Exhibit 10.2

 

COLLABORATION AGREEMENT

 

This Agreement is entered into as of April 27, 2005 by and between:

 

SEATTLE GENETICS, INC., a Delaware corporation, having its principal place of
business at 21823 30th Drive S.E., Bothell, Washington 98021

 

(hereinafter referred to as “SGI”)

 

and:

 

MEDIMMUNE, INC., a Delaware corporation, having its principal place of business
at One MedImmune Way, Gaithersburg, MD 20878

 

(hereinafter referred to as “Licensee”).

 

WITNESSETH

 

WHEREAS, SGI owns or controls intellectual property rights relating to
technology useful for linking proprietary [***] to other molecules, such as
antibodies, capable of directing such [***] to specific tissues and/or cells;

 

WHEREAS, Licensee is currently conducting research and development programs to
discover antigens that may have activity in certain disease-related pathways,
and to develop antibodies that bind to those antigens;

 

WHEREAS, the Parties have created ADCs (as such term is defined below) to, and
conducted initial characterization work regarding, the First Exclusive Antigen
(as such term is defined below) pursuant to the terms and subject to the
conditions of the Initial Agreement (as such term is defined below);

 

WHEREAS, Licensee wishes to obtain an exclusive worldwide license under SGI’s
patent rights and know-how related to SGI’s proprietary [***] to the First
Exclusive Antigen for use in conjunction with Licensee’s antibodies on the terms
set forth below and Licensee wishes to acquire from SGI an exclusive option to
obtain an exclusive worldwide license under SGI’s patent rights and know-how
related to SGI’s proprietary [***] to a Second Exclusive Antigen for use in
conjunction with Licensee’s antibodies; and

 

WHEREAS, SGI wishes to grant to Licensee such license and option and to allow
Licensee to evaluate SGI’s [***] for use with certain of Licensee’s antigens and
antibodies.

 

NOW, THEREFORE, in consideration of the mutual covenants and obligations set
forth herein, the Parties hereto, intending to be legally bound, agree as
follows:

 

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ARTICLE 1 - DEFINITIONS AND INTERPRETATION

 

1.1 Definitions: For the purposes of this Agreement the following words and
phrases shall have the following meanings:

 

1.1.1 “AAA” has the meaning set forth in Section 19.3.

 

1.1.2 “ADC” or “Antibody-Drug Conjugate” means an Antibody [***] and that
contains, uses or is made using SGI Technology.

 

1.1.3 “ADC Access Fee” has the meaning set forth in Section 6.1.1.

 

1.1.4 “Affiliate” of a Party means any corporation or other business entity
that, directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with a Party. As used herein, the term
“control” means the direct or indirect ownership of [***] or more of the stock
having the right to vote for directors thereof or the ability to otherwise
control the management thereof.

 

1.1.5 “Agreement” means this agreement, all amendments and supplements to this
Agreement and all schedules to this Agreement, including the following:

 

Schedule A     -     Research Plan.

 

Schedule B     -     SGI Patents.

 

Schedule C     -     SGI In-Licenses.

 

Schedule D     -     Designated Antigens and Exclusive Antigens.

 

1.1.6 “Antibody” or “Antibodies” means any and all antibodies, or [***],
including, but not limited to, [***].

 

1.1.7 “Antigen” means any [***].

 

1.1.8 [***].

 

1.1.9 “[***]” means the SGI Technology licensed to SGI under the BMS Agreement
(as defined in the definition of “SGI In-Licenses”).

 

1.1.10 “Calendar Quarter” means any of the three-month periods beginning January
1, April 1, July 1 and October 1 in any year.

 

1.1.11 “Change in Control” has the meaning set forth in Section 16.1.

 

1.1.12 “Claims” has the meaning set forth in Section 14.1.1.

 

1.1.13 “Combination Product” means any Licensed Product and [***].

 

1.1.14 “Confidential Information” has the meaning set forth in Section 8.1.

 

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1.1.15 “Control” means, with respect to any information or intellectual property
right, possession by a Party of the ability to grant the right to access or use,
or to grant a license or a sublicense to, such information or intellectual
property right as provided for herein without violating the terms of any
agreement or other arrangement with any Third Party.

 

1.1.16 “Cost of Goods” shall mean with respect to Drug Conjugation Materials
supplied to Licensee (a) for manufacturing activities performed by Third
Parties, SGI’s reasonably documented out-of-pocket costs incurred in such
manufacture and supply of Drug Conjugation Materials, as well as SGI’s internal
costs incurred in supporting the Third Party manufacturing relationship,
including without limitation [***]; and (b) for manufacturing activities
performed by SGI or its Affiliates, the consolidated fully burdened cost of
providing such goods or services, which shall include costs of the following:
[***].

 

1.1.17 “Designated Antigen(s)” means the [***] Antigens, excluding the [***],
that are designated as such in accordance with Section 2.5 of this Agreement.

 

1.1.18 “Drug Conjugation Material(s)” means (a) any and all [***], including,
but not limited to, the [***], and (b) any [***] that are useful in [***].

 

1.1.19 “Drug Conjugation Technology” means Drug Conjugation Materials and uses
thereof, including [***], and methods for producing Drug Conjugation Materials
and attaching Drug Conjugation Materials to [***] and the [***], and uses
thereof.

 

1.1.20 “Effective Date” means the date set forth in the first line of this
Agreement.

 

1.1.21 “EMEA” means the European Medicines Agency and any successor agency(ies)
thereto

 

1.1.22 “Events of Force Majeure” has the meaning set forth in Article 15.

 

1.1.23 “Exclusive Antigen(s)” means collectively, the [***].

 

1.1.24 “Exclusive License(s)” has the meaning set forth in Section 3.2.

 

1.1.25 “Exclusive License Maintenance Fee” has the meaning set forth in Section
6.2.

 

1.1.26 “FD&C Act” means the federal Food, Drug & Cosmetic Act, as amended.

 

1.1.27 “FDA” means the United States Food and Drug Administration, and any
successor agency(ies) thereto.

 

1.1.28 “Field” means the [***].

 

1.1.29 “First Commercial Sale” means, in each country of the Territory, the
first commercial sale of a Licensed Product by Licensee, its Affiliates or
Sublicensees to a Third

 

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Party following, if required by law, Regulatory Approval and, when Regulatory
Approval is not required by law, the first commercial sale in that country, in
each case for use or consumption of such Licensed Product in such country by the
general public. Sales for test marketing, sampling and promotional uses,
clinical trial purposes or compassionate or similar use shall not be considered
to constitute a First Commercial Sale.

 

1.1.30 “First Exclusive Antigen” means [***].

 

1.1.31 “FTE Fees” has the meaning set forth in Section 6.1.2.

 

1.1.32 “GAAP” means generally accepted accounting principles in the United
States.

 

1.1.33 “Good Laboratory Practices” means the then-current standards for
laboratory activities for pharmaceuticals, as set forth in the FD&C Act and
applicable regulations and guidances promulgated thereunder, including without
limitation the Code of Federal Regulations, as amended from time to time.

 

1.1.34 “IND” means (a) an Investigational New Drug Application filed with the
FDA or its equivalent in any country outside the United States where a
regulatory filing is required or obtained to conduct a clinical trial; or (b)
with respect to any country where a regulatory filing is not required or
obtained to conduct a clinical trial, the first enrollment of a patient in the
first trial involving the first use of a Licensed Product in humans.

 

1.1.35 “Indemnitee” has the meaning set forth in Section 14.2.

 

1.1.36 “Indemnitor” has the meaning set forth in Section 14.2.

 

1.1.37 “Initial Agreement” means the Research Collaboration Agreement effective
[***] by and between the Parties, as amended.

 

1.1.38 “Initiation” means, with respect to a human clinical trial, the dosing of
the first patient with a Licensed Product pursuant to the clinical protocol for
the specified clinical trial.

 

1.1.39 “Joint Patents” has the meaning set forth in Section 9.2.2.

 

1.1.40 “Liabilities” has the meaning set forth in Section 14.1.1.

 

1.1.41 “Licensed Product” means any and all products containing an ADC comprised
of an Antibody that binds specifically [***] to an Exclusive Antigen and that is
attached to a [***]: (a) the manufacture, use, sale, offer for sale or import of
which would [***]; or (b) which [***].

 

1.1.42 “Licensed Technology Acquisition Agreement” has the meaning set forth in
Section 3.6.1.

 

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1.1.43 “Licensee ADC Know-How” means all Program Inventions developed by
Licensee using SGI Technology, and that are necessary or useful for identifying,
developing, making, using or selling [***].

 

1.1.44 “Licensee ADC Patents” means all patent applications and patents that are
Controlled by Licensee that claim Licensee ADC Know-How.

 

1.1.45 “Licensee Know-How” means all technical information, processes, formulae,
data, inventions, methods, chemical compounds, biological or physical materials,
know-how and trade secrets, in each case that are not in the public domain, used
by Licensee in the Research Program and that are Controlled by Licensee,
including technical information, processes, formulae, data, inventions, methods,
chemical compounds, biological or physical materials, know-how and trade secrets
that relate to (a) [***], or (b) [***].

 

1.1.46 “Licensee Indemnitee” has the meaning set forth in Section 14.1.1.

 

1.1.47 “Licensee Materials” means any tangible chemical, biological or physical
materials that are furnished by or on behalf of Licensee to SGI in connection
with this Agreement.

 

1.1.48 “Licensee Patents” means all patent applications and patents that claim
Licensee Know-How.

 

1.1.49 “Licensee Proprietary Antigen” means an Antigen for which Licensee
Patents (excluding Licensee ADC Patents) would reasonably be expected to [***].

 

1.1.50 “Net Sales” means, as to each Calendar Quarter, the gross invoiced sales
prices charged for all Licensed Products sold by Licensee, its Affiliates and
Sublicensees to independent Third Parties during such Calendar Quarter, after
[***]:

 

  (a) [***];

 

  (b) [***];

 

  (c) [***];

 

  (d) [***];

 

  (e) [***]; and

 

  (f) [***].

 

All of the [***] shall be determined in accordance with GAAP. In the event that
Licensee, its Affiliates or Sublicensees make any adjustments to [***] have been
reported pursuant to this Agreement, the adjustments shall be reported and
reconciled in the next report and payment of any royalties due.

 

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In the event a Licensed Product is sold as a [***], for the purposes of
determining royalty payments, shall be determined by [***], in each case during
the applicable royalty reporting period or, if sales of the ADC [***] did not
occur in such period or country, then in the most recent royalty reporting
period in which [***] Licensed Product occurred in such country or if no such
sales have occurred in such country, the [***] during the applicable royalty
period. In the event that such [***].

 

1.1.51 “Option” has the meaning set forth in Section 3.3.

 

1.1.52 “Option Period” means the period commencing on the Effective Date and
continuing for [***] thereafter; provided that the Option Period shall terminate
when Licensee [***], and further provided, that the Option Period shall continue
for [***].

 

1.1.53 “Parties” means Licensee and SGI, and “Party” means either of them.

 

1.1.54 “Patent(s)” means all patents and patent applications in any country,
including divisions, continuations, continuations in part, reissues, renewals,
registrations, confirmations, reexaminations, extensions, supplementary
protection certificates and the like.

 

1.1.55 “Phase I Clinical Trial” means a clinical trial in which there is a first
administration of a candidate drug in humans that would satisfy the requirements
of 21 C.F.R. 312.21(a).

 

1.1.56 “Phase II Clinical Trial” means a controlled dose clinical trial
prospectively designed to evaluate the efficacy and safety of a candidate drug
in the targeted patient population and to define the optimal dosing regimen that
would satisfy the requirements of 37 C.F.R. 312.21(b).

 

1.1.57 “Phase III Clinical Trial” means a controlled, and usually multi-center,
clinical trial, involving patients with the disease or condition of interest to
obtain sufficient efficacy and safety data to support Regulatory Approval of a
candidate drug that would satisfy the requirements of 37 C.F.R. 312.21(c).

 

1.1.58 “Program Invention” means any [***]; provided, that any Program Invention
made pursuant to the [***].

 

1.1.59 “Proposed Disclosure” has the meaning set forth in Section 8.3.1.

 

1.1.60 “Publication” has the meaning set forth in Section 8.4.

 

1.1.61 “Reduction Amount” has the meaning set forth in Section 6.5.4.

 

1.1.62 “Regulatory Approval” means final regulatory approval in a country
(including, where applicable, pricing approval in the event that actual sales in
that country do not take place before such approval) required to market a
Licensed Product for a disease or condition in accordance with the applicable
laws and regulations of a given country. In the United States, its territories
and possessions, Regulatory Approval means approval of a New Drug Application
(“NDA”), Biologics License Application (“BLA”) or an equivalent by the FDA.

 

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1.1.63 “Reports” has the meaning set forth in Section 7.1.1.

 

1.1.64 “Research Fees” has the meaning set forth in Section 6.1.2.

 

1.1.65 “Research Fees Report” has the meaning set forth in Section 6.1.2.

 

1.1.66 “Research License” has the meaning set forth in Section 3.1.

 

1.1.67 “Research Plan” means the plan for the Research Program agreed upon by
the Parties and attached hereto as Schedule A, as amended from time to time by
mutual agreement of the Parties.

 

1.1.68 “Research Program” means the research program conducted during the
Research Program Term pursuant to Article 2.

 

1.1.69 “Research Program Term” the period that is [***].

 

1.1.70 “Royalty Term” means, on an Exclusive Antigen-by-Exclusive Antigen basis
and country-by-country basis, the period commencing on the First Commercial Sale
of the first Licensed Product for an Exclusive Antigen in a country and ending
upon the tenth (10th) anniversary of the date of First Commercial Sale of such
first Licensed Product for such Exclusive Antigen in such country, regardless of
the number of different Licensed Products for that Exclusive Antigen being sold
in such country; provided, however, that if after such tenth (10th) anniversary
a Licensed Product infringes a Valid Claim of an issued SGI Patent licensed to
Licensee under this Agreement in such country, the Royalty Term shall continue
in such country while such infringement exists.

 

1.1.71 “Second Exclusive Antigen” means a Designated Antigen, other than the
First Exclusive Antigen, for which Licensee exercises the Option for an
Exclusive License under Article 3 of this Agreement.

 

1.1.72 “SGI Indemnitee” has the meaning set forth in Section 14.1.1.

 

1.1.73 “SGI In-Licenses” means the following agreements between SGI and the
indicated Third Parties: (a) the [***].

 

1.1.74 “SGI Know-How” means any and all technical information, processes,
formulae, data, inventions, methods, chemical compounds, biological or physical
materials, know-how and trade secrets, in each case that are not in the public
domain, that relate to or are useful to practice the Drug Conjugation Technology
and that are owned, in whole or in part, by SGI or its Affiliates on, before or
after the Effective Date or are licensed to SGI as of the Effective Date or that
are licensed to SGI under a Licensed Technology Acquisition Agreement after the
Effective Date.

 

1.1.75 “SGI Patents” means any and all Patents: (a) that are owned in whole or
in part by SGI or its Affiliates, or licensed to SGI or its Affiliates as of the
Effective Date, (b) that become owned in whole or in part by SGI or its
Affiliates at any time during the Term, or (c) that are licensed to SGI or its
Affiliates after the Effective Date under a Licensed Technology

 

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Acquisition Agreement, in each case to the extent that such Patents would be
infringed by (a) Drug Conjugation Technology and/or the discovery, development,
manufacture or use thereof or (b) an Antibody linked to Drug Conjugation
Material or the discovery, development, manufacture or use thereof. SGI Patents
include, but are not limited to, rights to the Patents set forth in Schedule B.

 

1.1.76 “SGI Technology” means the SGI Patents and the SGI Know-How.

 

1.1.77 “Sublicensee” means any person or entity that is granted a sublicense
under the SGI Technology by Licensee or its Affiliates in accordance with the
terms of this Agreement, which term does not include Licensee’s distributors.

 

1.1.78 “Supply Fees” has the meaning set forth in Section 6.1.2.

 

1.1.79 “Technology Acquisition Agreement” shall mean any agreement entered into
after the Effective Date between SGI or its Affiliates and a Third Party under
which SGI or its Affiliates is granted a license to (a) any of such Third
Party’s Patents that cover Drug Conjugation Technology or (b) any of such Third
Party’s Know-How that reasonably relates to the foregoing.

 

1.1.80 “Term” has the meaning set forth in Section 13.1.

 

1.1.81 “Territory” means all countries in the world.

 

1.1.82 “Third Party” means any person or entity other than Licensee, SGI and
their respective Affiliates.

 

1.1.83 “Valid Claim” means (a) an unexpired claim of an issued patent which has
not been cancelled, abandoned, disclaimed, or revoked and has not been found to
be unpatentable, invalid or unenforceable by an unreversed and unappealable or
unappealed decision of a court or other authority in the subject country; or (b)
a pending claim of an application for a patent that is being maintained in good
faith and which application has been pending for less than [***] from the
earliest priority date to which such application is entitled.

 

1.2 Certain Rules of Interpretation in this Agreement and the Schedules.

 

1.2.1 Unless otherwise specified, all references to monetary amounts are to
United States of America currency (U.S. Dollars or Dollars);

 

1.2.2 The preamble to this Agreement and the descriptive headings of Articles
and Sections are inserted solely for convenience of reference and are not
intended as complete or accurate descriptions of the content of this Agreement
or of such Articles or Sections;

 

1.2.3 The use of words in the singular or plural, or with a particular gender,
shall not limit the scope or exclude the application of any provision of this
Agreement to such person or persons or circumstances as the context otherwise
permits;

 

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1.2.4 The words “include” and “including” have the inclusive meaning frequently
identified with the phrases “without limitation” and “but not limited to”;

 

1.2.5 Unless otherwise specified, time periods within or following which any
payment is to be made or act is to be done shall be calculated by excluding the
day on which the period commences and including the day on which the period ends
and by extending the period to the next business day following if the last day
of the period is not a business day in the jurisdiction of the Party to make
such payment or do such act;

 

1.2.6 Whenever any payment is to be made or action to be taken under this
Agreement is required to be made or taken on a day other than a business day,
such payment shall be made or action taken on the next business day following
such day to make such payment or do such act;

 

1.2.7 The singular includes the plural and vice versa except if the context is
otherwise; and

 

1.2.8 The word “or” is used in the inclusive sense and includes the conjunctive
and disjunctive (and/or).

 

ARTICLE 2 - RESEARCH PROGRAM

 

2.1 Conduct of the Research Program.

 

2.1.1 Licensee intends to conduct a Research Program, with SGI’s support, to
evaluate and select ADCs targeting the Designated Antigens and Exclusive
Antigens for development and commercialization by Licensee as Licensed Products,
as more fully described in the Research Plan.

 

2.1.1 SGI shall use commercially reasonable efforts to conduct work in
accordance with the Research Plan, in a good scientific manner, and in
compliance in all material respects with all requirements of applicable laws,
rules and regulations and all applicable Good Laboratory Practice to attempt to
achieve its objectives efficiently and expeditiously.

 

2.1.3 SGI shall maintain records in sufficient detail and in good scientific
manner appropriate for regulatory purposes and the purpose of establishing and
perfecting intellectual property (including patent rights), which shall fully
and properly reflect all work done and results achieved in the conduct of the
Research Plan. Licensee shall have the right during normal business hours and
upon reasonable notice, to inspect and copy all such records of SGI. At
Licensee’s reasonable request, SGI shall arrange for employees and/or
consultants of Licensee involved in the activities contemplated under the
Research Plan to visit the offices and laboratories of SGI during normal
business hours and upon reasonable notice, to discuss the Research Plan and its
results in detail with the technical personnel and consultants of SGI.

 

2.2 Term of the Research Program. The term of the Research Program shall be for
the Research Program Term, unless terminated earlier in accordance with Article
13.

 

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2.3 Delivery of Drug Conjugation Materials. In support of the Research Program,
during the Research Program Term, SGI will deliver Drug Conjugation Materials to
Licensee that are available to SGI at mutually agreed upon times and in mutually
agreed upon quantities to enable Licensee to attach such materials to Licensee’s
Antibodies to create ADCs. At Licensee’s request, SGI will also provide Licensee
with [***] provided to Licensee to [***]. All such Drug Conjugation Materials
and other information provided by SGI to Licensee hereunder will be deemed
Confidential Information of SGI pursuant to Article 8.

 

2.4 SGI Preparation of ADCs. The Parties acknowledge that SGI and Licensee have
[***]. In order to identify the lead candidate for the First Exclusive Antigen
and to identify the Second Exclusive Antigen during the Research Program Term,
SGI will prepare and deliver to Licensee mutually agreed upon research
quantities of ADCs using the Drug Conjugation Materials that are available to
SGI targeted to the First Exclusive Antigen and to [***].

 

2.5 Availability of Antigens.

 

2.5.1 Licensee shall provide SGI with a [***], which Licensee desires to [***]
for purposes of this Agreement and [***], SGI shall notify Licensee in writing
whether the Exclusive License described in Article 3 of this Agreement is
available with respect to such Antigen and hereby notifies Licensee that, with
respect to the Antigen listed on Schedule D attached hereto, an Exclusive
License is available as of the Effective Date. Schedule D to this Agreement will
be amended from time to time to list the Designated Antigens and the Second
Exclusive Antigen (including a description thereof) under this Agreement. The
Parties hereby acknowledge and agree that an Antigen [***].

 

2.5.2 During the [***] after the Effective Date, Licensee shall have the [***].

 

2.6 Additional Activities under Research Program. Upon mutual written agreement
of the Parties, the Research Program may also include technical assistance by
SGI with respect to the [***].

 

2.7 Payment. Licensee shall pay SGI the amounts set forth in Section 6.1.2 for
any research efforts or other assistance provided by SGI that was requested by
Licensee in writing (including by email); provided that Licensee’s failure to
request particular research efforts or assistance from SGI in writing shall not
preclude Licensee’s payment obligations hereunder if SGI can reasonably
demonstrate that such research efforts or assistance were in fact requested
orally or in some other manner by an authorized employee or agent of Licensee.

 

2.8 Supply of Licensee Materials. From time to time during the Research Program
Term, Licensee may supply SGI with Licensee Materials for use in the Research
Program. In connection therewith, SGI hereby agrees that (a) it shall not use
Licensee Materials for any purpose other than exercising any rights granted to
it hereunder; (b) it shall use the Licensee Materials only in compliance with
all applicable federal, state, and local laws and regulations; (c) it shall not
transfer any Licensee Materials to any Third Party without the prior written
consent of Licensee; (d) Licensee shall retain full ownership of all such
Licensee Materials; and (e) upon the expiration or termination of this
Agreement, SGI shall at the instruction of Licensee either destroy or return any
unused Licensee Materials.

 

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2.9 Books and Records. SGI shall keep full and accurate records and books of
account containing all particulars that may be reasonably necessary for the
purpose of determining the FTEs that are charged to Licensee pursuant to this
Agreement. Such books of account shall be kept by SGI at its places of business
and, with all necessary supporting data shall, for the [***] following the end
of the calendar year to which each shall pertain be open for inspection by an
independent certified accountant selected by Licensee and reasonably acceptable
to SGI upon reasonable notice during normal business hours at [***] for the sole
purpose of verifying FTEs charged in compliance with this Agreement, but in no
event more than [***] each calendar year and limited to the records of the [***]
preceding the inspection. All information and data offered shall be used only
for the purpose of verifying FTEs charged to Licensee. In the event that such
inspection shall indicate in any calendar year that the charges paid by Licensee
were overstated by [***] or more, then [***] shall pay the cost of the
inspection. Licensee will invoice SGI for any overpayments, which shall become
due and payable no later than [***] after receipt of an invoice from Licensee.

 

2.10 Disclaimers. EXCEPT AS MAY BE EXPRESSLY PROVIDED IN THIS AGREEMENT, SGI
MAKES NO REPRESENTATIONS AND GRANTS NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN
FACT OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, REGARDING THE DRUG
CONJUGATION MATERIALS OR ANY ADCs PREPARED BY SGI, INCLUDING ANY WARRANTY OF
QUALITY, MERCHANTABILITY, NON-INFRINGEMENT OR FITNESS FOR A PARTICULAR USE OR
PURPOSE. EXCEPT AS MAY BE EXPRESSLY PROVIDED IN THIS AGREEMENT, LICENSEE MAKES
NO REPRESENTATIONS AND GRANTS NO WARRANTIES, EXPRESS OR IMPLIED, EITHER IN FACT
OR BY OPERATION OF LAW, BY STATUTE OR OTHERWISE, REGARDING THE LICENSEE
MATERIALS, INCLUDING ANY WARRANTY OF QUALITY, MERCHANTABILITY, NON-INFRINGEMENT
OR FITNESS FOR A PARTICULAR USE OR PURPOSE.

 

ARTICLE 3 – LICENSES; OPTION; DROPPED ANTIGENS

 

3.1 Research License Grants. Subject to the terms and conditions of this
Agreement, SGI grants to Licensee a non-exclusive, worldwide, royalty-free
license under the SGI Technology solely to conduct the Research Program as set
forth in the Research Plan with respect to ADCs for Designated Antigens (the
“Research License”). The Research License shall include the right to evaluate
and conduct research on ADCs that bind to any Designated Antigen solely for the
purpose of determining Licensee’s interest in exercising the Option for such
Designated Antigen, but shall not include (a) the right to grant sublicenses
thereto to any Third Party, (b) the right to initiate any human clinical trial
utilizing such ADCs in any country or (c) the right to sell an ADC with respect
to an Antibody for a Designated Antigen. Except for Patents owned by Licensee
pursuant to Section 9.1, [***], subject to the terms and conditions of this
Agreement. [***]. The Research License shall continue for the Research Program
Term, unless earlier terminated pursuant to Article 13; provided that the
Research License shall terminate in the event Licensee exercises its Option for
the Second Exclusive License pursuant to the terms hereof.

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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3.2 Exclusive License Grants.

 

3.2.1 Subject to the terms and conditions of this Agreement, SGI agrees to grant
and hereby grants to Licensee an exclusive (even as to SGI), royalty-bearing
license under the SGI Technology, with the right to sublicense as permitted in
Section 3.5, to discover, research, develop, have developed, make, have made,
import, use, offer for sale, and sell Licensed Products within the Field in the
Territory (with respect to each Exclusive Antigen, an “Exclusive License” and,
for the First Exclusive Antigen and the Second Exclusive Antigen, collectively,
the “Exclusive Licenses”). Each Exclusive License shall continue for the Royalty
Term thereof, unless earlier terminated pursuant to Article 13. It is expressly
understood and agreed that the Exclusive License with respect to Licensed
Product for the First Exclusive Antigen is effective as of the Effective Date
and that the Exclusive License with respect to the Second Exclusive Antigen
shall automatically take effect on the Option Exercise Date.

 

3.2.2 Licensee acknowledges that Licensee has been granted a license with
respect to SGI Patents and SGI Know-How. As a result, pursuant to this
Agreement, during the Royalty Term, Licensee has agreed to pay royalties to SGI
based on Net Sales of Licensed Product.

 

3.3 Grant of Option. Subject to the provisions of this Agreement, SGI hereby
grants Licensee an option to obtain the Exclusive License described in Section
3.2 of this Agreement to a Designated Antigen as the Second Exclusive Antigen
(the “Option”) during the Option Period.

 

3.4 Procedure to Exercise Option. At any time during the Option Period, Licensee
shall have the right to notify SGI in writing that it desires to obtain the
Exclusive License to the Second Exclusive Antigen by providing written notice to
SGI of the Designated Antigen that is the Second Exclusive Antigen. Licensee
shall pay SGI the Option Exercise Fee described in Section 6.3 of this Agreement
(the date of payment by Licensee of the Option Exercise Fee being referred to
herein as the “Option Exercise Date”) whereupon (a) such Designated Antigen
shall be deemed to be the Second Exclusive Antigen for purposes of this
Agreement and (b) Licensee is automatically granted an Exclusive License with
respect to such Second Exclusive Antigen in accordance with Section 3.2 of this
Agreement, without any further action of the Parties. [***].

 

3.5 Rights to Sublicense.

 

3.5.1 Licensee shall have the right to grant sublicenses of each Exclusive
License to any Affiliate or Third Party with respect to any Licensed Product.
Licensee agrees to contractually obligate each Sublicensee to comply with all
terms of this Agreement, the SGI In-Licenses and any Licensed Technology
Acquisition Agreements, in each of such cases, that are applicable to a
Sublicensee. Licensee shall also require any such Sublicensee to agree in
writing to keep books and records and permit SGI to review the information
concerning such books and records in accordance with the terms of this
Agreement.

 

3.5.2 Licensee shall notify SGI of each sublicense under an Exclusive License
granted to Affiliates or Third Parties and shall provide SGI with the name and
address of each Sublicensee and a description of the rights granted and the
territory covered by each Sublicensee.

 

3.5.3 [***].

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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3.6 Technology Acquisition Agreements.

 

3.6.1 Technology Acquisition Agreements. During the Term, if SGI proposes or
desires to enter into a Technology Acquisition Agreement in order to obtain a
license to one or more Patents that cover or potentially cover a Licensed
Product that is being developed, marketed or sold by Licensee or its Affiliates
or a Sublicensee, SGI [***]. After entering into any Technology Acquisition
Agreement (whether or not covering technology referred to in the previous
sentence), SGI [***]. In each Technology Acquisition Agreement, SGI [***]. Upon
such written notice from Licensee that Licensee is sublicensed under such
Technology Acquisition Agreement, such Technology Licensee Agreement shall
automatically become a “Licensed Technology Acquisition Agreement.” [***].

 

3.6.2 Amendment of Schedule B. Schedule B shall be amended from time to time to
add the patents and patent applications licensed under Licensed Technology
Acquisition Agreements.

 

3.7 Compliance with SGI In-Licenses and Licensed Technology Acquisition
Agreements.

 

3.7.1 Licensee, its Affiliates and Sublicensees shall comply with all
obligations, covenants and conditions of the SGI In-Licenses and Licensed
Technology Acquisition Agreements applicable to Licensee and its Affiliates and
Sublicensees and, subject to Section 3.7.2 and Section 12.3, any amendments
thereto following written disclosure thereof to Licensee, that apply under each
of the SGI In-Licenses and/or Licensed Technology Acquisition Agreements. The
Parties agree that BMS is a third party beneficiary of this Agreement solely to
the extent SGI Technology licensed to Licensee hereunder includes technology
sublicensed by SGI under the BMS Agreement.

 

3.7.2 SGI will [***] hereunder or [***].

 

3.8 [***].

 

3.8.1 [***].

 

3.8.2 [***].

 

ARTICLE 4 - TECHNOLOGY DISCLOSURE

 

During the Term, SGI shall (a) promptly disclose to Licensee all SGI Know-How
licensed to Licensee that is reasonably useful to enable Licensee to use the
Drug Conjugation Materials and Drug Conjugation Technology to practice the
Research License and Exclusive Licenses, including manufacturing, analytical and
formulation methods and procedures, and shall also provide regular updates
regarding SGI Patents, in each case subject to the conditions of this Agreement
and (b) upon Licensee’s reasonable request and with adequate notice to SGI, make
available to Licensee at SGI’s facilities, SGI’s personnel to provide a
reasonable amount of technical assistance and training to Licensee’s personnel;
provided that after the expiration of the Research Program Term, SGI’s
obligations hereunder shall be limited to disclosure of information relating to
Licensee’s ongoing development, manufacturing, clinical trials,

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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regulatory and other matters reasonably associated with Licensed Products, and
shall not include SGI’s continued disclosure to Licensee for research purposes
of new Drug Conjugation Materials and/or Drug Conjugation Technology developed
after expiration or termination of the Research Program Term. Licensee shall pay
to SGI for such assistance under this Article 4 an amount equal to the FTE Fees
in accordance with Section 6.1.2 for SGI employees providing such assistance;
[***]. Notwithstanding the foregoing, during the Term but after expiration or
termination of the Research Program Term, SGI will, upon request from Licensee
on no more than an annual basis, provide a [***]. For the purposes of clarity,
this Article 4 does not reduce the scope of the licenses granted to Licensee
pursuant to this Agreement.

 

ARTICLE 5 - DEVELOPMENT AND COMMERCIALIZATION; MANUFACTURING

 

5.1 Diligence.

 

5.1.1 Licensee agrees to use commercially reasonable efforts to, at its expense,
develop a Licensed Product for the First Exclusive Antigen and for the Second
Exclusive Antigen, if a Second Exclusive Antigen is selected by Licensee, in the
United States, and thereafter as set forth in Section 5.1.5 in Europe and Japan.

 

5.1.2 If, in any calendar year, Licensee or its Affiliate(s) and/or a
Sublicensee and/or a collaborator of Licensee (including work of SGI under the
Research Program), alone or together, has [***] for such Exclusive Antigen:

 

  (a) [***];

 

  (b) [***];

 

  (c) [***];

 

  (d) [***];

 

  (e) [***];

 

  (f) [***];

 

  (g) [***];

 

  (h) [***];

 

  (i) [***];

 

  (j) [***].

 

If, in a calendar year, Licensee [***].

 

5.1.3 Subject to Section 5.1.4, in the event that Licensee [***] by written
notice to Licensee within [***] after the end of the applicable calendar year,
unless [***] after such notice.

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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5.1.4 If Licensee receives a notice under Section 5.1.3, Licensee shall have the
[***].

 

5.1.5 It is expressly understood that Licensee [***]. In the event that Licensee
fails to exert commercially reasonable efforts to develop a Licensed Product for
an Exclusive Antigen in [***].

 

5.1.6 Licensee agrees to use commercially reasonable efforts to market and sell
Licensed Product in each country in which Regulatory Approval is obtained
therefor.

 

5.2 Funding and Progress Reports. Except as expressly set forth herein, as
between SGI and Licensee, Licensee shall be solely responsible for funding all
costs of the development and commercialization of Licensed Products. Licensee
shall keep SGI informed in a timely manner as to the progress of the development
of Licensed Products.

 

5.3 Manufacturing. Except as otherwise expressly set forth in this Agreement,
Licensee shall be responsible for all manufacturing and supply of the Licensed
Products. Notwithstanding the foregoing, SGI shall (a) [***] and (b) [***]. If
SGI has an [***]. In the event SGI agrees to [***]. In addition, if requested by
Licensee, SGI shall provide Licensee with reasonable consultation in working
with any Third Party that is manufacturing Drug Conjugation Materials or ADCs,
subject to reimbursement in accordance with Section 6.1.2 for any consultation
provided.

 

5.4 Development and Commercialization. Licensee shall have the sole right within
its discretion to determine all matters with respect to research, development,
manufacturing and commercialization of Licensed Products.

 

ARTICLE 6 - FEES, ROYALTIES AND PAYMENTS

 

6.1 Research Fees. Licensee shall pay to SGI the following amounts in
consideration of the Research Program:

 

6.1.1 Within thirty (30) days of the Effective Date, Licensee shall pay to SGI a
non-refundable, non-creditable fee of Two Million U.S. Dollars ($2,000,000) by
wire transfer of immediately available funds (the “ADC Access Fee”).

 

6.1.2 Licensee shall pay SGI at an annual rate of [***] per FTE who provides
assistance as requested by Licensee pursuant to this Agreement in each of the
[***] of the Term (the “FTE Fees”). Commencing upon the [***] of the Effective
Date and upon every [***] thereafter, the FTE Fees per FTE per year will [***]
in accordance with the [***]. Licensee shall also pay SGI for all Drug
Conjugation Materials supplied by SGI to Licensee hereunder at the rate of [***]
of SGI’s Cost of Goods therefor (the “Supply Fees”). To the extent reasonably
possible, SGI shall [***]. The FTE Fees and the Supply Fees are collectively
referred to herein as (the “Research Fees”). Within [***] after the end of each
[***], SGI shall submit a report to Licensee supporting the calculation of the
Research Fees due for such [***] (a “Research Fees Report”). Licensee shall pay
all Research Fees to SGI within [***] of receipt of each Research Fees Report.
An “FTE” is [***]. The portion of an FTE year devoted by an employee shall be

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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determined by [***]; provided, however, that [***]. The FTE Rate for each FTE
includes [***]. Notwithstanding the foregoing, Licensee [***].

 

6.2 Exclusive License Maintenance Fees. Licensee shall pay an [***] to SGI in
the sum of [***] (the “Exclusive License Maintenance Fee”) on [***] of the
Effective Date (with respect to the [***]) and [***] of the [***] (with respect
to the [***]) to the extent such applicable [***] for a Licensed Product
incorporating such Exclusive Antigen in any country of the Territory.
Notwithstanding the foregoing, the Exclusive License Maintenance Fee will be
[***].

 

6.3 Option Exercise Fee. Licensee shall pay to SGI an Option Exercise Fee of
[***] for the Exclusive License obtained by Licensee with respect to the Second
Exclusive Antigen prior to the expiration of the Option Period, payable within
[***] after the exercise by Licensee of the Option with respect to the Second
Exclusive Antigen in accordance with Section 3.4 of this Agreement.

 

6.4 Royalties Payable by Licensee. In consideration for the Exclusive Licenses
granted to Licensee herein, during the Royalty Term, and subject to Section 6.5,
Licensee shall pay to SGI and BMS the following royalties on Net Sales of
Licensed Products as to which Licensee retains an Exclusive License under this
Agreement that are sold during the Royalty Term. Such royalties shall be paid at
the following rates, determined on an Exclusive Antigen-by-Exclusive-Antigen
basis as set forth below:

 

6.4.1 Royalties Payable to SGI.

 

  (a) [***];

 

  (b) [***]; and

 

  (c) [***].

 

6.4.2 Royalties Payable to BMS. Licensee shall pay, during the Royalty Term, the
royalties (taking into account any applicable offsets) that SGI owes to BMS
pursuant to the terms and conditions of the BMS Agreement as a result of Net
Sales of Licensed Products licensed to Licensee under this Agreement, but [***].
SGI shall disclose to Licensee all information that would be useful to
Licensee’s ability to [***].

 

6.5 Third Party Royalties; Adjustments to Royalties.

 

6.5.1 Except as provided in Section 6.4.2 and in Section 6.5.5, [***].

 

6.5.2 The royalties otherwise due and payable to SGI pursuant to Section 6.4.1
of this Agreement shall be [***] with respect to any Licensed Product sold in
any country where commercialization, manufacture, marketing or sale of such
Licensed Product does [***]. In addition, in the event that Licensee is
obligated to make any payments under [***].

 

6.5.3 If the sum of (a) the royalties payable by Licensee, its Affiliates and
Sublicensees to SGI and BMS under [***], (b) any other royalties Licensee pays
any Third Party

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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in order to practice the SGI Technology to make, use and sell a Licensed Product
and (c) any royalties payable under Licensed Technology Acquisition Agreements
[***] of such [***], then the royalties otherwise due and payable by Licensee
under Section 6.4.1 for such [***] shall be [***]; provided, however, that in no
event shall the royalty payments due and payable to SGI pursuant to Section
6.4.1 with respect to such Licensed Product in any calendar year be [***].

 

6.5.4 If, as a result of negotiations between SGI and [***] conducted during the
Term, the royalty payable to [***] that is payable by Licensee pursuant to
Section [***] is [***] (the amount of any such reduction, the “Reduction Amount”
for a Licensed Product), then the royalty otherwise due and payable by Licensee
to SGI under [***]; provided, that in no event shall the royalty payments due
and payable to SGI pursuant to [***]. For purposes of clarity, this Section
6.5.4 shall not apply to any reduction or adjustment to the [***].

 

6.5.5 Licensee agrees to pay milestones and royalties that are due and payable
with respect to Licensed Products under Licensed Technology Acquisition
Agreements as to which Licensee elects to receive and retains a sublicense under
this Agreement pursuant to Section 3.6.1. [***].

 

6.6 Milestone Payments. As additional consideration for the licenses, rights and
privileges granted to it hereunder, Licensee shall pay to SGI the following
milestone payments within [***] of the first occurrence of each event set forth
below with respect to the [***] whether such events are achieved by Licensee,
its Affiliates or Sublicensees, as follows:

 

  (a) Upon [***];

 

  (b) Upon [***];

 

  (c) Upon [***];

 

  (d) Upon [***];

 

  (e) Upon [***];

 

  (f) Upon [***];

 

  (g) Upon [***]; and

 

  (h) Upon [***].

 

If any of (a) through (d) above is achieved before a preceding milestone payment
has become due, then such payment shall be deemed to become due within [***] of
the achievement of the subsequent milestone.

 

With respect to all Licensed Products for the [***].

 

With respect to all Licensed Products for the [***].

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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6.7 Payment Terms. Royalties shown to have accrued by each Report provided for
under Article 6 of this Agreement shall be due on the date such Report is due
pursuant to Section 7.1.3.

 

6.8 Payment Method. All payments by Licensee to SGI under this Agreement shall
be paid in U.S. dollars, and all such payments shall be made by bank wire
transfer in immediately available funds to the bank account designated by SGI in
writing.

 

6.9 Exchange Control. If at any time legal restrictions prevent the prompt
remittance of part or all royalties with respect to any country in the Territory
where Licensed Products are sold, payment shall be made through such lawful
means or method as the Parties reasonably shall determine.

 

6.10 Withholding Taxes. Except as otherwise provided below, all amounts due from
Licensee to SGI under this Agreement are gross amounts. Licensee shall be
entitled to deduct the amount of any withholding taxes payable or required to be
withheld by Licensee, its Affiliates or Sublicensees, to the extent Licensee,
its Affiliates or Sublicensees pay such withheld amounts to the appropriate
governmental authority on behalf of SGI. Licensee shall use commercially
reasonable efforts to minimize any such taxes, levies or charges required to be
withheld on behalf of SGI by Licensee, its Affiliates or Sublicensees. Licensee
promptly shall deliver to SGI proof of payment of all such taxes, levies and
other charges, together with copies of all communications from or with such
governmental authority with respect thereto, and shall cooperate with SGI in
seeking any related tax credits that may be available to SGI with respect
thereto.

 

6.11 [***]. SGI shall promptly notify Licensee in writing in the event that,
during the [***]. If SGI fails to provide such notice, and Licensee subsequently
[***].

 

ARTICLE 7 - ROYALTY REPORTS AND ACCOUNTING

 

7.1 Reports, Exchange Rates.

 

7.1.1 During the Royalty Term, Licensee shall furnish to SGI, with respect to
each [***], a written report showing, on a consolidated basis in reasonably
specific detail and on a country-by-country basis, (a) the gross sales of
Licensed Products sold by Licensee, its Affiliates and its Sublicensees in the
Territory during the corresponding [***] and the calculation of Net Sales from
such gross sales; (b) the royalties payable in U.S. dollars, if any, which shall
have accrued hereunder based upon such Net Sales of Licensed Products; (c) the
withholding taxes, if any, required by law to be deducted in respect of such
royalties; (d) the dates of the First Commercial Sale of each Licensed Product
in each country in the Territory, if it has occurred during the corresponding
[***]; and (e) the exchange rates (as determined pursuant to Section 7.1.4
herein) used in determining the royalty amount expressed in U.S. dollars
(collectively, “Reports”).

 

7.1.2 Licensee shall include in each permitted sublicense granted by it pursuant
to this Agreement a provision requiring its Affiliates and Sublicensees to make
Reports to Licensee within [***] of the close of each [***] and to keep and
maintain records of sales made pursuant to such sublicense as if such sales were
by Licensee for the purpose of Section 7.1.1.

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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7.1.3 Reports shall be due on the [***] following the end of the [***] to which
such Report relates. Licensee shall keep complete and accurate records in
sufficient detail to properly reflect all gross sales and Net Sales and to
enable the royalties’ payable hereunder to be determined.

 

7.1.4 For any given [***], if any portion of Net Sales would be otherwise
determined in currency other than U.S. Dollars then, for the purposes of
calculating such Net Sales, such currency will be converted to U.S. Dollars in
the following manner:

 

(a) Net Sales will be determined in the original currency for each country for
each of the [***]; then

 

(b) the Net Sales values for each month as calculated under Section 7.1.4(a) for
each country will be separately converted into U.S. Dollars based on the average
rate of exchange for that month ([***]; and then

 

(c) the portion of Net Sales attributable to that currency for that [***]
calculated under Section 7.1.4(b).

 

7.2 Audits.

 

7.2.1 Upon the written request of SGI and with at least [***] prior written
notice, but not more than [***] in any [***], Licensee shall permit an
independent certified public accounting firm of internationally recognized
standing, selected by SGI and reasonably acceptable to Licensee, at [***], to
have access during normal business hours to such of the records of Licensee as
required to be maintained under this Agreement to verify the accuracy of the
Reports due hereunder. Such accountants may audit records relating to Reports
made for any year ending not more than [***] prior to the date of such request.
The accounting firm shall disclose to SGI only whether the Reports were correct
or not, and the specific details concerning any discrepancies. No other
information obtained by such accountants shall be shared with SGI.

 

7.2.2 If such accounting firm concludes that any royalties were owed but not
paid to SGI, Licensee shall pay the additional royalties within [***] of the
date SGI delivers to Licensee such accounting firm’s written report so
concluding. The fees charged by such accounting firm shall be paid by [***];
provided, however, if the audit discloses that the royalties payable by Licensee
for the audited period are more than [***] of the royalties actually paid for
such period, then [***] charged by such accounting firm. If such accounting firm
concludes that the royalties paid were more than what was owed during such
period, SGI shall refund the overpayments within [***] of the date SGI receives
such accounting firm’s written report so concluding.

 

7.3 Confidential Financial Information. SGI shall treat all financial
information subject to review under this Article 7 or under any sublicense
agreement as Confidential Information of Licensee as set forth in Article 8, and
shall cause its accounting firm to retain all such financial information in
confidence under terms substantially similar to those set forth in Article 8.

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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ARTICLE 8 – CONFIDENTIALITY

 

8.1 Non-Disclosure Obligations. Except as otherwise provided in this Article 8,
during the Term and for a period of [***] thereafter, each Party shall maintain
in confidence, and use only for purposes as expressly authorized and
contemplated by this Agreement, all confidential or proprietary information,
data, documents or other materials supplied by the other Party under this
Agreement and marked or otherwise identified as “Confidential.” Confidential
Information of a Party may also include information relating to such Party’s
research programs, development, marketing and other business practices and
finances. For purposes of this Agreement, information and data described above
shall be hereinafter referred to as “Confidential Information.” Each Party shall
use at least the same standard of care as it uses to protect its own
Confidential Information to ensure that its and its Affiliates’ employees,
agents, consultants and clinical investigators only make use of the other
Party’s Confidential Information for purposes as expressly authorized and
contemplated by this Agreement and do not disclose or make any unauthorized use
of such Confidential Information.

 

8.2 Permitted Disclosures. Notwithstanding the foregoing, but subject to the
last sentence of this Section 8.2, the provisions of Section 8.1 shall not apply
to information, documents or materials that the receiving Party can establish:

 

(a) have become published or otherwise entered the public domain other than by
breach of this Agreement by the receiving Party or its Affiliates;

 

(b) are permitted to be disclosed by prior consent of the other Party;

 

(c) have become known to the disclosing Party by a Third Party, provided such
Confidential Information was not obtained by such Third Party directly or
indirectly from the other Party under this Agreement on a confidential basis;

 

(d) prior to disclosure under the Agreement, were already in the possession of
the receiving Party, its Affiliates or Sublicensees, provided such Confidential
Information was not obtained directly or indirectly from the other Party under
this Agreement;

 

(e) are required to be disclosed by the receiving Party to comply with any
applicable law, regulation or court order, provided that the receiving Party
shall provide prior notice of such disclosure to the other Party and take
reasonable and lawful actions to avoid or minimize the degree of disclosure;

 

(f) is disclosed by Licensee to governmental or other regulatory agencies to
gain or maintain approval to conduct clinical trials or to market Licensed
Product, but such disclosure may be only to the extent reasonably necessary; or

 

(g) is deemed necessary by Licensee to be disclosed to Sublicensees, Affiliates,
agents, consultants, or other Third Parties for the research, development,
manufacture, use or commercialization of Licensed Product, or in connection with
a licensing transaction related to Licensed Product or loan, financing or
investment or acquisition, merger, consolidation or similar transaction (or for
such entities to determine their interest in performing such activities), in
each case on the condition that any Third Parties to whom such disclosures are

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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made agree to be bound by confidentiality and non-use obligations substantially
similar to those contained in this Agreement.

 

Notwithstanding the disclosures permitted under subsections (e), (f) and (g), if
the information, documents or materials covered by such subsection are otherwise
protected by obligations of confidentiality, then the confidentiality
obligations of Section 8.1 shall still apply.

 

8.3 Publicity/Use of Names.

 

8.3.1 On the Effective Date, the Parties shall issue a mutually agreed upon
press release relating to this Agreement and the activities to be conducted
hereunder. A Party may issue any subsequent press releases or other public
disclosures relating to this Agreement or activities conducted hereunder (each,
a “Proposed Disclosure”) upon prior written approval of the other Party, such
approval not to be unreasonably withheld; provided, however, that each Party
will use commercially reasonably efforts to submit to the other Party a draft of
such Proposed Disclosure for review and comment by the other Party at least
[***] prior to the date on which such Party would like to release such Proposed
Disclosure. No approval of the other Party shall be required if a subsequent
press release or other public disclosure solely discloses information that has
previously been approved. Neither Party shall use the name, trademark, trade
name or logo of the other Party or its employees in any publicity or news
release relating to this Agreement or its subject matter, without the prior
express written permission of the other Party. Neither Party shall disclose the
existence or terms of this Agreement except as provided in this Section 8.3.

 

8.3.2 Notwithstanding the terms of Section 8.3.1, either Party shall be
permitted to disclose the existence and terms of this Agreement to the extent
required, in the reasonable opinion of such Party’s legal counsel, to comply
with applicable laws, rules or regulations, including without limitation the
rules and regulations promulgated by the United States Securities and Exchange
Commission or any other governmental agency. Notwithstanding the foregoing,
before disclosing this Agreement or any of the terms hereof pursuant to this
Section 8.3.2, the Parties will consult with one another on the terms of this
Agreement to be redacted in making any such disclosure. If a Party discloses
this Agreement or any of the terms hereof in accordance with this Section 8.3.2,
such Party agrees, at its own expense, to seek confidential treatment of the
portions of this Agreement or such terms, as may be reasonably requested by the
other Party.

 

8.3.3 Either Party may also disclose the existence and terms of this Agreement
to its attorneys and advisors and to potential acquirors, in connection with a
potential consolidation, merger or similar transaction and to existing and
potential investors or lenders of such Party, as a part of their due diligence
investigations, and/or to potential licensees and/or to potential collaborators
and/or to permitted assignees in each case under a written agreement to keep the
terms of this Agreement confidential and to use such confidential information
solely for the purpose permitted pursuant to this Section 8.3.3.

 

8.4 Publications Regarding Results of the Research Program. Neither Party may
publish, present or announce results of the Research Program either orally or in
writing (a “Publication”) without complying with the provisions of this Section
8.4. The other Party shall

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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have [***] from receipt of a proposed Publication to provide comments and/or
proposed changes to the publishing Party. The publishing Party shall take into
account the comments and/or proposed changes made by the other Party on any
Publication and shall agree to designate employees or others acting on behalf of
the other Party as co-authors on any Publication describing results to which
such persons have contributed in accordance with standards applicable to
authorship of scientific publications. If the other Party reasonably determines
that the Publication would entail the public disclosure of such Party’s
Confidential Information and/or of a patentable invention upon which a patent
application should be filed prior to any such disclosure, submission of the
concerned Publication to Third Parties, the confidential information shall be
deleted and publication shall be delayed for such period as may be reasonably
necessary for any such Confidential Information of the other Party (if the other
Party has requested deletion thereof from the proposed Publication) to be
deleted, and/or the drafting and filing of a patent application covering such
invention, provided such additional period shall not exceed [***] from the date
the publishing Party first provided the proposed Publication to the other Party.

 

ARTICLE 9 - INVENTIONS AND PATENTS

 

9.1 Ownership of Inventions and Technology.

 

9.1.1 Except as provided in Sections 9.1.2, 9.1.3 and 9.1.4, inventions and
intellectual property rights therein solely invented by employees, agents or
consultants of SGI shall be owned by SGI and inventions and intellectual
property rights therein solely invented by employees, agents or consultants of
Licensee shall be owned by Licensee.

 

9.1.2 Except as provided in Section 9.1.3 and 9.1.4, inventions and intellectual
property rights therein jointly made by one or more employees, agents or
consultants of SGI and one or more employees of Licensee shall be jointly owned
by SGI and Licensee [***].

 

9.1.3 [***] shall own all Program Inventions made by employees, agents or
consultants of [***]: (a) primarily relate to an [***]; (b) primarily relate to
an [***]; or (c) primarily relate to [***].

 

9.1.4 [***] shall own all Program Inventions made by employees, agents or
consultants of [***] that result from or are associated with the use of [***].

 

9.1.5 SGI agrees to assign and hereby assigns to Licensee all right, title and
interest in and to the Program Inventions owned by Licensee [***].

 

9.1.6 Licensee agrees to assign and hereby assigns to SGI all right, title and
interest in and to the Program Inventions owned by SGI [***].

 

9.1.7 Each Party shall promptly disclose to the other Party the making,
conception or reduction to practice of any Program Inventions.

 

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9.1.8 Inventorship, for the purposes of this Agreement, shall be determined in
accordance with U.S. patent laws of inventorship.

 

9.1.9 Subject to the licenses granted herein and Sections [***], as between the
Parties: (a) [***]; and (b) [***].

 

9.1.10 The Parties recognize and agree that this Agreement and the Initial
Agreement are each a “joint research agreement” under 35 U.S.C. 103(c)(3). The
Parties further agree to cooperate to avail themselves and each other of the
provisions of said section 35 U.S.C. 103(c) as amended through the CREATE Act on
December 10, 2004.

 

9.2 Patent Prosecution and Maintenance.

 

9.2.1 SGI shall be responsible for and shall control the preparation, filing,
prosecution, grant and maintenance of all SGI Patents. SGI shall, at its sole
expense, prepare, file, prosecute and maintain such SGI Patents in good faith
consistent with its customary patent policy and its reasonable business
judgment. SGI shall provide Licensee with information with respect to SGI
Patents on a periodic basis, including the filing, prosecution and maintenance
thereof as reasonably requested by Licensee.

 

9.2.2 Each Party shall be responsible for and shall control the preparation,
filing, prosecution, grant and maintenance, of any patents and patent
applications claiming Program Inventions owned [***] by it in accordance with
[***] and shall, [***]. Patents and patent applications owned [***] shall be
controlled, prepared, filed, prosecuted and maintained by [***].

 

9.2.3 If either Party decides not to continue prosecuting or not to maintain a
[***], then such Party shall promptly so notify the other Party (which notice
shall be at least [***] before any relevant deadline for such [***]).
Thereafter, the other Party shall [***].

 

9.2.4 The Parties shall at all times fully cooperate in order to reasonably
implement the provisions of Sections [***], such cooperation may include the
execution of necessary legal documents, coordinating prosecution to avoid and/or
mitigate any patentability issues raised during prosecution including, for
instance, enablement, estoppel and double patenting, and the provision of any
other assistance to its relevant personnel. Further, notwithstanding anything to
the contrary herein, neither Party shall disclose in a Patent of a Party
Confidential Information of the other Party that such Party is obligated to
maintain confidential pursuant to the provisions of Article 8.

 

9.3 Enforcement of SGI Patents.

 

9.3.1 SGI shall have the first right, at its sole expense, but not the
obligation, to determine the appropriate course of action to enforce the SGI
Patents or otherwise abate the infringement thereof, to take (or refrain from
taking) appropriate action to enforce the SGI Patents, to control any litigation
or other enforcement action and to enter into, or permit, the settlement of any
such litigation or other enforcement action with respect to the SGI Patents. SGI
shall in good faith consider the interests of Licensee in conducting the
foregoing activities.

 

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All monies recovered upon the final judgment or settlement of any such suit to
enforce any SGI Patents with respect to the manufacture, use or sale by Third
Parties of products competitive with Licensed Products or technologies
competitive with SGI Patents shall be [***]. Licensee shall fully cooperate with
SGI in any such action at [***], to enforce the SGI Patents, including being
joined as a party to such action if necessary.

 

9.3.2 If SGI fails to take any action to enforce the SGI Patents or control any
litigation with respect to the SGI Patents with respect to the manufacture, use
or sale by Third Parties of products competitive with Licensed Products or
technologies competitive with SGI Patents within a period of [***] after the
Parties receive reasonable notice of the infringement of the SGI Patents, then
Licensee shall have the right to bring and control any such action by counsel of
its own choice, [***]. In such case, all monies recovered upon the final
judgment or settlement of any such suit to enforce any SGI Patents shall be
[***]. In such a case, SGI shall cooperate fully with Licensee, at [***], in its
efforts to enforce the SGI Patents, including being joined as a party to such
action if necessary. In no event may Licensee assert an argument or settle a
suit in a manner which would render a claim in the SGI Patents invalid or
unenforceable without SGI’s prior written consent.

 

9.3.3 In the event either Party becomes aware of an infringement by a Third
Party of a Joint Patent, it shall promptly notify the other Party and the
Parties shall determine a mutually agreeable course of action. In no event shall
a Party make an argument or settle a dispute which would render a claim in a
Joint Patent to be invalid or unenforceable without the other Party’s prior
written consent.

 

9.4 Prior Patent Rights. Notwithstanding anything to the contrary in this
Agreement, with respect to any SGI Patents that are subject to an SGI In-License
or Licensed Technology Acquisition Agreement, the rights and obligations of the
Parties under Section 9.2 and 9.3 shall be subject to SGI’s licensors’ rights to
participate in and control prosecution, maintenance and enforcement of such SGI
Patents, and to receive a share of damages recovered in such action, in
accordance with the terms and conditions of the applicable SGI In-License.

 

ARTICLE 10 - INFRINGEMENT ACTIONS BROUGHT BY THIRD PARTIES

 

If Licensee, its Affiliate, or any of Licensee’s Sublicensees, is sued by a
Third Party for infringement of a Third Party’s patent because of the use of the
SGI Technology in connection with activities conducted pursuant to this
Agreement, the Party that has been sued shall promptly notify the other Party
within [***] of its receipt of notice of such suit. The notice shall set forth
the facts of such infringement available to the relevant Party to the extent not
previously provided.

 

ARTICLE 11 - REGULATORY ASSISTANCE

 

Licensee shall be solely responsible for, and shall solely own, all applications
for Regulatory Approval with respect to Licensed Products. Should Licensee
desire to file an IND or an application for Regulatory Approval, or equivalents
of the foregoing, for a Licensed Product, SGI will use reasonable commercial
efforts to provide at Licensee’s request any documents not previously provided
to Licensee necessary to compile the [***], and any other

 

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relevant information as the Parties may mutually agree. Licensee shall reimburse
SGI for any out-of-pocket costs incurred by SGI in providing any such
information plus an amount equal to SGI’s then current FTE Fee for SGI’s
personnel engaged in such activities, as set forth in Section 6.1.2. If SGI has
a drug master file with the FDA or equivalent that contains information related
to Drug Conjugation Materials that is useful to support an IND or application
for Regulatory Approval, Licensee shall [***] of such drug master file on
mutually agreeable terms.

 

ARTICLE 12 – REPRESENTATIONS. WARRANTIES AND COVENANTS

 

12.1 Representations and Warranties.

 

12.1.1 This Agreement has been duly executed and delivered by each Party and
constitutes the valid and binding obligation of each Party, enforceable against
such Party in accordance with its terms, except as enforceability may be limited
by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium or
other laws relating to or affecting creditors’ rights generally and by general
equitable principals. The execution, delivery and performance of this Agreement
has been duly authorized by all necessary action on the part of each Party, its
officers and directors.

 

12.1.2 The execution, delivery and performance of the Agreement by each Party
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 law or
regulation of any court, governmental body or administrative or other agency
having jurisdiction over it.

 

12.1.3 SGI represents and warrants that (a) the SGI Technology is all of the
technology, know-how, patents and/or patent applications Controlled by SGI on
the Effective Date related to Drug Conjugation Technology that is [***] with the
right to grant the licenses granted herein, (b) it has the right to grant the
licenses granted herein and that it has validly granted such licenses and that
as of the Effective Date it has [***], (c) as of the Effective Date, there are
[***]; (d) SGI has provided Licensee with accurate and complete copies of the
SGI In-Licenses, with certain information redacted therefrom that has [***]; and
(e) as of the Effective Date, (i) the SGI In-Licenses [***], (ii) each of the
SGI In-Licenses is in [***] and (iii) SGI has [***], and (iv) SGI has the right
to grant the sublicenses granted herein under the SGI In-Licenses and has
validly granted such sublicenses.

 

12.2 Performance by Affiliates. The Parties recognize that each may perform some
or all of its obligations under this Agreement through Affiliates, provided,
however, that each Party shall remain responsible and be a guarantor of the
performance by its Affiliates and shall cause its Affiliates to comply with the
provisions of this Agreement in connection with such performance.

 

12.3 Covenants of SGI. SGI hereby covenants and agrees that: (a) it will [***];
(b) it will perform its contractual obligations as necessary [***] during the
respective terms thereof; (c) it will [***], provided that (i) such [***]
subject to this Agreement and (ii) such [***] SGI In-License or Licensed
Technology Acquisition Agreement; and (d) it will promptly advise Licensee of
any notice of a [***].

 

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ARTICLE 13 – TERM AND TERMINATION

 

13.1 Term. Unless earlier terminated pursuant to this Article 13, the term of
this Agreement (the “Term”) shall commence on the Effective Date and shall
remain in full force and effect until the earlier of: (a) fifty (50) years; or
(b) with respect to each Exclusive License obtained by Licensee, the expiration
of the last to expire Royalty Term for such Exclusive License.

 

13.2 Termination of Exclusive License by Licensee. Licensee shall have the right
to [***] under this Agreement and, as to [***] in each case by providing not
less than [***] prior written notice to SGI of such termination. Any termination
of an Exclusive License by Licensee under this Section 13.2 shall [***].
Furthermore, termination of an Exclusive License with respect to [***] during
the remainder of the Royalty Term pursuant to the terms of Article 6.

 

13.3 Termination for Cause.

 

13.3.1 In the event that Licensee fails to make a payment with respect to an
Exclusive License when due or Licensee materially breaches its obligations under
Article 14 or Sections 3.7.1 or 9.1 of this Agreement with respect to an
Exclusive License, SGI shall have the right to provide Licensee with written
notice of such failure to pay or such breach, and if Licensee fails to make such
payment or to cure such breach within [***] thereafter, SGI shall have the right
to terminate such Exclusive License by written notice to Licensee.

 

13.3.2 Notwithstanding the foregoing, if Licensee reasonably disputes whether a
payment is due or the amount of such payment, Licensee shall have the right to
pay to SGI only the undisputed amount and either Party shall have the right to
institute legal proceedings to determine whether the amount in dispute is
payable. In such event, the disputed payment or amount thereof shall not be due
until there is a final determination as to the amount that is payable by
Licensee.

 

13.3.3 In the event that SGI materially breaches its obligations under Articles
2, or 14 or Section 9.1 of this Agreement, Licensee shall have the right to
provide SGI with written notice of such breach and if SGI fails to cure such
breach within [***] thereafter, Licensee shall have the right to terminate this
Agreement by written notice to SGI.

 

13.4 Bankruptcy.

 

13.4.1 Either Party may terminate this Agreement if, at any time, (a) the other
Party shall file in any court or agency pursuant to any statute or regulation of
any state, country or jurisdiction, a petition for a liquidating bankruptcy or
(b) such other Party shall propose or be a party to any dissolution or
liquidation that is not dismissed within [***] after the filing thereof

 

13.4.2 All rights and licenses granted under this Agreement are, and shall be
deemed to be, for purposes of Section 365(n) of the United States Bankruptcy
Code, licenses of rights to “intellectual property” as defined under Section
101(56) of the United States Bankruptcy Code. The Parties agree that in the
event of the commencement of a bankruptcy proceeding by or against one Party
hereunder under the United States Bankruptcy Code, the other Party shall be
entitled to complete access to any such intellectual property, and all

 

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embodiments of such intellectual property, pertaining to the rights granted in
the licenses hereunder of the Party by or against whom a bankruptcy proceeding
has been commenced, subject, however, to payment of the fees, milestone payments
and royalties set forth in this Agreement through the effective date of any
termination hereunder.

 

13.5 Termination of SGI In-Licenses. All rights and obligations under an SGI
In-License and/or Licensed Technology Acquisition Agreement sublicensed under
this Agreement shall terminate upon [***] prior written notice by SGI to
Licensee if Licensee performs any action that would constitute a material breach
of any obligation of Licensee under such SGI In-License Agreement and/or
Technology Acquisition Agreement and fails to cure such breach within such [***]
period; provided, however, such cure period may be extended by mutual written
consent of the Parties. In the event that Licensee fails to maintain the [***]
of this Agreement, SGI shall provide Licensee with written notice of such
breach. If Licensee fails to cure such breach with [***] thereafter, all rights
and obligations under the [***]. SGI covenants that (a) it will use reasonable
commercial efforts to maintain all [***], (b) it shall [***] and (c) it shall
provide Licensee with prompt written notice if it [***].

 

13.6 Effect of Expiration and Termination.

 

13.6.1 In the event that this Agreement is terminated by Licensee pursuant to
[***], Licensee shall continue to have all Exclusive Licenses then in effect,
subject to its continued payment of the applicable fees, milestone payments and
royalties with respect thereto as set forth in Article 6 and subject to the
obligations of Article 7.

 

13.6.2 In the event that an Exclusive License under this Agreement is terminated
with respect to one or more countries, and a sublicense has been granted under
this Agreement under any such Exclusive License with respect to Licensed Product
in any such country, then SGI agrees to grant to each Sublicensee designated by
Licensee a direct license to such Sublicensee under the terms and conditions of
this Agreement, which license shall be of the same scope sublicensed to such
Sublicensee, provided that such Sublicensee: (a) agrees to be bound to SGI under
the terms and conditions of this Agreement with respect to the Licensed Products
as to which the sublicense has been granted; (b) agrees to comply with all
provisions of applicable SGI In-Licenses and Licensed Technology Acquisition
Agreements; and (c) is not in breach of its sublicense agreement with Licensee.

 

13.6.3 In the event that a Designated Antigen does not become an Exclusive
Antigen: (a) if such Designated Antigen [***], Licensee agrees to grant to SGI a
[***] under the Licensee ADC Know-How and Licensee ADC Patents solely with
respect to ADCs that specifically bind to such Antigen; and (b) if such
Designated Antigen [***], Licensee agrees to [***]. For the avoidance of doubt,
(i) Section 13.6.3 shall not necessarily be deemed to grant to SGI any rights in
the Licensee Patents or Licensee Know-How, Licensee Inventions, Licensee
Invention Patents, or Joint Inventions, beyond the Licensee ADC Patents and
Licensee ADC Know How; and (ii) the grant of a license pursuant to Section
13.6.3 [***].

 

13.6.4 Except where explicitly provided within this Agreement, termination of
this Agreement for any reason, or expiration of this Agreement, will not affect
any: (a) obligations, including payment of any fees, milestones, royalties or
other sums which have

 

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accrued as of the date of termination or expiration, and (b) rights and
obligations which, from the context thereof, are intended to survive termination
or expiration of this Agreement, including provisions of Articles 1, 7 (with
respect to royalties owed under this Agreement prior to termination), 8, 9, 10,
14 and 19 and Sections 2.9, 2.10, 13.4.2 and 13.6.

 

13.6.5 Upon the expiration of the Term, or of the Royalty Term for an Exclusive
Antigen, SGI shall grant, and shall by this provision be deemed to have granted,
to Licensee a royalty-free, perpetual, worldwide, nonexclusive license to use
the SGI Technology to make, use, sell, offer for sale and import Licensed
Products that bind specifically to the applicable Exclusive Antigen(s), with no
further obligation to SGI.

 

13.6.6 This Agreement or an Exclusive Licenses granted hereunder may be
terminated only as provided in and in accordance with the termination provisions
of Sections 5.1.3 and 5.1.4 and Article 13 of this Agreement.

 

ARTICLE 14 - INDEMNITY

 

14.1 Direct Indemnity.

 

14.1.1 Each Party shall defend, indemnify and hold harmless the other Party and
its Affiliates and their officers, directors, employees and agents and their
respective successors, heirs and assigns (individually and collectively, an “SGI
Indemnitee” when the other Party is SGI and individually and collectively a
“Licensee Indemnitee” when the other Party is Licensee) from and against all
liabilities, losses, damages, and expenses, including reasonable attorneys’ fees
and costs, (collectively, the “Liabilities”) resulting from all Third Party
claims, suits, actions, terminations or demands (collectively, the “Claims”)
that are incurred, relate to or arise out of (a) the inaccuracy of any
representation or warranty made by such Party in this Agreement), or (b) the
gross negligence, recklessness, unlawful acts or willful misconduct of the
indemnifying Party in connection with the performance of its obligations
hereunder.

 

14.1.2 Licensee shall defend, indemnify and hold harmless SGI Indemnitees from
and against all Liabilities resulting from all Claims that are incurred, relate
to or arise out of the development, manufacture or commercialization of Licensed
Products by Licensee, its Affiliates or Sublicensees, including any failure to
test for or provide adequate warnings of adverse side effects, or any
manufacturing defect in any Licensed Product; except in each case to the extent
such Liabilities resulted from the gross negligence, recklessness or willful
misconduct or unlawful acts by SGI or the inaccuracy of any representation or
warranty made by SGI in this Agreement or from any other action for which SGI
must indemnify Licensee under Section 14.1.3.

 

14.1.3 SGI shall defend, indemnify and hold harmless Licensee Indemnitees from
and against all Liabilities resulting from all Claims that are incurred, relate
to or arise out of any claims of infringement of Third Party rights arising out
of the use of SGI Technology to research, develop, manufacture or commercialize
a Licensed Product (but not any other technology, including the composition or
methods of making or using Antibodies or technology not relating to SGI
Technology), except to the extent such Liabilities resulted from the gross
negligence, recklessness or willful misconduct or unlawful acts by Licensee or
the inaccuracy of

 

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any representation or warranty made by Licensee in this Agreement or any other
action for which Licensee must indemnify SGI under Section 14.1.2.

 

14.2 Procedure. An SGI Indemnitee or Licensee Indemnitee (the “Indemnitee”) that
intends to claim indemnification under this Article 14 shall promptly provide
notice to the other Party (the “Indemnitor”) of any Liability or action in
respect of which the Indemnitee intends to claim such indemnification, which
notice shall include a reasonable identification of the alleged facts giving
rise to such Liability and shall reasonably cooperate with all reasonable
requests of the Indemnifying Party with respect thereto. The Indemnitor shall,
jointly with any other Indemnitor similarly noticed, assume the defense thereof,
at the sole cost of the Indemnitor, with counsel selected by the Indemnitor.
However, notwithstanding the foregoing, the Indemnitee shall have the right to
retain its own counsel, with the fees and expenses to be paid by the Indemnitor,
if representation of such Indemnitee by the counsel retained by the Indemnitor
would be inappropriate due to actual or potential differing interests between
such Indemnitee and any other Party represented by such counsel in such
proceedings. Any settlement of a Liability for which any Indemnitee seeks to be
indemnified, defended or held harmless under this Article 14 that could
adversely affect the Indemnitee shall be subject to prior consent of such
Indemnitee, provided that such consent shall not be withheld unreasonably. The
Indemnitee may not settle any such claim, demand, action or other proceeding or
otherwise consent to an adverse judgment in any such action or other proceeding
or make any admission as to liability or fault without the express written
permission of the Indemnifying Party, which shall not be unreasonably withheld.

 

ARTICLE 15 - FORCE MAJEURE

 

No Party (or any of its Affiliates) shall be held liable or responsible to the
other Party (or any of its Affiliates), or be deemed to have defaulted under or
breached the Agreement, for failure or delay by such Party in fulfilling or
performing any term of the Agreement when such failure or delay is caused by or
results from causes beyond the reasonable control of the affected Party (or any
of its Affiliates), including fire, floods, embargoes, war, acts of war (whether
war be declared or not), insurrections, riots, civil commotions, acts of God or
acts, earthquakes, or omissions or delays in acting by any governmental
authority (collectively, “Events of Force Majeure”); provided, however, that the
affected Party shall exert all reasonable efforts to eliminate, cure or overcome
any such Event of Force Majeure and to resume performance of its covenants
promptly. Notwithstanding the foregoing, to the extent that an Event of Force
Majeure continues for a period in excess of [***], the affected Party shall
promptly notify in writing the other Party of such Event of Force Majeure and
within [***] of the other Party’s receipt of such notice, the Parties shall
negotiate in good faith either (a) a resolution of the Event of Force Majeure,
if possible, (b) an extension by mutual agreement of the time period to resolve,
eliminate, cure or overcome such Event of Force Majeure, (c) an amendment of
this Agreement to the extent reasonably possible, or (d) an early termination of
this Agreement.

 

ARTICLE 16 - ASSIGNMENT

 

16.1 This Agreement may not be assigned or otherwise transferred, nor, except as
expressly provided hereunder, may any right or obligations hereunder be assigned
or transferred to any Third Party by either Party without the consent of the
other Party, such consent not to be

 

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unreasonably withheld; provided, however, that either Party may, without such
consent but with notification, assign this Agreement and its rights and
obligations hereunder to any of its Affiliates or in connection with the
transfer or sale of all or substantially all of its business or the business to
which this Agreement is related, or in the event of its merger or consolidation
of such Party (such sale, merger or consolidation shall be hereinafter referred
to as a “Change in Control”). Any permitted assignee shall assume all rights and
obligations of its assignor under this Agreement; provided, however, that such
assignment shall not relieve the assignor of its obligations under this
Agreement and further provided, however, that [***]. Any attempted assignment of
this Agreement not in accordance with this Article 16 shall be void and of no
effect.

 

16.2 During the Term, except as set forth in Section 16.1, SGI will not assign
ownership (in whole or in part), in and to any SGI Patents and/or SGI Know-How
without a written agreement from the assignee that such assigned SGI Patents
and/or SGI Know-How is subject to the licenses granted to Licensee under this
Agreement, with Licensee being made a third party beneficiary thereof.

 

ARTICLE 17 - SEVERABILITY

 

Each Party hereby agrees that it does not intend to violate any public policy,
statutory or common laws, rules, regulations, treaty or decision of any
government agency or executive body thereof of any country or community or
association of countries. Should one or more provisions of this Agreement be or
become invalid, the Parties hereto shall substitute, by mutual consent, valid
provisions for such invalid provisions, in their economic effect, are
sufficiently similar to the invalid provisions that it can be reasonably assumed
that the Parties would have entered into this Agreement based on such valid
provisions. In case such alternative provisions cannot be agreed upon, the
invalidity of one or several provisions of this Agreement shall not affect the
validity of this Agreement as a whole, unless the invalid provisions are of such
essential importance to this Agreement that it is to be reasonably assumed that
the Parties would not have entered into this Agreement without the invalid
provisions.

 

ARTICLE 18 – INSURANCE

 

During the Term and thereafter for the period of time required below, each Party
shall maintain on an ongoing basis comprehensive general liability insurance in
the minimum amount of [***] for bodily injury and property damage liability; and
commencing not later than [***] and thereafter for the period of time required
below, Licensee shall obtain and maintain on an ongoing basis products liability
insurance (including contractual liability coverage on Licensee’s
indemnification obligations under this Agreement) in the amount of at least
[***] for bodily injury and property damage liability. All of such insurance
coverage shall be maintained with an insurance company or companies having an
A.M. Best rating of “A-” or better. Licensee shall provide to SGI a
certificate(s) evidencing all required coverage hereunder upon the written
request of SGI. [***].

 

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ARTICLE 19 - MISCELLANEOUS

 

19.1 Notices. Any consent, notice or report required or permitted to be given or
made under this Agreement by one of the Parties hereto to the other shall be in
writing, delivered personally or by facsimile (and promptly confirmed by
personal delivery, first class air mail or courier), first class air mail or
courier, postage prepaid (where applicable), addressed to such other Party at
its address indicated below, or to such other address as the addressee shall
have last furnished in writing to the address or in accordance with this Section
19.1 and (except as otherwise provided in this Agreement) shall be effective
upon receipt by the addressee.

 

If to SGI:

Seattle Genetics, Inc.

21823 30th Drive S.E.

Bothell, WA 98021

Attention: Chief Executive Officer

Telephone: (425) 527-4000

Facsimile: (425) 527-4109

With a copy to: General Counsel

 

If to Licensee:

MedImmune, Inc.

One MedImmune Way

Gaithersburg, MD 20878

Attention: VP of Research

Telephone: 301-398-4199

Facsimile: 301-398-9199

 

With a copy to: Legal Affairs

Attention: General Counsel

Telephone: 301-398-4625

Facsimile: 301 398-9625

 

19.2 Applicable Law. The Agreement shall be governed by and construed in
accordance with the laws of the State of Washington, without regard to the
conflict of law principles thereof that may dictate application of the laws of
any other state.

 

19.3 Arbitration. In the event the Parties are unable to reach agreement with
respect to any matter, which is expressly made subject to arbitration in this
Agreement, such matter will be determined through binding arbitration in [***]
in accordance with the Commercial Rules of Arbitration of the American
Arbitration Association (“AAA”). Any dispute not expressly made subject to
arbitration in this Agreement shall be resolved in a court of competent
jurisdiction, unless the Parties mutually agree otherwise at the time. In an
arbitration pursuant to this Section 19.3:

 

(a) The arbitration panel shall be comprised of [***]. Each Party shall be
entitled to appoint one arbitrator. The Parties shall appoint their respective
arbitrators within [***] after submission for arbitration. The [***] so
appointed shall [***] maintained by the American Arbitration Association. If the
Parties’ appointed arbitrators shall fail to agree. within

 

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[***] from the date both Parties’ arbitrators have been appointed, on the [***]
by the appropriate administrative body of the American Arbitration Association.

 

(b) Within [***] of appointment of the full arbitration panel, the Parties shall
exchange their final proposed positions with respect to the matters to be
arbitrated, which shall approximate as closely as possible the closest positions
of the parties previously taken in the negotiations. Within [***] of appointment
of the arbitration Panel, each Party shall submit to the arbitrators a copy of
the proposed position, which it previously delivered to the other Party,
together with a brief or other written memorandum supporting the merits of its
proposed position. The arbitration panel shall promptly convene a hearing, at
which time each Party shall have [***] to argue in support of its proposed
position. The Parties will not call any witnesses in support of their arguments.

 

(c) The arbitration panel shall render a decision based on the respective
positions of the Parties. In making their decision, the arbitrators shall
consider the terms and conditions of this Agreement, the relative merits of the
proposed positions and the written and oral arguments of the Parties. In the
event the arbitrators seek the guidance of the law of any jurisdiction, the law
of the [***] shall govern.

 

(d) The arbitrators shall make their decision known to the Parties as quickly as
possible by delivering written notice of their decision to both Parties. Such
written notice need not justify their decision. The Parties will execute any and
all papers necessary to comply with the decision of the arbitration Panel within
[***] of receipt of notice of such decision. The decision of the arbitrators
shall be final and binding on the Parties, and specific performance may be
ordered by any court of competent jurisdiction.

 

(e) The Parties will bear their own costs in preparing for the arbitration. The
costs of the arbitrators will be equally divided between the Parties.

 

19.4 Entire Agreement. This Agreement and the Initial Agreement contains the
entire understanding of the Parties with respect to the specific subject matter
hereof. All express or implied agreements and understandings, either oral or
written, heretofore made are expressly superseded by this Agreement. This
Agreement may be amended, or any term hereof modified, only by a written
instrument duly executed by both Parties hereto.

 

19.5 Independent Contractors. SGI and Licensee each acknowledge that they shall
be independent contractors and that the relationship between the two Parties
shall not constitute a partnership, joint venture, agency or any type of
fiduciary relationship. Neither SGI nor Licensee shall have the authority to
make any statements, representations or commitments of any kind, or to take any
action, which shall be binding on the other Party, without the prior consent of
the other Party to do so.

 

19.6 Affiliates. Each Party shall cause its respective Affiliates to comply
fully with the provisions of this Agreement to the extent such provisions
specifically relate to, or are intended to specifically relate to, such
Affiliates, as though such Affiliates were expressly named as joint obligors
hereunder.

 

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19.7 Waiver. The waiver by either Party hereto of any right hereunder or the
failure to perform or of a breach by the other Party shall not be deemed a
waiver of any other right hereunder or of any other breach or failure by said
other Party whether of a similar nature or otherwise.

 

19.8 Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

 

19.9 Cumulative Remedies. Except for breach of diligence obligations in Article
5 for which a sole, exclusive remedy has been set forth, no remedy referred to
in this Agreement is intended to be exclusive, but each shall be cumulative and
in addition to any other remedy referred to in this Agreement or otherwise
available under law.

 

19.10 Waiver of Rule of Construction. Each Party has had the opportunity to
consult with counsel in connection with the review, drafting and negotiation of
this Agreement. Accordingly, the rule of construction that any ambiguity in this
Agreement shall be construed against the drafting Party shall not apply.

 

19.11 Further Assurance. Each Party will duly execute and deliver, or cause to
be duly executed and delivered, such further instruments and do and cause to be
done such further acts and things, including the filing of such assignments,
agreements, documents and instruments, as may be necessary or as the other Party
may reasonably request in connection with this Agreement or to carry out more
effectively the provisions and purposes, or to better assure and confirm until
such other Party its rights and remedies under this Agreement.

 

[Signature page follows]

 

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IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective
Date.

 

SEATTLE GENETICS, INC. By:   /s/ Clay B. Siegall

Name:

  Clay B. Siegall

Title:

  President and CEO

 

MEDIMMUNE, INC. By:   /s/ David M. Mott

Name:

  David M. Mott

Title:

  CEO

 

SIGNATURE PAGE TO ADC COLLABORATION AGREEMENT

 

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requested with respect to the omitted portions.

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SCHEDULE A

 

RESEARCH PLAN

 

RESEARCH SUPPORT

 

SGI will conjugate research quantities of Antibodies to Designated Antigens with
various combinations of Drug Conjugation Materials [***]. SGI will also provide
[***].

 

DEVELOPMENT SUPPORT

 

  a. Assistance will be provided in the form of technical summaries and
quarterly teleconferences. Requested data, reports, methods and materials will
be provided on an as available basis and as information is updated. On-site
meetings and technical transfer can be provided as needed to advance development
efforts. Upon executing the agreement SGI will provide the technical summary
data package. [***]

 

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SCHEDULE B

 

SGI PATENTS [***]

 

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requested with respect to the omitted portions.

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SCHEDULE C

 

SGI IN-LICENSES

 

The following SGI In-Licenses are attached:

 

[***]

 

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with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

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SCHEDULE D

 

DESIGNATED ANTIGENS AND EXCLUSIVE ANTIGENS

 

“First Exclusive Antigen” means [***]

 

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requested with respect to the omitted portions.

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SCHEDULE E

 

[***]

 

[***]     Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.