Exhibit 10.4

 

Execution Version

Confidential

 

Confidential Materials omitted and filed separately with the Securities and
Exchange Commission.
Triple asterisks denote omissions.

 

LICENSE AGREEMENT

 

This LICENSE AGREEMENT (the “Agreement”) is effective as of September 17, 2014
(the “Effective Date”) by and between Spectrum Pharmaceuticals Cayman, L.P., an
Exempted Limited Partnership organized under the laws of the Cayman Islands
(“Spectrum”) and CASI Pharmaceuticals, Inc., a Delaware corporation
(“Licensee”). Licensee and Spectrum are each referred to herein by name or,
individually, as a “Party” or, collectively, as “Parties.”

 

BACKGROUND

 

A.           Spectrum owns and/or controls rights in and to a product containing
Ibritumomab Tiuxetan in a Kit (as defined below) and Yttrium-90 (Y-90) Chloride
sterile solution (the “Product”).

 

B.           Licensee desires to obtain a license to develop and commercialize
the Product for use in the Field in the Licensee Territory (each capitalized
term as defined below), and Spectrum desires to grant Licensee such a license.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements provided
herein below and other consideration, the receipt and sufficiency of which is
hereby acknowledged, Licensee and Spectrum hereby agree as follows:

 

Article 1
DEFINITIONS

 

The following capitalized terms shall have the meanings given in this Article 1
when used in this Agreement:

 

1.1          “AAA” has the meaning set forth in Section 10.2.

 

1.2          “AAA Rules” has the meaning set forth in Section 10.2.

 

1.3          “Additional Products” has the meaning set forth in Section 3.4.1.

 

1.4          “Affiliate” shall mean with respect to either Party, any Person
controlling, controlled by or under common control with such Party, for so long
as such control exists. For purposes of this Section 1.4 only, “control” shall
mean (i) direct or indirect ownership of fifty percent (50%) or more of the
stock or shares having the right to vote for the election of directors of such
corporate entity or (ii) the possession, directly or indirectly, of the power to
direct, or cause the direction of, the management or policies of such entity,
whether through the ownership of voting securities, by contract or otherwise.

 

1.5          “Agreement” has the meaning set forth in the Preamble including any
schedules, exhibits, annexures, attached hereto or any amendments and
modifications.

  

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

 

 

 

1.6          “Agreement Year” shall mean a twelve (12) month period from the
Effective Date and each anniversary thereof.

 

1.7          “Applicable Laws” shall mean, with respect to a Party’s activities
under this Agreement, any and all laws, ordinances, orders, rules, rulings,
directives and regulations of any kind whatsoever of any governmental or
regulatory authority within the applicable jurisdiction applicable to such
Party’s activities.

 

1.8          “Auditing Party” has the meaning set forth in Section 5.5.

 

1.9          “***” shall mean ***.

 

1.10        “***” shall mean ***.

 

1.11        “Business Day” shall mean any day other than a Saturday, Sunday or
any other day on which commercial banks in the United States, the People’s
Republic of China or Hong Kong are authorized or required by law to remain
closed.

 

1.12        “Chairperson” has the meaning set forth in Section 2.1.3.

 

1.13        “Change of Control” means, with respect to either Party, (i) the
sale of all or substantially all of such Party’s assets or business relating to
this Agreement; (ii) a merger, consolidation, share exchange or other similar
transaction involving such Party and any Third Party which results in the
holders of the outstanding voting securities of such Party immediately prior to
such merger, consolidation, share exchange or other similar transaction ceasing
to hold more than fifty percent (50%) of the combined voting power of the
surviving, purchasing or continuing entity immediately after such merger,
consolidation, share exchange or other similar transaction, or (iii) the
acquisition by a person or entity, or group of persons or entities acting in
concert, of more than fifty percent (50%) of the outstanding voting equity
securities of such Party; in all cases of clauses (i)-(iii), where such
transaction is to be entered into with any person or group of persons other than
the other Party or its Affiliates.

 

1.14        “Commercialization” shall mean, with respect to the Product, any and
all processes and activities conducted to establish and maintain sales for the
Product (including with respect to reimbursement and patient access), including
offering for sale, detailing, selling (including launch), marketing (including
education and advertising activities), promoting, storing, transporting,
distributing, and importing the Product, but shall exclude Development of the
Product. For clarity, Commercialization shall include the manufacture of the
Product in support of the foregoing processes and activities, including, to the
extent applicable, packaging, labeling and other finishing activities, quality
control and assurance testing, in each case, with respect to such product.
“Commercialize” and “Commercializing” shall have their correlative meanings.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-2-

 

 

1.15        “Commercially Reasonable Efforts” shall mean, with respect to the
efforts to be expended by a Party with respect to any objective, the efforts and
resources normally applied by the Party to other pharmaceutical products of
similar commercial potential and is at a similar stage in its development or
product life but no less than those reasonable, diligent, good faith efforts
consistent with those normally applied in the pharmaceutical industry for
products of similar commercial potential. With respect to Licensee’s efforts in
connection with the Development, or Commercialization of the Product hereunder,
commercially reasonable efforts shall mean efforts reasonably used by Licensee
or its Affiliates (giving due consideration to relevant industry standards) for
Licensee’s own products (including internally developed, acquired and
in-licensed products) with similar commercial potential at a similar stage in
their lifecycle (assuming continuing development of such product), taking into
consideration their safety, tolerability and efficacy, and the
radioimmunotherapy nature of the Product, the profitability on a GAAP basis
consistent with Licensee’s publicly reported financial statements, the
competitive landscape, extent of market exclusivity, patent protection, cost to
develop the product, promotable claims, health economic claims, the approved
indications and the regulatory and reimbursement structure involved.

 

1.16        “Common Stock” has the meaning set forth in Section 5.1.

 

1.17        “Confidential Information” has the meaning set forth in Section 7.1.

 

1.18        “Control” shall mean, with respect to any Intellectual Property
right, possession by a party (including its Affiliates) of the right (whether by
ownership, license or otherwise) to grant to another party a license or a
sublicense under such Intellectual Property right without violating the terms of
any agreement or other arrangement with any third party. “Controlled” and
“Controlling” shall have their correlative meanings. Notwithstanding anything to
the contrary in this Agreement, in the event that a Third Party acquires
(including by merger or consolidation) a Party or an Affiliate of a Party, or a
Party or an Affiliate of a Party transfers to a Third Party all or substantially
all of its assets to which this Agreement relates (such Third Party and its
Affiliates immediately prior to such acquisition or transfer (the “Subject
Transaction”), collectively, the “Acquiring Entities”), the following shall not
be deemed to be Controlled by such Party or its Affiliates for purposes of this
Agreement: (i) any subject matter owned or controlled by any Acquiring Entity
immediately prior to the effective date of such Subject Transaction, and (ii)
any subject matter developed or acquired by or on behalf of any Acquiring Entity
after a Subject Transaction independently, without accessing or practicing
subject matter within the Licensed Technology or any other technology or
information made available to such Party under this Agreement.

 

1.19        “Development” shall mean, with respect to the Product, any and all
processes and activities conducted to obtain and maintain Regulatory Approval
for the Product, including preclinical testing, test method development and
stability testing, toxicology, formulation, process development, quality
assurance/control development, statistical analysis, clinical studies (including
trials for additional indications for the Product for which a Regulatory
Approval has been obtained), quality of life assessments, pharmacoeconomics,
post-marketing studies, label expansion studies, regulatory affairs, and further
activities relating to the clinical development or preparation of such product
for filing MAAs with Regulatory Authorities and Commercialization. “Develop” and
“Developing” shall have their correlative meanings.

 

1.20        “Dispute” has the meaning set forth in Section 10.1.

 

1.21        “Effective Date” has the meaning set forth in the Preamble.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-3-

 

 

1.22        “Enforcing Party” has the meaning set forth in Section 6.5.5.

 

1.23        “Field” shall mean the use of the Product for the diagnosis,
prevention and therapy of all diseases, conditions and disorders in humans.

 

1.24        “First Commercial Launch” shall mean the first shipment of the
Product in commercial quantities for commercial sale to a Third Party in
Licensee Territory after receipt of all applicable Regulatory Approvals therefor
from the applicable Regulatory Authority in Licensee Territory.

 

1.25        “Foreign Marketing Approval” has the meaning set forth in
Section 4.1.6.

 

1.26        “Imported Product Regulatory Approval” has the meaning set forth in
Section 4.1.6.

 

1.27        “Indemnify” has the meaning set forth in Section 8.5.1.

 

1.28        “Initial Transfer” has the meaning set forth in Section 4.2.3.

 

1.29        “Intellectual Property” shall mean intellectual property rights of
every kind and nature throughout the world, however denominated, including all
rights and interests pertaining to or deriving from:

 

(a)          Patent and Know-How;

 

(b)          trademarks, trade names, service marks, service names, brands,
trade dress and logos, domain names, and the goodwill and activities associated
therewith;

 

(c)          copyrights, works of authorship, rights of privacy and publicity,
moral rights, and similar proprietary rights of any kind or nature, in all media
now known or hereafter created; and

 

(d)          any and all registrations, applications, recordings, licenses,
statutory rights, common-law rights and rights relating to any of the foregoing.

 

1.30        “International Accounting Standards” shall mean the International
Financial Reporting Standards or U.S. Generally Accepted Accounting Principles.

 

1.31        “Invention” has the meaning set forth in Section 6.1.2.

 

1.32        “Investment Agreement” has the meaning set forth in Section 5.1.

 

1.33        “JPC” has the meaning set forth in Section 2.1.1.

 

1.34        “Joint Patents” has the meaning set forth in Section 6.1.1(c).

 

1.35        “Joint Inventions” has the meaning set forth in Section 6.1.1(c).

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-4-

 

  

1.36        “Kit” shall mean the product kit described in Exhibit 1.36.

 

1.37        “Know-How” shall mean inventions, business, marketing, technical and
manufacturing information, know-how and materials, including technology,
software, instrumentation, specifications, devices, data, compositions,
formulas, biological materials, assays, reagents, constructs, compounds,
discoveries, procedures, processes, practices, protocols, methods, techniques,
results of experimentation or testing, knowledge, trade secrets, skill and
experience, in each case whether or not patentable or copyrightable.

 

1.38        “Licensee” has the meaning set forth in the Preamble.

 

1.39        “Licensee Indemnitees” has the meaning set forth in Section 8.5.1.

 

1.40        “Licensee Inventions” has the meaning set forth in Section 6.1.1(b).

 

1.41        “Licensee Know-How” shall mean any and all Know-How Controlled by
Licensee or its Affiliates during the Term that is reasonably necessary or
useful for the Development or Commercialization of the Product for use in the
Field. Licensee Know-How shall also include Licensee Inventions.

 

1.42        “Licensee Territory” shall mean People’s Republic of China
including, Hong Kong, Macau and Taiwan; provided however, that Hong Kong shall
not be part of the Licensee Territory until such time that is the earlier of (a)
the completion of the transfer of the MA (as defined in the MA Transfer and
Interim Holding Agreement) pursuant to the MA Transfer and Interim Holding
Agreement, dated March 25, 2014, by and between Spectrum and Global Medical
Solutions Hong Kong Ltd., or (b) one (1) year from the execution of this
Agreement.

 

1.43        “Licensee Trademarks” has the meaning set forth in Section 4.3.4(a).

 

1.44        “Losses” has the meaning set forth in Section 8.5.1.

 

1.45        “MAA” shall mean a new drug application or similar application or
submission filed with or submitted to any Regulatory Authority to obtain
permission to commence marketing and sales of the Product in any particular
jurisdiction.

 

1.46        “Made” has the meaning set forth in Section 6.1.2.

 

1.47        “Manufacturing Cost” shall mean Spectrum’s, or Non-Spectrum Foreign
Regulatory Approval Holder’s, bona fide and actual manufacturing cost or bona
fide invoiced cost from a Third Party manufacturer.

 

1.48        “Material Impact” shall mean a material adverse effect on the
regulatory status or commercial sales of the Product.

 

1.49        “Material Impact Matters” has the meaning set forth in Section 2.3.

 

1.50        “Net Sales” has the meaning set forth in the Upstream Stream
Licenses.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-5-

 

 

1.51        “Non-Spectrum Foreign Marketing Approval Holder” has the meaning set
forth in Section 4.1.6.

 

1.52        “Party” or “Parties” has the meaning set forth in the Preamble.

 

1.53        “Patent” shall mean any of the following, whether existing now or in
the future anywhere in the world: (i) any issued patent, including inventor's
certificates, substitutions, extensions, confirmations, reissues,
re-examination, renewal or any like governmental grant for protection of
inventions; and (ii) any pending application for any of the foregoing, including
any continuation, divisional, substitution, continuations-in-part, provisional
and converted provisional applications.

 

1.54        “Payment Period” has the meaning set forth in Section 5.2.2.

 

1.55        “Person” shall mean any individual, corporation, partnership,
association, joint-stock company, trust, unincorporated organization or
government or political subdivision thereof.

 

1.56        “Prior CDA” has the meaning set forth in Section 7.3.

 

1.57        “Product” has the meaning set forth in the Preamble.

 

1.58        “Prosecution and Maintenance” shall mean, with respect to a Patent,
the preparing, filing, prosecuting and maintenance of such Patent, as well as
re-examinations, reissues, requests for Patent term extensions and the like with
respect to such Patent, together with the conduct of interferences, the defense
of oppositions and other similar proceedings with respect to the particular
Patent.

 

1.59        “Regulatory Approval” shall mean, with respect to the Product in a
particular jurisdiction, approval or other permission by the applicable
Regulatory Authorities sufficient to initiate manufacturing, importing,
marketing and sales of such product, including pricing and reimbursement
approvals.

 

1.60        “Regulatory Authority” shall mean any federal, national,
multinational, state, provincial or local regulatory agency, department, bureau
or other governmental entity with authority over the Development,
Commercialization or other use or exploitation (including the granting of
Regulatory Approvals) of the Product in any jurisdiction, including the FDA.

 

1.61        “Regulatory Filing” shall mean any filing, application, or
submission with any Regulatory Authority, including MAAs and authorization,
approvals or clearances arising from the foregoing, including Regulatory
Approvals, and all correspondence or communication with or from the relevant
Regulatory Authority, as well as minutes of any material meetings, telephone
conferences or discussions with the relevant Regulatory Authority, in each case
with respect to the Product.

 

1.62        “Senior Executives” has the meaning set forth in Section 2.3.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-6-

 

 

1.63        “Spectrum” has the meaning set forth in the Preamble.

 

1.64        “Spectrum Copyrights” shall mean all works of authorship (including
advertising, marketing and promotional materials, artwork, labeling, and other
works of authorship), and all copyrights, moral rights and other rights and
interests thereto throughout the Licensee Territory, whether or not registered,
that are (i) Controlled by Spectrum or its Affiliates, and (ii) are delivered to
Licensee by Spectrum for use in connection with the Product.

 

1.65        “Spectrum Indemnitees” has the meaning set forth in Section 8.5.2.

 

1.66        “Spectrum Inventions” has the meaning set forth in Section 6.1.1(a).

 

1.67        “Spectrum Know-How” shall mean any and all Know-How Controlled by
Spectrum or its Affiliates during the Term that is reasonably necessary or
useful for the Development or Commercialization of the Product for use in the
Field. Spectrum Know-How shall also include Spectrum Inventions.

 

1.68        “Spectrum Patents” shall mean any and all Patents Controlled by
Spectrum or its Affiliates during the Term claiming (i) the composition of or
formulation for, (ii) any method, composition or apparatus for the manufacture
of, or (iii) any method of using in the Field, in each case of clause (i), (ii),
and (iii), the Product. Spectrum Patents shall also include Patents that claim
Spectrum Inventions. A list of Spectrum Patents is appended hereto as Exhibit
1.68 and will be updated periodically to reflect changes thereto during the
Term.

 

1.69        “Spectrum Product Marks” has the meaning set forth in
Section 4.3.4(c).

 

1.70        “Spectrum Technology” shall mean the Spectrum Know-How, Spectrum
Patents and Spectrum Copyrights.

 

1.71        “Spectrum Trademarks” shall mean the trademarks and service marks,
the goodwill associated therewith, and all registrations and applications
relating thereto, that are (i) Controlled by Spectrum or its Affiliates, during
the Term, and (ii) used by Spectrum in connection with the Product. A list of
Spectrum Trademarks is appended hereto as Exhibit 1.71 and will be updated
periodically to reflect changes thereto during the Term.

 

1.72        “Spectrum Territory” shall mean all countries and territories
throughout the world other than the Licensee Territory.

 

1.73        “Supply Agreement” has the meaning set forth in Section 4.5.2.

 

1.74        “Term” has the meaning set forth in Section 9.1.

 

1.75        “Territory” shall mean all of the countries and territories in the
world. A Party’s respective “Territory” shall mean, in the case of Spectrum, the
Spectrum Territory, and in the case of Licensee, the Licensee Territory.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-7-

 

  

1.76        “Third Party” shall mean any Person other than Licensee, Spectrum or
their respective Affiliates.

 

1.77        “Third-Party Claim” has the meaning set forth in Section 8.5.1.

 

1.78        “Upstream Licenses” shall mean ***.

 

1.79        “Upstream Payments” has the meaning set forth in Section 5.2.1.

 

1.80        “Wind-Down Period” has the meaning set forth in Section 9.8.2.

 

Article 2
GOVERNANCE

 

2.1          Joint Product Committee.

 

2.1.1       Establishment. Promptly after the Effective Date, Licensee and
Spectrum shall establish a joint product committee (the “JPC”) to oversee,
review and coordinate the activities of Licensee under this Agreement, including
the Development and Commercialization of the Product for use in the Field in the
Licensee Territory.

 

2.1.2       Responsibilities. The JPC shall be responsible for: (i) overseeing,
reviewing and monitoring Licensee’s activities under this Agreement including,
without limitation, any clinical trials proposed to be conducted by Licensee;
(ii) facilitating access to and the exchange of information between the Parties
related to the Development and/or Commercialization of the Product for use in
the Field in the Licensee Territory; and (iii) undertaking and/or approving such
other matters as are specifically provided for the JPC under this Agreement.

 

2.1.3       Membership. The JPC shall be comprised of an equal number of
representatives from each of Spectrum and Licensee and unless otherwise agreed
such number shall be two (2) senior representatives from each Spectrum and
Licensee. Either Party may replace its respective JPC representatives at any
time with prior notice to the other Party, provided, that such replacement is of
comparable authority and scope of functional responsibility within that Party’s
organization as the person he or she is replacing. Unless otherwise agreed by
the Parties, the JPC shall have at least one representative with relevant
decision-making authority from each Party such that the JPC is able to
effectuate all of its decisions within the scope of its responsibilities.
Licensee shall select one of its representatives as the chairperson for the JPC
(the “Chairperson”) and the Licensee may replace the Chairperson upon written
notice to Spectrum. The Chairperson shall be responsible for calling meetings,
preparing and circulating an agenda in advance of each meeting (which agenda
will include every matter requested by either Party), and preparing and issuing
minutes of each meeting within thirty (30) days thereafter.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission. 

-8-

 

 

2.2          Meetings. The JPC shall hold meetings (either in person, by
teleconference or videoconference) at such times and places as the Parties may
mutually agree, provided, that, unless the Parties agree otherwise, the JPC
shall meet at least semi-annually during the Development of the Product for use
in the Field in the Licensee Territory, and at least annually thereafter. Each
Party shall bear its own costs associated with attending such meetings. As
appropriate, other employees of the Parties may attend the JPC’s meetings as
nonvoting observers, but no Third Party personnel may attend unless otherwise
agreed by the Parties. At the request of Spectrum and with prior written
approval of Licensee, which shall not be unreasonably withheld, Third Party
licensees of Spectrum for the development and commercialization of the Product
for use in the Field in the Spectrum Territory may attend the JPC’s meetings as
nonvoting participants if they have agreed to confidentiality terms at least as
restrictive as those set forth in this Agreement. Each Party may also call for
special meetings to resolve particular matters requested by such Party.

 

2.3          Decision Making. Decisions of the JPC shall be made by consensus of
the members present in person or by other means (e.g., teleconference) at any
meeting, with at least one representative from each Party participating in such
vote. The members of the JPC shall at all times use good faith efforts to reach
consensus on matters properly referred to the JPC. In the event that the JPC is
unable to reach consensus with respect to a particular matter within its
purpose, then either Party may, by written notice to the other, refer the matter
to the respective business head of each Party or their respective designee who
is senior in rank and authority to such Party’s JPC representatives (the “Senior
Executives”) for resolution by good faith discussions for a period of at least
fifteen (15) Business Days. In the event that the Senior Executives are unable
to reach agreement with respect to such matter within such fifteen (15) Business
Days, then Licensee shall have the final decision-making authority with respect
to such matter, except in the event that such matter is reasonably possible to
create a Material Impact in the Spectrum Territory (the “Material Impact
Matters”) and Spectrum notifies Licensee during or before any referral of the
matter to Senior Executives of each Party for resolution of Spectrum’s belief
that such matter is a Material Impact Matter, in which case, Spectrum shall have
the final decision-making authority.

 

2.4          Authority. The JPC shall perform its responsibilities under this
Agreement based on the principles of prompt and diligent Development and
Commercialization of the Product for use in the Field in the Licensee Territory,
consistent with good pharmaceutical practices and commercially reasonable
consideration of the optimal balance of maximizing long-term sale of the Product
in the Licensee Territory.

 

2.5          Day-to-Day Responsibilities. Each Party shall: (i) be responsible
for day-to-day implementation and operation of the activities hereunder for
which it has or is otherwise assigned responsibility under this Agreement,
provided, that such implementation is not inconsistent with the express terms of
this Agreement or the decisions of the JPC within the scope of their authority
specified herein; and (ii) keep the other Party informed as to the progress of
such activities as reasonably requested by the other Party and as otherwise
determined by the JPC.

 

2.6          JPC Participation; Discontinuation. It is understood that
Spectrum’s participation on the JPC shall be as a matter of right, but not an
obligation. Accordingly, Spectrum may, at its discretion, elect to discontinue
its participation in the JPC at any time during the Term upon written notice to
Licensee. If Spectrum provides such written notice, then JPC shall have no
further authority under this Agreement and shall cease to function, and
thereafter decisions which were previously to be made by the JPC as set forth
and contemplated in this Agreement shall be made solely by the Licensee in its
reasonable discretion except that all decisions with respect to Material Impact
Matters shall be made solely by Spectrum, and all of the rights and obligations
of the Parties under this Agreement shall continue in full force and effect as
rights and obligations directly between the Parties, including, without
limitation, each Party’s obligations to provide and rights to receive results,
data and other information generated from the other Party’s activities with
respect to the Development of the Product for use in the Field.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-9-

 

 

Article 3
LICENSES AND EXCLUSIVITY

 

3.1          Grant to Licensee.

 

3.1.1       License. Subject to and in accordance with the terms and conditions
of this Agreement, Spectrum hereby grants to Licensee, during the Term, (i) an
exclusive (even as to Spectrum and its Affiliates, except to the extent
necessary to perform their obligations under this Agreement), irrevocable
(except as set forth in Article 9), fully paid-up, royalty-free (except as set
forth in Section 5.2.1), sublicenseable at any tier (in accordance with Section
3.1.2) license to use the Spectrum Know-How, and under the Spectrum Patents, to
Commercialize (including to use, sale, offer for sale and import) the Product
solely in the Licensee Territory and solely for use in the Field, subject to and
in accordance with Section 4.3, and (ii) a non-exclusive, irrevocable (except as
set forth in Article 9), fully paid-up, royalty-free, sublicenseable at any tier
(in accordance with Section 3.1.2) license to use the Spectrum Know-How, and
under the Spectrum Patents, to Develop the Product solely in the Licensee
Territory and solely for use in the Field, subject to and in accordance with
Sections 4.1 and 4.2.

 

3.1.2       Sublicenses. Neither Licensee nor any of its Affiliates may grant or
authorize sublicenses under the license under Section 3.1.1 without the prior
written consent of Spectrum, which approval shall not be unreasonably withheld,
delayed, or conditioned, except that Licensee shall have the right to sublicense
at any tier the license under Section 3.1.1 to its Affiliates without the
consent of Spectrum. Licensee shall be responsible for the failure by its
Affiliates to comply with, and Licensee shall ensure the compliance by each of
its Affiliates with, the terms of this Agreement including all relevant
restrictions, limitations and obligations.

 

3.2          Activities Outside the Field and Outside the Licensee Territory.

 

3.2.1       Licensee Rights Limited to the Field and the Licensee Territory.
Licensee agrees that neither it, nor any of its Affiliates, will Develop
(including file for Regulatory Approval with respect to) or Commercialize
(including use, sale, offer for sale or import) the Product anywhere in the
world, or for any use anywhere in the world, except in the Licensee Territory,
and for use in the Field in the Licensee Territory, only in accordance with and
under this Agreement. Licensee agrees that neither it, nor any of its
Affiliates, will use or otherwise exploit, except as expressly licensed under
this Agreement, any Spectrum Patents, Spectrum Know-How and/or Spectrum
Trademark, or their counterparts in a country outside the Licensee Territory.

 

3.2.2       Territorial Integrity. Each Party shall use Commercially Reasonable
Efforts to prevent any Product sold or otherwise distributed by such Party,
directly or indirectly, from being sold, distributed or otherwise transported
for use outside its respective Territory.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-10-

 

  

3.3          Upstream Licenses. In addition to the payment obligations under
Section 5.2, Licensee shall, and shall cause its Affiliates and sublicensees to,
comply with all the terms and conditions of the Upstream Licenses applicable to
Licensee or its Affiliates or sublicensees, or to Spectrum due to Licensee’s or
its Affiliates’ or sublicensees’ activities, under this Agreement in the
Licensee Territory. To the extent that any provisions are more restrictive, or
broader, under the Upstream Licenses than may be explicitly set out in the
Agreement, such more restrictive or broader provisions shall govern Licensee’s
rights. During the Term, Spectrum shall promptly furnish Licensee with copies of
(a) complete and unredacted copies of the Upstream Licenses and any relevant
ancillary agreements, exhibits, schedules, or other documents which set forth
and are sufficient to fully describe all the terms and conditions with which
Licensee must comply in relation to the Upstream Licenses, (b) all amendments of
the Upstream Licenses, and (c) all correspondence (or in the case of oral
discussions, a summary of such discussions) with or from and reports received
from or provided to licensors under the Upstream Licenses to the extent material
to Licensee or the rights granted or to be granted to Licensee under this
Agreement. In addition, during the Term, Spectrum shall provide copies of all
notices received by Spectrum relating to any alleged breach or default by
Spectrum under the Upstream Licenses within five (5) Business Days after
Spectrum’s receipt thereof..

 

3.4          Assistance to Obtain Rights to Additional Products.

 

3.4.1       Introduction to Third Parties with Rights to Additional Products.
With regard to any current and/or future proprietary, licensed or acquired
pharmaceutical or biologic assets or products, and any and all other
derivatives, and/or improvements thereof, that Spectrum Controls or that come
under the Control of Spectrum, other than the Product (the “Additional
Products”), to the extent Development and Commercialization rights in the
Licensee Territory are Controlled by Third Parties, at Licensee’s reasonable
request, Spectrum shall use good faith efforts, solely from the perspective of
Spectrum’s best interests, to introduce Licensee to such Third Parties to
facilitate Licensee to license or acquire such rights in the Licensee Territory
from such Third Parties, with the understanding that Licensee shall be solely
responsible for all costs or consideration related to a license or acquisition
of such rights in the Licensee Territory from such Third Parties.

 

3.4.2       Efforts to Obtain Rights in the Licensee Territory. Spectrum shall
use good faith efforts, solely from the perspective of Spectrum’s best
interests, when engaging in negotiations with Third Parties to license or
acquire any Development and Commercialization rights for any pharmaceutical or
biologic assets or products, and any and all other derivatives, and/or
improvements thereof owned by such third parties, to license or acquire
Development and Commercialization rights thereto in the Licensee Territory.

 

3.4.3       Termination Upon Change of Control. Licensee acknowledges and agrees
that Spectrum’s obligations under Sections 3.4.1 and 3.4.2 above shall terminate
and be of no further effect upon the consummation of Change of Control by
Spectrum.

 

3.5          No Other Rights. Each Party acknowledges that the rights and
licenses granted under this Article 3 and elsewhere in this Agreement are
limited to the scope expressly granted. Accordingly, except for the rights
expressly granted under this Agreement, no right, title, or interest of any
nature whatsoever is granted, whether by implication, estoppel, reliance, or
otherwise, by either Party to the other Party. All rights with respect to
Know-How, Patents or other Intellectual Property rights that are not
specifically granted herein are reserved to the owner thereof.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-11-

 

  

Article 4
REGULATORY MATTERS, DEVELOPMENT AND COMMERCIALIZATION OF PRODUCT

 

4.1          Regulatory Matters.

 

4.1.1       General. Licensee shall be responsible for all correspondence,
meetings and other interactions, with the relevant Regulatory Authorities
concerning regulatory activities related to the Product in the Field in the
Licensee Territory, and for preparing and filing any and all Regulatory Filings
for Regulatory Approval for the Product in the Field in the Licensee Territory
at its sole expense and shall use Commercially Reasonable Efforts in doing so.
Spectrum shall assist and cooperate with Licensee in connection with the
preparation, filing and maintenance of such Regulatory Filings, as reasonably
requested by Licensee. All Regulatory Approvals in the Licensee Territory shall
be owned by Licensee and filed and obtained in Licensee’s and/or Spectrum’s name
in accordance with Applicable Laws.

 

4.1.2       Reporting. Licensee shall keep Spectrum fully informed of regulatory
developments relating to the Product in the Field in the Licensee Territory and
shall promptly notify Spectrum in writing of any action or decision by any
Regulatory Authority in the Licensee Territory regarding the Product in the
Field. Licensee shall provide Spectrum for review and comment all draft
Regulatory Filings in its original language (with a summary in English) and in
electronic form (other than routine correspondence) at least twenty (20)
Business Days (or in the event of a shorter filing deadline, as soon as
practicable) in advance of their intended date of submission to a Regulatory
Authority in the Licensee Territory. Spectrum shall use good faith efforts to
provide Licensee with comments to such draft Regulatory Filings prior to the
intended date of submission, and Licensee shall consider in good faith any
comments thereto provided by Spectrum. Licensee shall promptly notify Spectrum
of any Regulatory Filings (other than routine correspondence) submitted to or
received from any Regulatory Authority in the Licensee Territory regarding the
Product in the Field, and shall provide copies thereof at least five (5)
Business Days after submission or receipt, which copy may be provided in its
original language and in electronic form. Licensee shall keep Spectrum informed
of all meetings, conferences and discussions with any Regulatory Authority in
the Licensee Territory concerning the Product, and shall provide Spectrum with a
summary of the substantive content discussed in any such meeting, conferences or
discussions within five (5) Business Days after such meetings, conferences or
discussions. In addition, upon Spectrum’s request, Licensee shall promptly meet
and confer with Spectrum to discuss any regulatory matters related to the
Product in the Licensee Territory, either in person at Licensee’s facility or by
audio or video teleconference as Spectrum may elect.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-12-

 

  

4.1.3       Regulatory Costs. Licensee shall be solely responsible for all of
its costs and expenses related to the preparation, filing and maintenance of all
Regulatory Approvals for the Product in the Field in the Licensee Territory.
Spectrum shall support Licensee, as reasonably requested by Licensee, in
obtaining Regulatory Approvals in Licensee Territory, including providing
necessary documents or other materials in Spectrum’s possession required by
Applicable Laws to obtain Regulatory Approvals in such territory, all in
accordance with the terms and conditions of this Agreement, provided, that
Spectrum shall be under no obligation to generate any additional data unless
specifically agreed by Spectrum and Licensee.

 

4.1.4       Rights of Reference. Spectrum hereby grants to Licensee a right of
reference to all Regulatory Filings filed by or on behalf of Spectrum, which
right of reference Licensee may use for the sole purpose of seeking, obtaining
and maintaining Regulatory Approvals and Developing and Commercializing the
Product in the Field in the Licensee Territory. At Licensee’s reasonable
request, Spectrum shall submit to the Regulatory Authorities a copy of the
Regulatory Filings related to the Product, which are reasonably determined by
Spectrum to be necessary to support Licensee’s application for Regulatory
Approvals in the Licensee Territory.

 

4.1.5       Reporting; Adverse Drug Reactions.

 

(a)          Pharmacovigilance Agreement. Promptly after the Effective Date, the
Parties shall enter into a pharmacovigilance agreement on reasonable and
customary terms, including: (a) providing detailed procedures regarding the
maintenance of core safety information and the exchange of safety data relating
to the Product within appropriate timeframes and in an appropriate format to
enable each Party to meet both expedited and periodic regulatory reporting
requirements; and (b) ensuring compliance with the reporting requirements of all
applicable Regulatory Authorities on a worldwide basis for the reporting of
safety data in accordance with all applicable regulatory and legal requirements
regarding the management of safety data. Each Party hereby agrees to comply with
its respective obligations under such pharmacovigilance agreement and to cause
its Affiliates to comply with such obligations.

 

(b)          Adverse Event Reporting. As between the Parties: (a) Licensee or
its designee shall be responsible for the timely reporting of all adverse drug
reactions/experiences, Product quality, Product complaints and safety data
relating to the Product to the appropriate Regulatory Authorities in the
Licensee Territory; and (b) Spectrum or its designee shall be responsible for
reporting all adverse drug reactions/experiences, Product quality, Product
complaints and safety data relating to the Product to the appropriate Regulatory
Authorities in the Spectrum Territory; all in accordance with Applicable Laws.

 

4.1.6       Spectrum Assistance for Imported Products. In the event that (a) to
apply for Regulatory Approval for the Product as an imported drug or product (an
“Imported Product Regulatory Approval”) in a country or regulatory jurisdiction
within the Licensee Territory, a Regulatory Authority or Applicable Laws of such
country or regulatory jurisdiction requires the applicant to hold a marketing
authorization, certificate of pharmaceutical product, or an equivalent
certification for such Product outside of such country or regulatory
jurisdiction within the Licensee Territory (a “Foreign Marketing Approval”),
(b) Licensee decides to seek Imported Product Regulatory Approval for such
Product in such country or regulatory jurisdiction, and (c) Licensee requests
Spectrum, if Spectrum is the Foreign Marketing Approval holder for such Product,
to authorize Licensee to file, in Spectrum’s name, or if, Spectrum’s Affiliate
or a Third Party is the Foreign Marketing Approval holder for such Product (the
“Non-Spectrum Foreign Marketing Approval Holder”), to procure such Non-Spectrum
Foreign Marketing Approval Holder to authorize Licensee to file in such
Non-Spectrum Foreign Marketing Approval Holder’s name, for such Imported Product
Regulatory Approval for such Product, then, Spectrum shall, and shall use
commercially reasonable efforts to cause any Non-Spectrum Marketing Approval
Holder to, provide all reasonable assistance, facilitation and support including
providing all documents and data reasonably requested by Licensee in a timely
manner and at Licensee’s cost to effectuate such Imported Product Regulatory
Approval including:

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-13-

 

 

(a)          Licensee shall have sole responsibility for, and sole
decision-making authority with respect to, preparing, filing, obtaining and
maintaining the Imported Product Regulatory Approvals and related Regulatory
Filings, provided, that Spectrum shall, and shall cause its Affiliates and any
Non-Spectrum Foreign Marketing Approval Holder to, at the request of Licensee,
cooperate with Licensee to prepare, file, obtain and maintain such Imported
Product Regulatory Approvals and related Regulatory Submissions.

 

(b)          Spectrum shall:

 

(i)          if Spectrum holds the Foreign Marketing Approval, authorize
Licensee, and provide all reasonable assistance, facilitation and support
including providing all documentations and data reasonably requested by Licensee
to Licensee, to file, in Spectrum’s name, for Imported Product Regulatory
Approval in such country or regulatory jurisdiction, at the direction of
Licensee and for Licensee’s sole benefit; or

 

(ii)         if a Non-Spectrum Foreign Marketing Approval Holder holds the
Foreign Marketing Approval for such Product, use commercially reasonable efforts
to cause such Non-Spectrum Foreign Marketing Approval Holder to authorize and
provide all reasonable assistance, facilitation and support including providing
all documentations and data reasonably requested by Licensee to Licensee, to
file, in such Non-Spectrum Foreign Marketing Approval Holder’s name, for
Imported Product Regulatory Approval in such country or regulatory jurisdiction,
at the direction of Licensee and for Licensee’s sole benefit.

 

(c)          If the Regulatory Authority or Applicable Laws in such country or
regulatory jurisdiction allows the Spectrum to appoint a local agent (or
registration agent) to assist in the filing, maintenance or amendment of the
Imported Product Regulatory Approval, then Spectrum shall appoint, or use
commercially reasonable efforts to procure any Non-Spectrum Foreign Marketing
Approval Holder to appoint, including providing a power of attorney which
effectuates such appointment and registering such appointment with the relevant
Regulatory Authority, Licensee or its designated Affiliate as its designated
local agent for the Imported Product Regulatory Approval process inclusive of,
to the fullest extent possible, the receipt of communications from the
Regulatory Authority and submission of all relevant Regulatory Submissions.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-14-

 

 

(d)          Spectrum shall use commercially reasonable efforts to cause any
Non-Spectrum Foreign Marketing Approval Holder to grant to Licensee, during the
Term, an exclusive (even as to Spectrum, its Affiliates, and any Non-Spectrum
Foreign Marketing Approval Holder), irrevocable (except as set forth in
Article 9), fully-paid, royalty-free (except as set forth in Section 5.2.1),
sublicenseable (in accordance with Section 3.1.2) license under such Imported
Product Regulatory Approvals to Develop and Commercialize the Product solely in
the Licensee Territory and solely for use in the Field in accordance with this
Agreement. In addition, Spectrum shall cause any Non-Spectrum Foreign Marketing
Approval Holder to, provide to Licensee, all benefits of any Imported Product
Regulatory Approvals and enforce, at Licensee’s cost and expense, at the request
of and for the account of Licensee, any rights of Spectrum or its Affiliates
arising under any Imported Product Regulatory Approvals against any Person.

 

(e)          Spectrum shall use commercially reasonable efforts to cause any
Non-Spectrum Foreign Regulatory Approval Holder to Manufacture and supply via
the named manufacturer or supplier on the relevant Imported Product Regulatory
Approval all Products for Commercialization under the Imported Product
Regulatory Approvals in the Territory to Licensee and its designated Affiliates
and sublicensees at a price per Product equal to the Non-Spectrum Foreign
Regulatory Approval Holder’s Manufacturing Cost (as may change from time to
time) for such Product plus ***.

 

(f)          Spectrum shall, and hereby appoints, and shall use commercially
reasonable efforts to cause its Affiliates and any Non-Spectrum Foreign
Marketing Approval Holder to appoint, Licensee as its attorney-in-fact to
Develop and Commercialize the Product under the Imported Product Regulatory
Approval on Spectrum’s or the Non-Spectrum Foreign Marketing Approval Holder’s
behalf, and shall execute a power of attorney in favor of Licensee to this
effect during the Term.

 

(g)          Spectrum shall, and shall use commercially reasonable efforts to
cause its Affiliates and any Non-Spectrum Foreign Marketing Approval Holder to,
(x) notify Licensee of all communications received from the applicable
Regulatory Authority with respect to any Imported Product Regulatory Approvals,
(y) provide all official original copies of all Imported Product Regulatory
Approvals received from the applicable Regulatory Authority to Licensee, and (z)
provide copies of any written correspondence received from the applicable
Regulatory Authorities with respect to any Imported Product Regulatory Approvals
to Licensee, in each case, promptly after receipt thereof.

 

(h)          Spectrum shall not, and shall use commercially reasonable efforts
to cause its Affiliates and any Non-Spectrum Foreign Marketing Approval Holder
to not, interact or communicate with the CFDA regarding the Imported Product
Regulatory Approvals without the prior approval or participation of Licensee.

 

(i)          If at any time Spectrum, its Affiliates or any Non-Spectrum Foreign
Marketing Approval Holder are permitted by the applicable Regulatory Authority
to transfer the Imported Product Regulatory Approval to Licensee, Spectrum
shall, and hereby does, and shall cause its Affiliates and any Non-Spectrum
Foreign Marketing Approval Holder to, assign to Licensee or its designated
Affiliate, all rights, title and interests in and to such Imported Product
Regulatory Approvals and related Regulatory Submissions for the Product in the
Field in the Territory. Spectrum agrees and covenants that it shall, and shall
cause it Affiliates and any Non-Spectrum Foreign Marketing Approval Holder to,
promptly take any and all actions necessary to effectuate the prompt assignment
of such Imported Product Regulatory Approvals and related Regulatory
Submissions, or to enable Licensee or its designated Affiliate to obtain new
Imported Product Regulatory Approvals or related Regulatory Submissions,
including executing and delivering all documents or instruments, and providing
all copies of documents or information, that may be necessary, required or which
Licensee or its designated Affiliate may request.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-15-

 

  

4.2          Development.

 

4.2.1       General. Licensee shall take the lead in, and be responsible for,
conducting the Development activities, including clinical trials, as may be
reasonably necessary to expeditiously obtain Regulatory Approvals for the
Product for use in the Field in the Licensee Territory. Except as otherwise
provided herein, it is understood and agreed that, as between the Parties, all
Development efforts for the Product for use in the Field in the Licensee
Territory shall be at the sole expense of Licensee.

 

4.2.2       Clinical Trials. If additional clinical trials are required in the
Licensee Territory, Licensee shall promptly inform JPC and shall not conduct any
clinical trial without the prior approval of the JPC in accordance with
Section 2.3.

 

4.2.3       Development Assistance. Promptly after the Effective Date, but not
to exceed thirty (30) days following the Effective Date, Spectrum shall, at its
own cost and expense, make available to Licensee the Spectrum Know-How that
exists on the Effective Date and was not previously provided to Licensee (but
without an obligation for Spectrum personnel to travel) including all Spectrum
Know-How developed, collected, or submitted as part of an investigational new
drug application or similar application or submission filed with or submitted to
any Regulatory Authority to obtain permission to commence clinical trials in
relation to the Product in any particular jurisdiction (the “Initial Transfer”).
For clarity, the Initial Transfer shall not require Spectrum to conduct any new
Development work or prepare or complete any reports not already completed. After
the Initial Transfer, Spectrum shall provide Licensee with reasonable assistance
regarding scientific, clinical and/or manufacturing matters (including the
chemistry, manufacture and controls of the Product) in the Development of the
Product in the Field in the Licensee Territory. Such assistance shall include
the transfer of additional Spectrum Know How to Licensee and reasonable access
to Spectrum personnel involved in the research and Development of the Product,
either in-person or by teleconference.

 

4.2.4       Diligence. Licensee shall use Commercially Reasonable Efforts to
Develop and obtain and maintain Regulatory Approval for the Product for at least
one indication in the Field in the Licensee Territory and shall not take actions
that would be reasonably likely to create a Material Impact. Licensee will have
no other diligence obligations with respect to the Development of the Product
under this Agreement.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-16-

 

  

4.3          Commercialization.

 

4.3.1       General. Except as otherwise provided herein, it is understood and
agreed that, as between the Parties, all Commercialization efforts for the
Product for use in the Field in the Licensee Territory shall be at the sole
expense of Licensee.

 

4.3.2       Diligence. Licensee will use Commercially Reasonable Efforts to
Commercialize the Product in the Field in each country in the Licensee Territory
in which Regulatory Approval is received and shall not take actions that would
be reasonably likely to create a Material Impact. Without limiting the
foregoing, Licensee agrees to, directly or through one or more of its
Affiliates, use Commercially Reasonable Efforts (i) to launch the Product for
use in the Field as soon as practicable in the Licensee Territory, and
thereafter (ii) to market, promote and sell the Product in the Field throughout
the Licensee Territory to maximize Net Sales with respect thereto. Licensee will
have no other diligence obligations with respect to the Commercialization of the
Product under this Agreement.

 

4.3.3       Pricing. Licensee shall have the sole right to determine pricing of
the Product in the Field in the Licensee Territory, provided, that Licensee and
Spectrum shall discuss the pricing strategy for the Licensee Territory.

 

4.3.4       Trademarks.

 

(a)          Licensee Trademarks. Licensee shall have the right to select the
Product names and all trademarks, including any Spectrum Trademarks (subject to
Section 4.3.4(b) and only to the extent Spectrum has the right to grant a
license to such Spectrum Trademarks to Licensee), used in connection with the
Commercialization of the Product for use in the Field, including special
promotional or advertising taglines, in each case in the Licensee Territory (all
such trademarks, other than the Spectrum Trademarks, specific to the Product and
including all goodwill associated therewith, and all applications,
registrations, extensions and renewals relating thereto, shall be referred to as
the “Licensee Trademarks”). Licensee shall be the exclusive owner of the
Licensee Trademarks, and shall use Commercially Reasonable Efforts to register
and maintain, at its expense, such Licensee Trademarks as shall be used for
Commercialization of the Product for use in the Field in the Licensee Territory.

 

(b)          Reference to Spectrum as Licensor.

 

(i)          Spectrum Trademarks. To the extent permitted by Applicable Laws, at
Spectrum’s election, the labels and packaging of the Product and all promotional
materials for the Product shall include text identifying Spectrum as the
licensor of the Product and a Spectrum Trademark to be placed in a size and
location reasonably agreed to by the Parties, provided, that such mark: (i) is
used in a consistent and noticeable manner sufficient to constitute trademark
usage under Applicable Laws, (ii) is clearly identified as a trademark (i.e.,
through the use of a “®”, “™” or other appropriate identifier), (iii) is not
used as combination marks with other marks or trademarks, and (iv) is reasonably
less prominent in size and location as the Licensee Trademarks. Licensee shall
obtain Spectrum’s review and approval prior to the first use of the Spectrum
Trademarks in such labeling, packaging or promotional materials, such approval
not to be unreasonably withheld if the Spectrum Trademarks are used in a manner
that is consistent with Spectrum’s reasonable usage guidelines for such Spectrum
Trademarks.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-17-

 

  

(ii)         Trademark License. In connection with Section 4.3.4(b)(i) above,
Spectrum hereby grants to Licensee an exclusive license to use the Spectrum
Trademarks (except with respect to the Spectrum’s trade name under which such
license to use is non-exclusive) for the packaging, labeling, marketing,
promotion, distribution and sale of the Product for use in the Field in the
Licensee Territory in accordance with this Agreement, and Licensee shall have
the right to exercise such license through its Affiliates, provided, that
Licensee shall be responsible for the failure by its Affiliates to comply with,
and Licensee guarantees the compliance by each of its Affiliates with, the terms
of this Agreement including all relevant restrictions, limitations and
obligations. Spectrum shall own all right, title and interest in and to the
Spectrum Trademarks and the registrations thereof and all goodwill from the use
of the Spectrum Trademarks shall vest in and inure to the benefit of Spectrum.
Spectrum shall use Commercially Reasonable Efforts to register and maintain, at
Licensee’s expense, such Spectrum Trademarks as shall be used for
Commercialization of the Product for use in the Field in the Licensee Territory.

 

(c)          Spectrum Product Marks. Spectrum shall have the right, but not the
obligation, to brand the Product for use in the Field in the Spectrum Territory
using the Licensee Trademarks (“Spectrum Product Marks”). Accordingly, Licensee
shall provide to Spectrum copy proofs of each Licensee Trademark and reasonable
usage guidelines therefor as such mark is registered with the applicable
Regulatory Authorities in the Licensee Territory for Spectrum’s review and
consideration. Spectrum shall obtain Licensee’s review and approval prior to the
first use of the Spectrum Product Marks in such labeling, packaging or
promotional materials, such approval not to be unreasonably withheld if the
Spectrum Product Marks are used in a manner that is consistent with Licensee’s
reasonable usage guidelines for such Spectrum Product Marks. Subject to this
Section 4.3.4(c), Licensee further hereby grants to Spectrum an exclusive
license to use the Spectrum Product Marks (except with respect to the Licensee’s
trade name under which such license to use is non-exclusive), to the extent
Spectrum Product Marks exist in the Spectrum Territory, consistent with the
usage guidelines applicable to Licensee and its Affiliates’ use of such Licensee
Trademarks in the Licensee Territory solely in connection with the Development
and Commercialization of the Product solely for use in the Field and solely in
the Spectrum Territory for the packaging, labeling, marketing, promotion,
distribution and sale of the Product for use in the Field in the Spectrum
Territory in accordance with this Agreement, and Spectrum shall have the right
to exercise such license through its Affiliates or sublicense a Third Party,
provided, that Spectrum shall be responsible for the failure by its Affiliates
or Third Party sub-licensees to comply with, and Spectrum guarantees the
compliance by each of its Affiliates with, the terms of this Agreement including
all relevant restrictions, limitations and obligations. Licensee shall own all
right, title and interest in and to any Spectrum Product Marks and the
registrations thereof and all goodwill from the use of the Spectrum Product
Marks shall vest in and inure to the benefit of Licensee. The above
notwithstanding, Licensee shall have the right, but not the obligation, to
register or maintain any Spectrum Product Marks in the Spectrum Territory.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-18-

 

  

4.4          Reporting. Without limiting any other provisions of this Agreement,
Licensee shall keep Spectrum reasonably informed through the JPC as to the
progress of its activities with respect to the Development and Commercialization
of the Product or otherwise under this Article 4 and provide such reports and
information with respect thereto as designated by the JPC or as may be
reasonably requested by Spectrum. In addition, Licensee shall promptly notify
Spectrum if it anticipates or there are material deviations from the
Commercialization Plan(s) or any development diligence requirement, and shall
discuss in good faith and keep Spectrum informed as to any corrective actions
that it intends or is taking to address such deviations.

 

4.5          Manufacturing and Supply.

 

4.5.1       No Manufacturing Rights. Spectrum retains all rights with respect to
manufacturing of the Product.

 

4.5.2       Supply. Subject to the terms and conditions of this Agreement,
Spectrum shall use Commercially Reasonable Efforts to supply or have supplied to
Licensee or its designee all quantities of the Product ordered by Licensee for
use in the Field in the Licensee Territory in accordance with a separate written
agreement to be negotiated between the Parties pursuant to Section 4.5.3 below
(a “Supply Agreement”). Licensee shall solely purchase from Spectrum its entire
requirement of the Product and Spectrum shall have the right to manufacture and
have manufactured such quantities of the Product for Licensee.

 

4.5.3       Supply Agreement. Within ninety (90) days of the Effective Date, the
Parties shall negotiate and execute a Supply Agreement for the supply by
Spectrum to Licensee of the requirements of the Product ordered by Licensee for
Development and Commercialization in the Licensee Territory.

 

4.5.4       Supply Price and Adjustment. The price per unit of each Product
supplied by Spectrum under the Supply Agreement shall be equal to Spectrum’s
Manufacturing Cost (as may change from time to time) for such Product plus ***.

 

4.5.5       Quality Agreement. Within ninety (90) days of executing the Supply
Agreement, Spectrum and Licensee shall execute a mutually acceptable quality
agreement that allocates roles and responsibilities to each Party with respect
to quality control and regulatory compliance with respect to supply of the
Product to Licensee.

 

Article 5
PAYMENTS

 

5.1          Upfront Equity Consideration. As consideration for the licenses
granted under Section 3.1 and Licensee’s other rights under this Agreement,
Licensee shall issue 2,176,755 shares of Licensee’s common stock, par value
$0.01 per share (the “Common Stock”) in accordance with the terms and conditions
of that certain investment agreement between the Parties as of the even date
hereof (the “Investment Agreement”).

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-19-

 

  

5.2         Payments to Upstream Licensors.

 

5.2.1       Payments. Licensee shall pay to Spectrum any and all payments due
from Spectrum to *** under the Upstream Licenses on account of the Development
and/or Commercialization of the Product in the Field in the Licensee Territory
by Licensee and its Affiliates and sublicensees (the “Upstream Payments”)
including running royalty payments; provided that if Licensee is obligated to
make any Upstream Payments due to the achievement of a milestone, Licensee shall
only pay: (a) a prorated portion of any Upstream Payments triggered by the
occurrence of a sales milestones reached in part due to sales by Licensee in the
Licensee Territory; and (b) any Upstream Payments triggered by the occurrence of
a development milestone wherein the trigger is explicitly defined as the
achievement of a milestone in the Licensee Territory or achieved as a direct
result of Licensee’s Development of the Product in the Licensee Territory. As an
example of Licensee’s obligation to only pay a prorated portion of an Upstream
Payment triggered by the occurrence of a sales milestone, if (x) a sales
milestone payment of $10,000,000 is triggered due to the occurrence of aggregate
annual sales of the Product within a territory covering the Licensed Territory
reaching a certain threshold and (y) at the triggering of the sales milestone
payment, Licensee’s annual sales of the Product in the Licensee Territory for
the year the payment is triggered account for 10% of total sales of the Product
in a territory which covers the Licensee Territory, then (z) Licensee shall pay
$1,000,000 of that $10,000,000 sales milestone payment. Except for (i) the
upfront equity consideration under Section 5.1, and (ii) the Upstream Payments
under this Section 5.2.1, no payment shall be due from Licensee to Spectrum for
the Development and/or Commercialization of the Product in the Field in the
Licensee Territory.

 

5.2.2       Payment Reports and Payments. For as long as Licensee is obligated
to make the Upstream Payments in accordance with Section 5.2.1, within thirty
(30) days after the last day of each calendar quarter, Licensee will deliver to
Spectrum a report of Net Sales of the Product by Licensee, its Affiliates and
sublicensees during the preceding quarterly period (any such period, a “Payment
Period”), with all the Upstream Payments in accordance with Section 5.2.1, if
any, for the Payment Period covered by such report being due no later than forty
(40) days after the last day of such Payment Period. For any Upstream Payments
triggered due to the occurrence of a sales milestone, Spectrum shall provide
Licensee with an invoice no later than twenty (20) days before such Upstream
Payment is due if feasible or such other documentation and such invoice or
documentation will set forth: (a) the Licensee’s prorated portion of such
Upstream Payment, (b) how the Licensee’s prorated portion of the Upstream
Payment was calculated and reasonable support for the calculation, and (c) the
date when such Upstream Payment is due. In relation to any Upstream Payment,
which Spectrum claims is triggered due to the occurrence of a development
milestone achieved as a direct result of Licensee’s Development of the Product
in the Licensee Territory (other than wherein the trigger is explicitly defined
as the achievement of a milestone in the Licensee Territory), Spectrum shall
provide Licensee with information, reasonably requested by Licensee, regarding
the Development of the Product in the Spectrum Territory sufficient for Licensee
to determine whether Licensee’s Development has triggered such an Upstream
Payment.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-20-

 

  

5.3          Payment Method. All payments due under this Agreement to Spectrum
shall be made by bank wire transfer in immediately available funds to an account
designated by Spectrum. All payments hereunder shall be made in the legal
currency of the United States of America, and all references to “$” or “Dollars”
shall refer to United States dollars. To the extent that Applicable Law imposes
withholding taxes on any payments from Licensee to Spectrum pursuant to this
Agreement, Licensee may withhold such taxes and pay such amounts to the relevant
government authority. For any Upstream Payments where Spectrum cannot reduce any
amounts owed to the Upstream Licensor under the applicable Upstream License with
respect to withholding taxes paid by the Licensee under this Agreement, all
amounts payable to Spectrum pursuant to this Agreement shall be made without
reduction for any withholding or similar taxes paid by Licensee. For any
Upstream Payments where Spectrum can reduce any amounts owed to the Upstream
Licensor under the applicable Upstream License with respect to withholding taxes
paid by the Licensee under this Agreement, the Licensee may deduct from the
amounts payable to Spectrum pursuant to this Agreement any withholding or
similar taxes paid by Licensee. Licensee shall furnish to Spectrum appropriate
evidence of payment of such taxes or other amount required by Applicable Laws to
be deducted from any payment due under this Agreement to Spectrum, including any
tax or withholding levied by a foreign taxing authority in respect of such
payment.

 

5.4          Support Fees. Spectrum will provide to Licensee at its own expense:
(a) *** (***) hours of regulatory and development support during the first
Agreement Year, and (b) *** (***) hours of regulatory and development support
for each Agreement year after the first anniversary of the Effective Date.
Regulatory and development support provided by Spectrum to Licensee, in excess
of the number of free hours, set forth above, in any Agreement Year, shall be
charged at a rate of $*** per hour. For clarity, the costs incurred by Spectrum
to provide the Initial Transfer under Section 4.2.3 shall also be borne by
Spectrum and shall not be charged to Licensee or counted toward the hours set
out in the this Section that Spectrum will provide to Licensee at its own
expense.

 

5.5         Records; Audit. The Parties will, and will cause its Affiliates to,
keep and maintain for three (3) years after the relevant calendar quarter
complete and accurate books and records in sufficient detail so that Net Sales
and payments made hereunder can be properly calculated. No more frequently than
once during each calendar year during the Term and once during the three (3)
year period thereafter, the Parties will permit independent third party auditors
appointed by Spectrum, ***, or Licensee (the party requesting an audit, the
“Auditing Party”) and with at least forty-five (45) days advance notice at any
time during normal business hours, accompanied at all times, to inspect, audit
and copy reasonable amounts of relevant accounts and records of the non-Auditing
Party and its Affiliates and reports submitted to the non-Auditing Party and its
Affiliates by its sublicensees pertaining to a payment period that is not
earlier than thirty-six (36) months from the date of conclusion of the audit,
for the sole purpose of verifying the accuracy of the calculation of Upstream
Payments to Spectrum pursuant to this Article 5. The accounts, records and
reports related to any particular period of time may only be audited one time
under this Section 5.5. The Auditing Party will cause their independent third
party auditors not to provide the Auditing Party with any copies of such
accounts, records or reports and not to disclose to the Auditing Party any
information other than information relating solely to the accuracy of the
accounting and payments made by Licensee pursuant to this Article 5. The
Auditing Party will cause its independent third party auditors to promptly
provide a copy of their report to non-Auditing Party. If such audit determines
that payments are due to Spectrum, Licensee will pay to Spectrum any such
additional amounts within ten (10) Business Days after the date on which such
auditor’s written report is delivered to Licensee and the Auditing Party, unless
such audit report is disputed by Licensee, in which case the dispute will be
resolved in accordance with Article 10. If such audit determines that Licensee
has overpaid any amounts to Spectrum, Spectrum will refund any such overpaid
amounts to Licensee within ten (10) Business Days after the date on which such
auditor’s written report is delivered to Licensee and the Auditing Party. Any
such inspection of records will be at the Auditing Party’s expense unless such
audit discloses a deficiency or overpayment in the payments made by Licensee
(whether for itself or on behalf of its Affiliates) of more than *** percent
(***%) of the aggregate amount payable for the relevant period, in the case of
such a deficiency, Licensee will bear the cost of such audit, or in the case of
such overpayment caused by Spectrum, Spectrum shall bear the cost of such audit.
Each of the parties agree that all information subject to review under this
Section 5.5 is non-Auditing Party’s Confidential Information that is subject to
confidentiality and non-use obligations under Section 7.2, and Auditing Party
agrees that it shall cause its independent third party auditors to also retain
all such information subject to the non-disclosure and non-use restrictions of
Section 7.2 or similar (but no less stringent) obligations of confidentiality
and non-use customary in the accounting industry.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-21-

 

  

5.6          Late Payment. Any payments or portions thereof due hereunder which
are not paid when due shall bear interest equal to the lesser of (i) the rate
equal to the thirty (30) day U.S. dollar LIBOR rate effective for the date that
payment was due, as published by The Wall Street Journal, Internet Edition at
www.wsj.com in the “Money Rates” column, on the date such payment was due, plus
an additional *** percent (***%), or (ii) the maximum rate permitted by
Applicable Laws, calculated on the number of days such payment is delinquent.
This Section 5.6 shall in no way limit any other remedies available to Spectrum.

 

Article 6
INTELLECTUAL PROPERTY

 

6.1          Ownership of Inventions.

 

6.1.1       Ownership.

 

(a)          Spectrum shall own all right, title and interest to (i) any and all
Inventions solely Made by or on behalf of Spectrum or its Affiliates in
connection with their activities under this Agreement and (ii) any and all
Patents claiming any such Inventions described in the foregoing clause (ii)
(collectively, “Spectrum Inventions”).

 

(b)          Licensee shall own all right, title and interest to (i) any and all
Inventions solely Made by or on behalf of Licensee or its Affiliates or
sublicensees in connection with their activities under this Agreement, and
(ii) any and all Patents claiming any such Inventions described in the foregoing
clause (i) (collectively, “Licensee Inventions”).

 

(c)          The Parties shall jointly own all right, title and interest to
(i) any and all Inventions jointly Made by at least one employee, agent,
consultant, contractor, Affiliate, or sublicensee of Spectrum and at least one
employee, agent, consultant, contractor, Affiliate, or sublicensee of Licensee
(each having the obligation to assign such Inventions to either Spectrum or
Licensee), and (ii) any and all Patents claiming such Inventions described in
the foregoing clause (i) (“Joint Patents” and collectively with Inventions
described in clause (i), “Joint Inventions”).

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-22-

 

  

(d)          During the Term, Spectrum Inventions and Joint Inventions shall be
included in the definition of Spectrum Technology, Spectrum Patents, Spectrum
Know-How, and Spectrum Copyrights, as applicable, and subject to the licenses
granted under Section 3.1. For the avoidance of doubt, Spectrum reserves the
right to use, practice or otherwise exploit any and all Spectrum Inventions and
Joint Inventions subject to the licenses granted under Section 3.1.

 

6.1.2       Interpretation. For purposes of this Section 6.1, “Invention” shall
mean any invention (whether or not patentable), data, results, ideas, discovery,
development, method, process, know-how, works of authorship or other information
that is Made by or on behalf of a Party or the Parties; and “Made” shall mean
developed, conceived, authored, acquired or created by or on behalf of a Party
or the Parties. It is understood that except as expressly set forth under this
Section 6.1, inventorship, authorship and other indicia of which Party Made an
Invention will be determined in accordance with United States or the relevant
foreign Intellectual Property laws under which the relevant foreign Intellectual
Property right exists in effect at the time such Invention was Made.

 

6.2          License Grant to Spectrum. Licensee hereby grants to Spectrum a
perpetual, irrevocable, fully paid-up, royalty free, exclusive license, with the
right to grant sublicenses at any tier, under Licensee Know-How (including,
without limitation, Licensee Inventions) and Licensee’s rights in the Joint
Inventions, to research, Develop, make, have made, use, sell, offer for sale,
have sold, import and otherwise Commercialize the Product in the Spectrum
Territory.

 

6.3          Patent Prosecution. Spectrum shall control the Prosecution and
Maintenance of Spectrum Patents and Joint Patents. Licensee will bear the costs
of Prosecution and Maintenance of all Spectrum Patents and Joint Patents in the
Licensee Territory. Costs billed to or incurred by Spectrum for the Prosecution
and Maintenance of all Spectrum Patents and Joint Patents in the Licensee
Territory will be rebilled to Licensee and are due within thirty (30) days of
rebilling by Spectrum.

 

6.4          Defense of Third Party Infringement Claims. If the Product becomes
the subject of a Third Party’s claim or assertion of infringement of a Patent
relating to the manufacture, use, sale, offer for sale or importation of the
Product for use in the Field in the Licensee Territory, the Party first having
notice of the claim or assertion shall promptly notify the other Party, and the
Parties shall agree on and enter into a “common interest agreement” wherein such
Parties agree to their shared, mutual interest in the outcome of such potential
dispute, and thereafter, the Parties shall promptly confer to consider the claim
or assertion and the appropriate course of action.

 

6.5          Enforcement.

 

6.5.1       Notice. Licensee will promptly report in writing to Spectrum any
(a) known or suspected third party infringement of any Spectrum Patents,
Spectrum Trademarks, or Spectrum Copyrights, or (b) unauthorized use or
misappropriation of any Spectrum Know-How or other Confidential Information by a
Third Party of which it becomes aware, and will provide Spectrum with all
available evidence supporting such infringement or unauthorized use or
misappropriation. Spectrum will promptly report in writing to Licensee any
(a) known or suspected third party infringement of any Licensee Inventions,
Licensee Trademarks, or Spectrum Product Marks, or (b) unauthorized use or
misappropriation of any Licensee Know-How or other Confidential Information by a
Third Party of which it becomes aware, and will provide Licensee with all
available evidence supporting such infringement or unauthorized use or
misappropriation.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-23-

 

  

6.5.2       Right to Enforce Spectrum Patents, Spectrum Trademarks or Spectrum
Copyrights. Spectrum will have the first right, but not the obligation, to take
any reasonable measures it deems appropriate to stop activities in the Licensee
Territory infringing the Spectrum Patents, Spectrum Trademarks or Spectrum
Copyrights or the use without proper authorization of any Spectrum Know-How, in
each case in connection with a Third Party’s manufacture, use, sale, offering
for sale, or importation of Product for use in the Field in the Licensee
Territory, including initiating or prosecuting an infringement or other
appropriate action against. If Spectrum does not initiate any such measures
within one hundred twenty (120) days of receiving written notice from Licensee
of such activities (or within a reasonable shorter time period if a shorter
period to take action is required by Applicable Laws to avoid the loss of legal
rights), then Licensee will have the second right, but not the obligation, to
take any reasonable measures it deems appropriate to stop such activities,
provided, that, Licensee must coordinate and consult with Spectrum regarding
such measures and will not take any measures, without the written permission of
Spectrum, which permission will not be unreasonably withheld. It shall be
reasonable for Spectrum to withhold such permission if Spectrum reasonably
believes such measures will affect the protection that any Spectrum-Controlled
Intellectual Property affords Spectrum. Licensee will have no right to settle
any infringement or misappropriation Action under this Section 6.5.2 in a manner
that diminishes the rights or interests of Spectrum without the express written
consent of Spectrum. In addition, Licensee will not settle any such action in a
manner that admits the invalidity or unenforceability of any Spectrum-Controlled
Intellectual Property without obtaining the prior written consent of Spectrum.

 

6.5.3       Right to Enforce Licensee Inventions, Licensee Trademarks or
Spectrum Product Marks. Licensee will have the first right, but not the
obligation, to take any reasonable measures it deems appropriate to stop
activities in the Spectrum Territory infringing the Licensee Inventions,
Licensee Trademarks or Spectrum Product Marks or the use without proper
authorization of any Licensee Know-How, in each case in connection with a Third
Party’s manufacture, use, sale, offering for sale, or importation of Product for
use in the Field in the Spectrum Territory, including initiating or prosecuting
an infringement or other appropriate action against. If Licensee does not
initiate any such measures within one hundred twenty (120) days of receiving
written notice from Spectrum of such activities (or within a reasonable shorter
time period if a shorter period to take action is required by Applicable Laws to
avoid the loss of legal rights), then Spectrum will have the second right, but
not the obligation, to take any reasonable measures it deems appropriate to stop
such activities, provided, that, Spectrum must coordinate and consult with
Licensee regarding such measures and will not take any measures, without the
written permission of Licensee, which permission will not be unreasonably
withheld. It shall be reasonable for Licensee to withhold such permission if
Licensee reasonably believes such measures will affect the protection that any
Licensee -Controlled Intellectual Property affords Licensee. Spectrum will have
no right to settle any infringement or misappropriation Action under this
Section 6.5.3 in a manner that diminishes the rights or interests of Licensee
without the express written consent of Licensee. In addition, Spectrum will not
settle any such action in a manner that admits the invalidity or
unenforceability of any Licensee-Controlled Intellectual Property without
obtaining the prior written consent of Licensee.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-24-

 

  

6.5.4       Right to Enforce Joint Patents or Joint Inventions. Spectrum will
have the first right, but not the obligation, to take any reasonable measures it
deems appropriate to stop activities in the Licensee Territory infringing the
Joint Patents or Joint Inventions or the use without proper authorization of any
Joint Invention, in each case in connection with a Third Party’s manufacture,
use, sale, offering for sale, or importation of Product for use in the Field in
the Territory, including initiating or prosecuting an infringement or other
appropriate action against. If Spectrum does not initiate any such measures
within one hundred twenty (120) days of becoming aware of such activities (or
within a reasonable shorter time period if a shorter period to take action is
required by Applicable Laws to avoid the loss of legal rights), then Licensee
will have the second right, but not the obligation, to take any reasonable
measures it deems appropriate to stop such activities in the Licensee Territory,
provided, that, Licensee must coordinate and consult with Spectrum regarding
such measures and will not take any measures, without the written permission of
Spectrum, which permission will not be unreasonably withheld. Licensee will have
no right to settle any infringement or misappropriation Action under this
Section 6.5.4 in a manner that diminishes the rights or interests of Spectrum
without the express written consent of Spectrum. In addition, Licensee will not
settle any such action in a manner that admits the invalidity or
unenforceability of any Joint Patent or Joint Inventions without obtaining the
prior written consent of Spectrum.

 

6.5.5       Cooperation. The Party commencing, controlling or defending any
enforcement action under this Section 6.5 (the “Enforcing Party”) shall keep the
other Party reasonably informed of the progress of such action, and such other
Party shall have the right to participate with counsel of its own choice at its
own expense. In any event, the other Party shall reasonably cooperate with the
Enforcing Party, including providing information and materials, at the Enforcing
Party’s request and expense.

 

6.5.6       Recoveries. Any recovery received as a result of any enforcement
action to enforce any Intellectual Property pursuant to this Section 6.5 shall
be used first to reimburse the Enforcing Party for the costs and expenses
(including court, attorneys’ and professional fees) incurred in connection with
such action, and the remainder of the recovery shall be shared as following:
(i) if the enforcement action is filed in the Enforcing Party’s territory, one
hundred percent (100%) of such recovery shall be paid to the Enforcing Party,
and (ii) if the enforcement action is not filed in the Enforcing Party’s
territory, *** percent (***%) of such recovery shall be paid to the Enforcing
Party and *** percent (***%) of such recovery shall be paid to the other Party.

 

6.5.7       Patents Claiming Spectrum Inventions. During the Term, Patents
claiming Spectrum Inventions that are necessary or useful for the Development
and Commercialization of the Product shall be deemed Spectrum Patents and the
enforcement thereof shall be subject to Sections 6.5.1- 6.5.6 above.

 

6.6           Patent Marking. At Spectrum’s request, Licensee shall mark (or
cause to be marked) the Product marketed and sold hereunder with appropriate
Spectrum Patent numbers or indicia in accordance with Applicable Laws.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-25-

 

 

Article 7
CONFIDENTIALITY

 

7.1          Confidentiality; Exceptions. Except to the extent expressly
authorized by this Agreement or otherwise agreed by the Parties in writing, the
Parties agree that the receiving Party shall keep confidential and shall not
publish or otherwise disclose or use for any purpose other than as provided for
in this Agreement any confidential or proprietary information or materials
furnished to it by the other Party pursuant to this Agreement (collectively,
“Confidential Information”). Notwithstanding the foregoing, Confidential
Information shall not be deemed to include information or materials to the
extent that it can be established by written documentation by the receiving
Party that such information or material:

 

7.1.1       was already known to or possessed by the receiving Party without any
obligation of confidentiality, at the time of its disclosure to the receiving
Party hereunder;

 

7.1.2       was generally available to the public or otherwise part of the
public domain at the time of its disclosure to the receiving Party hereunder;

 

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

 

7.1.4       was independently developed by the receiving Party without use of or
reference to the other Party’s Confidential Information as demonstrated by
documented evidence prepared by the receiving Party contemporaneously with such
independent development; or

 

7.1.5       was disclosed to the receiving Party, other than under an obligation
of confidentiality, by a Third Party who had no obligation to the disclosing
Party not to disclose such information to others.

 

7.2          Authorized Use and Disclosure. Each Party may use and disclose
Confidential Information of the other Party as follows: (i) under appropriate
confidentiality provisions substantially equivalent to those in this Agreement
in connection with the performance of its obligations or exercise of rights
granted to such Party in this Agreement; (ii) to the extent such disclosure is
reasonably necessary for the Prosecution and Maintenance of Patents (including
applications therefor) in accordance with this Agreement, prosecuting or
defending litigation, complying with applicable governmental regulations, filing
for, conducting preclinical or clinical trials, obtaining and maintaining
regulatory approvals (including Regulatory Approvals), or otherwise required by
Applicable Laws or the rules of a recognized stock exchange, provided, that if a
Party is required by Applicable Laws or stock exchange to make any such
disclosure of the other Party’s Confidential Information it will, except where
impracticable for necessary disclosures (for example, in the event of medical
emergency), give reasonable advance notice to the other Party of such disclosure
requirement and, except to the extent inappropriate in the case of patent
applications, will use its reasonable efforts to secure confidential treatment
of such Confidential Information required to be disclosed; (iii) to its
Affiliates and sublicensees, in each case under appropriate confidentiality
provisions substantially equivalent to those of this Agreement; (iv) in
communication with existing and potential investors, acquirers, consultants,
advisors (including financial advisors, lawyers and accountants) and others on a
need to know basis, in each case under appropriate confidentiality provisions
substantially equivalent to those of this Agreement; or (v) to the extent
mutually agreed to by the Parties.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-26-

 

  

7.3          Prior Agreements. This Agreement supersedes the Confidentiality
Agreement between Spectrum and Licensee dated January 28, 2014 (the “Prior CDA”)
with respect to information disclosed thereunder. All information or materials
disclosed or provided by Spectrum to Licensee under the Prior CDA shall be
deemed Confidential Information of Spectrum (subject to the exceptions set forth
herein) and shall be subject to Licensee’s confidentiality obligations under
this Article 7. All information disclosed by Licensee under the Prior CDA shall
be deemed Confidential Information of Licensee (subject to the exceptions set
forth herein) and shall be subject to Spectrum’s confidentiality obligations
under this Article 7.

 

7.4          Scientific Publications. Licensee shall submit to Spectrum any
proposed publication or public disclosure containing clinical or scientific
results relating to the Product for use in the Field at least sixty (60) days in
advance to allow Spectrum to review such proposed publication or disclosure.
Spectrum shall notify Licensee in writing during such sixty (60)-day reviewing
period if Spectrum wishes to (a) remove its Confidential Information from such
proposed publication or presentation, in which event Licensee shall remove such
Confidential Information from its proposed publication or presentation; or
(b) request a reasonable delay in publication or presentation in order to
protect patentable information, in which event Licensee shall delay the
publication or presentation for a period of no more than one hundred twenty
(120) days to enable patent applications to be filed in accordance with
Section 6.3 protecting inventions disclosed in such publication or presentation.
For clarity, if Spectrum fails to notify Licensee during the sixty (60)-day
reviewing period as provided under this Section 7.4, Licensee shall be free to
proceed with the proposed publication or presentation.

 

7.5          Publicity.

 

7.5.1       Confidential Terms. Each of the Parties agrees not to disclose to
any Third Party the terms and conditions of this Agreement without the prior
approval of the other Party, except to advisors (including consultants,
financial advisors, attorneys and accountants), potential and existing investors
and acquirers on a need to know basis, in each case under circumstances that
reasonably protect the confidentiality thereof, or to the extent necessary to
comply with the terms of agreements with Third Parties, or to the extent
required by Applicable Laws, including securities laws. Notwithstanding the
foregoing, the Parties agree upon the initial press release(s) to announce the
execution of this Agreement, which is attached hereto as Exhibit 7.5.1;
thereafter, Spectrum and Licensee may each disclose to Third Parties the
information contained in such press release(s) without the need for further
approval by the other.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

-27-

 

  

7.5.2       Publicity Review. The Parties acknowledge the importance of
supporting each other’s efforts to publicly disclose results and significant
developments regarding the Product for use in the Field in the Licensee
Territory and other activities in connection with this Agreement, beyond what
may be strictly required by Applicable Laws and the rules of a recognized stock
exchange, and each Party may make such disclosures from time to time with the
approval of the other Party, which approval shall not be unreasonably withheld,
conditioned or delayed. Such disclosures may include achievement of significant
events in the Development (including regulatory process) or Commercialization of
the Product for use in the Field in the Licensee Territory. Unless otherwise
requested by Spectrum, Licensee shall indicate that Spectrum is the owner and
licensor of the Product and Spectrum Technology in each public disclosure issued
by Licensee regarding the Product. When Spectrum elects to make any such public
disclosure under this Section 7.5.2, it will give Licensee reasonable notice to
review and comment on such statement, it being understood that if Licensee does
not notify Spectrum in writing within a three (3) Business Day period or such
shorter period if required by Applicable Laws of any reasonable objections, as
contemplated in this Section 7.5.2, such disclosure shall be deemed approved,
and in any event Licensee shall work diligently and reasonably to agree on the
text of any proposed disclosure in an expeditious manner. The principles to be
observed in such disclosures shall be accuracy, compliance with Applicable Laws
and regulatory guidance documents, reasonable sensitivity to potential negative
reactions of applicable Regulatory Authorities and the need to keep investors
and others informed regarding the requesting Party’s business, including as
required by the rules of a recognized stock exchange.

 

Article 8
REPRESENTATIONS, WARRANTIES AND COVENANTS; INDEMNIFICATION

 

8.1          Licensee Representations and Warranties. Licensee represents and
warrants to Spectrum that:

 

8.1.1       it is duly organized and validly existing under the Applicable Laws
of the jurisdiction of its incorporation, and has full corporate power and
authority to enter into this Agreement and to carry out the provisions hereof;

 

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

 

8.1.3       this Agreement is legally binding upon it and enforceable in
accordance with its terms and the execution, delivery and performance of this
Agreement by it does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound, nor violate any material Applicable Laws;

 

8.1.4       Licensee, its Affiliates and their employees and contractors have
not and shall not, in connection with the performance of their respective
obligations under this Agreement directly or indirectly through Third Parties,
pay, promise or offer to pay, or authorize the payment of, any money or give any
promise or offer to give, or authorize the giving of anything of value to a
public official or entity or other person for purpose of obtaining or retaining
business for or with, or directing business to, any person, including Licensee
(it being understood that, without any limitation to the foregoing, Licensee,
and to its knowledge, its and its Affiliates’ employees and contractors, has not
directly or indirectly promised, offered or provided any corrupt payment,
gratuity, emolument, bribe, kickback, illicit gift or hospitality or other
illegal or unethical benefit to a public official or entity or any other person
in connection with the performance of Licensee’s obligations under this
Agreement, and shall not, directly or indirectly, engage in any of the
foregoing). Notwithstanding the foregoing, the intent of this warranty is to
ensure compliance with the US Foreign Corrupt Practices Act of 1977, as amended,
UK Bribery Act, and any rules or regulations thereunder or any similar
anti-corruption or anti-bribery laws applicable to company or any of its
affiliates or subsidiaries (in each case, as in effect at the time of such
action).  Licensee will certify annually to conducting an effective compliance
program and Spectrum will have rights to audit the Company’s compliance program
periodically; and

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-28-

 

  

8.1.5       it is not aware of any action, suit or inquiry or investigation
instituted by any Person which questions or threatens the validity of this
Agreement.

 

8.2           Spectrum’s Warranties. Spectrum represents and warrants to
Licensee, as of the Effective Date, that:

 

8.2.1       it is duly organized and validly existing under the Applicable Laws
of the jurisdiction of its incorporation, and has full corporate power and
authority to enter into this Agreement and to carry out the provisions hereof;

 

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

 

8.2.3       this Agreement is legally binding upon it and enforceable in
accordance with its terms and the execution, delivery and performance of this
Agreement by it does not conflict with any agreement, instrument or
understanding, oral or written, to which it is a party or by which it may be
bound, nor violate any material Applicable Laws;

 

8.2.4       it has the full right, power and authority under the Spectrum
Technology, Spectrum Trademarks, and the Upstream Licenses to grant the licenses
to Licensee as purported to be granted pursuant to this Agreement;

 

8.2.5       as of the Effective Date, it has provided complete and unredacted
copies of the Upstream Licenses and any relevant ancillary agreements, exhibits,
schedules, or other documents including any and all amendments thereto) which
set forth and are sufficient to fully describe all the terms and conditions with
which Licensee must comply in relation to the Upstream Licenses;

 

8.2.6       the Upstream Licenses represent all the material agreements Spectrum
or its Affiliates have entered into that may affect Licensee’s exercise of the
rights granted under this Agreement;

 

8.2.7       it is not aware of any action, suit or inquiry or investigation
instituted by any Person which questions or threatens the validity of this
Agreement;

 

8.2.8       as of the Effective Date, Spectrum has not granted, and will not
grant during the Term, rights to any Third Party under the Spectrum Technology
that conflict with the rights granted to Licensee hereunder;

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

-29-

 

  

8.2.9       as of the Effective Date, Spectrum has not received any written
notice of any threatened claims or litigation seeking to invalidate or otherwise
challenge the Spectrum Patents or Spectrum’s rights therein;

 

8.2.10     to its actual knowledge, as of the Effective Date, none of the
Spectrum Patents are subject to any pending re-examination, opposition,
interference or litigation proceedings; and

 

8.2.11     to its actual knowledge, as of the Effective Date, the performance of
Development and Commercialization activities in accordance with this Agreement
will not infringe any Intellectual Property rights of any Third Party in the
Licensee Territory, including any issued patent of any Third Party in the
Licensee Territory or, if and when issued, any claim within any published patent
application of any Third Party in the Licensee Territory.

 

8.3          Disclaimer of Warranties. EXCEPT AS SET FORTH IN THIS Article 8,
SPECTRUM AND LICENSEE EXPRESSLY DISCLAIM ANY WARRANTIES OR CONDITIONS, EXPRESS,
IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO THE SUBJECT MATTER OF THIS
AGREEMENT (INCLUDING THE LICENSED TECHNOLOGY), INCLUDING ANY IMPLIED WARRANTY OF
MERCHANTABILITY, NONINFRINGEMENT, OR FITNESS FOR A PARTICULAR PURPOSE.

 

8.4          Spectrum’s Representations, Warranties, and Covenants. Spectrum
represents, warrants and covenants to Licensee and agrees that:

 

8.4.1       it and its Affiliates are in compliance, and it shall comply, and
shall cause its Affiliates to comply, in all material respects, with all
Upstream Licenses;

 

8.4.2       it shall not, during the Term, amend any Upstream License in any
manner that adversely affects the rights granted to Licensee hereunder or
Spectrum’s ability to materially perform its obligations hereunder; and

 

8.4.3       it and its Affiliates shall not, during the Term, do or fail to do
any acts, which cause to be terminated or result in the termination of any
Upstream Licenses or result in the loss of any rights under any Upstream
Licenses, which would adversely affect the rights granted to Licensee hereunder
or Spectrum’s ability to materially perform its obligations hereunder.

 

8.5          Indemnification.

 

8.5.1       Indemnification by Spectrum. Spectrum hereby agrees to defend, hold
harmless and indemnify (collectively, “Indemnify”) Licensee and its Affiliates,
and its and their agents, directors, officers and employees (the “Licensee
Indemnitees”) from and against any liability or expense (including reasonable
legal expenses and attorneys’ fees) (collectively, “Losses”) resulting from
suits, claims, actions and demands, in each case brought by a Third Party (each,
a “Third-Party Claim”) against any Licensee Indemnitee arising out of: (i) a
breach of any of Spectrum’s representations and warranties under Section 8.2 or
representations, warranties and covenants under Section 8.4; (ii) the
Development, Commercialization or other exploitation of the Product by Spectrum,
its Affiliates, or sub-licensees in the Spectrum Territory; or (iii) the gross
negligence or intentional misconduct of any Spectrum Indemnities. Spectrum’s
obligation to Indemnify the Licensee Indemnitees pursuant to this Section 8.5.1
shall not apply to the extent that any such Losses (A) arise from the gross
negligence or intentional misconduct of any Licensee Indemnitee; (B) arise from
any breach by Licensee of this Agreement; or (C) are Losses for which Licensee
is obligated to Indemnify the Spectrum Indemnitees pursuant to Section 8.5.2.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-30-

 

  

8.5.2       Indemnification by Licensee. Licensee hereby agrees to Indemnify
Spectrum and its Affiliates, and its and their agents, directors, officers and
employees (the “Spectrum Indemnitees”) from and against any and all Losses
resulting from Third-Party Claims arising out of: (i) a breach of any of
Licensee’s representations and warranties under Section 8.1; (ii) the
Development, Commercialization or other exploitation of the Product by the
Licensee, its Affiliates, or sub-licensees in the Licensee Territories; or
(iii) the gross negligence or intentional misconduct of any Licensee
Indemnities. Licensee’s obligation to Indemnify the Spectrum Indemnitees
pursuant to this Section 8.5.1 shall not apply to the extent that any such
Losses (A) arise from the gross negligence or intentional misconduct of any
Spectrum Indemnitee; (B) arise from any breach by Spectrum of this Agreement; or
(C) are Losses for which Spectrum is obligated to Indemnify the Licensee
Indemnitees pursuant to Section 8.5.1.

 

8.5.3       Additional Indemnities.

 

(a)          In addition to the indemnities set forth in Section 8.5.1, Spectrum
hereby agrees to Indemnify the Licensee Indemnitees from and against any and all
Losses resulting from any breach by Spectrum of Section 3.1 (Grant to Licensee),
Section 4.1.4 (Rights of Reference), Section 4.2.3 (Development Assistance), or
Section 8.4.3 (Spectrum’s Representations, Warranties, and Covenants), as single
event or in combination with one or more breaches, that: (i) has a material
adverse effect on Licensee’s Development or Commercialization of the Product in
the Licensee Territory, and (ii) if curable, shall have continued uncured for
ninety (90) days after written notice thereof was provided to Spectrum by
Licensee.

 

(b)          In addition to the indemnities set forth in Section 8.5.2, Licensee
hereby agrees to Indemnify the Spectrum Indemnitees from and against any and all
Losses resulting from any breach by Licensee of Section 3.1 (Grant to Licensee),
Section 3.2.1 (Licensee Rights Limited to the Field and the Licensee Territory),
Section 3.3 (Upstream Licenses), or Sections 4.2.4 and 4.3.2 (Diligence), as
single event or in combination with one or more breaches, that: (i) has a
material adverse effect on Spectrum’s rights under the Upstream Licenses, and
(ii) if curable, shall have continued uncured for ninety (90) days after written
notice thereof was provided to Licensee by Spectrum.

 

8.5.4       Procedure. To be eligible to be Indemnified hereunder, the
indemnified Party shall provide the indemnifying Party with prompt notice of the
Third-Party Claim giving rise to the indemnification obligation pursuant to this
Section 8.5 and the exclusive ability to defend (with the reasonable cooperation
of the indemnified Party) or settle any such claim, provided, that the
indemnifying Party shall not enter into any settlement that admits fault,
wrongdoing or damages without the indemnified Party’s written consent, such
consent not to be unreasonably withheld or delayed. The indemnified Party shall
have the right to participate, at its own expense and with counsel of its
choice, in the defense of any claim or suit that has been assumed by the
indemnifying Party, provided, that the indemnifying Party shall have no
obligations with respect to any Losses resulting from the indemnified Party’s
admission, settlement or other communication without the prior written consent
of the indemnifying Party.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-31-

 

  

8.6          NO CONSEQUENTIAL DAMAGES. NOTWITHSTANDING THE FOREGOING, IN NO
EVENT WILL EITHER PARTY BE LIABLE TO OTHER PARTY FOR ANY CONSEQUENTIAL,
INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES UNDER THIS
AGREEMENT, EXCEPT TO THE EXTENT THE DAMAGES RESULT FROM A PARTY’S BREACH OF
CONFIDENTIALITY OBLIGATIONS HEREUNDER, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT,
OR ARISE FROM EITHER PARTY’S INDEMNIFICATION OBLIGATIONS UNDER THIS Article 8 OR
EITHER PARTY’S MATERIAL BREACH UNDER SECTION 9.10.

 

8.7          MAXIMUM LIABILITY. EXCEPT FOR A PARTY’S BREACH OF CONFIDENTIALITY
OBLIGATIONS HEREUNDER, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, IN NO EVENT SHALL
THE MAXIMUM AGGREGATE LIABILITY OF EITHER PARTY IN RESPECT OF ALL CLAIMS UNDER
THIS AGREEMENT EXCEED THE ***.

 

Article 9
TERM AND TERMINATION AND MATERIAL BREACH

 

9.1          Term. This Agreement shall become effective as of the Effective
Date and, unless earlier terminated pursuant to the other provisions of this
Article 9, shall be perpetual (the “Term”).

 

9.2          Termination for Breach. Each Party may terminate this Agreement in
the event the other Party materially breaches this Agreement, and such breach,
if curable, shall have continued uncured for ninety (90) days after written
notice thereof was provided to the breaching Party by the terminating Party. Any
such termination shall become effective at the end of such ninety (90) day
period unless, if applicable, the breaching Party has cured any such breach
prior to the expiration of such ninety (90) day period.

 

9.3          Termination for Patent Challenge. If Licensee or any of its
Affiliates challenges under any court action or proceeding, or before any patent
office, the validity, patentability, enforceability, scope or non-infringement
of any Spectrum Patent, or initiates a reexamination of any Spectrum Patent, or
assists any Third Party to conduct any of the foregoing activities (each, a
“Challenge”), Spectrum will have the right to immediately terminate this
Agreement. In any event, Licensee shall notify Spectrum at least thirty (30)
days prior to initiating any such Challenge.

 

9.4          Termination of Upstream Licenses. To the extent any Upstream
License is terminated, the rights granted hereunder with respect to such
Upstream License shall also hereby terminate.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-32-

 

  

9.5          Termination for Insolvency. Each Party shall have the right to
terminate this Agreement upon delivery of written notice to the other Party in
the event that (i) such other Party files in any court or agency pursuant to any
statute or regulation of any jurisdiction a petition in bankruptcy or insolvency
or for reorganization or similar arrangement for the benefit of creditors or for
the appointment of a receiver or trustee of such other Party or its assets, (ii)
such other Party is served with an involuntary petition against it in any
insolvency proceeding and such involuntary petition has not been stayed or
dismissed within ninety (90) days of its filing, or (iii) such other Party makes
an assignment of substantially all of its assets for the benefit of its
creditors.

 

9.6          Provision for Insolvency. All rights and licenses granted under or
pursuant to any Section of this Agreement are rights to “intellectual property”
(as defined in Section 101(35A) of Bankruptcy Code). Each Party hereby
acknowledges that (i) copies of research data, (ii) laboratory samples, (iii)
product samples, (iv) formulas, (v) laboratory notes and notebooks, (vi) data
and results related to clinical trials, (vii) Regulatory Filings and Regulatory
Approvals, (viii) rights of reference in respect of Regulatory Filings and
Regulatory Approvals, (ix) pre-clinical research data and results, and (x)
marketing, advertising and promotional materials, in each case, that relate to
such intellectual property, constitute “embodiments” of such intellectual
property pursuant to Section 365(n) of the Bankruptcy Code. Each Party agrees
not to interfere with the other Party’s exercise, pursuant to Section 365(n) of
the Bankruptcy Code, of rights and licenses to intellectual property licensed
hereunder and embodiments thereof and agrees to use Commercially Reasonable
Efforts to assist such other Party to obtain such intellectual property and
embodiments thereof in the possession or control of Third Parties as reasonably
necessary for such other Party to exercise, pursuant to Section 365(n) of the
Bankruptcy Code, such rights and licenses. Each Party shall take any and all
action requested by the other Party to ensure that the foregoing provisions of
this Section 9.6 may be fully effectuated under Applicable Laws, and, if
requested by the other Party, each Party shall procure that any past, existing
or future creditor of the other Party irrevocably waives in writing any and all
rights that such creditor may have to the intellectual property licensed
hereunder and embodiments thereof.

 

9.7          General Effects of Termination.

 

9.7.1       Termination of Rights. In the event of termination of this Agreement
for any reason, all rights and licenses granted to Licensee herein shall
immediately terminate.

 

9.7.2       Accrued Obligations. Termination of this Agreement for any reason
shall not release either Party of any obligation or liability which, at the time
of such termination, has already accrued to the other Party or which is
attributable to a period prior to such termination.

 

9.7.3       Non-Exclusive Remedy. Notwithstanding anything herein to the
contrary, termination of this Agreement by a Party shall be without prejudice to
other remedies such Party may have at law or equity.

 

9.7.4       General Survival. Article 1 (Definitions), Article 6 (Intellectual
Property), Article 7 (Confidentiality), Article 10 (Dispute Resolution),
Article 11 (Miscellaneous) and Sections 5.5 (Records; Audit)(for a period of
three (3) years after the effectiveness of the termination of this Agreement),
8.5 (Indemnification), 8.6 (No Consequential Damages), 8.7 (Maximum Liability),
9.7 (General Effects of Termination), 9.8 (Additional Effects of Termination),
9.9 (Termination Press Releases), and 9.10 (Material Breach) shall survive
termination of this Agreement for any reason. Except as otherwise provided in
this Article 9, all rights and obligations of the Parties under this Agreement
shall terminate upon termination of this Agreement for any reason.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

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9.8          Additional Effects of Certain Terminations. If this Agreement is
terminated by Spectrum, then:

 

9.8.1       Ongoing Trials. If there are any ongoing clinical trials with
respect to the Product being conducted by or on behalf of Licensee (or its
Affiliate) at the time of notice of termination, Licensee agrees to (i) promptly
transition to Spectrum or its designee some or all of such clinical trials and
the activities related to or supporting such trials, or (ii) terminate such
clinical trials in each case, as requested by Spectrum. The Parties recognize
that early termination of this Agreement requires both discussion and
coordination between the Parties to ensure patient safety, continuity of
treatment, if appropriate, and compliance with Applicable Laws. Upon early
termination of this Agreement, the Parties shall cooperate to provide for an
orderly transition or cessation of any clinical trials, as requested by
Spectrum. Each Party further agrees to take no action or forego taking action if
such action or forbearance would in any manner jeopardize patient safety or
cause the other Party to violate any Applicable Laws.

 

9.8.2       Commercialization. To avoid a disruption in the supply of the
Product, if this Agreement is terminated after the First Commercial Launch of
the Product for use in the Field in the Licensee Territory, Licensee and its
Affiliates shall continue to distribute and sell such Product for use in the
Field in the Licensee Territory, in accordance with the terms and conditions of
this Agreement, for a period reasonably sufficient for them to sell off all
amounts of Product in Licensee’s inventory not to exceed *** (***) months from
the effective date of such termination (the “Wind-Down Period”). Notwithstanding
any other provision of this Agreement, during this Wind-Down Period, Licensee’s
and its Affiliates’ rights with respect to the Product (including the licenses
granted under Section 3.1) shall be non-exclusive and Spectrum shall have the
right to engage one or more partners(s) or distributor(s) of the Product in all
or part of the Licensee Territory. During the Wind-Down Period, Licensee shall
continue to make any and all Upstream Payments to Spectrum for the Product sold
or disposed by Licensee, its Affiliates, or its sublicensees. After the
Wind-Down Period, Licensee and its Affiliates shall not sell the Product or make
any representation regarding their status as a licensee of or distributor for
Spectrum for the Product. Within thirty (30) days of expiration of the Wind-Down
Period, Licensee shall notify Spectrum of any quantity of the Product remaining
in Licensee’s inventory and Spectrum shall have the option, upon notice to
Licensee, to purchase any such quantities of the Product, as applicable, from
Licensee at a price equal to the amounts paid by Licensee for such Product.

 

9.8.3       Regulatory Filings. Licensee shall promptly assign and transfer to
Spectrum all Regulatory Filings for the Product that are held or controlled by
or under authority of Licensee, and shall take such actions and execute such
other instruments, assignments and documents as may be necessary to effect the
transfer of rights under the Regulatory Filings to Spectrum. Licensee shall
cause each of its Affiliates or sublicensees to transfer any such Regulatory
Filings to Spectrum if this Agreement terminates. If Applicable Laws prevents or
delays the transfer of ownership of a Regulatory Filing to Spectrum, Licensee
shall grant, and does hereby grant, to Spectrum an exclusive and irrevocable
right of access and reference to such Regulatory Filing for the Product, and
shall cooperate fully to make the benefits of such Regulatory Filings available
to Spectrum and/or its designee(s). Within sixty (60) days after notice of such
termination, Licensee shall provide to Spectrum copies of all such Regulatory
Filings, and of all preclinical and clinical data (including raw data, original
records, investigator reports, both preliminary and final, statistical analyses,
expert opinions and reports, safety and other electronic databases) and other
Know-How pertaining to the Product, or the manufacture thereof. Spectrum shall
be free to use and disclose such Regulatory Filings and other items in
connection with the exercise of its rights and licenses under this Section 9.8.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-34-

 

 

 9.8.4       License to Spectrum. Licensee hereby grants Spectrum, effective
upon the effective date of termination of this Agreement, a perpetual,
irrevocable, fully paid-up, royalty free, non-exclusive license, with the right
to grant sublicenses at any tier, under Licensee Know-How (including, without
limitation, Licensee Inventions) and Licensee’s rights in the Joint Inventions,
to research, Develop, make, have made, use, sell, offer for sale, have sold,
import and otherwise Commercialize the Product in the Licensee Territory.

 

9.8.5       Transition Assistance. Licensee agrees to fully cooperate with
Spectrum and its designee(s) to facilitate a smooth, orderly and prompt
transition of the Development and Commercialization of the Product to Spectrum
and/or its designee(s) during this Wind-Down Period. Without limiting the
foregoing, Licensee shall promptly provide Spectrum (i) all commercial data
generated by Licensee under this Agreement including copies of customer lists,
customer data and other customer information relating to the Product, and
(ii) manufacturing information (including protocols for the production,
packaging, testing and other manufacturing activities) relating to the Product
in Licensee’s Control, which in each case Spectrum shall have the right to use
and disclose for any purpose during this Wind-Down Period and thereafter. Upon
request by Spectrum, Licensee shall transfer to Spectrum some or all quantities
of the Product in its or its Affiliates’ Control (as requested by Spectrum),
within thirty (30) days after the end of this Wind-Down Period, provided, that
Spectrum shall reimburse Licensee for the out-of-pocket costs that Licensee
actually incurred to manufacture or otherwise acquire the quantities so provided
to Spectrum. If any Product was manufactured by any Third Party for Licensee, or
Licensee had contracts with vendors which contracts are necessary or useful for
Spectrum to take over responsibility for the Product in the Licensee Territory,
then Licensee shall to the extent possible and requested in writing by Spectrum,
assign all of the relevant Third-Party contracts to Spectrum, and in any case,
Licensee agrees to cooperate with Spectrum to ensure uninterrupted supply of the
Product. If Licensee or its Affiliate manufactured any Product at the time of
termination, then Licensee (or its Affiliate) shall continue to provide for
manufacturing of such Product for Spectrum, at its fully-burdened manufacturing
cost therefor, from the date of notice of such termination until such time as
Spectrum is able, using Commercially Reasonable Efforts to do so but no longer
than the expiration of the Wind-Down Period, to secure an acceptable alternative
commercial manufacturing source from which sufficient quantities of the Product
may be procured and legally sold in the Licensee Territory.

 

9.8.6       Costs and Expenses. Except as expressly provided herein, Licensee
shall perform its obligations under this Section 9.8 at its own costs without
consideration from Spectrum. Spectrum shall be responsible for its own costs of
performing its activities under this Section 9.8.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-35-

 

  

9.9          Termination Press Releases. In the event of termination of this
Agreement for any reason, the Parties shall cooperate in good faith to
coordinate public disclosure of such termination and the reasons therefor, and
shall not, except to the extent required by Applicable Laws or the rules of a
recognized stock exchange, disclose such information without the prior approval
of the other Party, such approval not to be unreasonably withheld, conditioned
or delayed. When Spectrum elects to make a public disclosure under this
Section 9.9, Spectrum shall provide Licensee with a draft of any such public
disclosure it intends to issue three (3) Business Days in advance and with the
opportunity to review and comment on such statement, it being understood that if
Licensee does not notify Spectrum in writing within such three (3) Business Day
period (or such shorter period if required by Applicable Laws or the rules of a
recognized stock exchange) of any reasonable objections, such disclosure shall
be deemed approved, and in any event the Parties shall work diligently and
reasonably to agree on the text of any such proposed disclosure in an
expeditious manner. The principles to be observed in such disclosures shall be
accuracy, compliance with Applicable Laws and regulatory guidance documents,
reasonable sensitivity to potential negative reactions to such news and the need
to keep investors and others informed regarding the Parties’ business and other
activities.

 

9.10        Material Breach.

 

9.10.1     Spectrum agrees that any breach by Spectrum of Section 3.1 (Grant to
Licensee), Section 4.1.4 (Rights of Reference), Section 4.2.3 (Development
Assistance), or Section 8.4.3 (Spectrum’s Representations, Warranties, and
Covenants) as single event or in combination with one or more breaches, that has
a material adverse effect on Licensee’s Development or Commercialization of the
Product in the Licensee Territory shall be deemed a material breach by Spectrum
of this Agreement, and, if such breach, if curable, shall have continued uncured
for ninety (90) days after written notice thereof was provided to Spectrum by
Licensee, then: (a) subject to Section 8.7, Licensee shall be entitled to
recovery of damages for such material breach without any limitation on the
amount or type of damages (including special, consequential (including loss of
profits and loss of revenue), incidental, punitive or indirect damages); and (b)
Licensee, in addition to being entitled to exercise all rights provided herein
(unless Licensee has also terminated this Agreement under Section 9.2) or
granted by law, including, without limitation, recovery of damages, will be
entitled to specific performance of its rights and Spectrum’s obligations under
the above Sections 3.1 (Grant to Licensee), Section 4.1.4 (Rights of Reference),
Section 4.2.3 (Development Assistance), or Section 8.4.3 (Spectrum’s
Representations, Warranties, and Covenants) of the Agreement, without the
necessity of posting any bond and without the necessity of establishing that
monetary relief would not provide an adequate remedy. Spectrum agrees that
Licensee may seek, and AAA (or any court having competent jurisdiction in
relation to any injunctive or provisional relief necessary) may grant, specific
performance in the event of such Spectrum’s material breach, and that monetary
damages would not be adequate compensation for any loss incurred by reason of a
material breach by Spectrum as recited in this Section of this Agreement, and
hereby agrees to waive any defense in any action for specific performance,
including that a remedy at law would be adequate.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-36-

 

  

9.10.2     Licensee agrees that any breach by Licensee of Section 3.1 (Grant to
Licensee), Section 3.2.1 (Licensee Rights Limited to the Field and the Licensee
Territory), Section 3.3 (Upstream Licenses), or Sections 4.2.4 and 4.3.2
(Diligence) as single event or in combination with one or more breaches, that
has a material adverse effect on Spectrum’s rights under the Upstream Licenses
shall be deemed a material breach by Licensee of this Agreement, and, if such
breach, if curable, shall have continued uncured for ninety (90) days after
written notice thereof was provided by Spectrum to Licensee, then: (a) subject
to Section 8.7, Spectrum shall be entitled to recovery of damages for such
material breach without any limitation on the amount or type of damages
(including special, consequential (including loss of profits and loss of
revenue), incidental, punitive or indirect damages); and (b) Spectrum, in
addition to being entitled to exercise all rights provided herein or granted by
law, including, without limitation, recovery of damages, will be entitled to
specific performance of its rights and Licensee’s obligations under the above
Sections 3.1 (Grant to Licensee), Section 3.2.1 (Licensee Rights Limited to the
Field and the Licensee Territory), Section 3.3 (Upstream Licenses), or Sections
4.2.4 and 4.3.2 (Diligence) of the Agreement, without the necessity of posting
any bond and without the necessity of establishing that monetary relief would
not provide an adequate remedy. Licensee agrees that Spectrum may seek, and AAA
(or any court having competent jurisdiction in relation to any injunctive or
provisional relief necessary) may grant, specific performance in the event of
such Licensee’s material breach, and that monetary damages would not be adequate
compensation for any loss incurred by reason of a material breach by Licensee as
recited in this Section of this Agreement, and hereby agrees to waive any
defense in any action for specific performance, including that a remedy at law
would be adequate.

 

Article 10
DISPUTE RESOLUTION

 

10.1        Disputes. If the Parties are unable to resolve any dispute or other
matter arising out of or in connection with this Agreement (“Dispute”), either
Party may, by written notice to the other, have such Dispute referred to the
respective business heads of the Parties for attempted resolution by good faith
negotiations within fifteen (15) Business Days after such notice is received. In
such event, each Party shall cause its respective business head to meet
(face-to-face or by teleconference) and be available to attempt to resolve such
Dispute. If the Parties should resolve such Dispute under this Section 10.1, a
memorandum setting forth their agreement will be prepared and signed by both
Parties if requested by either Party. The Parties shall cooperate in an effort
to limit the issues for consideration in such manner as narrowly as reasonably
practicable in order to resolve the Dispute. If the Parties are unable to
resolve such Dispute under this Section 10.1, then either Party may submit such
Dispute to arbitration pursuant to Section 10.2 below or initiate proceedings
pursuant to Section 10.3 below, as applicable. No Dispute shall be submitted to
arbitration under Section 10.2 below and no proceedings shall be initiated
pursuant to Section 10.3 below, as applicable, until the following procedures in
this Section 10.1 have been satisfied, unless the Senior Executives have already
attempted to resolve such Dispute pursuant to Section 2.3, in which case, either
Party may refer such Dispute to arbitration pursuant to Section 10.2 below or
initiate proceedings pursuant to Section 10.3 below, as applicable, provided,
that any applicable statute of limitations with respect to such Dispute shall be
tolled while the Parties attempt to resolve such Dispute in accordance with
Section 2.3 or this Section 10.1.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-37-

 

  

10.2        Arbitration. Except with respect to Disputes related to Intellectual
Property rights as provided under Section 10.3 below, if the Parties are unable
to resolve a Dispute under Section 10.1 above, either Party may, upon written
notice to the other Party, submit such Dispute for resolution by final, binding
arbitration in the manner described in this Section 10.2 below, as applicable.
Any arbitration under this Section 10.2 below, as applicable, shall be conducted
by the American Arbitration Association (“AAA”) in New York, New York in
accordance with the then-current Commercial Rules of Arbitration of AAA (“AAA
Rules”), except as modified by this Section 10.2 below, as applicable. The
arbitration shall be conducted by a single arbitrator. The costs of such
arbitration shall be shared equally by the Parties, and each Party shall bear
its own expenses in connection with the arbitration. The Parties shall use good
faith efforts to complete arbitration under this Section 10.2 within ninety (90)
days following the initiation of such arbitration. The arbitrator shall
establish reasonable additional procedures to facilitate and complete such
arbitration within such ninety (90) day period. Nothing in this Agreement shall
limit the right of either Party to seek to obtain in any court of competent
jurisdiction any equitable or interim relief or provisional remedy, including
injunctive relief.

 

10.3        Other Disputes. If the Parties are unable to resolve a Dispute
related to Intellectual Property rights under Section 10.1 above, either Party
may initiate legal proceedings with respect thereto. Each of the Parties
irrevocably agrees that the federal or state courts in New York, New York shall
have the exclusive jurisdiction to hear and decide any suit, action,
proceedings, and/or settle any such Disputes, and for these purposes, each Party
irrevocably submits to the jurisdiction of the courts of New York. EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING (WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATED TO THIS
AGREEMENT.

 

Article 11
MISCELLANEOUS

 

11.1        Affiliates; Licensees. For clarity and without limitation, each
Party shall have the right to exercise any of its rights and licenses or perform
or delegate all or any portion of any of its obligations under this Agreement
through any of its Affiliates, provided, that each Party shall remain
responsible to the other Party under this Agreement for all activities of its
Affiliates to the same extent as if such activities had been undertaken by such
Party itself. In addition, Spectrum shall have the right to exercise any of its
rights and licenses or perform or delegate all or any portion of any of its
obligations under this Agreement through any of its Third Party licensees,
provided, that Spectrum shall require each such licensee to be bound by a
written agreement containing terms and conditions consistent with the terms and
conditions of this Agreement.

 

11.2        Governing Law. This Agreement and any dispute arising from the
performance or breach hereof shall be governed by and construed and enforced in
accordance with the laws of the State of New York, without reference to
conflicts of laws principles.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-38-

 

  

11.3        Assignment. This Agreement shall not be assignable by either Party
to any Third Party without the written consent of the other Party and any such
attempted assignment shall be void. Notwithstanding the foregoing, either Party
may assign this Agreement, without the written consent of the other Party, to an
Affiliate of such Party or an entity that acquires all or substantially all of
the business or assets of such Party to which this Agreement pertains (whether
by merger, reorganization, acquisition, sale, operation of law or otherwise),
and agrees in writing to be bound by the terms and conditions of this Agreement.
No assignment or transfer of this Agreement shall be valid and effective unless
and until the assignee/transferee agrees in writing to be bound by the
provisions of this Agreement. The terms and conditions of this Agreement shall
be binding on and inure to the benefit of the permitted successors and assigns
of the Parties. Except as expressly provided in this Section 11.3, any attempted
assignment or transfer of this Agreement shall be null and void.

 

11.4        Notices. Any notice, request, delivery, approval or consent required
or permitted to be given under this Agreement shall be in writing and shall be
deemed to have been sufficiently given if delivered in person, transmitted by
facsimile (receipt verified) or by express courier service (signature required)
or five (5) days after it was sent by registered letter, return receipt
requested (or its equivalent), provided, that no postal strike or other
disruption is then in effect or comes into effect within two (2) days after such
mailing, to the Party to which it is directed at its address or facsimile number
shown below or such other address or facsimile number as such Party will have
last given by notice to the other Party.

 

If to Spectrum, addressed to:

 

Spectrum Cayman, L.P.

c/o Spectrum Pharmaceuticals, Inc.

11500 South Eastern Ave. Suite 240

Henderson, NV 89052

Attn: Legal Department

Telephone number: (702) 835-6300

Facsimile number:   (702) 260-7405

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-39-

 

  

With a copy to:

Stradling Yocca Carlson & Rauth

660, Newport Center Dr, Suite 1600

Newport Beach, CA 92660

Attn: Shivbir S. Grewal, Esq.

Telephone number: (949) 725-4000

Facsimile number:   (949) 725-4100

 

If to Licensee, addressed to:

 

CASI Pharmaceuticals, Inc.

9620 Medical Center Drive, Suite 300

Rockville, MD 20850

Attn: General Counsel

 

Telephone number: (240) 864-2781

Facsimile number:  (240) 864-2782

 

With a copy to:

 

Ropes & Gray LLP

36F, Park Place 1601 Nanjing Road West

Shanghai 200040, China

Attention: Geoffrey Lin and Arthur Mok

Telephone: +86 21 6157 5200

Facsimile: + 86 21 6157 5299

 

11.5        Waiver. Neither Party may waive or release any of its rights or
interests in this Agreement except in writing. The failure of either Party to
assert a right hereunder or to insist upon compliance with any term or condition
of this Agreement shall not constitute a waiver of that right or excuse a
similar subsequent failure to perform any such term or condition. No waiver by
either Party of any condition or term in any one or more instances shall be
construed as a continuing waiver of such condition or term or of another
condition or term.

 

11.6        Severability. If any provision hereof should be held invalid,
illegal or unenforceable in any jurisdiction, the Parties shall negotiate in
good faith a valid, legal and enforceable substitute provision that most nearly
reflects the original intent of the Parties and all other provisions hereof
shall remain in full force and effect in such jurisdiction and shall be
liberally construed in order to carry out the intentions of the Parties as
nearly as may be possible. Such invalidity, illegality or unenforceability shall
not affect the validity, legality or enforceability of such provision in any
other jurisdiction. If a Party seeks to avoid a provision of this Agreement by
asserting that such provision is invalid, illegal or otherwise unenforceable,
the other Party shall have the right to terminate this Agreement pursuant to
Section 9.2 upon sixty (60) days prior written notice to the asserting Party,
unless such assertion is eliminated and cured within such sixty (60) day period.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-40-

 

  

11.7        Entire Agreement/Modification. This Agreement, including its
Exhibits, sets forth all the covenants, promises, agreements, warranties,
representations, conditions and understandings between the Parties and
supersedes and terminates all prior agreements and understandings between the
Parties including the Prior CDA. No subsequent alteration, amendment, change or
addition to this Agreement shall be binding upon the Parties unless reduced to
writing and signed by the respective authorized officers of the Parties.

 

11.8        Relationship of the Parties. The Parties agree that the relationship
of Spectrum and Licensee established by this Agreement is that of independent
contractors. Furthermore, the Parties agree that this Agreement does not, is not
intended to, and shall not be construed to, establish an employment, agency or
any other relationship. Except as may be specifically provided herein, neither
Party shall have any right, power or authority, nor shall they represent
themselves as having any authority to assume, create or incur any expense,
liability or obligation, express or implied, on behalf of the other Party, or
otherwise act as an agent for the other Party for any purpose.

 

11.9        Force Majeure. Except with respect to payment of money, neither
Party shall be liable to the other for failure or delay in the performance of
any of its obligations under this Agreement for the time and to the extent such
failure or delay is caused by earthquake, riot, civil commotion, war, terrorist
acts, strike, flood, change of law, political unrest, or governmental acts or
restriction, or other cause that is beyond the reasonable control of the
respective Party. The Party affected by such force majeure will provide the
other Party with full particulars thereof as soon as it becomes aware of the
same (including its best estimate of the likely extent and duration of the
interference with its activities), and will use Commercially Reasonable Efforts
to overcome the difficulties created thereby and to resume performance of its
obligations as soon as practicable. If the performance of any such obligation
under this Agreement is delayed owing to such a force majeure for any continuous
period of more than one hundred eighty (180) days, the Parties will consult with
respect to an equitable solution, including the possibility of the mutual
termination of this Agreement.

 

11.10       Compliance with Applicable Laws/Other.  Notwithstanding anything to
the contrary contained herein, all rights and obligations of Spectrum and
Licensee are subject to prior compliance with, and each Party shall comply with,
all Applicable Laws, including obtaining all necessary approvals required by the
applicable agencies of the governments of the relevant jurisdictions. In
addition, each Party shall conduct its activities under this Agreement in
accordance with good scientific and business practices.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-41-

 

  

11.11      Interpretation. The captions and headings to this Agreement are for
convenience only, and are to be of no force or effect in construing or
interpreting any of the provisions of this Agreement. Unless specified to the
contrary, references to Articles, Sections or Exhibits mean the particular
Articles, Sections or Exhibits to this Agreement and references to this
Agreement include all Exhibits hereto. Unless context otherwise clearly
requires, whenever used in this Agreement: (i) the words “include” or
“including” shall be construed as incorporating, also, “but not limited to” or
“without limitation;” (ii) the word “day” or “year” means a calendar day or year
unless otherwise specified; (iii) the word “notice” shall mean notice in writing
(whether or not specifically stated) and shall include notices, consents,
approvals and other written communications contemplated under this Agreement;
(iv) the words “hereof,” “herein,” “hereby” and derivative or similar words
refer to this Agreement (including any Exhibits); (v) the word “or” shall be
construed as the inclusive meaning identified with the phrase
“and/or;”(vi) provisions that require that a Party, the Parties or a committee
hereunder “agree,” “consent” or “approve” or the like shall require that such
agreement, consent or approval be specific and in writing, whether by written
agreement, letter, approved minutes or otherwise; (vii) words of any gender
include the other gender; (viii) words using the singular or plural number also
include the plural or singular number, respectively; (ix) references to any
specific law, rule or regulation, or article, section or other division thereof,
shall be deemed to include the then-current amendments thereto or any
replacement law, rule or regulation thereof; and (x) neither Party or its
Affiliates shall be deemed to be acting “on behalf of” the other Party
hereunder.

 

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

 

[The remainder of this page intentionally left blank; the signature page
follows.]

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

-42-

 

  

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

 

SPECTRUM PHARMACEUTICALS CAYMAN, L.P.   CASI PHARMACEUTICALS, INC.       By:
Spectrum Pharmaceuticals International Holdings, LLC   By: /s/ Ken K. Ren Its:
General Partner   Name:  Ken K. Ren       Title: Chief Executive Officer By:
Spectrum Pharmaceuticals, Inc.     Its: Managing Member             By: /s/
Rajesh C. Shrotriya     Name:  Rajesh C. Shrotriya, MD     Title: Chairman and
CEO    

 

List of Exhibits:

 

Exhibit 1.36: Kits

Exhibit 1.68: Spectrum Patents

Exhibit 1.71: Spectrum Trademarks

Exhibit 7.5.1: Press Release(s)

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

 

   

Exhibit 1.36

 

Kits

 

1.     One (1) Zevalin vial containing 3.2 mg ibritumomab tiuxetan in 2 mL 0.9%
Sodium Chloride as a clear, colorless solution.

 

2.     One (1) 50 mM Sodium Acetate Vial containing 13.6 mg Sodium Acetate
trihydrate in 2 mL Water for Injection, USP as a clear, colorless solution

 

3.     One (1) Formulation Buffer Vial containing 750 mg Albumin (Human), 76 mg
Sodium Chloride, 28 mg Sodium Phosphate Dibasic Dodecahydrate, 4 mg Pentetic
Acid, 2 mg Potassium Phosphate Monobasic and 2 mg Potassium Chloride in 10 mL
Water for Injection, pH 7.1 as a clear yellow to amber colored solution

 

4.     One (1) empty Reaction Vial.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

 

  

Exhibit 1.68

 

Spectrum Patents

 

Title   Country   Application
No.   Effective
filing date   Patent No.   Grant Date ***   ***   ***   ***   ***   ***   ***  
***   ***   ***   *** ***   ***   ***   ***   ***   ***   ***   ***   ***   ***
  *** ***   ***   ***   ***   ***   ***   ***   ***   ***   ***   ***

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

 

  

Exhibit 1.71

 

Spectrum Trademarks

 

Country   Trademark   Class   Goods   Appl.
Date   Appl.
Number   Reg.
Date   Reg.
Number ***   ***   ***   ***   ***   ***   ***   *** ***   ***   ***   ***   ***
  ***   ***   *** ***   ***       ***   ***   ***   ***   *** ***   ***   ***  
***   ***   ***   ***   *** ***   ***   ***   ***   ***   ***   ***   *** ***  
***   ***   ***   ***   ***   ***   *** ***   ***   ***   ***   ***   ***   ***
  *** ***   ***   ***   ***   ***   ***   ***   *** ***   ***   ***   ***   ***
  ***   ***   *** ***   ***   ***   ***   ***   ***   ***   ***

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

 

  

Exhibit 7.5.1

 

Press Release(s)

 

See attached.

 

*** = Portions of this exhibit have been omitted pursuant to a request for
confidential treatment.  An unredacted version of this exhibit has been filed
separately with the Commission.

 

 

 

  

Spectrum Pharmaceuticals Out-Licenses

Rights for Greater China to CASI Pharmaceuticals for Three of Its Drugs

 

  · Spectrum receives a 19.99% stake (pre-transaction) in CASI, a NASDAQ-listed,
oncology-focused Company with expertise and focus on markets in China and a $1.5
million promissory note

 

HENDERSON, Nev. and ROCKVILLE, Md. (September 18, 2014) – Spectrum
Pharmaceuticals, Inc. (Nasdaq: SPPI), a biotechnology company with fully
integrated commercial and drug development operations with a primary focus in
hematology and oncology, and CASI Pharmaceuticals, Inc. (Nasdaq: CASI), a
biopharmaceutical company dedicated to the acquisition, development and
commercialization of innovative therapeutics addressing cancer and other unmet
medical needs for the global market with a primary focus on China, announce the
signing of license agreements whereby CASI has been granted exclusive rights to
two of Spectrum Pharmaceuticals’ commercial oncology drugs, Zevalin®
(ibritumomab tiuxetan) Injection for intravenous use and Marqibo® (vinCRIStine
sulfate LIPOSOME injection) for intravenous infusion, and a Phase 3 drug
candidate, Captisol-EnabledTM Melphalan (CE melphalan), for development and
commercialization in China, including Taiwan, Hong Kong and Macau.

 

ZEVALIN is used in the treatment of non-Hodgkin’s lymphoma (NHL) and MARQIBO is
used in the treatment of acute lymphoblastic leukemia (ALL). CE melphalan has
met the endpoints in a pivotal trial for use as a conditioning treatment prior
to autologous stem cell transplant for patients with multiple myeloma. Spectrum
plans to file a New Drug Application with the U.S. Food and Drug Administration
(FDA) for CE melphalan in the second half of 2014.

 

CASI will be responsible for the development and commercialization of the three
drugs, including the submission of import drug registration applications to
regulatory authorities and conducting any confirmatory clinical studies in
greater China, if and as required.

 

“We are delighted to see our anticancer drugs to be developed and marketed in
greater China through CASI, a NASDAQ-listed Company focused on China,” said
Rajesh C. Shrotriya, MD, Chairman and Chief Executive Officer of Spectrum
Pharmaceuticals. “The management of CASI has a track record of successfully
developing anticancer drugs in China. We are pleased to be a shareholder of CASI
at this early stage of their development and look forward to CASI creating value
for our shareholders as they grow. China’s pharmaceutical market is growing at a
rapid pace and is already approaching second place to only the United States in
the world. The greater China drug market for anticancer drugs is projected to
become the world’s largest in the next decade and CASI has the opportunity to
take a leading position to address these significant unmet medical needs. We are
impressed with the management team at CASI and their expertise in China, and
look forward to sharing in the success of our drugs in this important market.”

 

Spectrum Pharmaceuticals, Inc., 11500 S. Eastern Ave., Ste. 240  •  Henderson,
Nevada 89052   •   Tel: 702-835-6300

•   Fax: 702-260-7405   •   www.sppirx.com   •   NASDAQ: SPPI

 

CASI Pharmaceuticals, Inc., 9620 Medical Center Drive, Ste. 300 • Rockville,
Maryland 20852   •   Tel: 240-864-2643

•   Fax: 301-325-2437   •   www.casipharmaceuticals.com   •   NASDAQ: CASI

 

 

 

  

Commenting on the transaction, Ken K. Ren, Ph.D., CASI’s Chief Executive
Officer, said, “We are very excited to have entered into this transaction with
Spectrum, a Company with a successful track record of developing and
commercializing drugs expeditiously in the U.S. The addition of these three
drugs transforms our pipeline and significantly expands our market share
potential in China. Our transaction is structured rather uniquely in that the
shares and note represent the purchase price to Spectrum and is in lieu of
royalties and milestones normally associated with traditional licenses, thereby
aligning Spectrum’s interest with our shareholders. We look forward to a
productive relationship with Spectrum.”

 

Dr. Ren added, “These drug products come with strong intellectual property
protection and significant technology barriers. We are currently preparing the
import drug registration applications in greater China, initially for ZEVALIN
and MARQIBO, and since both drugs are approved for sale in the U.S., we
anticipate that confirmatory clinical trials will be required for marketing
approval in our territory. The submission of the import drug registration for CE
melphalan will follow immediately after its approval by the U.S. FDA. The annual
incidence in China for NHL, ALL and multiple myeloma is increasing each year
with high mortality rates, it is our goal to have these innovative products
available to patients in greater China as soon as possible to address these
unmet medical needs, and as Spectrum expands these drugs into additional
indications in the U.S., we too will apply for expanded labels in our
territory.”

 

In addition to its initial stake in CASI, Spectrum Pharmaceuticals will have
certain rights to maintain its post-transaction ownership position. Spectrum
Pharmaceuticals also will have the opportunity to designate a member to CASI’s
board of directors. Detailed information on the transaction can be found in
CASI’s Report on Form 8-K, which will be filed with the Securities and Exchange
Commission.

 

H.C. Wainwright & Co., LLC acted as Spectrum's advisor.

 

About Spectrum Pharmaceuticals, Inc.

 

Spectrum Pharmaceuticals is a leading biotechnology company focused on
acquiring, developing, and commercializing drug products, with a primary focus
in oncology and hematology. Spectrum and its affiliates market five oncology
drugs: FUSILEV® (levoleucovorin) for Injection; FOLOTYN® (pralatrexate
injection); ZEVALIN® (ibritumomab tiuxetan) Injection for intravenous use;
MARQIBO® (vinCRIStine sulfate LIPOSOME injection) for intravenous infusion; and
BELEODAQ™ (belinostat) for Injection. Spectrum's strong track record in
in-licensing and acquiring differentiated drugs, and expertise in clinical
development have generated a robust, diversified and growing pipeline of product
candidates in advanced-stage Phase 2 and Phase 3 studies. More information on
Spectrum is available at www.sppirx.com.

 

 

 

  

About CASI Pharmaceuticals, Inc.

 

CASI is a biopharmaceutical company dedicated to the acquisition, development
and commercialization of innovative therapeutics addressing cancer and other
unmet medical needs for the global market with a primary focus on China.. CASI’s
product pipeline includes exclusive regional rights to ZEVALIN (ibritumomab
tiuxetan), MARQIBO (vinCRIStine sulfate LIPOSOME injection) and Captisol-Enabled
(propylene glycol-free) melphalan (CE melphalan) in greater China (including
Taiwan, Hong Kong and Macau). CASI’s development pipeline also includes its
proprietary drug candidate ENMD-2076, a selective angiogenic kinase inhibitor
currently in multiple Phase 2 oncology studies, and 2ME2 (2-methoxyestradial)
currently under reformulation development. CASI is headquartered in Rockville,
Maryland and has a wholly owned subsidiary and R&D operations in Beijing, China.
More information on CASI is available at www.casipharmaceuticals.comand in the
Company’s filings with the U.S. Securities and Exchange Commission.

 

About ZEVALIN and the ZEVALIN Therapeutic Regimen

 

ZEVALIN (ibritumomab tiuxetan) injection for intravenous use, is indicated for
the treatment of patients with relapsed or refractory, low-grade or follicular
B-cell non-Hodgkin's lymphoma (NHL). ZEVALIN is also indicated for the treatment
of patients with previously untreated follicular non-Hodgkin's Lymphoma who
achieve a partial or complete response to first-line chemotherapy.

 

ZEVALIN is a CD20-directed radiotherapeutic antibody. The ZEVALIN therapeutic
regimen consists of two components: rituximab, and Yttrium-90 (Y-90)
radiolabeled ZEVALIN for therapy. ZEVALIN builds on the combined effect of a
targeted biologic monoclonal antibody augmented with the therapeutic effects of
a beta-emitting radioisotope.

 

Important ZEVALIN Safety Information

 

Deaths have occurred within 24 hours of rituximab infusion, an essential
component of the ZEVALIN therapeutic regimen. These fatalities were associated
with hypoxia, pulmonary infiltrates, acute respiratory distress syndrome,
myocardial infarction, ventricular fibrillation, or cardiogenic shock. Most
(80%) fatalities occurred with the first rituximab infusion. ZEVALIN
administration can result in severe and prolonged cytopenias in most patients.
Severe cutaneous and mucocutaneous reactions, some fatal, can occur with the
ZEVALIN therapeutic regimen.

 

Please see full Prescribing Information, including BOXED WARNINGS, for ZEVALIN
and rituximab. Full prescribing information for ZEVALIN can be found at
www.ZEVALIN.com.

 

About MARQIBO

 

MARQIBO is a novel, sphingomyelin/cholesterol liposome-encapsulated, formulation
of vincristine sulfate. Vincristine, a microtubule inhibitor, is FDA-approved
for the treatment of adult patients with Philadelphia chromosome-negative (Ph-)
acute lymphoblastic leukemia (ALL) in second or greater relapse or whose disease
has progressed following two or more anti-leukemia therapies. (The encapsulation
technology, utilized in this formulation, has been shown to provide prolonged
circulation of vincristine in the blood).

 

 

 

  

Please see important safety information below and the full prescribing
information for MARQIBO at www.marqibo.com.

 

Indication and usage

 

MARQIBO is a liposomal vinca alkaloid indicated for the treatment of adult
patients with Philadelphia chromosome-negative (Ph-) acute lymphoblastic
leukemia (ALL) in second or greater relapse or whose disease has progressed
following two or more anti-leukemia therapies. This indication is based on
overall response rate. Clinical benefit such as improvement in overall survival
has not been verified.

 

Important safety information

 

CONTRAINDICATIONS

 

  · MARQIBO is contraindicated in patients with demyelinating conditions
including Charcot-Marie-Tooth syndrome

 

  · MARQIBO is contraindicated in patients with hypersensitivity to vincristine
sulfate or any of the other components of MARQIBO (vinCRIStine sulfate LIPOSOME
injection

 

  · MARQIBO is contraindicated for intrathecal administration

 

About Captisol-Enabled Melphalan

 

Captisol-enabled, PG-free melphalan is a novel intravenous formulation of
melphalan being investigated for the multiple myeloma transplant setting, for
which it has been granted an Orphan Drug Designation by the FDA. This
formulation eliminates the use of propylene glycol, which has been reported to
cause renal and cardiac side effects that limit the ability to deliver higher
doses of therapeutic compounds. The use of the Captisol technology to
reformulate melphalan also improves its stability and is anticipated to allow
for slower infusion rates and longer administration durations, potentially
enabling clinicians to safely achieve a higher dose intensity for pre-transplant
chemotherapy.

 

About Captisol

 

Captisol is a patent-protected, chemically modified cyclodextrin with a
structure designed to optimize the solubility and stability of drugs. Captisol
was invented and initially developed by scientists in the laboratories of Dr.
Valentino Stella at the University of Kansas’ Higuchi Biosciences Center for
specific use in drug development and formulation. This unique technology has
enabled seven FDA-approved products, including Onyx Pharmaceuticals’ Kyprolis®,
Baxter International’s Nexterone® and Merck’s NOXAFIL IV. There are also more
than 30 Captisol-enabled products currently in clinical development.

 

 

 

  

Forward-Looking Statements – Spectrum Pharmaceuticals, Inc.

 

This press release may contain forward-looking statements regarding future
events and the future performance of Spectrum Pharmaceuticals that involve risks
and uncertainties that could cause actual results to differ materially. These
statements are based on management's current beliefs and expectations. These
statements include, but are not limited to, statements that relate to our
business and its future, including sales of Spectrum’s drug products, certain
company milestones, Spectrum's ability to identify, acquire, develop and
commercialize a broad and diverse pipeline of late-stage clinical and commercial
products, leveraging the expertise of partners and employees around the world to
assist us in the execution of our strategy, and any statements that relate to
the intent, belief, plans or expectations of Spectrum or its management, or that
are not a statement of historical fact. Risks that could cause actual results to
differ include the possibility that our existing and new drug candidates may not
prove safe or effective, the possibility that our existing and new applications
to the FDA and other regulatory agencies may not receive approval in a timely
manner or at all, the possibility that our existing and new drug candidates, if
approved, may not be more effective, safer or more cost efficient than competing
drugs, the possibility that our efforts to acquire or in-license and develop
additional drug candidates may fail, our lack of sustained revenue history, our
limited marketing experience, our customer concentration, the possibility for
fluctuations in customer orders, evolving market dynamics, our dependence on
third parties for clinical trials, manufacturing, distribution, information and
quality control and other risks that are described in further detail in the
Company's reports filed with the Securities and Exchange Commission. We do not
plan to update any such forward-looking statements and expressly disclaim any
duty to update the information contained in this press release except as
required by law.

 

SPECTRUM PHARMACEUTICALS, INC. ®, FUSILEV®, FOLOTYN®, ZEVALIN®, and MARQIBO® are
registered trademarks of Spectrum Pharmaceuticals, Inc. and its affiliates.
BELEODAQ™, REDEFINING CANCER CARE™ and the Spectrum Pharmaceuticals logos are
trademarks owned by Spectrum Pharmaceuticals, Inc. Any other trademarks are the
property of their respective owners.

 

© 2014 Spectrum Pharmaceuticals, Inc. All Rights Reserved.

 

Forward-Looking Statements – CASI Pharmaceuticals, Inc.

 

This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act with respect to the outlook for
expectations for future financial or business performance, strategies,
expectations and goals. Forward-looking statements are subject to numerous
assumptions, risks and uncertainties, which change over time. Forward-looking
statements speak only as of the date they are made, and no duty to update
forward-looking statements is assumed.

 

 

 

  

Actual results could differ materially from those currently anticipated due to a
number of factors, including: the risk that we may be unable to continue as a
going concern as a result of our inability to raise sufficient capital for our
operational needs; the possibility that we may be delisted from trading on the
Nasdaq Capital Market; the volatility in the market price of our common stock;
the difficulty of executing our business strategy in China; our inability to
enter into strategic partnerships for the development, commercialization,
manufacturing and distribution of our proposed product candidate or future
candidates; risks relating to the need for additional capital and the
uncertainty of securing additional funding on favorable terms; risks associated
with our product candidates; risks associated with any early-stage products
under development; the risk that results in preclinical models are not
necessarily indicative of clinical results; uncertainties relating to
preclinical and clinical trials, including delays to the commencement of such
trials; the lack of success in the clinical development of any of our products;
dependence on third parties; and risks relating to the commercialization, if
any, of our proposed products (such as marketing, safety, regulatory, patent,
product liability, supply, competition and other risks). Such factors, among
others, could have a material adverse effect upon our business, results of
operations and financial condition. We caution readers not to place undue
reliance on any forward-looking statements, which only speak as of the date
made. Additional information about the factors and risks that could affect our
business, financial condition and results of operations, are contained in our
filings with the U.S. Securities and Exchange Commission, which are available
at www.sec.gov.

 

SPECTRUM INVESTOR CONTACT:

 

Spectrum Pharmaceuticals, Inc.

Shiv Kapoor

Vice President, Strategic Planning & Investor
Relations

702-835-6300

InvestorRelations@sppirx.com

 

CASI INVESTOR CONTACTS:

 

CASI Pharmaceuticals, Inc.

240.864.2643

ir@casipharmaceuticals.com

 

LHA

Kim Sutton Golodetz

212.838.3777

kgolodetz@lhai.com

 

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