our PLX cells are a platform
technology that can be used for the treatment of numerous diseases, when we
discuss the timing to bring this product to market and its ability to improve
the quality of life of Pulmonary Hypertension patients, when we say that closing
of the agreement with United Therapeutics is expected by the end of August 2011
and imply that we may receive future payments if our products are commercialized
and generate gross profits or when we say that data from two Phase I clinical
trials indicate that Pluristem’s first PLX product, PLX-PAD, is safe and
potentially effective for the treatment of end stage PAD or that Pluristem’s
pre-clinical animal models have demonstrated PLX cells are also potentially
effective in nerve pain and muscle damage when administered locally and in
inflammatory bowel disease, MS and stroke when administered systemically. These
forward-looking statements are based on the current expectations of the
management of Pluristem only, and are subject to a number of factors and
uncertainties that could cause actual results to differ materially from those
described in the forward-looking statements. The following factors, among
others, could cause actual results to differ materially from those described in
the forward-looking statements: changes in technology and market requirements;
we may encounter delays or obstacles in launching our clinical trials; our
technology may not be validated as we progress further and our methods may not
be accepted by the scientific community; we may be unable to retain or attract
key employees whose knowledge is essential to the development of our products;
unforeseen scientific difficulties may develop with our process; our products
may wind up being more expensive than we anticipate; results in the laboratory
may not translate to equally good results in real surgical settings; our patents
may not be sufficient; our products may harm recipients; changes in legislation;
inability to timely develop and introduce or commercialize new technologies,
products and applications; loss of market share and pressure on pricing
resulting from competition, which could cause the actual results or performance
of Pluristem to differ materially from those contemplated in such
forward-looking statements. Except as otherwise required by law, Pluristem
undertakes no obligation to publicly release any revisions to these
forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events. For a more detailed
description of the risks and uncertainties affecting Pluristem, reference is
made to Pluristem's reports filed from time to time with the Securities and
Exchange Commission.
 
84

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