*Certain confidential information contained in this document, marked by
brackets, has been omitted and filed with the Securities and Exchange Commission
pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.

 
LICENSE AGREEMENT
 
THIS AGREEMENT (the “Agreement”) is made and is effective December 5, 2006, (the
“Effective Date”) by and between Targeted Genetics Corporation, a corporation
having a principal place of business at 1100 Olive Way, Suite 100, Seattle,
Washington 98101 (“TGC”), and Amsterdam Molecular Therapeutics B.V. (“AMT”), a
corporation having a principal place of business at Meibergdreef 61, 1100 DA
Amsterdam, The Netherlands.
 
RECITALS
 
WHEREAS, TGC has exclusively licensed the Licensed Patent Rights (relating to an
AAV1 Vector gene delivery system) from the University of Pennsylvania as part of
a license agreement entered into between TGC and the University of Pennsylvania
(“UPenn”) with the effective date of June 1, 2002 (“UPenn Agreement”).
 
WHEREAS, AMT is developing an AAV1 product to treat LPL type 1 and LPL type 5
deficiency that requires a license to the Licensed Patent Rights and therefore
seeks a license to the Licensed Patent Rights in the Field, as such terms are
defined herein; and
 
WHEREAS, TGC is willing to grant such a license on the terms set forth herein
and the University of Pennsylvania is willing to acknowledge such grant of a
sublicense.
 
NOW THEREFORE, the parties agree as follows:
 
1. DEFINITIONS
 
1.1 “AAV1 Vector” means the adeno-associated virus serotype 1 vector technology
which includes without limitation the AAV serotype 1 rep, cap, and ITR sequences
and proteins whether utilized in whole or in part to deliver therapeutic genes
into cells, and which is the subject of the Licensed Patent Rights
 
1.2 “Affiliate” means any company or other legal entity other than AMT in
whatever country organized, controlling, controlled by or under common control
with AMT. The term “control” means possession, direct or indirect, of the powers
to direct, cause or significantly influence the direction of the management and
policies of the company or entity in question, whether through the ownership of
voting securities, by contract or otherwise.
 
1.3 “Federal Government Interest” means the rights of the United States
Government under Public Laws 96-517, 97-256 and 98-620, codified at 35 U.S.C.
200-212, and any regulations issued thereunder, as such statute or regulations
may be amended from time to time hereafter.
 

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1.4 “Field” means treatment of LPL deficiency type 1 and LPL deficiency type 5
by in vivo gene therapy utilizing an AAV1 Vector encoding the LPL gene.
 
1.5 “Included CIPs” has the meaning given in Paragraph 1.9.
 
1.6 “License” has the meaning given in Paragraph 2.1.
 
1.7 “LPL” means Lipoprotein Lipase.
 
1.8 “Licensed Patent Rights” means rights to any subject matter described or
claimed in U.S. Patent Nos. 6,759,237 and 7,105,345;and all foreign counterparts
including all continuations, divisionals, and any continuation-in-part
applications, to the extent that such continuation-in- part (or any continuation
or divisional thereof) has claims directed to subject matter enabled and
described in U.S. Patent Nos. 6.759,237 and 7,105,345 and such claims are
necessary or relevant for the Field ( collectively, “Included CIPs”); any
patents issuing on said applications, continuing applications, divisional
applications, including reissues and reexaminations thereof, and any foreign
applications or patents corresponding directly thereto.
 
1.9 “Licensed Product” means a product in the Field that, absent the License,
would in the country of sale infringe any Valid Claim within the Licensed Patent
Rights in such country.
 
1.10 “Net Sales” means [*].
 
1.11 “Person” means an individual, sole proprietorship, partnership, limited
partnership, limited liability partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, or other similar entity or organization, including without
limitation, a government or political subdivision, department or agency of a
government.
 
1.12 “Royalties” has the meaning given in Paragraph 4.1.
 
1.13 “Third Party” means any Person other than AMT, TGC or any of their
respective Affiliates.
 
1.14 “Valid Claim” means
 

 
i)
a claim of an issued and unexpired patent included within Licensed Patent
Rights, which has not been held permanently revoked, unenforceable or invalid by
a decision of a court or other governmental agency of competent jurisdiction,
unappealable or un-appealed within the time allowed for appeal, and which has
not been admitted to be invalid or unenforceable through reissue or disclaimer
or otherwise; or

 
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ii)
a claim of a pending patent application included within Licensed Patent Rights
which claim was filed and is being prosecuted in good faith and has not been
abandoned or finally disallowed without the possibility of appeal or refiling of
the application, provided that no more than [eight (8)] years have passed since
the earliest priority date for such application.

 
2. GRANT
 
2.1 TGC grants to AMT a non-exclusive, non-sublicensable license under the
Licensed Patent Rights in each country of the world where there are Valid Claims
of Licensed Patent Rights, to make, have made, develop, use, sell, offer to sell
and import Licensed Products (the “License”).
 
2.2 AMT acknowledges that in accordance with the Federal Government Interest,
the United States government retains certain rights in intellectual property
funded in whole or part under any contract, grant or similar agreement with a
Federal agency, including but not limited to the requirement that Licensed
Products subject to sale in the United States must be substantially manufactured
in the United States. The license grant of this Article 2 is expressly subject
to all of such rights.
 
2.3 UPenn retains the reserved right to use, and to permit other for-profit or
nonprofit organizations to use, the Licensed Patent Rights strictly for
educational and for research purposes. Any such rights of U Penn or a third
party to practice the Licensed Patent Rights for educational or research
purposes shall be royalty-free.
 
3. CONSIDERATION AND MAINTENANCE FEES
 
3.1 Upon signing this Agreement, AMT shall pay to TGC a $1,750,000 fee in
consideration of the License.
 
3.2 Upon the first anniversary of the Effective Date and upon each anniversary
during the Term thereafter, AMT shall pay to TGC a $[*] maintenance fee for
maintenance of the License.
 
4. ROYALTIES AND PAYMENTS
 
4.1 AMT shall pay to TGC earned royalties based on Net Sales (“Royalties”) in
the amount of: (i) [*] percent ([*]%) of the Net Sales of Licensed Products if
cumulative Net Sales are less than $[*], or (ii) [*] percent ([*]%) of the Net
Sales of Licensed Products if cumulative Net Sales are equal to or greater than
$[*] but less than $[*], or (iii) [*] percent ([*]%) of Net Sales of Licensed
Products if cumulative Net Sales are $[*] or more. [*] The Net Sales thresholds
in such section (i)-(iii) will be applied separately to each distinct Licensed
Product, but where the same Licensed Product is packaged or labeled differently
in different nations, or otherwise to accommodate the same to different markets
or indications, the Net Sales thereof in all such nations, markets and
indications shall be aggregated.
 
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4.2 In addition to the Royalties and other payments set forth herein, AMT shall
pay TGC the following “Milestone Payments.” For the purposes of this Agreement,
the human clinical trial designations of phase I, phase II, phase III, and
Biologic License Application, or BLA, while referring to United States Food and
Drug Administration shall also be construed to mean any such jurisdiction the
equivalent designation applied to clinical trial and drug development of similar
status by the appropriate foreign governmental health regulatory agency. [*]:
 
Section
 
Milestone
 
Milestone Payments
4.2.1
 
[*]
 
$[*]
4.2.2
 
[*]
 
$[*]
4.2.3
 
[*]
 
$[*]
4.2.4
 
[*]
 
$[*]
4.2.5
 
[*]
 
$[*]

 
4.3 Royalties accruing to TGC shall be paid to TGC on a quarterly basis. Each
such payment will be for royalties which accrued within the most recently
completed calendar quarter and payment shall be made by AMT within thirty (30)
days of the end of such calendar quarter.
 
4.4 Milestone Payments shall be paid to TGC within thirty (30) days of
achievement.
 
4.5 Royalty or Milestone Amounts that are not paid when due shall accrue
interest from the due date until paid, at a rate equal to one and one quarter
percent (1.25%) per month (or the maximum allowed by law, if less).
 
4.6 AMT must maintain complete and accurate books and records which enable the
Royalties, fees, and payments payable under this Agreement to be verified. The
records for each calendar quarter must be maintained for three (3) years after
the submission of each report under Article 4. Upon reasonable prior written
notice to AMT from TGC, AMT shall permit a certified public accountant or a
person possessing similar professional status and associated with an independent
accounting firm reasonably acceptable to AMT to inspect all books and records
relating to the sales of Licensed Products by AMT as necessary to verify the
same. Access to these books and records pertaining to Net Sales must be made
available no more than once each calendar year for each Licensed Product, during
normal business hours, and once each year for each Licensed Product during each
of the three (3) years after expiration or termination of this Agreement. The
accounting firm shall enter into appropriate obligations with AMT to treat all
information it receives during its inspection in confidence. The accounting firm
shall disclose to the parties only whether such books and records are correct
and details concerning any discrepancies, but no other information shall be
disclosed to TGC. The charges of the accounting firm shall be paid by TCG,
except if a review or audit of such books and records of AMT determines that AMT
has underpaid royalties on Licensed Products by five percent (5%) or more then
AMT must pay the charges of the accounting firm in connection with such review
or audit. Notwithstanding the foregoing, AMT agrees to conduct, at its expense,
an independent audit of sales and Royalties with respect to a Licensed Product
at least every two (2) years once annual sales of such Licensed Product are
greater than five million dollars ($5,000,000) per annum. The audit shall
address, at a minimum, the amount of gross sales by or on behalf of AMT during
the audit period, the amount of funds owed to TGC under this Agreement, and
whether the amount owed has been paid to TGC and is reflected in the records of
the AMT. A report by the auditors shall be submitted promptly to TGC upon
completion.
 
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4.7 In the event that any patent or any claim thereof included within the
Licensed Patent Rights shall be held invalid or unenforceable in a final
decision by a court of competent jurisdiction from which no appeal has or can be
taken, any and all obligation to pay Royalties based solely on such patent or
claim shall cease as of the date of such final decision.
 
4.8 Any component of Net Sales denominated in currencies other than U.S. Dollars
shall be converted into U.S. Dollars in accordance with the provisions of this
paragraph, and reported in U.S. Dollars. All payments required under this
Agreement from time to time shall be made in U.S. Dollars. Any currency
conversions shall be made using the average quarterly exchange rates published
regularly by Citibank, New York, or its successor. The average will be
calculated by summing the exchange rates for the final business day of each of
the three (3) months in the applicable calendar quarter and dividing by three
(3). All currency conversions will be calculated to an accuracy of three (3)
digits after the decimal point.
 
5. PATENT FILING, PROSECUTION AND MAINTENANCE
 
5.1 As between the parties, TGC shall have the responsibility for the
preparation, filing, prosecution and maintenance of the Licensed Patent Rights
in the United States and foreign countries for which patent protection has been
sought. TGC shall maintain the Licensed Patent Rights in all territories for the
maximum time period permitted by applicable law, including by timely paying all
applicable maintenance fees and diligently prosecuting any patent applications
and diligently defending any Third Party challenges to validity or
enforceability.
 
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6. PATENT INFRINGEMENT
 
6.1 In the event that AMT learns of the infringement of any Licensed Patent
Rights by the manufacture, use or sale of a product in the Field, AMT shall so
inform TGC in writing and shall provide TGC with reasonable evidence of such
infringement.
 
6.2 As between the parties, TGC shall have the first right but not the
obligation to prosecute such infringement of the Licensed Patent Rights. In the
event such infringement relates specifically to the manufacture, use or sale of
a product in the Field, AMT shall have the right but not the obligation to
participate in such infringement litigation and be represented by counsel of its
choice at its own expense. In the event TGC notifies AMT that it will not bring
such action as it relates specifically to the manufacture, use or sale of a
product in the Field, AMT at it is own expense shall have the right to bring
such action and shall cause TGC to be joined in such action in jurisdictions
where it is necessary for TGC to be named in order for AMT to have standing in
such infringement litigations; provided, however, that AMT shall allow TGC to
participate and be represented by counsel of its own choice at AMT’s sole
expense. AMT shall not nor shall AMT cause TGC to settle or compromise any such
suit in a manner that imposes any obligations or restrictions on TGC or grants
any License Patent Rights without TGC’s written permission.
 
6.3 Each party shall, at the request and expense of the party initiating such
suit, cooperate in all respects, including being joined as a named party, and,
to the extent possible, have its employees testify when requested and make
available relevant records, papers, information, samples, specimens, and the
like. No such suit shall be settled by a party in any manner which diminishes
the rights of the other party hereto under this Agreement without the written
agreement of both parties.
 
6.4 Any legal action against a third party under this Section 6 shall be at the
expense of the party on account of whom suit is brought and recoveries recovered
thereby shall first be allocated to reimburse the expenses of the parties on a
pro rata basis, after which, when the infringement relates to the manufacture,
use or sale of a product in the Field,, any remaining recoveries shall belong to
AMT and AMT shall pay TGC royalty amounts set forth in Section 4 on such
remaining recoveries as if such recoveries were Net Sales.
 
7. REPORTING
 
7.1 AMT will make quarterly royalty reports to TGC on or before each January 30,
April 30, July 30 and October 30 of each year (i.e., within thirty (30) days
from the end of each calendar quarter) and certified by the chief financial
officer of AMT. Each such royalty report will cover AMT’s most recently
completed calendar quarter and will show: (a) the gross sales and Net Sales of
Licensed Products sold by AMT during the most recently completed calendar
quarter, including (i) all amounts invoiced, billed, or received; and (ii) the
number of units and the country of sale; and (b) the Royalties payable hereunder
with respect to such. If no sales of Licensed Products have been made during any
reporting period, a statement to this effect shall be provided by AMT to TGC.
 
7.2 Progress Reports.
 
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7.2.1 AMT will provide TGC with a written plan relating to AMT’s development in
the Field (the “Development Plan”) within thirty (30) days after the signing of
this Agreement by both parties. The Development Plan will outline the disease
indications, patient populations to be addressed, publicly available information
on competition and estimates of development timelines for AMT’s products in the
Field. The Development Plan will separately address activities applicable to
each Licensed Product.

7.2.2 At or within thirty (30) days following each anniversary of the Effective
Date, AMT will provide TGC with a written progress report that describes any
progress made against the Development Plan (as supplemented by progress reports,
where applicable) submitted a year earlier and plans for development in the
coming year. AMT shall also notify TGC within thirty (30) days of the first
commercial sale of any Licensed Product.

7.2.3 AMT will provide TGC with audited financial statements, produced by a
certified public accounting firm, ninety (90) days following the end of each of
AMT’s fiscal years, as well as a copy of any management letter recommendations
submitted by the auditors.

7.2.4 Where applicable AMT will provide TGC with copies of reports such as Form
10-K and Form 10-Q filings made to the United States Securities and Exchange
Commission or other similar regulatory agency outside of the United States.

7.2.5 TGC shall keep the Development Plan, all such progress reports, financial
statements and any other information AMT provided to TCG under this Section 7
confidential, other than the provision of such reports to the University of
Pennsylvania as required under the UPenn Agreement, for five (5) years or until
the time, if any, of the first commercial sale of any Licensed Product(s).
 
8. TERM OF THE AGREEMENT
 
8.1 Unless otherwise terminated in accordance with the terms of this Agreement,
this Agreement shall be in force from the Effective Date until the last to
expire Valid Claim of Licensed Patent Rights (the “Term”).
 
8.2 Any termination of this Agreement shall not affect the rights and
obligations set forth in the following Articles:

Article 6.4 Allocation of Patent Infringement Recovery
Article 11.2 Disposition of Licensed Products on Hand upon Termination
Article 13 Use of Names and Trademarks
Article 15 Indemnification
Article 20 Failure to Perform
Article 21 Governing Law
 
9. TERMINATION BY TGC
 
9.1 If AMT violates or fails to pay Royalties, Milestone Payments or fees under
Articles 3 or 4, or (ii) breaches or fails to perform, or has any other default,
under any contractual obligation of AMT to TGC and fails to repair any default
in Sections 9.1(i) or 9.1(ii) within thirty (30) days after receipt of such
notice of breach, TGC shall have the right to terminate this Agreement by a
second written notice (“Notice of Termination”) to AMT. If a Notice of
Termination is sent to AMT, this Agreement shall terminate fifteen (15) days
after receipt of such notice unless other terms are mutually agreed upon.
 
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9.2 If AMT shall cease its operations other than in connection with a
reorganization of its business in connection with a redomociliation or other
corporate event unrelated to the solvency of AMT, become bankrupt or insolvent,
apply for or consent to the appointment of a trustee, receiver or liquidator of
its assets or seek relief under any law for the aid of debtors then TGC shall
have the right to terminate the License.
 
10. TERMINATION BY AMT
 
10.1 AMT shall have the right to terminate this Agreement at any time, effective
sixty (60) days after receipt by TGC of a written notice of termination
delivered pursuant to this section.
 
10.2 AMT may terminate this Agreement with immediate effect by giving written
notice to TGC, if TGC ceases its operations, becomes insolvent, applies for or
consents to the appointment of a trustee, receiver or liquidator of its assets,
or seeks relief under any law for the aid of debtors. If TGC violates or fails
to perform any material term or covenant of this Agreement, then AMT may give
written notice of such default (“Notice of Default”) to TGC. If TGC fails to
repair such default within thirty (30) days after receipt of such Notice of
Default, AMT shall have the right to terminate this Agreement by a Notice of
Termination to TGC, effective immediately.
 
11. EFFECT OF TERMINATION, DISPOSITION OF LICENSED PRODUCTS UPON TERMINATION
 
11.1 Effect of Termination. Upon the termination of this Agreement, except
pursuant to Paragraph 10.2, the License granted by TGC to AMT hereunder shall
revert to TGC.
 
11.2 Upon termination of this Agreement for any reason, except pursuant to
Paragraph 10.2, AMT shall have the right to dispose of all previously made or
partially made Licensed Products, within a period of three (3) months; provided,
however, that the sale of such Licensed Products shall be subject to the terms
of this Agreement including, but not limited to, the payment of Royalties at the
rate and at the time provided herein and the rendering of reports.
 
11.3 Upon termination of this Agreement for any reason, except pursuant to
Paragraph 10.2, AMT shall pay, within thirty (30) days to TGC, pursuant to
Section 3 and 4, any and all amounts due within sixty (60) days of receipt by
TGC of a notice of termination from AMT.
 
11.4 Upon the termination of this Agreement pursuant to Paragraph 10.2 or the
termination of the UPenn Agreement, TGC’s rights hereunder shall be assigned
directly to the UPenn and shall remain in full force and effect under the terms
hereof; and, provided that AMT is not in material breach of this Agreement, the
rights and obligations of AMT herein (including but not limited to the License)
shall continue in full force and effect without expansion, restriction,
inhibition or diminution; provided that [*].
 
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11.5  Nothing herein shall constitute a waiver of either party's right to seek
damages in the event of a material breach of this Agreement by the other party.
 
12. PATENT MARKING
 
12.1 AMT agrees to mark all Licensed Products made, used or sold under the terms
of this Agreement, or their containers, in accordance with the applicable patent
marking laws.
 
13. USE OF NAMES AND TRADEMARKS
 
13.1 Unless required by law, nothing contained in this Agreement shall be
construed as conferring any right to use in advertising, publicity, or other
promotional activities any name, trade name, trademark, or other designation of
either party hereto or the UPenn (including any contraction or abbreviation of
the foregoing).
 
13.2 Unless required by law, neither party shall disclose, at any time, the
financial terms or events upon which financial obligations are triggered in the
License, save that TGC and AMT shall have the right to do so (i) to the extent
such disclosure is required in publicly filed financial statements or other
public statements under rules governing a stock exchange (e.g., the rules of the
United States Securities and Exchange Commission, NASDAQ, NYSE, Amsterdam, UKLA
or any other stock exchange on which securities issued by either Party may be
listed); and (ii) to its actual or potential investment bankers; (iii) to
existing and potential investors in connection with an offering or placement of
securities for purposes of obtaining financing for its business and to actual
and prospective lenders for the purpose of obtaining financing for its business;
and (iv) to a bona fide potential acquiror or merger partner for the purposes of
evaluating entering into a merger or acquisition, provided, however, any such
persons must be obligated to hold in confidence and not make use of such
confidential information for any purpose. A press release acknowledging the
grant of the License by TGC to AMT shall be publicly disclosed by either or both
parties, only upon mutual agreement of the text of such release by both parties.
 
14. REPRESENTATIONS, WARRANTIES AND COVENANTS
 
14.1 Each party hereby represents, warrants, and covenants to the other party as
of the Effective Date as follows:
 
i) such party (i) has the power and authority and the legal right to enter into
this Agreement and perform its obligations hereunder, and (ii) has taken all
necessary action on its part required to authorize the execution and delivery of
this Agreement and the performance of its obligations hereunder. This Agreement
has been duly executed and delivered on behalf of such party and constitutes a
legal, valid, binding obligation of such party and is enforceable against it in
accordance with its terms;
 
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ii) such party is not aware of any pending or threatened litigation (and has not
received any communication) that alleges that such party’s activities related to
this Agreement have violated, or that by conducting the activities as
contemplated herein such party would violate, any of the intellectual property
rights of any other Person;
 
iii) all necessary consents, approvals and authorizations of all governmental
authorities and other Persons or entities required to be obtained by such party
in connection with this Agreement have been obtained; and
 
14.2 TGC hereby represents, warrants, and covenants to AMT as of the Effective
Date that TGC is the exclusive licensee of the Licensed Patent Rights. During
the term of this Agreement, TGC shall use its best efforts not to encumber or
diminish the rights granted to AMT hereunder, including, without limitation, by
not committing any acts or permitting the occurrence of any omissions that would
cause the breach or termination of the UPenn Agreement. TGC shall promptly
provide AMT with notice of any alleged breach or termination of the UPenn
Agreement. As of the date hereof, TGC is not in breach of the UPenn Agreement,
and it is in full force and effect.
 
15. DISCLAIMER OF WARRANTY; INDEMNIFICATION
 
15.1 THE LICENSED PATENT RIGHTS AND LICENSED PRODUCTS ARE PROVIDED ON AN “AS IS”
BASIS AND TGC MAKES NO REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, WITH
RESPECT THERETO. BY WAY OF EXAMPLE BUT NOT OF LIMITATION, TGC MAKES NO
REPRESENTATION OR WARRANTY: (i) OF COMMERCIAL UTILITY; (ii) OF MERCHANTABILITY
OR FITNESS FOR A PARTICULAR PURPOSE; OR (iii) THAT THE USE OF THE LICENSED
PATENT RIGHTS AND LICENSED PRODUCTS UNDER THIS AGREEMENT WILL NOT INFRINGE ANY
PATENT, COPYRIGHT OR TRADEMARK OR OTHER PROPRIETARY OR PROPERTY RIGHTS OF
OTHERS. TGC SHALL NOT BE LIABLE TO AMT OR ANY THIRD PARTY WITH RESPECT TO: ANY
CLAIM ARISING FROM THE USE OF THE LICENSED PATENT RIGHTS AND LICENSED PRODUCTS
LICENSED UNDER THIS AGREEMENT OR FROM THE MANUFACTURE, USE OR SALE OF LICENSED
PRODUCTS; OR ANY CLAIM FOR LOSS OF PROFITS, LOSS OR INTERRUPTION OF BUSINESS, OR
FOR INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES OF ANY KIND.
 
15.2 AMT will defend, indemnify and hold harmless TGC and its trustees,
officers, agents and employees and UPenn and its trustees, officers, agents and
employees both collectively and severally (individually, an “Indemnified Party”,
and collectively, the “Indemnified Parties”), from and against any and all
liability, loss, damage, action, claim or expense suffered or incurred by the
Indemnified Parties (including attorney’s fees) (individually, a “Liability”,
and collectively, the “Liabilities”) that results from or arises out of (a) the
development, use, manufacture, promotion, sale or other disposition of any
Licensed Product by AMT or its collaborators or distributors; and (b) any breach
by AMT of any covenant or agreement contained in this Agreement; and (c) the
enforcement by an Indemnified Party of its rights under this Section. . Without
limiting the foregoing, AMT will defend, indemnify and hold harmless the
Indemnified Parties from and against any Liabilities resulting from:
 
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15.2.1 any product liability or other claim of any kind related to the use by a
third party of a Licensed Product that was manufactured, sold or otherwise
disposed of by AMT, or its collaborators or distributors, pursuant to and within
the scope of such relationships;
 
15.2.2 a claim by a third party that the use by AMT or its collaborators or
distributors, pursuant to and within the scope of such relationships, of
Licensed Patent Rights or the design, composition, manufacture, use, sale or
other disposition of any Licensed Product by AMT infringes or violates any
patent, copyright, trademark or other intellectual property rights of such third
party; and
 
15.2.3  clinical trials or studies conducted by or on behalf of AMT, or its
collaborators or distributors, pursuant to and within the scope of such
relationships, relating to the Licensed Products and Licensed Patent Rights,
including, without limitation, any claim by or on behalf of a human subject of
any such clinical trial or study, any claim arising from the procedures
specified in any protocol used in any such clinical trial or study, any claim of
deviation, authorized or unauthorized, from the protocols of any such clinical
trial or study, and any claim resulting from or arising out of the manufacture
or quality control by a third party of any substance administered in any
clinical trial or study.

Notwithstanding the foregoing, however, the Liabilities shall not include, and
in no instance shall AMT be required to indemnify any Indemnified Party with
respect to, any liability, claims, lawsuits, losses, damages, costs or expenses
to the extent the same are determined to be the result of any Indemnified
Party’s gross negligence or willful misconduct.

 
15.3 The Indemnified Party shall promptly notify AMT of any claim or action
giving rise to Liabilities subject to the provisions of the foregoing Section.
AMT shall have the right to defend or to cause to be defended any such claim or
action, at its cost and expense. AMT shall not settle or compromise any such
claim or action in a manner that imposes any restrictions or obligations on TGC
or grants any rights to Licensed Patent Rights or Licensed Products (other than
to the extent AMT has the right to grant such rights under this Agreement)
without TGC’s prior written consent. If AMT fails or declines to assume the
defense of any such claim or action within thirty (30) days after notice
thereof, TGC may assume the defense of such claim or action for the account and
at the risk of AMT, and any Liabilities related thereto shall be conclusively
deemed a liability of AMT; provided however, that TGC shall not settle such
claim or action if such settlement affects Licensed Patent Rights other than
those specifically at issue in such claim or action without AMT’s written
permission, which shall not be unreasonably withheld. AMT shall pay promptly to
the Indemnified Party any Liabilities to which the foregoing indemnity relates,
as incurred. The indemnification rights of TGC or other Indemnified Party
contained herein are in addition to all other rights which such Indemnified
Party may have at law or in equity or otherwise.
 
16. INSURANCE
 
16.1 AMT shall procure and maintain a policy or policies of commercial general
liability insurance, including broad form and contractual liability, in a
minimum amount of $[*] combined single limit per occurrence and in the aggregate
as respects personal injury, bodily injury and property damage arising out of
AMT’s performance of this Agreement.
 
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16.2 AMT shall, upon commencement of clinical trials involving Licensed
Products, procure and maintain a policy or policies of product liability
insurance in a minimum amount of $[*] combined single limit per occurrence and
in the aggregate as respects bodily injury and property damage arising out of
AMT’s performance of this Agreement.
 
16.3 AMT shall provide TGC with certificates evidencing the insurance coverage
required herein and all subsequent renewals thereof. Such certificates shall
provide that AMT’s insurance carrier(s) notify TGC in writing at least 30 days
prior to cancellation or material change in coverage. TGC will retain such
certificates and notices from AMT’s insurance carrier.
 
16.4 TGC shall periodically review the adequacy of the minimum limits of
liability specified herein. Further, TGC reserves the right to require AMT to
adjust such coverage limits in accordance with prevailing industry norms, to the
extent TGC is required to do the same by UPenn pursuant to the UPenn Agreement.
The specified minimum insurance amounts shall not constitute a limitation on
AMT’s obligation to indemnify TGC under this Agreement.
 
17. NOTICES
 
17.1 Any notice or payment required to be given to either party shall be deemed
to have been properly given and to be effective (a) on the date of delivery if
delivered in person or (b) five (5) days after mailing if mailed by a nationally
recognized courier or by first-class certified mail, postage paid, to the
respective addresses given below, or to such other address designated by written
notice, or sent via facsimile transmission to the number specified below.
 

For AMT:
Meibergdreef 61
P.O. Box 22506
1100 DA Amsterdam
The Netherlands
Fax: 31 (0) 20 566 92 72
Attention: CFO

 

For TGC:
1100 Olive Way, Suite 100
Seattle, Washington 98101
Fax: +1 206 223-0288
Attention: Chief Executive Officer

 
18. ASSIGNABILITY
 
18.1 This Agreement is binding upon and shall inure to the benefit of the
parties and their successors and assigns.
 
18.2 This Agreement may not be assigned by AMT without first obtaining the
express written consent of TGC. TGC shall not unreasonably withhold consent for
AMT to assign this Agreement to a Third Party in the event that AMT transfers
all or substantially all of the business of AMT to which the License relates to
a Third Party. Such Third Party shall assume all royalty obligations to TGC
hereunder. TGC further acknowledges that it shall not be entitled to any Royalty
or other compensation from the transaction pursuant to which the transfer to a
Third Party of all or substantially all of the business of AMT to which the
License relates took place.
 
*Confidential Treatment Requested

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19. WAIVER
 
19.1 It is agreed that no waiver by either party hereto of any breach or default
of any of the covenants or agreements herein set forth shall be deemed a waiver
as to any subsequent and/or similar breach or default.
 
19.2 UPenn, by its signature on this Agreement, expressly acknowledges and
agrees (1) to the terms of this sublicense; (2) to the extent that any term of
this sublicense is in conflict with the UPenn Agreement, the terms of this
Agreement shall govern as to the rights and obligations of AMT to TGC and AMT to
UPenn pursuant to this Agreement; and (3) to the extent any term of this
sublicense is in conflict with the UPenn Agreement, other than the UPenn
Agreement terms of Section 4.1.2 and 4.1.5, 4.3.2 and 4.3.3, the terms of this
Agreement shall govern as to the obligation of TGC to UPenn as they relate to
this specific Agreement. TGC shall be obligated to comply with Sections 4.1.2,
4.1.5, 4.3.2 and 4.3.3 of the UPenn Agreement as they relate to the financial
obligations of TGC to UPenn arising from the grant of this sublicense to AMT,
unless mutually agreed otherwise between TGC and UPenn.
 
20. FAILURE TO PERFORM
 
20.1 In the event of a failure of performance due under the terms of this
Agreement and if it becomes necessary for either party to undertake legal action
against the other on account thereof, then the prevailing party shall be
entitled to reasonable attorney’s fees in addition to costs and necessary
disbursements.
 
21. GOVERNING LAW
 
21.1 This Agreement shall be interpreted and construed in accordance with the
laws of the Commonwealth of Pennsylvania without regard to the principles of
conflicts of laws, but the scope and validity of any patent or patent
application shall be governed by the applicable laws of the country of such
patent or patent application. Each party hereby submits itself to the
non-exclusive jurisdiction of the federal or state courts located in the
Commonwealth of Pennsylvania, and any courts of appeal therefrom, and waives any
objection (on grounds of lack of jurisdiction, or forum non conveniens or
otherwise) to the exercise of such jurisdiction over it by any such courts, in
connection with any action that may be brought in such courts.
 

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22. FORCE MAJEURE
 
22.1 For a period of ninety (90) days, the parties to this Agreement shall be
excused from any performance required hereunder if such performance is rendered
impossible or unfeasible due to any catastrophe or other major event beyond
their reasonable control, including, without limitation, war, riot, and
insurrection; laws, proclamations, edicts, ordinances or regulations; strikes,
lockouts or other serious labor disputes; and floods, fires, explosions, or
other natural disasters. When such events have abated, the parties’ respective
obligations hereunder shall resume.
 
23. RIGHTS IN BANKRUPTCY
 
23.1 All rights and licenses (including but not limited to the License) granted
under or pursuant to this Agreement by TGC to AMT are, and shall otherwise be
deemed to be, for purposes of Section 365(n) of the U.S. Bankruptcy Code,
licenses of right to “intellectual property” as defined under Section 101 of the
U.S. Banckruptcy Code. The parties agree that AMT, as licensee of such rights
under this Agreement, shall retain and may fully exercise all of its rights and
elections under the U.S. Bankruptcy Code and to the fullest extent permitted by
law.
 
24. MISCELLANEOUS
 
24.1 The headings of the several sections are inserted for convenience of
reference only and are not intended to be a part of or to affect the meaning or
interpretation of this Agreement. The English language is the official language
of this Agreement and that text of the Agreement shall prevail over any
translation thereof.
 
24.2 This Agreement will not be binding upon the parties until it has been
signed below on behalf of each party, in which event, it shall be effective as
of the dated recited on page one.
 
24.3 No amendment or modification hereof shall be valid or binding upon the
parties unless made in writing and signed on behalf of each party.
 
24.4 This Agreement embodies the entire understanding of the parties and shall
supersede all previous communications, representations or understandings, either
oral or written, between the parties relating to the subject matter hereof.
 
24.5 If any provisions contained in this Agreement are or become invalid, are
ruled illegal by any court of competent jurisdiction or are deemed unenforceable
under then current applicable law from time to time in effect during the term
hereof, it is the intention of the parties that the remainder of this Agreement
shall not be affected thereby, provided that a party’s rights under this
Agreement are not materially affected. It is further the intention of the
parties that in lieu of each such provision which is invalid, illegal, or
unenforceable, there be substituted or added as part of this Agreement a
provision which shall be as similar as possible in economic and business
objectives as intended by the parties to such invalid, illegal or unenforceable,
provision, but shall be valid, legal and enforceable.
 

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IN WITNESS WHEREOF, both TGC and AMT have executed this Agreement, in duplicate
originals, by their respective officers hereunto duly authorized, on the day and
year hereinafter written.
 
Amsterdam Molecular Therapeutics, B.V.
 
Targeted Genetics Corporation
     
By   /s/ Ronald H.W. Loryn
 
By   /s/ H. Stewart Parker

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Name Ronald H.W. Loryn
 
Name H. Stewart Parker
     
Title CEO
 
Title Pres & CEO

Acknowledged and accepted by:

The Trustees of the University of Pennsylvania

By   /s/ John S. Zawad

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Name John S. Zawad, Ph.D.

Title Managing Director

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ATTACHMENT 1

Articles from the UPenn Agreement which would be added to this Agreement,
pursuant to Section 11.4 of this Agreement .

9.5- Penn hereby represents that (i) to its knowledge it has the lawful right to
grant the licenses granted herein, and (ii) all actions necessary with respect
to due authorization, execution and performance of this Agreement to make it
legal, valid, binding and enforceable with regard to Penn have been taken.

12.1 Targeted shall comply with all prevailing laws, rules and regulations
pertaining to the development, testing, manufacture, marketing, sale, use,
import or export of products. Without limiting the foregoing, it is understood
that this Agreement may be subject to United States laws and regulations
controlling the export of technical data, computer software, laboratory
prototypes and other commodities, articles and information, including the Arms
Export Control Act as amended in the Export Administration Act of 1979, and that
the parties’ obligations hereunder are contingent upon compliance with
applicable United States export laws and regulations. The transfer of certain
technical data and commodities may require a license from the cognizant agency
of the United States Government and/or written assurances by Targeted that
Targeted shall not export data or commodities to certain foreign countries
without prior approval of such agency. Penn neither represents that a license is
not required nor that, if required, it will issue.
 
12.9 Nothing in this Agreement, express or implied, is intended to confer on any
person, other than the parties hereto, the Covered Affiliates, or their
permitted assigns, any benefits, rights or remedies.

12.10 Penn and Targeted shall not discriminate against any employee or applicant
for employment because of race, color, sex, sexual or affectional preference,
age, religion, national or ethnic origin, or handicap.

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