In this task, you're given a passage that represents a legal contract or clause between multiple parties, followed by a question that needs to be answered. Based on the paragraph, you must write unambiguous answers to the questions and your answer must refer a specific phrase from the paragraph. If multiple answers seem to exist, write the answer that is the most plausible.

Q: Exhibit 10.21

Certain information has been excluded from this agreement (indicated by [***]) because such information (i) is not material and (ii) would be competitively harmful if publicly disclosed.

EXECUTION VERSION

CO-DEVELOPMENT AGREEMENT

This Co-Development Agreement (Agreement), made effective as of January 9, 2020 (the Effective Date), is by and between PhaseBio Pharmaceuticals Inc., a Delaware corporation, with a principal place of business at 1 Great Valley Parkway, Suite 30, Malvern, Pennsylvania 19355, USA (PB), and SFJ Pharmaceuticals X, Ltd. (SFJ), an SFJ Pharmaceuticals Group company and corporation organized and existing under the laws of the Cayman Islands, having its principal place of business at SIX, 2nd Floor, Cricket Square PO Box 2681, Grand Cayman, KY1-1111 Cayman Islands (each, a Party and collectively, the Parties).

WHEREAS, SFJ is in the business of facilitating, among other things, the development and approval of pharmaceutical products and desires to provide financing and participate in conducting the Clinical Trials for the development of the Product as a treatment of patients for the reversal of the effects of the Ticagrelor Compound; and

WHEREAS, PB has rights to the Product, is conducting clinical trials of the Product in the United States and the European Clinical Trial Countries, and would like to enter into an agreement with SFJ to provide operational support for the conduct of clinical trials of the Product in the European Clinical Trial Countries, to conduct clinical trials of the Product in the Designated Asian Countries, and to provide global financing for the continued development of the Product.

NOW THEREFORE, in consideration of the mutual agreements contained herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Defined Terms. Initially capitalized terms will have the meaning ascribed to such terms in this Agreement, including the following terms which will have the following respective meanings:

1.1.1 Account is any account as defined in the UCC with such additions as such term may hereafter be made and includes, without limitation, all accounts receivable and other sums owing to PB.

1.1.2 Affiliate means, with respect to a party, a business entity under common control with, or controlling or controlled by, such party, with control meaning direct or indirect ownership of 50% or more of the voting interest in such other entity, and in the case

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





of a partnership, control of the general partner. Notwithstanding the foregoing, neither The Blackstone Group Inc. nor any of its divisions, including Blackstone Life Sciences, shall be deemed to be an Affiliate of SFJ.

1.1.3 Alliance Manager has the meaning ascribed to such term in Section 5.1.5.

1.1.4 Anti-Corruption Laws means the U.S. Foreign Corrupt Practices Act, as amended, the UK Bribery Act 2010, as amended, and any other applicable anti-corruption laws and laws for the prevention of fraud, racketeering, money laundering or terrorism.

1.1.5 Applicable Law means the applicable laws, rules and regulations, including any rules, regulations, guidelines, or other requirements of any Governmental Authorities (including any Regulatory Authorities), to the extent legally binding, that may be in effect from time to time in any country or regulatory jurisdiction of the Territory. For clarity, Applicable Laws will include the FFDCA, the PHSA, the Anti-Corruption Laws, and all laws, regulations and legally binding guidelines applicable to the Clinical Trials, including GCP, GLP, GMP and ICH guidelines.

1.1.6 Approval Buy-Out Payment has the meaning ascribed to such term in Section 6.7.1.

1.1.7 Approval Payments has the meaning ascribed to such term in Section 6.1.

1.1.8 Approved CRO has the meaning ascribed to such term in Section 2.4.1.

1.1.9 Approved Third Party Vendor Costs has the meaning ascribed to such term in Section 5.2.2.2(g).

1.1.10 Approved Vendor has the meaning ascribed to such term in Section 2.4.2.

1.1.11 AstraZeneca Product has the meaning ascribed to such term in the AZ License.

1.1.12 AstraZeneca Product Improvements has the meaning ascribed to such term in the AZ License.

1.1.13 AstraZeneca Product Know-How has the meaning ascribed to such term in the AZ License.

1.1.14 AstraZeneca Product Patents has the meaning ascribed to such term in the AZ License.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.15 AstraZeneca Product References has the meaning ascribed to such term in the AZ License.

1.1.16 AZ License means the License Agreement between MedImmune and PB dated November 21, 2017, a copy of which is attached hereto as Exhibit L, as amended by that certain First Amendment to License Agreement dated January 9, 2020, a copy of which is attached hereto as Exhibit M.

1.1.17 BLA means: (a) a biologics license application submitted to the FDA pursuant to Section 351(a) of the PHSA and the regulations promulgated thereunder, or its successor application; or (b) an application for authorization to market and/or sell a biological product in any country or regulatory jurisdiction other than the US submitted to the applicable Regulatory Authority in such country or regulatory jurisdiction, including, with respect to the EU, a marketing authorization application submitted either (i) to the EMA pursuant to the centralized EU filing procedure or (ii) to the applicable national Regulatory Authority in an individual EU member state if the centralized EU filing procedure is not used.

1.1.18 Brilinta Competing Product means any P2Y12 receptor antagonist, other than the AstraZeneca Product or Generic Ticagrelor Product.

1.1.19 Business Day means a day that is not a Saturday, Sunday or a US federal holiday.

1.1.20 Buy-Out Payment means an Approval Buy-Out Payment or a Change of Control Buy-Out Payment.

1.1.21 Calendar Quarter means each successive period of three (3) consecutive calendar months ending on March 31, June 30, September 30 and December 31; provided, that, the (a) the first Calendar Quarter shall begin on the Effective Date and end on the last day of the Calendar Quarter in which the Effective Date falls, and (b) the final Calendar Quarter shall end on the last day of the Term.

1.1.22 Calendar Year means each successive period of twelve (12) months commencing on January 1 and ending on December 31; provided, that, (a) the first Calendar Year shall begin on the Effective Date and end on December 31 of the Calendar Year in which the Effective Date falls, and (b) the final Calendar Year shall end on the last day of the Term.

1.1.23 Case Report Form or CRF means the collection of documents designed specifically for recording data pursuant to the Protocol. A CRF is completed for each Subject and will be in electronic form, validated and in compliance with all Applicable Laws.

1.1.24 CFC means a controlled foreign corporation as defined in the IRC.

1.1.25 Change of Control means, with respect to PB, at any time prior to the date of the payment by PB of the final Approval Payment hereunder, (a) a merger, reorganization or consolidation with a Third Party which results in the voting securities of PB outstanding

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





immediately prior thereto ceasing to represent, or being converted into or exchanged for voting securities that do not represent, at least fifty percent (50%) of the combined voting power of the voting securities of the surviving entity or the parent corporation of the surviving entity immediately after such merger, reorganization or consolidation, (b) a transaction in which a Third Party becomes the beneficial owner of fifty percent (50%) or more of the combined voting power of the outstanding securities of PB, other than through the issuance of voting securities for the purpose of raising financing to one or more financial or institutional investors that are not then controlled by an entity engaged in the development or commercialization of pharmaceutical or biotechnology products, or (c) the sale or other transfer of all or substantially all of PB's business or assets relating to the Product for use in the Indication. A Licensing Transaction shall not constitute a Change of Control, unless such Licensing Transaction includes the grant of US Commercialization Rights in which event such Licensing Transaction shall be deemed to be a Change in Control.

1.1.26 Change of Control Buy-Out Payment has the meaning ascribed to such term in Section 6.7.2.

1.1.27 Claim means any Third Party claim, demand, suit and/or cause of action.

1.1.28 Clinical Investigator means the principal investigator at each Site.

1.1.29 Clinical Investigator Meeting has the meaning ascribed to such term in Section 3.2.2.1.

1.1.30 Clinical Supply Agreement has the meaning ascribed to such term in Section 3.14.1.2.

1.1.31 Clinical Supply Agreement has the meaning ascribed to such term in Section 3.14.1.1.

1.1.32 Clinical Trials means the Phase 3 Trial, any required supplemental clinical trial of the Product in China contemplated by the Development Plan, and the pharmacokinetic study of the Product in Japanese Subjects contemplated by the Development Plan.

1.1.33 Clinical Trial Activity has the meaning ascribed to such term in Section 2.3.1.

1.1.34 Clinical Trial Agreement has the meaning ascribed to such term in Section 3.2.1.3.

1.1.35 Clinical Trials Database has the meaning ascribed to such term in Section 3.5.3.1.

1.1.36 Clinical Trials Master File has the meaning ascribed to such term in Section 3.5.4.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.37 CMC means chemistry, manufacturing and controls.

1.1.38 CMC Information means the CMC information intended or required for the submission of an IND or BLA.

1.1.39 CMO means contract manufacturing organization or contract development and manufacturing organization.

1.1.40 Commercial Launch means, with respect to the Product and a country in the Territory, the first sale to a Third Party of such Product in such country after (a) Regulatory Approval and (b) in any country in which price approval is necessary or relevant for a majority of the population to obtain access to pharmaceutical products, price approval for such Product in such country.

1.1.41 Commercialization or Commercialize means the commercial manufacture, marketing, promotion, sale and/or distribution of the Product. For clarity, Commercialization excludes all activities associated with development and seeking Regulatory Approval for the Product.

1.1.42 Commercially Reasonable Efforts means with respect to the performance of activities under this Agreement by a Party (as pertains to its role in conducting the Clinical Trials): reasonable, diligent, good-faith efforts to accomplish such objective which are consistent with industry standards for companies of comparable size as that of such Party. Commercially Reasonable Efforts requires, with respect to a particular task or activity in making, using, selling, offering for sale, importing, exporting, developing (including seeking regulatory approvals or applicable pricing or reimbursement approvals) or otherwise commercializing the Product, that a Party: (i) promptly assign responsibility for such task or activity to specific employee(s) who are held accountable for progress and monitor such progress on an on-going basis; (ii) set and consistently seek to achieve specific and meaningful objectives for carrying out such task or activity; and (iii) make and implement decisions and allocate resources designed to advance progress with respect to such objectives in accordance with established timelines; provided, however, that, to the extent that the performance of a Party's obligations hereunder is adversely affected by the other Party's breach in performing its obligations hereunder, the impact on the first Party of such performance failure by the other Party will be taken into account in determining whether the first Party has used its Commercially Reasonable Efforts to perform any such affected obligations.

1.1.43 Competing Product means any agent intended to neutralize, abrogate or reverse the antiplatelet activity of the Ticagrelor Compound.

1.1.44 Completion Date means, as to a particular Clinical Trial, the earlier of (a) the date of final database lock for such Clinical Trial and (b) the date such Clinical Trial or this Agreement is terminated.

1.1.45 Confidential Information of a Party means all information and materials provided and/or disclosed (including in written form, electronic form or otherwise) by,

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





or on behalf of, such Party or its Affiliates, agents or representatives to the other Party, its Affiliates, agents or representatives in connection with this Agreement, including, technical, scientific, regulatory and other information, results, knowledge, techniques, data, analyses, inventions, invention disclosures, plans, processes, methods, know-how, ideas, concepts, test data (including pharmacological, toxicological and clinical test data), analytical and quality control data, formulae, specifications, marketing, pricing, distribution, cost, sales, and manufacturing data and descriptions. In addition, the terms and conditions of this Agreement shall be deemed to be Confidential Information of both SFJ and PB. For further clarity, the terms of the AZ License shall be considered the Confidential Information of PB, and SFJ acknowledges that the terms of the AZ License are also considered Confidential Information (as defined in the AZ License) of MedImmune, and that each of PB and MedImmune is deemed to be the receiving Party and the disclosing Party with respect thereto for purposes of the AZ License. Notwithstanding the foregoing, any AstraZeneca Product Know-How and any AstraZeneca Product Improvement shall be deemed to be the Confidential Information of PB for purposes of this Agreement and of MedImmune for purposes of the AZ License, and SFJ shall be deemed to be the receiving Party and PB shall be deemed to be the disclosing Party with respect thereto for purposes of this Agreement (it being understood that MedImmune is deemed to be the receiving Party and MedImmune is deemed to be the disclosing Party with respect thereto for purposes of the AZ License). In addition, notwithstanding SFJ's ownership of the Research Results prior to assignment thereof in accordance with Section 11.1.1.4, the Research Results shall at all times be deemed to be Confidential Information of PB, and PB and SFJ shall be deemed the disclosing Party and the receiving Party, respectively, with respect thereto.

1.1.46 Contingent Liabilities means, for any Person, (i) Indebtedness (as defined in Section 7.7.3) of that Person, and (ii) any direct or indirect liability, contingent or not, of that Person for (a) warranty obligations, (b) potential claims for damages, (c) assessments, and (d) any other condition, situation or set of circumstances involving various degrees of uncertainty that may result in a loss or liability.

1.1.47 Control or Controlled means (a) for Intellectual Property, a Party's ability to grant applicable licenses, sublicenses and/or other rights thereunder and (b) for materials and documents, a Party's ability to provide, or provide access to, such materials and/or documents, each without violating any contractual obligations to a Third Party. For clarity, if a Party only can grant a license or sublicense and/or provide rights and/or access of limited scope, for a specific purpose or under certain conditions due to an encumbrance, Control or Controlled will be construed to so limit such license, sublicense, provision of rights and/or access.

1.1.48 Copyrights means, collectively, all works of authorship, mask works and any and all other registered and unregistered copyrights and copyrightable works, and all applications, registrations, extensions, and renewals thereof.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.49 Cover, Covered or Covering means, with respect to the applicable Intellectual Property, in the absence of the applicable rights and licenses granted, would be infringed, misappropriated, or otherwise violated by.

1.1.50 CRO means contract research organization.

1.1.51 CRO Agreement has the meaning ascribed to such term in Section 2.4.1.

1.1.52 CSR means, for with respect to a Clinical Trial, a clinical study report, or other equivalent document or series of materials, constituting a summary report of the clinical and medical data resulting from such Clinical Trial and prepared for incorporation into submissions seeking Regulatory Approval for the Product, and includes all statistical analyses of such data per the statistical analysis plan.

1.1.53 Data Room means that certain electronic data room established by PB and to which SFJ and/or its advisors were granted access.

1.1.54 Designated Asian Countries means China, Japan, and Hong Kong.

1.1.55 Designated European Countries means [***].

1.1.56 Development has the meaning ascribed to such term in the AZ License.

1.1.57 Development Costs means all internal and external costs incurred or paid by SFJ or PB associated with completing the Clinical Trials, including but not limited to all Approved Third Party Vendor Costs, Product Supply Costs, the Initial Development Cost Payment, PB Costs, the SFJ Interim Management Fee and, if applicable, the SFJ Final Management Fee.

1.1.58 Development Plan means a written plan for the Development Program, the initial version of which is attached hereto as Exhibit D, and which will be subject to amendment by the JDC from time to time during the Development Term.

1.1.59 Development Program means a CMC, clinical and regulatory development program to be undertaken by the Parties to develop the Product for the Indication, carry out the Clinical Trials, and seek Regulatory Approval for the Product.

1.1.60 Development Term means the period commencing on the Effective Date and ending on the later of (a) the latest of the Completion Dates of the Clinical Trials, and (b) the date on which all efforts in pursuit of Regulatory Approval of the Product for Indication have been concluded or terminated.

1.1.61 Disclosing Party has the meaning ascribed to such term in Section 10.1.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.62 Dispute has the meaning ascribed to such term in Section 15.10.

1.1.63 Effective Date has the meaning ascribed to such term in the Preamble.

1.1.64 EMA means the European Medicines Agency and any successor agency thereto in the EU having substantially the same function.

1.1.65 EU means the European Union or any successor union of European states thereto having a substantially similar function.

1.1.66 European Clinical Trial Countries means [***].

1.1.67 Excluded Licensing Transaction means (a) a license or sublicense granted to an academic collaborator, service provider, contract research organization, contract manufacturer or similar Third Party that does not grant to such Third Party any right to Commercialize the Product (other than, in the case of a CMO, the right to commercially manufacture PB2452 or the Product on behalf of PB or its Affiliates, without any other right to Commercialize the Product), or (b) a license or sublicense not involving a grant of rights to the Product (by way of example and not of limitation, a license or sublicense to develop and commercialize any product based on PB's proprietary ELP technology, including PB1046 and PB1023).

1.1.68 Exclusive Period means, subject to the earlier termination of the AZ License, (a) in the case of the conduct of human clinical trials with respect to a Competing Product, the period beginning on the Effective Date and ending on November 21, 2022, and (b) in the case of the sale or offer for sale of a Competing Product, the period beginning on the Effective Date and ending on November 21, 2024.

1.1.69 Exercise Price has the meaning set forth in Section 8.1.

1.1.70 Executive Officers means the executive officers of each of PB and SFJ identified on Exhibit E.

1.1.71 Existing Licenses means: (a) the License, Development and Commercialization Agreement dated March 28, 2019, between PB and ImmunoForge Co., Ltd., including the ancillary agreements between such parties entered into in connection therewith; and (b) the License Agreement dated April 13, 2018, between PB and [***], as amended.

1.1.72 Existing PB Intellectual Property has the meaning ascribed to such term in Section 11.1.1.1.

1.1.73 Exploit has the meaning ascribed to such term in the AZ License.

1.1.74 FDA means the US Food and Drug Administration and any successor agency thereto in the US having substantially the same function.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.75 FFDCA means the US Food, Drug, and Cosmetic Act, as amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.1.76 Financial Disclosure Form has the meaning ascribed to such term in Section 3.2.1.4.

1.1.77 GAAP means generally accepted accounting principles in the US, as consistently applied by the applicable Party.

1.1.78 Generic Ticagrelor Product means an oral formulation of the Ticagrelor Compound that is (a) sold, offered for sale or distributed under: (i) in the U.S., an ANDA (as defined in the FFDCA) that refers to the AstraZeneca Product as the reference listed drug, (ii) in the EU, a marketing authorization for a generic medicinal product granted in accordance with Article 10 of Directive 2001/83/EC or (iii) in any other country or jurisdiction, an equivalent of provisions set forth in clause (i) or clause (ii) and (b) approved in the applicable country or jurisdiction for at least one of the indications for which the AstraZeneca Product is approved in such country or jurisdiction. For purposes of this definition, references to AstraZeneca Product exclude Generic Ticagrelor Products.

1.1.79 GMP Manufacturer means the Party that is responsible for ensuring that the Product is manufactured in accordance with GMP.

1.1.80 Going Concern Cure Period has the meaning ascribed to such term in Section 3.18.3.

1.1.81 Going Concern Funding has the meaning ascribed to such term in Section 4.2.4.

1.1.82 Going Concern Notice has the meaning ascribed to such term in Section 3.18.3.

1.1.83 Good Clinical Practices or GCP means all applicable good clinical practice standards for the design, conduct, performance, monitoring, auditing, recording, analyses and reporting of clinical trials, including, as applicable, (a) the International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use (ICH) Harmonised Tripartite Guideline for Good Clinical Practice (CPMP/ICH/135/95) and any other guidelines for good clinical practice for clinical trials on medicinal products; (b) the Declaration of Helsinki (2004) as last amended at the 52nd World Medical Association in October 2000 and any further amendments or clarifications thereto; and (c) the equivalent Applicable Laws in any relevant country, each as may be amended and applicable from time to time and in each case, that provide for, among other things, assurance that the clinical data and reported results are credible and accurate and protect the rights, integrity, and confidentiality of clinical trial Subjects.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.84 Good Manufacturing Practices or GMP means all applicable good manufacturing practices including, as applicable, (a) the applicable part of quality assurance to ensure that products are consistently produced and controlled in accordance with the quality standards appropriate for their intended use, as defined in European Commission Directive 2003/94/EC laying down the principals and guidelines of good manufacturing practice; (b) the principles detailed in the US Current Good Manufacturing Practices, 21 CFR Sections 210, 211, 601 and 610; (c) the Rules Governing Medicinal Product in the European Community, Volume IV Good Manufacturing Practice for Medicinal Product; (d) the principles detailed in the ICH Q7A guidelines; and (e) the equivalent Applicable Laws in any relevant country, each as may be amended and applicable from time to time.

1.1.85 Government Official is broadly defined as and includes: (a) any elected or appointed government official (e.g., a member of a ministry of health); (b) any employee or person acting for or on behalf of a government official, agency, or enterprise performing a governmental function; (c) any non-US political party officer, employee, or person acting for or on behalf of a non-US political party or candidate for public office; (d) any employee or person acting for or on behalf of a public international organization; (e) all government employees and employees of state-owned enterprises; or (f) any person otherwise categorized as a government official under local law; where government is meant to include all levels and subdivisions of non-US governments (i.e., local, regional, or national and administrative, legislative, or executive).

1.1.86 Governmental Authority means any supranational, federal, national, state or local court, agency, authority, department, regulatory body or other governmental instrumentality.

1.1.87 ICH has the meaning ascribed to such term in Section 1.1.78.

1.1.88 IDMC means the independent data monitoring committee, which will be established pursuant to Section 3.9.1.

1.1.89 IDMC Charter has the meaning ascribed to such term in Section 3.9.1.

1.1.90 IND means an investigational new drug application, clinical trial application, clinical trial exemption, or similar application or submission filed with or submitted to a Regulatory Authority in a jurisdiction that is necessary to initiate human clinical testing of a pharmaceutical product in such jurisdiction, including any such application filed with the FDA pursuant to 21 C.F.R. Part 312.

1.1.91 Indemnification Claim Notice has the meaning ascribed to such term in Section 12.2.1.

1.1.92 Indemnified Party has the meaning ascribed to such term in Section 12.2.1.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.93 Indemnifying Party has the meaning ascribed to such term in Section 12.2.1.

1.1.94 Indication means the reversal of the effects of the Ticagrelor Compound in Ticagrelor Compound-treated in at least one of (i) patients with major bleeding or (ii) patients requiring urgent surgery / invasive procedure.

1.1.95 Information means technical or scientific know-how, trade secrets, methods, processes, formulae, designs, specifications and data, including biological, chemical, pharmacological, toxicological, pre-clinical, clinical, safety, manufacturing and quality control data and assays; in each case, whether or not confidential, proprietary, patented or patentable.

1.1.96 Informed Consent has the meaning ascribed to such term in Section 3.3.2.1.

1.1.97 Initial Development Cost Payment has the meaning ascribed to such term in Section 4.2.2(i).

1.1.98 Initial EU Payment has the meaning ascribed to such term in Section 6.1.

1.1.99 Initial Funding Date has the meaning ascribed to such term in Section 4.2.2(i).

1.1.100 Initial US Payment has the meaning ascribed to such term in Section 6.1.

1.1.101 Intellectual Property means all intellectual property and industrial property rights of any kind or nature throughout the world, including all US and foreign, (a) Patents; (b) Trademarks; (c) Copyrights; (d) rights in computer programs (whether in source code, object code, or other form), algorithms, databases, compilations and data, technology supporting the foregoing, and all documentation, including user manuals and training materials, related to any of the foregoing; (e) trade secrets and all other confidential information, know-how, inventions, proprietary processes, formulae, models, and methodologies; (f) rights of publicity, privacy, and rights to personal information; (g) all rights in the foregoing and in other similar intangible assets; and (h) all applications and registrations for the foregoing.

1.1.102 Interim Period has the meaning ascribed to such term in Section 4.2.2.

1.1.103 Investigator's Brochure means the written document containing a brief description of the drug substance and formulation of the Product, a summary of the pharmacological and toxicological effects of the Product in animals and human nonclinical models, a summary of the pharmacokinetics and biological disposition of the Product in animals and humans, a summary of information relating to safety and effectiveness of the Product in humans obtained from prior clinical studies, and a description of possible risks and side effects to

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





be anticipated on the basis of prior experience with the Product under investigation or with related drugs.

1.1.104 IRB means institutional review board, or its equivalent.

1.1.105 IRC means the Internal Revenue Code of 1986, as amended, and the Treasury Regulations adopted thereunder.

1.1.106 JCC has the meaning ascribed to such term in Section 5.5.1.

1.1.107 JDC has the meaning ascribed to such term in Section 5.4.1.

1.1.108 JDC Chairperson has the meaning ascribed to such term in Section 5.4.2.

1.1.109 JDC Representative(s) has the meaning ascribed to such term in Section 5.4.1.

1.1.110 JSC has the meaning ascribed to such term in Section 5.1.1

1.1.111 JSC Chairperson has the meaning ascribed to such term in Section 5.1.2.

1.1.112 JSC Representative(s) has the meaning ascribed to such term in Section 5.1.1.

1.1.113 Licensed Compound has the meaning ascribed to such term in the AZ License.

1.1.114 Licensed Know-How has the meaning ascribed to such term in the AZ License.

1.1.115 Licensed Patents has the meaning ascribed to such term in the AZ License.

1.1.116 Licensed Product has the meaning ascribed to such term in the AZ License.

1.1.117 Licensing Transaction means: (a) a license or sublicense to a Third Party under any of the PB Intellectual Property to Commercialize the Product in the US, Designated European Countries, or Designated Asian Countries (other than, in the case of a Third Party CMO, a license or sublicense to commercially manufacture PB2452 or the Product on behalf of PB or its Affiliates, without any license or sublicense to engage in any other Commercialization activities with respect to the Product); or (b) a sale or transfer to a Third Party of any of the PB Intellectual Property, in each case, other than in conjunction with a permitted assignment of this Agreement pursuant to Section 15.6 in connection with the sale or other transfer of all or substantially all of its business or assets to which this Agreement relates.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





For clarity, an assignment of the AZ License to a Third Party in conjunction with a permitted assignment by PB of this Agreement pursuant to Section 15.6 in connection with the sale or other transfer of all or substantially all of its business or assets to which this Agreement relates shall not be deemed a Licensing Transaction.

1.1.118 Licensing Transaction Agreement means a definitive agreement for a Licensing Transaction between PB and a Third Party.

1.1.119 Losses means liabilities, losses, costs, damages, fees and/or expenses (including reasonable legal expenses and attorneys' fees) payable to a Third Party.

1.1.120 Manufacturer means the company set forth on Exhibit J.

1.1.121 Material Adverse Event means (i) an event occurring after the Effective Date that has a material adverse effect on (a) the business, operations, prospects or financial condition of PB, (b) prospect of payment of the Approval Payments by PB, or (c) the development of the Product for the Indication or prospects for Regulatory Approval of the Product for the Indication (it being understood that if the interim results of the Phase 3 Trial do not demonstrate Successful Phase 3 Interim Analysis, it shall be deemed to be a Material Adverse Event), or (ii) if PB has not obtained the SVB Consent within [***] of the Effective Date, or (iii) if PB is in default of its obligations under the AZ License (excluding any such default that would not entitle AZ to terminate the AZ License); provided however, that none of the following shall constitute, or shall be considered in determining whether there has occurred, a Material Adverse Event: (A) changes in laws or regulations or in the interpretations or methods of enforcement thereof; (B) changes in the pharmaceutical or biotechnology industries in general; or (C) any earthquakes, hurricanes, tsunamis, tornadoes, floods, mudslides, wildfires or other natural disasters, weather conditions, sabotage, terrorism, military action or war (whether or not declared) or other force majeure events in the US or any other country or region in the world.

1.1.122 Material Anti-Corruption Law Violation means a violation by a Party or its Affiliate of an Anti- Corruption Law relating to the subject matter of this Agreement that would, if it were publicly known, have a material adverse effect on the other Party or its Affiliate because of its relationship with such Party.

1.1.123 Maximum Development Costs has the meaning ascribed to such term in Section 4.1.

1.1.124 MedImmune means MedImmune Limited, a limited liability company formed under the laws of the United Kingdom.

1.1.125 MedImmune Confidential Information means (a) the terms of the AZ License; and (b) any AstraZeneca Product Know-How and any AstraZeneca Product Improvement.

1.1.126 MedImmune Pharmacovigilance Agreement has the meaning ascribed to the term Pharmacovigilance Agreement in the AZ License.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.127 NMPA means China's National Medical Products Administration or any successor agency thereto in China having substantially the same function.

1.1.128 Participation Rights means with respect to a Party, such Party's Chief Executive Officer and Chief Medical Officer (or their respective designees) shall be entitled to participate on a silent basis in all meetings with Regulatory Authorities during the Development Term and to the extent practicable such Party shall be entitled to review pre-meeting briefing materials. The other Party shall provide such Party with copies of the minutes of all of the aforementioned meetings within [***] after receipt of the final minutes from the applicable Regulatory Authority.

1.1.129 Party or Parties has the meaning ascribed to such term in the Preamble.

1.1.130 Patent will mean patents, patent applications, patent disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, substitutions, and extensions thereof.

1.1.131 PB has the meaning ascribed to such term in the Preamble.

1.1.132 PB2452 means the anti-ticagrelor antibody fragment product known as PB2452 (and referred to in the AZ License as MEDI2452), as further defined by the protein sequence set forth in Schedule 1.96 to the AZ License.

1.1.133 PB Confidential Information means all Confidential Information provided and/or disclosed by or on behalf of PB or its Affiliates, agents or representatives to SFJ or its Affiliates, agents or representatives hereunder. For clarity, PB Confidential Information will include any and all CMC Information.

1.1.134 PB Costs has the meaning ascribed to such term in Section 4.2.2(ii)(3).

1.1.135 PB Financial Statements has the meaning ascribed to such term in Section 3.18.2.

1.1.136 PB Indemnified Parties has the meaning ascribed to such term in Section 12.1.1.

1.1.137 PB Intellectual Property means all Intellectual Property owned or Controlled by PB that is necessary or useful for the manufacture, use, sale or import of the Product, including Trial Inventions.

1.1.138 PB Services means performing or managing all CMC related activities (including supply of Product for use in the Clinical Trials) and oversight of the Phase 3 Trial in the US and the European Clinical Trial Countries.

1.1.139 PB SOPs has the meaning ascribed to such term in Section 3.1.6.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.140 PB Territory means the US and the European Clinical Trial Countries.

1.1.141 Permitted Third Party means any CRO, Site, Clinical Investigator and/or Vendor to whom PB or SFJ has delegated responsibility or whom PB or SFJ has engaged in connection with the Clinical Trials or any CMO whom PB has engaged to perform CMC related activities (including supply of Product for use in the Clinical Trials). For clarity, Third Parties that have been delegated responsibility by or engaged by a Permitted Third Party will be considered Permitted Third Parties.

1.1.142 Person means any individual, corporation, general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, labor union, or other entity or Governmental Authority.

1.1.143 Personally Identifiable Information means any information relating to an identified or, in combination with other information, identifiable person or persons captured in an electronic or hardcopy format, including such information as it relates to clinical trials subjects (including key-coded patient data), physicians, clinicians, healthcare professionals, consultants, or other persons participating in the Clinical Trials, and any equivalent definition in the Applicable Laws to the extent that such definition is broader than that provided here.

1.1.144 Phase 3 Interim Data means the data collected from the Phase 3 Trial as of database lock for the interim analysis of the Phase 3 Trial expressly contemplated by the Phase 3 Trial Protocol.

1.1.145 Phase 3 Success Criteria shall mean that the results of the Phase 3 Trial meet at least one of the two primary endpoints set forth in the Phase 3 Trial Protocol.

1.1.146 Phase 3 Trial means the clinical trial of the Product described in PhaseBio Protocol Number PB‑CL‑004, entitled A Phase 3, multicenter, open-label, single arm study of PB2452 in Ticagrelor-treated patients with major bleeding or requiring urgent surgery / invasive procedure, as such protocol may be amended from time to time in accordance with this Agreement.

1.1.147 Phase 3 Trial Protocol has the meaning ascribed to such term in Section 2.1.1.

1.1.148 PHSA means the Public Health Service Act as set forth at 42 U.S.C. Chapter 6A, as may be amended from time to time, together with any rules, regulations and requirements promulgated thereunder (including all additions, supplements, extensions and modifications thereto).

1.1.149 PK Studies means the pharmacokinetic study of the Product in Japanese Subjects contemplated by the Development Plan, any pharmacokinetic study of the Product in Chinese Subjects contemplated by the Development Plan, and any other pharmacokinetic study of the Product in Japanese Subjects or Chinese Subjects that may be

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





required by the PMDA or NMPA, as applicable. PK Studies shall not include any clinical trial of the Product with any efficacy endpoint.

1.1.150 PMDA means the Pharmaceuticals and Medical Devices Agency of Japan or any successor agency thereto in Japan having substantially the same function.

1.1.151 Pre-Approval Commercialization Activities has the meaning ascribed to such term in Section 4.3.

1.1.152 Product means the product containing PB2452 described on Exhibit A.

1.1.153 Product Filings has the meaning ascribed to such term in Section 3.1.2.

1.1.154 Product Supply Costs has the meaning ascribed to such term in Section 3.14.1.2.

1.1.155 Program Transfer has the meaning ascribed to such term in the form of Program Transfer Agreement attached hereto as Exhibit O.

1.1.156 Program Transfer Agreement has the meaning ascribed to such term in Section 3.20.

1.1.157 Protocol means the Phase 3 Trial Protocol or an SFJ Territory Clinical Trial Protocol.

1.1.158 Receiving Party has the meaning ascribed to such term in Section 10.1.

1.1.159 Regulatory Approval means conditional or unconditional approval of a BLA for the Product for the Indication: (a) by the FDA in the US; (b) by EMA in the EU or by the applicable national Regulatory Authority in any individual Designated European Country; (c) by the PMDA in Japan; or (d) by the NMPA in China. For clarity, Regulatory Approval excludes any pricing or reimbursement approval that may be necessary or useful for marketing or sale of the Product in any country or regulatory jurisdiction. For further clarity, the Parties acknowledge that, as of the Effective Date, PB intends to file a BLA with EMA using the centralized EU filing procedure to seek Regulatory Approval in the EU, and PB neither intends, nor has any obligation under this Agreement, to submit any BLA to, or seek Regulatory Approval from, the applicable national Regulatory Authority in any individual Designated European Country.

1.1.160 Regulatory Authority means in a particular country or regulatory jurisdiction in the Territory, any applicable Governmental Authority involved in granting approval to initiate or conduct clinical testing in humans, for Regulatory Approval, including FDA, EMA, PMDA, and NMPA.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.161 Regulatory Documentation has the meaning ascribed to such term in the AZ License.

1.1.162 Research Results means all Information arising out of, or resulting from, the Clinical Trials and/or the CMC activities contemplated by the Development Program, including the Clinical Trials Database; but excluding AstraZeneca Product Improvements, AstraZeneca Product Know-How, AstraZeneca Product Patents, and Trial Inventions (including Intellectual Property in or to Trial Inventions).

1.1.163 Serious Safety Issue means any SUSAR or series of SUSARs directly related to or caused by the administration of the Product in the conduct of the Clinical Trials where such SUSAR or series of SUSARs substantially diminishes the probability of receiving Regulatory Approval for the Product, or results in a Regulatory Authority imposing a clinical hold on further development of the Product which clinical hold is not lifted or removed within [***].

1.1.164 SFJ has the meaning ascribed to such term in the Preamble.

1.1.165 SFJ Confidential Information means all Confidential Information provided and/or disclosed by, or on behalf of, SFJ or its Affiliates, agents or representatives to PB or its Affiliates, agents or representatives hereunder.

1.1.166 SFJ Final Management Fee has the meaning ascribed to such term in Section 4.2.3(i).

1.1.167 SFJ Indemnified Parties has the meaning ascribed to such term in Section 12.1.2.

1.1.168 SFJ Interim Management Fee has the meaning ascribed to such term in Section 4.2.2(ii)(2).

1.1.169 SFJ Services means providing global oversight of the CRO and other Third Party Vendors and execution of the Clinical Trials in European Clinical Trial Countries, Japan, and China.

1.1.170 SFJ SOPs has the meaning ascribed to such term in Section 3.1.5.

1.1.171 SFJ Territory means the Designated Asian Countries.

1.1.172 SFJ Territory Clinical Trial Protocol has the meaning ascribed to such term in Section 2.1.1.

1.1.173 Site has the meaning ascribed to such term in Section 3.2.1.3.

1.1.174 SOPs means the PB SOPs or SFJ SOPs.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.175 Statistical Analysis Plan has the meaning ascribed to such term in Section 3.5.6.

1.1.176 Subject has the meaning ascribed to such term in Section 3.3.2.1.

1.1.177 Subject Recruitment Plan has the meaning ascribed to such term in Section 3.3.1.

1.1.178 Successful Phase 3 Interim Analysis means that the interim results of the Phase 3 Trial meet the interim primary endpoint set forth in the Phase 3 Trial Protocol.

1.1.179 SUSAR means a suspected unexpected serious adverse reaction, without regard to causality, that is life- threatening (i.e., causes an immediate risk of death) or that results in any of the following outcomes: death; in-patient hospitalization or prolongation of existing hospitalization; persistent or significant disability or incapacity (i.e., substantial disruption of the ability to conduct normal life functions); or a congenital anomaly or birth defect. For clarity, a planned medical or surgical procedure is not, in itself, a SUSAR.

1.1.180 SVB means, subject to Section 7.4, Silicon Valley Bank, a California corporation.

1.1.181 SVB Consent has the meaning ascribed to such term in Section 7.6.1.2.

1.1.182 SVB Collateral means, subject to Section 7.4, Collateral as defined in the SVB Loan Agreement.

1.1.183 SVB Loan means, subject to Section 7.4, the $15,000,000 term loan evidenced by the SVB Loan Agreement.

1.1.184 SVB Loan Agreement means, subject to Section 7.4, that certain Loan and Security Agreement dated as of March 25, 2019 among SVB, WestRiver Innovation Lending Fund VIII, L.P., and PB, as amended, restated, or otherwise modified from time to time.

1.1.185 Term has the meaning ascribed to such term in Section 14.1.

1.1.186 Territory of a Party means: (a) in the case of PB, the PB Territory; or (b) in the case of SFJ, the SFJ Territory.

1.1.187 Third Party means any Person other than PB, SFJ and their Affiliates.

1.1.188 Third Party Infringement means any actual or threatened infringement, misappropriation, or other violation by a Third Party of any Intellectual Property Controlled by PB that relates to this Agreement and/or the Product, including the Trial Inventions.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.189 Ticagrelor Compound means (1S,2S,3R,5S)-3-[7-{[(1R,2S)-2-(3,4- difluorophenyl)cyclopropyl]amino}-5-(propylthio)-3H-[1,2,3]-triazolo[4,5-d]pyrimidin-3-yl]-5-(2-hydroxyethoxy)cyclopentane- 1,2-diol.

1.1.190 Timeline has the meaning ascribed to such term in Section 2.3.1.

1.1.191 Timeline Remediation Plan has the meaning ascribed to such term in Section 2.3.2.

1.1.192 Trademarks means, collectively, all registered and unregistered marks, trade dress rights, logos, taglines, slogans, Internet domain names, web addresses, and other indicia of origin, together with the goodwill associated with any of the foregoing, and all applications, registrations, extensions and renewals thereof, selected for use on the Product.

1.1.193 Trial Data Package means all Information, in any form, generated or developed by or on behalf of a Party or any of its Affiliates (including by any of their respective Permitted Third Parties) in the conduct of the Clinical Trials during the Development Term, including the Clinical Trial Database and other data and reports arising out of the Clinical Trials, any Clinical Trial Agreements or any Vendor Agreements or CRO Agreements related to the conduct of the Clinical Trials, including the Research Results; but, in each case, excluding Trial Inventions.

1.1.194 Trial Invention means: (a) any invention or discovery, whether or not patentable, made, developed, generated, conceived, or reduced to practice by or on behalf of a Party or any of its Affiliates or Permitted Third Parties, or jointly by or on behalf of the Parties or any of their respective Affiliates or Permitted Third Parties, in the course or as a result of the conduct of any Clinical Trial or any other activity conducted pursuant to this Agreement, including, without limitation, any improvement to any Existing PB Intellectual Property; and (b) all Intellectual Property in any of the items described in the preceding clause (a); but excluding, in each case, AstraZeneca Product Improvements, AstraZeneca Product Know-How and AstraZeneca Product Patents.

1.1.195 UCC means the Uniform Commercial Code, as the same may, from time to time, be enacted and in effect in the State of Delaware; provided, that, to the extent that the UCC is used to define any term herein and such term is defined differently in different Articles or Divisions of the UCC, the definition of such term contained in Article or Division 9 shall govern; and provided further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of, or remedies with respect to, the SFJ Security Interest on any SFJ Collateral is governed by the Uniform Commercial Code in effect in a jurisdiction other than the State of Delaware, the term UCC shall mean the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions relating to such provisions.

1.1.196 US, U.S. or USA means the United States of America, its territories and possessions, including Puerto Rico.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





1.1.197 US Approval Payments has the meaning ascribed to such term in Section 6.1.

1.1.198 US Commercialization Rights shall mean any license or grant of other rights exclusive or non-exclusive to Commercialize the Product for the Indication in the US (other than a license or grant of other rights to a CMO to commercially manufacture PB2452 or the Product on behalf of PB or its Affiliates, without any license or grant of other rights to engage in any other Commercialization activities with respect to the Product).

1.1.199 VAD means the value added data set, including the data in the format as described in the Statistical Analysis Plan.

1.1.200 Vendor(s) has the meaning ascribed to such term in Section 2.4.2.

1.1.201 Vendor Agreement has the meaning ascribed to such term in Section 2.4.2.

1.2 Construction. For purposes of this Agreement: (1) words in the singular will be held to include the plural and vice versa as the context requires; (2) the words including and include will mean including, without limitation, unless otherwise specified; (3) the terms hereof, herein, herewith, and hereunder, and words of similar import will, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement; and (4) all references to Section and Exhibit, unless otherwise specified, are intended to refer to a Section or Exhibit of or to this Agreement.

1.3 Conflicts. In the event of any conflict between the terms of this Agreement, the Protocol and/or any other Exhibit, the Protocol will control (as applicable), followed by the terms of this Agreement, and followed by any applicable other Exhibit.

ARTICLE 2

THE CLINICAL TRIALS

2.1 The Protocols.

2.1.1 The Protocols. The protocol for the Phase 3 Trial (the Phase 3 Trial Protocol) as it exists on the Effective Date has separately been mutually agreed upon by the Parties in writing. The protocol for each Clinical Trial (other than the Phase 3 Trial) of the Product to be conducted in the SFJ Territory (each, an SFJ Territory Clinical Trial Protocol) will be prepared by SFJ in consultation with PhaseBio and approved by the JDC within [***].

2.1.2 Changes to the Protocols.

2.1.2.1 Any changes to the Phase 3 Trial Protocol, including any country-specific appendices required by Applicable Law and changes made in response to any communications with any Regulatory Authorities, that require a submission to a Regulatory Authority, an IRB or other ethics committee, will be prepared by PB, with support from SFJ, and

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





will require the JDC's approval, which will not be unreasonably withheld or delayed and which will be communicated to the Parties as soon as reasonably practicable following the JDC's receipt of the draft amendment from PB. Any changes to an SFJ Territory Clinical Trial Protocol, including changes made in response to any communications with a Regulatory Authority, an IRB or other ethics committee in the SFJ Territory, will be prepared by SFJ, with support from PB, and will require the JDC's approval, which will not be unreasonably withheld or delayed and which will be communicated to the Parties as soon as reasonably practicable following the JDC's receipt of the draft amendment from SFJ.

2.1.2.2 If either Party believes that a Protocol requires amendment to comply with any Applicable Laws or based on any communications from any Regulatory Authorities, such Party will inform the JDC. If the JDC agrees that such an amendment is required by any Applicable Laws the JDC will provide the applicable Party (PB in the case of the Phase 3 Trial or SFJ in the case of any other Clinical Trial) with written notice thereof as soon as reasonably practicable, and such Party, with support from the other Party, will prepare a draft amendment to such Protocol, which will only be effective and part of such Protocol upon approval by the JDC pursuant to Section 5.2.2, which approval will not be unreasonably withheld and which will be communicated to the Parties as soon as reasonably practicable following the JDC's receipt of the draft amendment from such Party.

2.1.3 Protocol Approval. SFJ will be responsible for obtaining all necessary approvals of each Protocol (including as required by Applicable Laws) within the SFJ Territory, and PB will be responsible for obtaining all necessary approvals of the Phase 3 Trial Protocol (including as required by Applicable Laws) within the PB Territory, in each case prior to commencing the applicable Clinical Trial in such Party's Territory. Each Party will reasonably co-operate with the other in such regard.

2.2 Sponsor.

2.2.1 Sponsorship and Responsibilities. PB will be the sponsor of the Clinical Trials in the PB Territory. SFJ will be the sponsor of the Clinical Trials in the SFJ Territory. SFJ in the SFJ Territory, and PB in the PB Territory, will have all responsibilities of a sponsor as specified in Applicable Laws, except, in the case of the Phase 3 Trial in the European Clinical Trial Countries, that SFJ shall perform certain activities that are PB's responsibilities as sponsor as set forth in Exhibit G.

2.2.2 Compliance with the Protocol and Applicable Laws. Each Party will conduct the Phase 3 Trial within its Territory, and SFJ will conduct each other Clinical Trial in the SFJ Territory, and perform all other responsibilities assigned to it hereunder in connection with any such Clinical Trial in compliance with the applicable Protocol, all Applicable Laws and the terms hereof.

2.2.3 Diligence. Each Party will conduct due diligence with respect to each Permitted Third Party used by such Party to ensure that such Permitted Third Party can comply with all applicable terms and obligations of this Agreement and Applicable Laws.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





2.3 Compliance with the Timeline.

2.3.1 The Timeline. The timeline for conducting the Clinical Trials is attached as Exhibit I hereto (the Timeline). In conducting the Clinical Trials, the Parties will use Commercially Reasonable Efforts to complete each activity specified on the Timeline (each, a Clinical Trial Activity) by the date specified for such Clinical Trial Activity on the Timeline. The Parties will notify the JDC in writing upon completion or achievement of each of their designated Clinical Trial Activities.

2.3.2 Failure to Complete a Clinical Trial Activity. If a Party fails to, or knows that it will not, complete a Clinical Trial Activity in accordance with the timeline specified for such Clinical Trial Activity on the Timeline, that Party will promptly notify the JDC. Within [***] of such written notice, if the Party has failed to, or knows that it will not, complete (a) any Clinical Trial Activity within [***] of the date for the Clinical Trial Activity on the Timeline or (b) the final Clinical Trial Activity within [***] of the date for the final Clinical Trial Activity on the Timeline, the Party will provide the JDC with a written remediation plan detailing the means by which, and the date on which, that Party expects to be able to complete the relevant Clinical Trial Activities (each, a Timeline Remediation Plan). Following receipt thereof, the JDC Representatives will discuss and consider in good faith such Timeline Remediation Plan. If the JDC approves such Timeline Remediation Plan (such approval not to be unreasonably withheld or delayed), the JDC will provide the appropriate Party with written notice thereof, specifying the dates on which the Party will be required to update the JDC of its progress with respect thereto. If the JDC is unable to approve such Timeline Remediation Plan, the matter will be decided by the JSC in accordance with Section 5.2. After approval of a Party's Timeline Remediation Plan, if such Party believes in good faith that any modification to such Timeline Remediation Plan is necessary or appropriate, such Party may propose such modification to the JDC and shall disclose to the JDC any additional information or circumstances that have become known to such Party that form the basis for its request for modification. The JDC will discuss and consider such in good faith such modification, which shall be subject to JDC approval (such approval not to be unreasonably withheld or delayed) as described above.

2.3.3 Failure to Complete a Timeline Remediation Plan. If PB fails to complete a Clinical Trial Activity it is responsible for as outlined in an approved Timeline Remediation Plan, then SFJ has the right to withhold any quarterly fixed payments due to PB pursuant to Section 4.2 until the Clinical Trial Activity is completed, in which event SFJ will not be considered in breach of this Agreement for withholding any such amounts any amounts due to PB pursuant to this Section 2.3.3. If either Party fails to complete a Clinical Trial Activity it is responsible for as outlined in an approved Timeline Remediation Plan, then the other Party, at its sole discretion, may assume responsibility for completing such Clinical Trial Activity, in which event:

2.3.3.1 in the case of SFJ's assumption of responsibility for completing a Clinical Trial Activity that was to have been performed by PB, (a) the costs incurred by SFJ in completing such Clinical Trial Activity shall be included as Development Costs hereunder and

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





(b) in no event shall any failure or delay by SFJ in performing any of its obligations hereunder that are dependent upon the completion of such Clinical Trial Activity constitute a breach of this Agreement or entitle PB to terminate this Agreement or exercise any remedy available to it under this Agreement; and

2.3.3.2 in the case of PB's assumption of responsibility for completing a Clinical Trial Activity that was to have been performed by SFJ, (a) an amount equal to the costs incurred by PB in completing such Clinical Activity shall be deducted (i) first from the SFJ Interim Management Fee until the SFJ Interim Management Fee is reduced to zero, and (ii) thereafter from the SFJ Final Management Fee, and (b) in no event will any such costs incurred by PB be included in actual Development Costs for purposes of Section 14.2, and (c) in no event shall any failure or delay by PB in performing any of its obligations hereunder that are dependent upon the completion of such Clinical Trial Activity constitute a breach of this Agreement or a Material Adverse Event, or entitle SFJ (i) to withhold any quarterly fixed payments due to PB or other amounts SFJ is obligated to pay or incur pursuant to Section 4.2, (ii) to terminate this Agreement or (iii) to exercise any other remedy available to it under this Agreement, including the remedy set forth in Section 3.20.

2.4 Approved CROs and Approved Vendors.

2.4.1 Approved CROs. Except as otherwise provided herein, a Party may delegate any of its responsibilities described in Section 2.2 to its Affiliates (subject to Section 15.1) and/or any CRO that is either listed on Exhibit B or is approved in advance by the JDC (in either case, an Approved CRO). Each Party will be required to enter into a written agreement with each Approved CRO utilized by such Party (each, a CRO Agreement) on commercially reasonable and customary terms, consistent with industry standards for similar agreements and sufficient to enable such Party to comply with its obligations hereunder with respect to the delegated responsibilities, including, but not limited to, Section 2.2.2, and the terms pertaining to ownership of Intellectual Property and publications, and treatment of Confidential Information.

2.4.2 Approved Vendors. Each Party will be permitted to contract for services, equipment, tools, materials and/or supplies required for the Clinical Trials or Regulatory Approval with any Person that is either listed on Exhibit C or is approved in advance by the JDC (each, an Approved Vendor). Such Party will be required to enter into a written agreement with each such Person (each, a Vendor Agreement) on commercially reasonable and customary terms, consistent with industry standards for similar agreements and sufficient to enable such Party to comply with its obligations hereunder with respect to the contracted activities, including, but not limited to, the terms pertaining to publications and ownership of Intellectual Property, and treatment of Confidential Information.

2.4.3 Responsibility. For clarity, each Party will remain responsible for all of its obligations under this Agreement, notwithstanding any delegation to an Affiliate or an Approved CRO or any contracting to an Approved Vendor. Each Party shall use Commercially Reasonable Efforts to oversee the services of its Affiliates and any Approved CRO or Approved Vendor utilized by such Party to provide services hereunder.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





2.5 Background Materials and Reasonable Assistance.

2.5.1 Background Materials.

2.5.1.1 Promptly following the Effective Date, PB will provide SFJ with all copies of documents and information Controlled by PB that SFJ, acting in good faith, identifies as reasonably necessary for SFJ to perform its Development Program responsibilities hereunder (the Background Materials), except to the extent the provision of any such documents is otherwise provided for in this Agreement. For clarity, PB will remain the sole owner of, and will retain all right, title and interest in, to and under all Background Materials, including all Intellectual Property thereto, and the Background Materials will be PB Confidential Information.

2.5.1.2 If, during the Development Term, any additional documents and/or information that PB Controls are reasonably necessary for the performance of SFJ's Development Program responsibilities, SFJ may request such documents and/or information (with reasonable specificity) from PB, and PB will provide such documents and/or information as reasonably necessary to SFJ (and such documents will be deemed Background Materials).

2.5.2 Questions Pertaining to the Phase 3 Trial Protocol. Promptly following the Effective Date during the Development Term, PB will identify one (1) individual with knowledge of the Phase 3 Trial Protocol and the Product who will be made available at reasonable times during normal business hours in such employee's country of residence upon reasonable advance notice to answer SFJ's questions directly pertaining to such Protocol.

ARTICLE 3

CLINICAL TRIALS ACTIVITIES, REGULATORY APPROVAL AND RESPONSIBILITIES

3.1 Parties' Roles and Responsibilities.

3.1.1 PB Responsibilities. PB will have primary responsibility for conducting the Phase 3 Trial in the US and the European Clinical Trial Countries, provided that SFJ will provide operational support for and assist with the conduct of the Phase 3 Trial in the European Clinical Trial Countries as specified on Exhibit G and will enter into Clinical Trial Agreements with Sites in the European Clinical Trial Countries and CRO Agreements for the Phase 3 Trial in the European Clinical Trial Countries. Except as expressly set forth in Section 3.1.2 with respect to the PK Studies, PB will have sole responsibility for interactions with Regulatory Authorities in the US and the European Clinical Trial Countries during the Development Term with SFJ to have Participation Rights. Thereafter, if the Phase 3 Trial meets the Phase 3 Trial Success Criteria, PB will use Commercially Reasonable Efforts to perform all activities associated with submitting BLAs and seeking Regulatory Approval for the Indications in the US and the Designated European Countries.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.1.2 SFJ Responsibilities. SFJ will have primary responsibility for conducting the Phase 3 Trial in the Designated Asian Countries and sole responsibility for conducting the other Clinical Trials in the Designated Asian Countries (provided that SFJ may elect not to conduct Clinical Trials in Hong Kong). If SFJ elects to conduct any PK Study in Japanese Subjects in the US or Chinese Subjects in the US, PB shall, with SFJ's assistance and cooperation, file an appropriate amendment to the US IND for the Product with the protocol for such PK Study, and SFJ may conduct such PK Study in the applicable Subjects in the US in accordance with such protocol. In connection with any Japanese or Chinese PK Study during the Development Term, (i) SFJ will have sole responsibility for interactions with Regulatory Authorities in Japan and China, with PB to have Participation Rights, and (ii) PB, as the sponsor of the US IND for the Product, will have primary formal responsibility for interactions with the FDA regarding any PK Study conducted in Japanese Subjects or Chinese Subjects (as applicable) in the US, with SFJ to have Participation Rights, but, as between PB and SFJ (but not vis-à-vis the FDA), SFJ shall, in consultation with PB, determine the strategy for such interactions, and, except to the extent contrary to Applicable Law or in violation of PB's duties as the sponsor of such US IND, PB's interactions with the FDA shall at all times be consistent with SFJ's strategy. Thereafter, if the Phase 3 Trial meets the Phase 3 Trial Success Criteria and the necessary endpoints are met in the other Clinical Trials in the SFJ Territory, SFJ will use Commercially Reasonable Efforts to perform all activities associated with submitting BLAs and seeking Regulatory Approval for the Indication in Japan and China, and PB will use Commercially Reasonable Efforts to perform all activities associated with seeking Approval for the Indication in the Designated European Countries. Upon approval of a BLA for the Product for the Indication by NMPA in China or PMDA in Japan, SFJ, on behalf of itself and its Affiliates, shall, and hereby does, assign to PB all of SFJ's and its Affiliates' right, title and interest in and to all INDs, BLAs and Regulatory Approvals (including all amendments and supplements to any of the foregoing) and other filings with, and formal submissions to, NMPA or PMDA, respectively, and other applicable Regulatory Authorities in such country, in each case, with respect to the Product in such country (collectively, Product Filings). Within [***] after assignment of such Product Filings in the applicable country, SFJ shall deliver to PB: (a) true, correct and complete copies of all Product Filings in such country (in each case, whether held in the name of SFJ or any of its Affiliates), and disclose to PB in writing all previously-undisclosed Research Results within the Trial Data Package; (b) formally transfer or assign, or cause to be formally transferred or assigned, into the name of PB or its designee all Product Filings in such country (in each case, whether held in the name of SFJ or any of its Affiliates); and (c) take such other actions and execute such other instruments, assignments and documents as may be necessary to effect, evidence, register and record the transfer, assignment or other conveyance of such rights to PB or its designee.

3.1.3 Regulatory Interactions. Without limitation to Section 3.12.5, SFJ shall, except to the extent a need for exigent action prevents it from doing so, cooperate with PB to provide MedImmune with copies of SFJ's initial BLA relating to the Product to PMDA or NMPA, as applicable, a reasonable amount of time (but no less than [***]) prior to the anticipated date for the applicable submission to allow MedImmune to review and comment on such BLA, and SFJ shall consider all comments and proposed revisions from MedImmune in good faith in connection with effecting such submission. SFJ shall cooperate with PB in PB's

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





consultation with MedImmune regarding, and in keeping MedImmune informed of, the status of the preparation of the dossier rationale and proposed labeling with respect to the Product in the SFJ Territory. Upon MedImmune's request (as communicated by PB to SFJ), SFJ shall promptly (and in any event, within [***]) provide to MedImmune access to and copies of any Regulatory Documentation necessary or reasonably useful for MedImmune to Exploit the AstraZeneca Product or update the label with respect thereto.

3.1.4 Compliance. Each Party will conduct its portion of the Development Program and perform all other of its duties and responsibilities hereunder in accordance with the Development Plan and in material compliance with all Applicable Laws. PB will use Commercially Reasonable Efforts to oversee the Manufacture of the Product, and PB will materially comply, and PB will require that all Permitted Third Parties of PB materially comply, with all Applicable Laws with respect to the analysis, storage, handling, disposal and transfer of the Product. SFJ will materially comply, and SFJ will require that all Permitted Third Parties of SFJ materially comply, with all Applicable Laws with respect to the storage, handling, disposal and transfer of all quantities of Product supplied by or on behalf of PB for use in the conduct of Clinical Trials in the European Clinical Trial Countries and the Designated Asian Countries.

3.1.5 SFJ SOPs. Subject to the terms hereof, SFJ will, within the SFJ Territory, use Commercially Reasonable Efforts to conduct, or ensure that the Approved CRO conducts, the Clinical Trials in accordance with the standard operating procedures (the SFJ SOPs) that will be provided to PB within [***] following the later of (i) the Effective Date or (ii) the selection of such Approved CRO for PB's review and comment. Following the Effective Date, SFJ may amend any SOPs; provided that with respect to material amendments to SOPs that pertain to Clinical Trials activities and/or other obligations that are, or will be, performed by SFJ or any Permitted Third Party utilized by SFJ during the remainder of the Term or any time thereafter as set forth in this Agreement, SFJ will provide the JDC with a copy of each such amendment to permit the JDC Representatives to review and comment on such amendments and SFJ will reasonably consider incorporating such comments.

3.1.6 PB SOPs. Subject to the terms hereof, PB will, within the PB Territory, use Commercially Reasonable Efforts to conduct, or ensure that the Approved CRO conducts, the Clinical Trials in accordance with the standard operating procedures (the PS SOPs) that will be provided to SFJ within [***] following the later of (i) the Effective Date or (ii) the selection of such Approved CRO for SFJ's review and comment. Following the Effective Date, PB may amend any SOPs; provided that with respect to material amendments to SOPs that pertain to Clinical Trials activities and/or other obligations that are, or will be, performed by PB or any Permitted Third Party utilized by PB during the remainder of the Term or any time thereafter as set forth in this Agreement, PB will provide the JDC with a copy of each such amendment to permit the JDC Representatives to review and comment on such amendments and PB will reasonably consider incorporating such comments.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.2 Sites and Clinical Investigators.

3.2.1 Selection of Sites and Investigators.

3.2.1.1 SFJ will select the study sites within the SFJ Territory and the European Clinical Trial Countries to conduct the Clinical Trials and will inform the JDC in advance of SFJ's choice of each study site; the JDC will have the right to reject any such site(s) which the JDC will determine in its reasonable judgment are not appropriate.

3.2.1.2 PB will select the study sites within the US to conduct the Clinical Trials and will inform the JDC in advance of PB's choice of each study site; the JDC will have the right to reject any such site(s) which the JDC will determine in its reasonable judgment are not appropriate.

3.2.1.3 Each Party will enter, and will ensure that its Affiliates enter, and each Approved CRO will enter, into an agreement with each study site; such an agreement will be substantially in the form to be provided by PB and agreed upon by the Parties within [***] following the Effective Date (the Clinical Trial Agreement) (upon execution of such Clinical Trial Agreement, such study site will be deemed a Site). If a study site requires any material changes to such form Clinical Trial Agreement, SFJ with regard to the European Clinical Trial Countries and the SFJ Territory and PB with regard to the US, will inform the JDC and seek JDC approval of such change, and the JDC will not unreasonably withhold such approval. For clarity, each Clinical Trial Agreement will be on commercially reasonable and customary terms, consistent with industry standards for similar agreements and sufficient to enable such Party to comply with its obligations hereunder with respect to such Clinical Trial, including, but not limited to, Section 2.2.2, the terms pertaining to ownership of Intellectual Property and publications, and treatment of Confidential Information.

3.2.1.4 The Clinical Trials Agreements will also require that the Clinical Investigators, any sub-investigators (e.g., research fellows, residents and associates) and any others required by Applicable Law at each Site complete a financial disclosure document substantially in the form to be agreed upon by the Parties (the Financial Disclosure Form). For clarity, if any of the foregoing individuals do not complete such Financial Disclosure Form, such individuals may not participate in, or do any work in connection with, the Clinical Trials.

3.2.2 Obligations During the Clinical Trials Conduct.

3.2.2.1 During the Development Term, SFJ will conduct meetings with the Clinical Investigators within the SFJ Territory and the European Clinical Trial Countries, and PB will conduct meetings with the Clinical Investigators in the US (each, a Clinical Investigator Meeting), of which the JDC will be provided with reasonable advance notice and in which the other Party will have the right (but not the obligation) to attend and participate. Minutes of Clinical Investigator Meetings will be made available to the JDC upon request.

3.2.2.2 Each Party will provide the JDC with copies of all communications relevant to the Clinical Trials and provided to all Sites, and upon request of the

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





JDC, provide the JDC with copies of any other communications between such Party and any individual Sites and/or any Affiliate or Approved CRO and any individual Sites.

3.2.2.3 If a Party terminates a Site, such Party will inform the JDC with the reason for such termination and if reasonably practicable, such notice will be provided reasonably in advance of such termination.

3.2.2.4 PB in the PB Territory and SFJ in the SFJ Territory will be responsible for preparing and submitting any INDs and amendments thereto to Regulatory Authorities as required by Applicable Laws in the countries for which Sites have been selected. PB will prepare the CMC Information and any updates to this information and submit it to the applicable Regulatory Authority as required by Applicable Laws.

3.3 Subjects and Informed Consent.

3.3.1 Subject Recruitment Plan. The Parties will comply with the subject recruitment plan for the Clinical Trials, which will be established by each Party for their respective Territory, except in the case of the European Clinical Trial Countries which SFJ will be responsible for, and communicated to the JDC, for approval by the JDC not to be unreasonably withheld, within a reasonable period of time after the Effective Date not to exceed [***] of the Effective Date (the Subject Recruitment Plan) in recruiting subjects to participate in the Clinical Trials. For clarity, prior to engaging in any recruiting activities, the Parties, within their respective Territory, will ensure that the applicable IRBs and/or other ethics committees approve any related materials and activities as required by the JDC and all Applicable Laws.

3.3.2 Informed Consent.

3.3.2.1 PB, with support from SFJ, will prepare the informed consent document(s) for use in the Clinical Trials. Each Party will ensure that the informed consent of each subject participating in a Clinical Trial in such Party's respective Territory, except in the case of the European Clinical Trial Countries which SFJ will be responsible for, be obtained in accordance with all Applicable Laws, including completion of the informed consent document. Such informed consent document for a Clinical Trial will be substantially in the form to be approved by the JDC within [***] following approval by the JDC of the final Protocol for such Clinical Trial (collectively, Informed Consent) (upon obtaining such Informed Consent, a prospective subject will be deemed a Subject). For clarity, the Informed Consent document that each Subject signs will expressly state that each Subject understands that such Party is providing support for the Clinical Trials and will authorize disclosure of data and results related to the Clinical Trials to PB or SFJ, as applicable, for any purpose, subject to all Applicable Laws.

3.3.2.2 PB will ensure that the Informed Consent has been obtained by a Permitted Third Party from each Subject in the US prior to administration of the Product to such Subject in accordance with the Protocol. SFJ will ensure that the Informed Consent has been obtained by a Permitted Third Party from each Subject in the European Clinical Trial Countries and the SFJ Territory prior to administration of the Product to such Subject in accordance with the Protocol.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.3.3 Inclusion and Exclusion Criteria. Neither Party will waive, and each Party will require that its Permitted Third Parties do not waive, any exclusion or inclusion criteria specified in the Protocol.

3.4 Investigator's Brochure.

3.4.1 Investigator's Brochure. PB will maintain the Investigator's Brochure for the Product. SFJ will, promptly following receipt of written notice from PB of the need for an Investigator's Brochure update, provide PB with all information regarding the Clinical Trials that is necessary to enable PB to update the Investigator's Brochure.

3.4.2 Parties' Responsibilities. Promptly following the Effective Date, PB will provide SFJ with the most recent version of the Investigator's Brochure. PB will also promptly provide SFJ with any updated versions of the Investigator's Brochure. Each Party will ensure that each Site in such Party's respective Territory, except in the case of the European Clinical Trial Countries which SFJ will be responsible for, and all applicable IRBs and other ethics committees receive a copy of, and promptly receive any updates to, the Investigator's Brochure.

3.5 Data Collection and Data Management.

3.5.1 CRF. PB, with support from SFJ, will be responsible for preparing the form of CRF for the Clinical Trials in accordance with the Protocol.

3.5.2 Data Management Plan.

3.5.2.1 Each Party will use Commercially Reasonable Efforts to comply with the data management plan to be agreed upon by the Parties within [***] following approval by the JDC of the final Protocol (the Data Management Plan). For clarity, the Data Management Plan will be agreed upon by the Parties prior to recruitment of subjects for the Clinical Trials.

3.5.2.2 With respect to any data collected in connection with the Clinical Trials, each Party will ensure that such data is held in one or more appropriate facilities with information security protections in accordance with all Applicable Laws including [***].

3.5.3 Clinical Trials Database.

3.5.3.1 PB, with support from SFJ, will use Commercially Reasonable Efforts to establish a Clinical Trials database for the data collected from each Site for the Clinical Trials (the Clinical Trials Database) within [***] following approval by the JSC of the Final Protocol. SFJ with regard to European Clinical Trial Countries and the SFJ Territory and PB with regard to the US will promptly update the Clinical Trials Database upon receiving data for the Clinical Trials from any Site and any other applicable Permitted Third Party, and each Party will ensure that the Sites and such other Permitted Third Parties promptly following collection thereof, provide data in connection with the Clinical Trials to such Party.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.5.3.2 Each Party will provide the JDC with electronic copies of such data requested by the JDC at JDC meetings and in accordance with Applicable Laws.

3.5.3.3 If, at any time during the Development Term, PB decides to change the format of the database for the Clinical Trials, PB will so notify SFJ and the Parties will cooperate to ensure that the format that PB selects permits SFJ to incorporate the data from the Clinical Trials into its relevant systems and is in compliance with all Applicable Laws.

3.5.3.4 The Vendor responsible for the database will provide SAS datasets to the Parties in accordance with specifications as defined by PB (i) when the data in the Clinical Trials Database are equivalent to [***] of total data expected to be recorded in the Clinical Trials Database; (ii) if a safety signal is identified; and/or (iii) if a request is received from the Regulatory Authorities.

3.5.3.5 PB and SFJ will jointly maintain the Clinical Trials Database including ensuring that information included in the Clinical Trials Database is accurate and up-to-date. PB will be responsible for registering, maintaining and updating any registries pertaining to the Clinical Trials to the extent required by any Applicable Laws, including www.clinicaltrials.gov, www.clinicalstudyresults.org, and the PHRMA Website Synopsis.

3.5.4 Clinical Trials Master File. Promptly following the Effective Date, PB and SFJ will jointly establish and maintain a Clinical Trials master file for each Clinical Trial in the format as agreed upon by the JDC (each a Clinical Trials Master File). Notwithstanding anything to the contrary herein, neither PB nor SFJ will be permitted to delegate its rights and obligations pursuant to this Section 3.5.4 to any Permitted Third Parties without the prior approval of the JDC, except either Party may delegate its rights and obligations pursuant to this Section 3.5.4 to any of its Affiliates.

3.5.5 Source Data Verification. PB will be responsible for source verification of data records in the US, and SFJ will be responsible for source data verification of data records in European Clinical Trial Countries and the SFJ Territory. At either Party's request, a Party will provide the other Party with copies of any reports relating to source data verification and other types of Clinical Trials audits.

3.5.6 Statistical Analysis. PB will perform any statistical analysis required in accordance with the statistical analysis plan for the Clinical Trials to be agreed upon by the Parties within [***] of the Effective Date (the Statistical Analysis Plan).

3.6 Audits.

3.6.1 Each Party will conduct quality oversight inspections and audits of the facilities and services of the Permitted Third Parties utilized by such Party in accordance with its standard operating procedures and will provide the other Party with copies of such audit reports upon request.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.6.2 During the Development Term, PB will conduct quality oversight inspections and audits of the manufacturing facilities for the Product in accordance with its internal policies and PB will provide SFJ with copies of such audit reports.

3.7 Monitoring. PB in the US, and SFJ in European Clinical Trial Countries and the SFJ Territory, will monitor the Clinical Trials, and share information with the JDC pertaining to monitoring the Clinical Trials, in accordance with the monitoring plan for the Clinical Trials to be agreed upon by the Parties within [***] following the Effective Date.

3.8 IRBs and Other Ethics Committees.

3.8.1 Each Party will be responsible for obtaining the approval of the IRBs and other ethics committees required prior to commencing, and during, the Clinical Trials at every Site in such Party's Territory, except in the case of the European Clinical Trial Countries which SFJ will be responsible for.

3.8.2 Each Party will ensure that IRBs and such other relevant ethics committees have current registrations and accreditations as required by Applicable Law and will provide all ethics committees, including all IRBs, and Regulatory Authorities, with all necessary documentation prior to, and during the course of, the Clinical Trials as required by Applicable Law.

3.8.3 PB in the US, and SFJ in the SFJ Territory and in the European Clinical Trial Countries, will be responsible for responding to all queries from the IRBs and other ethics committees; provided that (a) the other Party will make itself reasonably available to assist with any such queries and (b) if such query relates solely to the CMC Information, the Manufacturing Dossier, and/or preclinical studies, PB will prepare the applicable response and provide SFJ with a copy thereof.

3.9 IDMC

3.9.1 PB will establish an IDMC for the Clinical Trials, [***]. For clarity, [***].

3.9.2 PB will ensure that the IDMC is provided with all information and data that it requires [***], and SFJ will reasonably cooperate with PB in such regard.

3.10 Environmental Health and Safety.

3.10.1 In conducting the Clinical Trials, each Party will comply with all Applicable Laws relating to environmental, health and/or safety matters and will be solely responsible for establishing material and specimen handling guidelines and for ensuring use of controls, including appropriate personal protective equipment, that minimize potential worker exposure, obtaining the material safety data sheets and providing the appropriate training for workers who will be potentially exposed to the Product.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.10.2 Each Party will promptly notify the JDC, in writing, of any worker claims of suspected occupational illnesses related to working with the Product, regardless of whether such claims are received during the Development Term or any time thereafter. After termination of this Agreement for whatever reasons, or expiration of this Agreement, each Party will promptly notify the other Party of any worker claims of suspected occupational illnesses related to working with the Product during the Development Term, of which it has knowledge.

3.11 Completion of the Clinical Trials.

3.11.1 PB will use Commercially Reasonable Efforts to keep the Sites participating in the Phase 3 Trial in the US, and SFJ will use Commercially Reasonable Efforts to keep the Sites participating in each Clinical Trial in European Clinical Trial Countries and the SFJ Territory, operational, including continuing to dose Subjects with the Product in accordance with the Protocol and conducting any follow-up work required, until the Completion Date for such Clinical Trial. As a Clinical Trial is completed or otherwise terminated at each Site for which a Party is responsible, such Party will close out such Clinical Trial as specified in the Protocol, including performing all Subject follow-up and providing the other Party with all Clinical Trial data not provided as of such date. For clarity, copies of documents, including any CRFs and the Clinical Trials Master File will be made available and/or transferred to the other Party upon the other Party's request, or at the other Party's option, destroyed (provided that such destruction is in compliance with ICH guidelines). Notwithstanding the foregoing, neither Party will provide the other Party with any Personally Identifiable Information.

3.11.2 Upon the Completion Date of a Clinical Trial, SFJ will return to the location specified by PB at such time, or, at PB's option, destroy, any unused Product from such Clinical Trial (SFJ's expenses in doing so will be included in Development Costs), and will comply with all Applicable Laws in so returning or destroying such Product.

3.11.3 The CSR for the Phase 3 Trial will be prepared by PB, with support from SFJ, in compliance with all Applicable Laws, including ICH E3 guidelines. The final, signed CSR for the Phase 3 Trial (the Final Phase 3 Trial CSR) will be provided to SFJ promptly following the Completion Date of the Phase 3 Trial. In the event that there are any additional safety or efficacy data pertaining to the Phase 3 Trial that come into the possession of PB after it has provided SFJ with the Final Phase 3 Trial CSR, PB will prepare and promptly provide SFJ with a supplement to such CSR. The CSR for each Clinical Trial (other than the Phase 3 Trial) conducted in the SFJ Territory will be prepared by SFJ, with support from PB, in compliance with all Applicable Laws, including ICH E3 guidelines. The final, signed CSR for each such Clinical Trial conducted in the SFJ Territory (each, a Final SFJ Territory CSR) will be provided to PB promptly following the Completion Date of such Clinical Trial. In the event that there are any additional safety or efficacy data pertaining to any such other Clinical Trial conducted in the PB Territory that come into the possession of SFJ after it has provided PB with the Final SFJ Territory CSR for such Clinical Trial, SFJ will prepare and promptly provide PB with a supplement to such CSR.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.12 Commercially Reasonable Efforts.

3.12.1 Timely performance of the Clinical Trials and receipt of Regulatory Approval is important to the success of this Agreement. Each Party will use Commercially Reasonable Efforts to complete the Clinical Trials according to the Timeline and, if the Clinical Trials is successful, to obtain Regulatory Approval, in such Party's Territory. In the event that either Party fails to complete the Clinical Trials in their respective Territory according to the Timeline and this failure is not cured as set forth in Section 14.2.1, the other Party may terminate this Agreement pursuant to Section 14.2.1, or following discussion by the JSC that such Party failed to use Commercially Reasonable Efforts, the other Party may assume the roles and responsibilities of such Party; provided that in the event of such failure by SFJ, SFJ will remain obligated to pay the costs under Section 4.2.2(ii).

3.12.2 In the event of Successful Phase 3 Interim Analysis, PB will use Commercially Reasonable Efforts to obtain Regulatory Approval for the Product for the Indication (a) by the FDA in the US, including the obligation to file a BLA for the Product for the Indication with the FDA within [***] of Successful Phase 3 Interim Analysis, provided that PB shall not be required to file such BLA earlier than the estimated date for BLA filing in the US based on Successful Phase 3 Interim Analysis set forth in the Timeline, and (b) by EMA in the EU (or, as applicable, by the applicable national Regulatory Authorities in one or more Designated European Countries), including the obligation to file a BLA for the Product for the Indication with EMA (or the applicable national Regulatory Authorities in one or more Designated European Countries) within [***] of Successful Phase 3 Interim Analysis, provided that PB shall not be required to file such BLA earlier than the estimated date for BLA filing in the EU based on Successful Phase 3 Interim Analysis set forth in the Timeline.

In the event that PB fails to use Commercially Reasonable Efforts to so obtain Regulatory Approval for the Product for the Indication, including the obligation to file a BLA for the Product for the Indication with each of the FDA and EMA (or the applicable national Regulatory Authorities in one or more Designated European Countries) by the dates set forth in this Section 3.12.2, and this failure is not cured within [***] after receipt of written notice from SFJ requesting such cure, SFJ may either terminate this Agreement pursuant to Section 14.2.1, or assume PB's regulatory filing activities (in which event SFJ's expenses in assuming such regulatory filing activities shall be deemed to be Development Costs).

3.12.3 Upon achievement of the Phase 3 Success Criteria, PB will use Commercially Reasonable Efforts to obtain Regulatory Approval for the Product for the Indication by the FDA in the US and by EMA in the EU (or, as applicable, by the applicable national Regulatory Authorities in one or more Designated European Countries), including the obligation to file a BLA for the Product for the Indication with each of the FDA and EMA (or the applicable national Regulatory Authorities in one or more Designated European Countries) within [***] of the date of achievement of the Phase 3 Success Criteria. In the event that PB fails to use Commercially Reasonable Efforts to so obtain Regulatory Approval for the Product for the Indication, including the obligation to file a BLA for the Product for the Indication with each of the FDA and EMA (or the applicable national Regulatory Authorities in one or more

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Designated European Countries) within [***] of the date of achievement of the Phase 3 Success Criteria, and this failure is not cured as set forth in Section 14.2.1, SFJ may either terminate this Agreement pursuant to Section 14.2.1, or assume PB's regulatory filing activities (in which event SFJ's expenses in doing so shall be deemed to be Development Costs).

3.12.4 Upon achievement of the Phase 3 Success Criteria or Successful Phase 3 Interim Analysis if conditional approval based on interim data is allowed by the relevant Regulatory Authority (or, if later, achievement of the primary endpoint(s) of any other Japan-specific or China-specific Clinical Trial, as applicable, being conducted by SFJ in the applicable country that is necessary for filing of a BLA with PMDA or NMPA, respectively), SFJ will use Commercially Reasonable Efforts to obtain Regulatory Approval for the Product for the Indication by the PMDA in Japan and by the NMPA in China, including the obligation to file a BLA for the Product for the Indication with each of the PMDA and the NMPA within [***] of the date of achievement of the Phase 3 Success Criteria, provided that SFJ shall not be required to file such BLA earlier than the estimated date for BLA filing in Japan or China (as applicable) based on the Phase 3 Success Criteria or Successful Phase 3 Interim Analysis if conditional approval based on interim data is allowed by the relevant Regulatory Authority as set forth in the Timeline or, if later, achievement of the primary endpoint(s) of any other Japan-specific or China-specific Clinical Trial, as applicable, being conducted by SFJ in the applicable country that is necessary for filing of a BLA with PMDA or NMPA, respectively. In the event that SFJ fails to use Commercially Reasonable Efforts to so obtain Regulatory Approval for the Product for the Indication, including the obligation to file a BLA for the Product for the Indication with each of the PMDA and the NMPA within [***] of (a) the date of achievement of the Phase 3 Success Criteria or, (b) if later, achievement of the primary endpoint(s) of any other Japan-specific or China-specific Clinical Trial, as applicable, being conducted by SFJ in the applicable country that is necessary for filing of a BLA with PMDA or NMPA, respectively, or Successful Phase 3 Interim Analysis if conditional approval based on interim data is allowed by the relevant Regulatory Authority, and this failure is not (i) caused by PB's failure to perform its obligations hereunder or (ii) cured as set forth in Section 14.2.1, PB may either terminate this Agreement pursuant to Section 14.2.1, or assume SFJ's regulatory filing activities, in which event an amount equal to PB's expenses in doing so [***]. In no event will any such costs incurred by PB be included in actual Development Costs for purposes of Section 14.2.

3.12.5 Regulatory Approvals. The Parties acknowledge that regulatory matters with respect to the Product will reasonably require coordination with regulatory matters with respect to the AstraZeneca Product, and SFJ agrees to cooperate in good faith with PB and MedImmune as reasonably necessary for and in relation to each of PB and SFJ, on the one hand, and MedImmune, on the other hand, to obtain and maintain regulatory approvals (including Regulatory Approvals) with respect to the Product in the case of PB and SFJ and with respect to the AstraZeneca Product in the case of MedImmune. Prior to submitting any written or electronic communication to a Regulatory Authority in a country of the Territory with respect to AstraZeneca Product that would reasonably be expected to require a change to the Regulatory Authority‑approved full prescribing information for the AstraZeneca Product for such country, SFJ shall cooperate with PB in PB's consultation with MedImmune. SFJ shall keep PB reasonably informed of its efforts to obtain and maintain Regulatory Approval for the Product in

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





the SFJ Territory and developments with respect thereto, including SFJ's expected timing with respect to submission and receipt of any and all Regulatory Approvals.

3.13 Pharmacovigilance and Safety Information Exchange.

3.13.1 SFJ acknowledges that PB is bound by the pharmacovigilance and safety information exchange requirements of Sections 3.4.4(b) through 3.4.4(h) of the AZ License and the terms of the MedImmune Pharmacovigilance Agreement (a copy of which is attached hereto as Exhibit N) relating both to the Product and the AstraZeneca Product and that, in order to comply with its obligations to MedImmune, PB must obtain SFJ's commitment to provide adverse event and other safety information relating to the Product and to AstraZeneca Product to PB in a form and within the applicable time periods necessary for PB to comply with Sections 3.4.4(b) through 3.4.4(h) of the AZ License and the terms of the MedImmune Pharmacovigilance Agreement.

3.13.2 The safety reporting units from each of the Parties shall meet and shall within [***] of the Effective Date agree upon a written agreement for exchanging adverse event and other safety information relating to the Product (the Pharmacovigilance Agreement). The Pharmacovigilance Agreement will ensure that adverse event and other safety information are exchanged upon terms that will permit (a) PB to comply with Sections 3.4.4(b) through 3.4.4(h) of the AZ License and the terms of the MedImmune Pharmacovigilance Agreement, and (b) each Party to comply with Applicable Laws and requirements of Regulatory Authorities.

3.13.3 Each Party agrees not to enter in to any clinical activity implicating pharmacovigilance obligations for the Product in its respective Territory prior to execution of the Pharmacovigilance Agreement.

3.14 Product.

3.14.1 Supply of the Product.

3.14.1.1 PB will be the GMP Manufacturer of the Product for the Clinical Trials, either directly or through an Approved Vendor. In particular, with respect to the Clinical Trials, PB will maintain in force a clinical supply agreement with a CMO that has sufficient capacity to manufacture and supply GMP-compliant Product for the Clinical Trials in a timely manner in accordance with a clinical supply schedule approved by the JDC (as amended by the JDC from time to time, the Clinical Supply Schedule).

3.14.1.2 During the Development Term, PB will supply, as determined by the JDC, or cause to be supplied, as determined by the JDC to SFJ GMP-compliant Product manufactured in compliance with the then-current CMC Information included in the IND submitted to the applicable Regulatory Authority for the Clinical Trials in the European Clinical Trial Countries or the SFJ Territory, as applicable, in accordance with the Clinical Supply Schedule as set forth in a clinical supply agreement to be entered into between the Parties within [***] after the Effective Date (the Clinical Supply Agreement). The costs for the supply of the Product for the Clinical Trials in the US, the European Clinical Trial Countries and the SFJ

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Territory (the Product Supply Costs) will be borne by PB. Each Party will provide the JDC at each JDC meeting with quarterly reports regarding inventory of the Product and the reasonably anticipated needs for the Product to ensure that PB can supply the Product in accordance with the Clinical Supply Schedule.

3.14.2 Use of the Product.

3.14.2.1 SFJ will (i) in conducting the Clinical Trials, only use Product supplied by PB or such Third Parties designated by PB; (ii) only use the Product supplied by PB or Third Parties designated by PB, and require that its Permitted Third Parties that receive any of the Product supplied by PB or Third Parties designated by PB only use such Product, for the sole purpose of conducting the Clinical Trials in accordance with the respective Protocols; and (iii) ensure subject dosing compliance per the respective Protocols for the Clinical Trials conducted in the European Clinical Trial Countries or the SFJ Territory. Dosage and Administration Instructions will be provided to SFJ by PB sufficiently in advance of the Clinical Trials' commencement.

3.14.2.2 PB in the US, and SFJ in the European Clinical Trial Countries and the SFJ Territory, will be responsible for ensuring that the Product is administered solely to the Subjects in Clinical Trials conducted by such Party in accordance with the respective Protocols. For each dose administered to a Subject in a Clinical Trial conducted by such Party, such Party will implement procedures and ensure that records are maintained specifying the date and time that such dose of the Product is administered, the amount of the Product administered to such Subject, the lot number of the Product from which such dosage came, and the number of the Subject to which such dosage was administered. Each Party shall provide copies of such records to the other Party upon the other Party's reasonable request.

3.15 Complaints Related to the Product. During the Development Term, each Party will promptly forward to the other Party any complaints that it receives related to the Product. PB in the US, and SFJ in European Clinical Trial Countries and the SFJ Territory, will respond to any complaints of which such Party becomes aware relating to the Product provided that the other Party will provide reasonable cooperation in connection therewith. Notwithstanding the foregoing, if a complaint pertains to the manufacturing, appearance or general physical characteristics of the Product or other processes at the manufacturing facility, PB will be solely responsible for responding to such complaint.

3.16 Recall of the Product in Connection with Study Prior to Approval. If the Product is recalled for safety reasons or GMP non‑compliance prior to Regulatory Approval, PB in the US, and SFJ in European Clinical Trial Countries and the SFJ Territory, will be responsible for the operational execution of such recall. PB will cooperate with SFJ in connection with any such recall in European Clinical Trial Countries or the SFJ Territory. The costs for such any such recall will be at PB's expense and not be a Development Cost, unless such recall and/or costs were based on the material breach of this Agreement, intentional misconduct, or gross negligence of SFJ or any of its Affiliates or Permitted Third Parties, in which case, SFJ will bear the expense of any such recall and such expense will not be a Development Cost.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.17 Compliance with Laws. SFJ and its Affiliates and PB and its Affiliates will comply, and each Party will use Commercially Reasonable Efforts to ensure that all Permitted Third Parties utilized by such Party comply, with all Applicable Laws with respect to the storage, handling, disposal and transfer of the Product, and each Party assumes sole responsibility for the violation of such Applicable Laws by such Party or any of its Affiliates or its Permitted Third Parties.

3.18 Disclosures.

3.18.1 During the Development Term, each Party shall provide the other Party at meetings of the JSC (or in advance of such meetings as part of the information that may be distributed to JSC members prior to such meetings or, if no such meeting is held in a [***], directly to the other Party) at least once during each [***] with summaries of all data known to such Party material to obtaining Regulatory Approval, and material Product safety data in all indications (including but not limited to Serious Safety Issues), including such material data relating to efficacy, clinical sites, patient enrollment and drop-out rates, CMC and other material manufacturing data, and material communications with Regulatory Authorities.

3.18.2 PB shall (a) provide SFJ with quarterly unaudited financial statements and annual audited financial statements (the PB Financial Statements) promptly following the availability thereof (and no later than the date filed with the SEC) and provide to SFJ on a quarterly basis concurrently with the applicable PB Financial Statements [***], (b) promptly notify SFJ of achieving the Successful Phase 3 Interim Analysis and the Phase 3 Success Criteria, and (c) on or prior to the end of each [***] during the Term [***]. At least [***] during the Term, upon SFJ's request, Executive Officers of PB shall meet with Executive Officers of SFJ to review and discuss PB's financial condition and operations. [***].

3.18.3 PB shall provide prompt written notice (a Going Concern Notice) to SFJ if (i) PB determines in accordance with GAAP that it is probable that PB will be unable to meet its obligations as they become due within one year after the date that PB's financial statements for the then-current quarter are issued, or available to be issued or (ii) a Going Concern footnote is included in any of the PB Financial Statements required to be delivered by PB to SFJ pursuant to Section 3.18.2 (a Going Concern Condition). During the applicable Going Concern Cure Period (as defined below), PB shall have the ability to remedy the Going Concern Condition through a restructuring of PB's costs and operations (provided that such restructuring does not adversely impact PB's ability to perform its obligations hereunder) or through raising additional capital in one or more financing or strategic transactions so as to enable PB to meet its obligations as they become due within such one year period including performing all of PB's obligations hereunder. Going Concern Cure Period shall mean the [***] period following delivery of a Going Concern Notice, provided that if SFJ does not offer and fund Going Concern Funding as set forth in Section 4.2.4 sufficient to remedy the Going Concern Condition within such [***] period, the Going Concern Cure Period shall be extended to [***] following delivery of such Going Concern Notice.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





3.19 Exclusivity Commitment of SFJ. During the applicable Exclusive Period, SFJ shall not, and shall cause its Affiliates not to, either by itself or through a Third Party, conduct human clinical trials of, or sell, offer for sale or have sold:

3.19.1 any Competing Product (other than Product) alone or in combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients;

3.19.2 any combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients of the Product and a Competing Product;

3.19.3 any agent that is intended as an antidote to, or is intended to neutralize, abrogate or reverse the antiplatelet activity of, (i) any Brilinta Competing Product alone or in combination (whether fixed dose or co-packaged) with one (1) or more other active ingredients or (ii) both the Ticagrelor Compound and a Brilinta Competing Product;

3.19.4 without limitation to the foregoing, any agent with dual activity as (i) an antidote to, or for use as an agent to neutralize, abrogate or reverse the antiplatelet activity of, the Ticagrelor Compound and (ii) an antidote to, or for use as an agent to neutralize, abrogate or reverse the antiplatelet activity of, any Brilinta Competing Product; or

3.19.5 any Brilinta Competing Product.

3.20 Program Transfer. In the event that, at any time after payment to PB of the Initial Development Cost Payment on the Initial Funding Date, PB shall (a) fail to pay any amounts payable to SFJ hereunder within [***] of the date such payment is due, or (b) become in default of its obligations under the AZ License (excluding (x) any such default that would not entitle AZ to terminate the AZ License and (y) any such default that is caused by SFJ's breach of its obligations under this Agreement), or (c) (i) fail to remedy the Going Concern Condition within the Going Concern Cure Period as set forth in Section 3.18.3 or (ii) refuse to accept the Going Concern Funding if offered by SFJ as set forth in Section 4.2.4, then, SFJ may deliver written notice to PB electing to cause PB's business related to the Product to be transferred to SFJ (the Program Transfer Notice), and shall deliver a copy of the Program Transfer Notice to MedImmune concurrently with delivery to PB, and within [***] following the delivery of the Program Transfer Notice, PB and SFJ shall execute and deliver a Program Transfer Agreement in the form attached hereto as Exhibit O (the Program Transfer Agreement) which shall effect the Program Transfer effective as of the date SFJ delivers the Program Transfer Notice to PB. For clarity, this Section 3.20 shall not be effective prior to payment to PB of the Initial Development Cost Payment on the Initial Funding Date.

ARTICLE 4

DEVELOPMENT COSTS

4.1 Development Costs. SFJ will be obligated to pay or incur up to One Hundred Twenty Million U.S. Dollars ($120,000,000.00) of Development Costs (Maximum Development Costs) in accordance with the funding schedule set forth in Section 4.2. Any

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Development Costs in excess of the sum of the Maximum Development Costs and any Going Concern Funding will be borne by PB.

4.2 Funding Schedule.

4.2.1 Subject to Section 4.2.4 below, SFJ will pay or incur up to a total of $120 million of Development Costs as set forth in the table below and as detailed below, as set forth in Sections 4.2.2 and 4.2.3. For clarity, this Section 4.2.1 sets forth a summary of the payments due under Sections 4.2.2 and 4.2.3 only, and does not create any additional obligation to pay or incur development costs in excess of those obligations set forth in Sections 4.2.2 and 4.2.3.

To be paid 45 days after the later of (a) the Effective Date, and (b) the date that PB has obtained the SVB Consent, as set forth in Section 4.2.2(i)

To be paid prior to the date of Successful Phase 3 Interim Analysis, as set forth in Section 4.2.2(ii)

To be paid after the date of Successful Phase 3 Interim Analysis, as set forth in Section 4.2.3

Total

$10 Million Up to $80 Million* At least $20 Million and up to $30Million Up to $120 Million

* In addition to initial $10 Million.

4.2.2 Following the Effective Date and prior to the date of first availability of the Phase 3 Interim Data (the Interim Period), SFJ shall pay or incur up to $90 million of Development Costs as follows:

(i) The initial payment of Ten Million U.S. Dollars ($10,000,000.00) set forth in the table above, to reimburse PB for development costs incurred by PB prior to the Effective Date (the Initial Development Cost Payment), shall be payable on the date (Initial Funding Date) that is forty-five (45) days after the later of (a) the Effective Date, and (b) the date that PB has obtained the SVB Consent.

(ii) Following payment to PB of the Initial Development Cost Payment on the Initial Funding Date:

(1) SFJ shall promptly pay all Approved Third Party Vendor Costs incurred by SFJ or PB in connection with the Clinical Trials during the Interim Period.

(2) SFJ shall pay to SFJ Affiliates the amount of [***] to reimburse such SFJ Affiliates for their internal costs of overseeing the CROs in European Clinical Trial Countries and the SFJ Territory and for the management of the Clinical Trials in European Clinical Trial Countries and the SFJ Territory during the Interim Period (the SFJ Interim Management Fee).

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





(3) SFJ shall pay PB an amount equal to $90 million, less (a) the Initial Development Cost Payment, (b) the SFJ Interim Management Fee, and (c) the Approved Third Party Vendor Costs paid or incurred by SFJ during the Interim Period, (which Approved Third Party Vendor Costs amount shall be estimated and agreed to by the Parties no later than [***]) to be paid pro rata in six (6) equal quarterly payments within [***] after the end of each Calendar Quarter beginning with the Calendar Quarter ending September 30, 2020 through the Calendar Quarter ending December 31, 2021.

Notwithstanding anything else contained herein to the contrary, in no event shall SFJ be required to pay or incur Development Costs in excess of $90 million during the Interim Period. If the Development Costs during the Interim Period exceed $90 million, PB shall pay or incur all such excess Development Costs including continuing to provide the PB Services during the Interim Period at the expense of PB unless otherwise agreed to in writing by SFJ. For the avoidance of doubt, if the Successful Phase 3 Interim Analysis is not achieved, SFJ shall have no obligation to pay or incur any further Development Costs.

4.2.3 Following the date of the Successful Phase 3 Interim Analysis and until the end of the Development Term (the Final Period):

(i) SFJ shall pay to SFJ Affiliates the amount of [***] to reimburse such SFJ Affiliates for their internal costs of overseeing the CROs in European Clinical Trial Countries and the SFJ Territory and for the management of the Clinical Trials in European Clinical Trial Countries and the SFJ Territory during the Final Period (the SFJ Final Management Fee).

(ii) SFJ shall pay PB the amount (the PB Costs) by which the Elected Total Amount (defined below) exceeds the sum of (a) the Initial Development Cost Payment, (b) the SFJ Interim Management Fee, (c) the SFJ Final Management Fee, and (d) all Approved Third Party Vendor Costs (as estimated and agreed to by the Parties prior to the start of the Final Period which are expected to be paid by SFJ through the end of the Development Term) paid or incurred by SFJ (including Approved Third Party Vendor Costs paid by SFJ during the Interim Period) and (e) the amounts paid to PB pursuant to Section 4.2.2(ii)(3), which PB Costs shall be paid pro rata in five (5) equal quarterly payments within [***] after the end of each Calendar Quarter beginning for the Calendar Quarter ending March 31, 2022 through the Calendar Quarter ending March 31, 2023, provided however, in no case earlier than forty-five (45) days after the later of (i) Approved Third Party Vendor Costs have been agreed to by the Parties and (ii) PB has elected and informed SFJ of the Elected Total Amount. Within [***] after achievement of the Successful Phase 3 Interim Analysis, PB shall notify SFJ in writing of the total amount of Development Costs (inclusive of all Development Costs paid or incurred since the Effective Date) that PB elects to have SFJ fund (the Elected Total Amount), which shall be no less than $110 million and no more than $120 million.

(iii) In the event that the Development Costs paid by SFJ after paying all required payments under the preceding provisions of this Section 4.2 shall be less than the Elected Total Amount then any remaining balance of the Elected Total Amount shall be paid to PB by SFJ within [***] of the last payment under Section 4.2.3(ii), to be used by PB for

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





commercialization activities, and such amount paid by SFJ shall be deemed to be included in Development Costs.

Subject to Section 4.2.4 below, but notwithstanding anything else contained herein to the contrary, in no event shall SFJ be required to pay or incur Development Costs in excess of $120 million in total. If the total Development Costs exceed $120 million, PB shall pay or incur all such excess Development Costs including paying all excess Approved Third Party Vendor Costs and Product Supply Costs and continuing to provide the PB Services at the expense of PB unless otherwise agreed to in writing by SFJ. In connection with the Development, manufacture and Commercialization of the Product and fulfillment of PB's obligations hereunder, PB shall spend at least an amount equal to the amount of funding paid by SFJ to PB pursuant to this Section 4.2.

4.2.4 If PB has not eliminated a Going Concern Condition by the expiration of the applicable Going Concern Cure Period, SFJ shall have the option, but not the obligation, to pay PB an additional amount (the Going Concern Funding) up to the amount necessary to eliminate the Going Concern Condition as reasonably determined by SFJ after consultation with PB, which amount (if any) must be accepted by PB and shall be included in Development Costs and shall be paid by SFJ within [***] after the expiration of the Going Concern Cure Period. The Going Concern Funding shall be placed in an escrow account established by PB with the JSC to have sole authority to release funds from escrow to be spent as directed by the JSC to fulfill PB's obligations hereunder.

4.3 Pre‑Commercialization Costs. During the Term, PB will be solely responsible at its own cost (subject to Sections 4.2) for performing those activities reasonably necessary to prepare for Commercial Launch of the Product in the Territory (the Pre- Approval Commercialization Activities). Such Pre-Approval Commercialization Activities may include at PB's sole discretion creating educational or marketing materials, establishing distribution channels and designing packaging and labeling, in each case as reasonably necessary to Commercialize the Product in the Territory.

ARTICLE 5

GOVERNANCE

5.1 Joint Steering Committee.

5.1.1 Representatives. Within [***] after the Effective Date, the Parties will establish a joint steering committee to oversee and manage the collaboration (the JSC). Each Party initially will appoint [***] to serve as representatives to the JSC (the JSC Representatives), with each JSC Representative having knowledge and expertise regarding developing products similar to the Product and sufficient decision-making authority within the applicable Party to make decisions on behalf of such Party within the scope of the JSC's decision‑making authority and, if any such representative is not an employee of the appointing Party, such representative shall execute a confidentiality agreement in form and substance acceptable to the other Party (and, for the avoidance of doubt, the appointing Party shall remain

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





responsible to the other Party for any noncompliance by such representative with such confidentiality obligations). Each Party may replace its JSC Representatives at any time upon written notice to the other Party.

5.1.2 Chairperson. The JSC chairperson (JSC Chairperson) shall be designated from the Parties' JSC Representatives and shall serve for a term of one (1) year. SFJ shall appoint the first JSC Chairperson and subsequent appointments will rotate on an annual basis between PB and SFJ. The JSC Chairperson will be responsible for drafting and circulating the draft agenda and ensuring minutes are prepared.

5.1.3 Meetings. From the Effective Date, through the date of the Regulatory Approval in the US, at least one Designated European Country, and either Japan or China, the JSC will meet at least [***] (and for clarity, such meetings are intended to be conducted via teleconference) unless the Parties mutually agree otherwise. Either Party may call a special meeting of the JSC (by videoconference or teleconference) during the Development Term by providing at least [***] prior written notice to the other Party, which notice shall include a reasonably detailed description of the matter, in the event such Party reasonably believes that a significant matter must be addressed prior to the next scheduled meeting.

5.1.4 Participants. The JSC may invite individuals who are not JSC Representatives to participate in JSC meetings; provided that (a) all JSC Representatives of both Parties consent to such non-member's participation; and (b) such non-member has executed a confidentiality agreement in form and substance acceptable to the non-inviting Party (and, for the avoidance of doubt, the inviting Party shall remain responsible to the non-inviting Party for any noncompliance by such individual with such confidentiality obligations). For clarity, such non-members will have no voting rights at the JSC.

5.1.5 Alliance Managers. Each Party shall appoint an individual to act as an alliance manager for such Party (each, an Alliance Manager) by providing the name and contact information for the Alliance Manager to the JSC. Each Party may change its Alliance Manager from time to time in its sole discretion upon written notice to the JSC. The Alliance Managers shall be the primary point of contact for the Parties regarding the activities contemplated by the Agreement, and the Parties shall use reasonable efforts to ensure that any requests for information and data made outside of the JSC are made through the Alliance Mangers. The Alliance Managers shall attend all meetings of the JSC. For clarity, the Alliance Managers may also be members of the JSC.

5.1.6 Costs. Each Party will bear its own expenses relating to the meetings and activities of the JSC.

5.2 JSC Responsibilities and Decision-Making.

5.2.1 Responsibilities (Review and Discuss). The JSC's responsibilities will include reviewing and discussing (but not approving) the following:

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





5.2.1.1 Oversight of the Parties' collaboration including (i) overall strategic direction, (ii) developing strategies to maximize the value of the Product for the Indication, and (iii) reviewing and commenting on the Development Program and Regulatory Approval strategies;

5.2.1.2 material changes in the Development Program, including changes required by, or made to respond to comments from, a Regulatory Authority, that do not require approval pursuant to Section 5.2.2.2;

5.2.1.3 the activities related to, the progress of, and the costs incurred in connection with, the Development Program;

5.2.1.4 summaries of the Research Results;

5.2.1.5 forecast of the estimated timeline (on at least a [***] basis) for its development activities with respect to the Product for the Indication;

5.2.1.6 the addition to the Development Program of any new Clinical Trials testing the efficacy of the Product for the Indication; and

5.2.1.7 any other matters the Parties mutually agree in writing will be, or are expressly provided in this Agreement to be, reviewed and discussed by the JSC.

5.2.2 Responsibilities (Review and Approve). The JSC's responsibilities will include reviewing and approving (in each case, such approval not to be unreasonably withheld, conditioned or delayed) the following:

5.2.2.1 the Protocols;

5.2.2.2 [***]:

(a) [***];

(b) [***];

(c) [***];

(d) [***];

(e) [***]; or

(f) [***].

(g) commercially reasonable budgets of CRO and Third Party Vendor costs (the Approved Third Party Vendor Costs) and Product Supply Costs.

5.2.2.3 any other matters the Parties mutually agree in writing will be, or are expressly provided in this Agreement to be, reviewed and approved by the JSC.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





The JSC shall use good faith efforts to approve budgets for the Approved Third Party Vendor Costs and the Product Supply Costs no later than [***].

5.2.3 Limitation on Authority. Notwithstanding anything to the contrary set forth in this Agreement, the JSC will have no authority to (x) amend, modify or waive compliance with this Agreement, or (y) resolve any dispute concerning the validity, interpretation, construction of, or breach of this Agreement.

5.2.4 Decision-Making. PB shall retain sole decision-making authority over all matters within the scope of the JSC's oversight other than the matters described in the foregoing 5.2.2. The unanimous approval of the JSC will be required with respect to all matters within its decision-making authority as described in the foregoing Section 5.2.2. The JSC Representatives of each Party will collectively have one (1) vote. The presence of at least one of each Party's JSC representatives constitutes a quorum for the conduct of business at any JSC meeting, and no vote of the JSC may be taken without a quorum present. If the JSC cannot reach consensus on an issue for which it has decision-making authority, then PB shall have the final decision-making authority, provided that if SFJ disagrees with any such PB decision with regard to any of the matters set forth in Section 5.2.2, then, at SFJ's request, the matter shall be escalated to the Executive Officers for attempted resolution by good faith negotiations during a period of [***]. If, notwithstanding such good faith negotiations, the Executive Officers fail to resolve such matter prior to expiration of such [***] negotiation period, and SFJ in good faith continues to disagree with such PB decision, then SFJ shall have the right to terminate this Agreement as provided in Section 14.2.10 upon written notice to PB delivered within [***] after expiration of such [***] negotiation period.

5.3 Reports to be Provided to the JSC.

Except as may otherwise be agreed by the Parties, at each JSC meeting PB with regard to the PB Territory and SFJ with regard to the SFJ Territory will provide an update on the progress of the Clinical Trials and PB with regard to the U.S. and the Designated European Countries and SFJ with regard to Japan and China will report on progress toward obtaining Regulatory Approvals.

5.4 Joint Development Committee.

5.4.1 Representatives. Within [***] of the Effective Date, the Parties will establish a joint development committee to oversee the conduct of the Clinical Trials (the JDC). Each Party initially will appoint [***] to serve as representatives to the JDC (the JDC Representatives), with each JDC Representative having knowledge and expertise regarding developing products similar to the Product and sufficient seniority within the applicable Party to make decisions within the scope of the JDC's decision- making authority. Each Party may replace its JDC Representatives at any time upon written notice to the other Party.

5.4.2 Chairperson. The JDC chairperson (JDC Chairperson) shall be designated from the Parties' JDC Representatives and shall serve for a term of [***]. [***] shall

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





appoint the first JDC Chairperson and subsequent appointments will rotate on [***] basis between SFJ and PB. The JDC Chairperson will be responsible for drafting and circulating the draft agenda and ensuring minutes are prepared.

5.4.3 Meetings.

5.4.3.1 Timing.

(i) From the Effective Date through the date of first Regulatory Approval, the JDC will meet at least once every [***] (and for clarity, such meetings are intended to be conducted via teleconference) unless the Parties mutually agree otherwise.

(ii) Either Party may call a special meeting of the JDC (by videoconference or teleconference) during the Development Term by at least [***] prior written notice to the other Party in the event such Party reasonably believes that a significant matter must be addressed prior to the next scheduled meeting.

5.4.3.2 Participants. The JDC may invite individuals who are not JDC Representatives to participate in JDC meetings; provided that (a) the JDC Representatives of both Parties consent to such non-member's participation; and (b) such non-member is subject to confidentiality obligations consistent with those described in ARTICLE 11 of this Agreement. For clarity, such non-members will have no voting rights at the JDC.

5.4.3.3 Costs. For clarity, each Party will bear its own expenses relating to the meetings and activities of the JDC and such costs will not be Development Costs hereunder.

5.4.4 Notice to be Provided to the JDC.

5.4.4.1 Unusual or Unforeseen Events. Each Party will promptly notify the JDC of any unforeseen or unusual events that occur in connection with the Clinical Trials that may affect the quality, integrity, or timeliness of the Clinical Trials.

5.4.4.2 Urgent Safety Measures or Serious Breaches. If either Party becomes aware of (a) any urgent safety measures taken by a Clinical Investigator to protect Subjects against immediate hazard or (b) any serious breaches of the Protocol or any Applicable Laws (including ICH GCP guidelines), such Party will immediately inform the JDC.

5.4.4.3 Regulatory Inspections. Each Party will promptly notify the JDC within [***] of any inspection by any Governmental Authority, including any Regulatory Authority, in connection with the Clinical Trials. Each Party will promptly forward to the JDC copies of any inspection findings that a Site receives from any Regulatory Authority.

5.4.4.4 Government Investigations. Each Party will promptly notify the JDC upon learning of any investigations by any Governmental Authority in connection with the Clinical Trials.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





5.4.4.5 Notification of Error. If either Party learns of an error or omission in the conduct of the Clinical Trials that could call into question the validity, or otherwise compromise the quality and/or integrity, of part or all of the Clinical Trials or activities conducted in connection therewith, such Party will inform the JDC in writing within [***] of either Party learning of such error and/or omission. The members of the JDC will discuss in good faith a remediation plan to address such error within [***] of such written notification. Such remediation plan will not be effective unless and until approved by the JDC (such approval not to be unreasonably withheld or delayed). If the JDC approves such remediation plan, the JDC will provide each Party with written notice thereof, specifying the dates on which, and the detail with which the Party responsible for such Clinical Trial will be required to update the JDC of its progress with respect thereto. If the JDC is not able to approve such remediation plan, the matter will be decided by the JSC pursuant to the procedure described in Section 5.2.4.

5.4.4.6 Compliance with Laws. With respect to each of the foregoing Sections 5.4.4.1 through 5.4.4.5, the Party responsible for notifying the JDC will notify the Person to whom notice is required to comply with all Applicable Laws.

5.4.4.7 Progress Reports. Except as may otherwise be agreed to by the Parties, at each JDC meeting the Party responsible for such Clinical Trial will provide an update on the progress and cost of such Clinical Trial and Regulatory Approval as measured against the Timeline.

5.4.4.8 Post-Development Term Notices. Following completion of the Development Term and through the end of the Term, any and all notices required pursuant to this Section 5.4 will be provided to the JSC instead of the JDC.

5.4.5 Responsibilities and Decision-Making.

5.4.5.1 Responsibilities. The JDC's responsibilities will include: (a) approving the initial Protocol (b) approving any changes to the Protocol that requires a submission to a Regulatory Authority, an IRB or other ethics committees; (c) discussing the activities in connection with, the progress of, and the costs incurred in connection with, the Clinical Trials, including updates from any Clinical Investigator Meetings; (d) reviewing and discussing any notices that it receives pursuant to the foregoing Section 5.4.4; (e) discussing and reviewing the Research Results; (f) reviewing and discussing on at least a quarterly basis the forecast Development Costs and Timeline; (g) reviewing and discussing (as necessary) proof of submission of any safety reports to the Regulatory Authorities, Clinical Investigators, IRBs and any other ethics committees; (h) reviewing certain data to be provided by each Party at each JDC meeting as requested by the other Party and in accordance with all Applicable Laws; (i) reviewing performance and progress of the Clinical Trials and Regulatory Approval process; and (j) any other matters the Parties mutually agree will be, or are expressly provided in this Agreement to be, within the responsibilities of the JDC.

5.4.5.2 Decision-Making. The unanimous approval of the JDC will be required with respect to all matters within its decision-making authority as described in the foregoing Section 5.4.5.1. The JDC Representatives of each Party will collectively have one (1)

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





vote. The presence of at least one of each Party's JDC representatives constitutes a quorum for the conduct of business at any JDC meeting, and no vote of the JDC may be taken without a quorum present. If the JDC cannot reach consensus on an issue for which it has decision-making authority, then such matter will be escalated to the JSC.

5.5 Joint Commercialization Committee.

5.5.1 Representatives. By [***], the Parties will establish a joint commercialization committee (the JCC) to oversee and manage the Commercialization of the Product (excluding direct oversight and management of commercial manufacture of Product, provided that PB shall keep the JCC reasonably informed of commercial manufacturing activities), including PB's compliance with its diligence obligations under the AZ License. Each Party will initially appoint [***] to serve as representatives on the JCC (the JCC Representatives), with each JCC Representative having knowledge and expertise regarding Commercializing products similar to the Product or knowledge of PB's Commercialization plans and activities for the Product (as applicable) and being reasonably acceptable to the other Party. If any such representative is not an employee of the appointing Party, such representative shall execute a confidentiality agreement in form and substance acceptable to the other Party (and, for the avoidance of doubt, the appointing Party shall remain responsible to the other Party for any noncompliance by such representative with such confidentiality obligations). Each Party may replace its JCC Representatives at any time upon written notice to the other Party.

5.5.2 Information. PB shall provide to the JCC a draft of each Commercialization Plan (as defined in the AZ License) at least [***] in advance of the date PB is required to deliver such Commercialization Plan to MedImmune. The JCC shall promptly review and discuss each draft Commercialization Plan.

5.5.3 Chairperson. PB shall designate the JCC chairperson (JCC Chairperson) from its JCC Representatives. The JCC Chairperson will be responsible for drafting and circulating its Party's draft agenda and ensuring minutes are prepared.

5.5.4 Meetings. From the Effective Date through the date of the Final Approval Payment, the JCC will meet at least every two months (and for clarity, such meetings are intended to be conducted via teleconference), unless the Parties mutually agree otherwise. Either Party may call a special meeting of the JCC (by videoconference or teleconference) by providing at least five (5) Business Days' prior written notice to the other Party, which notice shall include a reasonably detailed description of the matter, in the event such Party reasonably believes that a significant matter must be addressed prior to the next scheduled meeting.

5.5.5 Participants. The JCC may invite individuals who are not JCC Representatives to participate in JCC meetings; provided that (a) all [***] JCC Representatives of both Parties consent to such non-member's participation; and (b) such non-member has executed a confidentiality agreement in form and substance acceptable to the non-inviting Party (and, for the avoidance of doubt, the inviting Party shall remain responsible to the non-inviting Party for any noncompliance by such individual with such confidentiality obligations).

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





5.5.6 Costs. Each Party will bear its own expenses relating to the meetings and activities of the JCC.

5.6 JCC Responsibilities and Decision-Making.

5.6.1 Responsibilities. The JCC's responsibilities will include the following:

5.6.1.1 [***].

5.6.1.2 [***];

5.6.1.3 [***];

5.6.1.4 [***];

5.6.1.5 [***]; and

5.6.1.6 Any other matters the Parties mutually agree will be, or are expressly provided in this Agreement to be, reviewed and discussed by the JCC.

5.6.2 Decision Making. The unanimous approval of the JCC will be required with respect to all matters within its decision-making authority as described in the foregoing Section 5.6.1. The JCC Representatives of each Party will collectively have one (1) vote. The presence of at least one of each Party's JCC representatives constitutes a quorum for the conduct of business at any JCC meeting, and no vote of the JCC may be taken without a quorum present. If the JCC cannot reach consensus on an issue for which it has decision-making authority, then such matter will be escalated to the JSC.

ARTICLE 6

PAYMENTS TO SFJ

6.1 Regulatory Approval. In exchange for the purchase of the Trial Data Package as set forth in Section 11.1.1.4, PB will pay to SFJ, in US Dollars:

6.1.1 following Regulatory Approval by the FDA, an initial payment in the amount set forth below to be made within [***] after the date of the Regulatory Approval by the FDA as shown in the table below (the Initial US Payment) and annual payments in the amounts set forth below on or before each applicable anniversary of the date of such Regulatory Approval (collectively but excluding the Initial US Payment, the US Approval Payments);

6.1.2 following Regulatory Approval by the EMA, an initial payment in the amount set forth below to be made within [***] after the date of the Regulatory Approval by the EMA (or, as applicable, by the national Regulatory Authority in any Designated European Country) as shown in the table below (the Initial EU Payment) and annual payments in the amounts set forth below on or before each applicable anniversary of the date of the such

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Regulatory Approval (collectively but excluding the Initial EU Payment, the EU Approval Payments); and

6.1.3 following Regulatory Approval by the PMDA or the NMPA, an initial payment in the amount set forth below to be made within [***] after the date of first Regulatory Approval by the PMDA or the NMPA as shown in the table below (the Initial Japan/China Payment) and annual payments in the amounts set forth below shall be due on each applicable anniversary of the date of such Regulatory Approval (collectively but excluding the Initial Japan/China Payment, the Japan/China Approval Payments);

provided, in each case, that if conditional Regulatory Approval in a geographic territory specified above in Section 6.1.1, 6.1.2 or 6.1.3 is obtained on the basis of Successful Phase 3 Interim Analysis but unconditional Regulatory Approval is not obtained (i.e., the accelerated Regulatory Approval is withdrawn by the applicable Regulatory Authority) in such geographic territory as a result of failure of the final results of the Phase 3 Trial to meet the Phase 3 Success Criteria or failure of any other human clinical trial that the applicable Regulatory Authority requires PB to conduct after the grant of conditional Regulatory Approval as a condition to the grant of unconditional Regulatory Approval to meet the primary endpoint(s) of such trial and the Product is required to be withdrawn from the market in such geographic territory, then PB shall have no obligation to make any additional Approval Payment for such geographic territory that would otherwise have become due during the period after withdrawal of such conditional Regulatory Approval and before such time (if ever) as Regulatory Approval for such geographic territory is again obtained (and for so long thereafter as such Regulatory Approval remains in effect), provided further that with regard to withdrawal of such conditional Regulatory Approval in [***].

The Initial US Payment, Initial EU Payment, Initial Japan/China Payment, US Approval Payments, EU Approval Payments and Japan/China Approval Payments are collectively referred to as the Approval Payments, and shall be subject to adjustment as provided in Section 6.2. For the sake of clarity, the Initial Japan/China Payment and each of additional Japan/China Approval Payment set forth in the table below shall only be paid once regardless of receipt of Regulatory Approval in both Japan and China.

Approval Payment Schedule

Upon Approval 1yr

Anniversary

2yr

Anniversary

3yr

Anniversary

4yr

Anniversary

5yr

Anniversary

6yr

Anniversary

7yr

Anniversary

8yr

Anniversary Total

FDA Approval 5,000,000 [***] [***] [***] [***] [***] [***] [***] 0 330,000,000

EMA Approval 5,000,000 [***] [***] [***] [***] [***] [***] [***] 0 210,000,000

First Approval by either PMDA or NMPA

1,000,000

[***] [***] [***] [***] [***] [***] [***] [***]

60,000,000

Total 11,000,000 [***] [***] [***] [***] [***] [***] [***] [***] 600,000,000

6.2 Payment Adjustments. In the event that the actual Development Costs paid or incurred by SFJ hereunder are lower or greater than One Hundred Twenty Million U.S. Dollars ($120,000,000.00), including by reason of any amount of Going Concern Funding paid by SFJ to

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





PB in accordance with Section 4.2.4, or in the event that such actual Development Costs are subject to adjustment pursuant to Section 2.3.3, Section 3.12.2 and/or Section 3.12.3, the Approval Payments will be multiplied by a fraction, the numerator of which is such actual amount of Development Costs paid or incurred by SFJ hereunder (as adjusted, to the extent applicable, pursuant to Section 2.3.3, Section 3.12.2 and/or Section 3.12.3) and the denominator of which is One Hundred Twenty Million U.S. Dollars ($120,000,000.00). In the event that Regulatory Approval is obtained in a particular jurisdiction while Development Costs for other jurisdiction(s) are still being paid or incurred, in which case the Parties shall recalculate the applicable adjustment at such time as the final amount of actual Development Costs is known and determine any true-up payments required to be made by PB with respect to any payment made pursuant to Section 6.1 prior to such time, and PB shall pay any such true-up payment to SFJ within [***] after receipt of invoice from SFJ.

6.3 Method and Timing of Payment. The US Approval Payments, EU Approval Payments and Japan/China Approval Payments to SFJ will be due as of the applicable annual anniversary of the date of the applicable Regulatory Approval. SFJ shall deliver invoices to PB for the US Approval Payments, EU Approval Payments and Japan/China Approval Payments at least [***] before the applicable anniversary of the date of Regulatory Approval, and such payments will be made by PB on or before the later of (a) [***] and (b) [***] following delivery of such invoices, by wire transfer to SFJ's account that SFJ shall designate on such invoice. PB will provide SFJ with written notice of each wire transfer to SFJ's account. All amounts payable and calculations under this Agreement shall be in US dollars.

6.4 Late Payments. If PB fails to pay any amount due under this Agreement on the due date therefore, then, without prejudice to any other remedies that SFJ may have, that amount will bear interest from the due date until payment of such amount is made, both before and after any judgment, at a rate equal to, [***] percent ([***]%) per annum computed on the basis of a year of 360 days for the actual number of days payment is delinquent or if such rate exceeds the maximum amount permitted by Applicable Law, at such maximum rate.

6.5 Taxes. The Parties hereby acknowledge and agree that payments made under this Agreement will be made without reduction for withholding or similar taxes, unless such withholding or similar tax is required (x) by a taxing authority as a result of an audit or examination, (y) due to the assignment of this Agreement or any payment obligation hereunder (to the extent permitted) by SFJ to an Affiliate or Third Party, or (z) as a result of a change in Applicable Laws at any time during the Term. In such case, the Parties shall use commercially reasonable and legal efforts to mitigate the amount of such taxes that would need to be withheld and/or paid. Any amounts withheld pursuant to this Section 6.5 will be timely paid over to the appropriate taxing authority, and will be treated for purposes of this Agreement as having been paid to the Party that otherwise would have received such amounts. In the event of a determination within the meaning of Section 1313(a) of the Code that withholding or similar taxes were required but were not properly withheld, the Party that received the relevant payment will indemnify and hold the other Party harmless with respect to such taxes and related Losses.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





6.6 Tax Cooperation. The Parties will cooperate and produce on a timely basis any tax forms or reports, including any IRS Forms W-8BEN or W-9, as applicable, reasonably requested by the other Party in connection with any payment made under this Agreement. Each Party will provide to the other Party any tax forms that may be reasonably necessary in order for such Party not to withhold tax or to withhold tax at a reduced rate under an applicable bilateral income tax treaty. Each Party will provide to the other Party any tax forms at least [***] prior to the due date for any such payments. Each Party will provide the other with commercially reasonable assistance to enable the recovery, as permitted by law, of withholding taxes, VAT, or similar obligations resulting from payments made under this Agreement, such recovery to be for the benefit of the Party bearing such withholding tax or VAT. Each Party will provide commercially reasonable cooperation to the other Party, at the other Party's expense, in connection with any official or unofficial tax audit or contest relating to tax payments made with respect to amounts paid or payable to such other Party under this Agreement.

6.7 Buy-Out Option.

6.7.1 Approval Buy-Out Option. Within one hundred and twenty (120) days following the receipt of Regulatory Approval with respect to each of the US, Designated European Countries, and Japan/China, PB shall have the right to make a one-time payment (each, an Approval Buy-Out Payment) in lieu of all (but not less than all) Approval Payments (as adjusted in accordance with Section 6.2) for the applicable country(ies) (other than the Initial US Payment, Initial EU Payment or Initial Japan/China Payment, as applicable, payable pursuant to Section 6.1 as a result of such Regulatory Approval, in each case, as adjusted in accordance with Section 6.2) by written notice delivered to SFJ no later than [***] after the date of such Regulatory Approval, which written notice shall set forth the amount of the applicable Approval Buy-Out Payment, the proposed date of closing (which shall occur within [***] after the date of the Regulatory Approval), and the calculation of the Approval Buy-Out Payment in reasonable detail based upon the proposed closing date. The Approval Buy-Out Payment will be calculated as follows:

[***]

Each Approval Buy-Out Payment will be payable in one installment in cash at the closing to an account specified by SFJ. The discount rate used to calculate each Approval Buy-Out Payment shall be [***] percent ([***]%).

6.7.2 Change of Control Buy-Out Option. Within one hundred and twenty (120) days following the closing of a Change of Control, PB or its successor shall have the right to make a one-time payment (the Change of Control Buy-Out Payment) in lieu of all (but not less than all) remaining Approval Payments for the applicable country(ies) in which Regulatory Approval has been received as of the date of closing of such Change of Control, provided that SFJ has not previously assigned the right to receive the Approval Payments to a Third Party, in which event PB or its successor shall not have such right. To exercise its right to make the Change of Control Buy-Out Payment, PB or its successor shall provide written notice to SFJ (the Change of Control Buy-Out Notice) no later than [***] after the date of closing of such Change of Control, which written notice shall set forth the amount of the applicable Change of

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Control Buy-Out Payment, the proposed date of closing of the buy-out (which shall occur within [***] after the date of closing of such Change of Control), and the calculation of the Change of Control Buy-Out Payment in reasonable detail based upon the proposed closing date of the buy-out. The Change of Control Buy-Out Payment will be calculated as follows:

[***]

The Change of Control Buy-Out Payment will be payable in one installment in cash at the closing to an account specified by SFJ. The discount rate used to calculate each Change of Control Buy-Out Payment shall be [***] percent ([***]%). For the avoidance of doubt, the Change of Control Buy-Out Payment shall only apply with regard to Approvals which have already been obtained prior to the Change of Control.

ARTICLE 7

SECURITY INTEREST

7.1 Grant of Security Interest. As security for the payment and performance of the PB Obligations, PB hereby grants to SFJ, effective upon PB's receipt of the Initial Development Cost Payment on the Initial Funding Date, a security interest in all of PB's right, title and interest (excluding any leasehold interest) in, to and under all of its property, wherever located and whether now existing or owned or hereafter acquired or arising, including all goods, accounts (including health-care receivables), equipment, inventory, contract rights or rights to payment of money, leases, license agreements, franchise agreements, general intangibles, intellectual property (including, for the avoidance of doubt, all PB Intellectual Property), commercial tort claims, documents, instruments (including any promissory notes), chattel paper (whether tangible or electronic), cash, deposit accounts, certificates of deposit, fixtures, letters of credit rights (whether or not the letter of credit is evidenced by a writing), securities, and all other investment property, supporting obligations, and financial assets, whether now owned or hereafter acquired, wherever located; and all of PB's books and records relating to the foregoing, and any and all claims, rights and interests in any of the above and all substitutions for, additions, attachments, accessories, accessions and improvements to and replacements, products, proceeds and insurance proceeds of any or all of the foregoing (collectively, the SFJ Collateral). Anything herein to the contrary notwithstanding, in no event shall the SFJ Collateral include, and PB shall not grant and shall not be deemed to have granted a security interest in, (1) any property to the extent that such grant of security interest is prohibited by any Applicable Law of a Governmental Authority or constitutes a breach or default under or results in the termination of or requires any consent not obtained under, any contract, license, agreement, instrument or other document evidencing or giving rise to such property, except to the extent that such Applicable Law or the term in such contract, license, agreement, instrument or other document providing for such prohibition, breach, default or termination or requiring such consent is ineffective under Section 9-406, 9-407, 9-408 or 9- 409 of the Uniform Commercial Code in effect in the State of Delaware (or any successor provision or provisions) of any relevant jurisdiction or any other Applicable Law (including bankruptcy or insolvency statutes) or principles of equity; provided, however, that such security interest shall attach immediately at such time as such Applicable Law

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





is not effective or applicable, or such prohibition, breach, default or termination is no longer applicable or is waived, and to the extent severable, shall attach immediately to any portion of the SFJ Collateral that does not result in such consequences or (2) any of PB's rights, title or interest in any of the outstanding voting capital stock or other ownership interests of a CFC in excess of 65% of the voting power of all classes of capital stock or other ownership interests of CFC entitled to vote. This Agreement shall create a continuing security interest in the SFJ Collateral which shall remain in effect until all PB Obligations (other than contingent indemnity obligations) have been paid or otherwise satisfied in full in accordance with this Agreement and/or, if applicable, the Program Transfer Agreement. Upon payment or other satisfaction of all PB Obligations (other than contingent obligation), SFJ shall, at the sole cost and expense of PB, release its Liens in the SFJ Collateral and all rights therein shall revert to PB.

7.2 Priority of Security Interest. PB represents, warrants and covenants that, subject to fulfilment of PB's obligations under Section 7.4 and SFJ making any filings necessary to achieve such perfection, the security interest granted to SFJ pursuant to this ARTICLE 7 (the SFJ Security Interest) on the Initial Funding Date shall be and shall at all times thereafter continue to be a first- priority perfected security interest in the SFJ Collateral (subject only to the lien of SVB arising under the SVB Loan Agreement, subject in all respects to the terms and conditions of the subordination agreement contemplated by Section 7.4 hereof, and other Permitted Liens that are permitted pursuant to the terms of this Agreement).

7.3 Authorization to File Financing Statements. PB hereby authorizes SFJ to file, on or at any time from time to time after PB's receipt of the Initial Development Cost Payment on the Initial Funding Date, and PB shall execute and deliver to SFJ (as applicable), financing statements, amendments to financing statements, continuation financing statements, termination statements, security agreements relating to the SFJ Collateral constituting intellectual property, fixture filings (if applicable), notices and other documents and instruments, in form satisfactory to SFJ as SFJ may reasonably request, to perfect and continue perfected, maintain the priority of or provide notice of SFJ's security interest in the SFJ Collateral and to accomplish the purpose of this Agreement, without notice to PB, with all appropriate jurisdictions located within the United States and the Designated European Countries. Such financing statements may indicate the SFJ Collateral as substantially the same as the SFJ Collateral described in Section 7.1 or words of similar effect, or as being of an equal or lesser scope, or with greater detail, all in SFJ's reasonable discretion.

7.4 Subordination to SVB Loan. On or before the Initial Funding Date, PB shall negotiate in good faith and enter into a subordination agreement with SVB and SFJ reflecting in all material respects the terms described on Exhibit P attached hereto, pursuant to which SFJ will subordinate to SVB all PB Obligations and all Liens in the SFJ Collateral in favor of SFJ of indebtedness of PB to SVB, which agreement shall (a) limit the aggregate principal amount of indebtedness of PB to SVB that will be senior to SFJ at [***], (b) include a provision pursuant to which in certain circumstances SFJ shall be entitled in its discretion to purchase or repay all obligations (other than contingent indemnity obligations) owing by PB to SVB arising under or in connection with the SVB Loan Agreement in exchange for a release of SVB's Liens on PB's assets, (c) include an obligation on the part of SFJ to, in connection with any refinancing or

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





replacement of the SVB Loan Agreement, enter into a new subordination agreement with a new lender(s) on terms and conditions that are taken as a whole not less favorable in any material respect to SFJ than those set forth in the subordination agreement to be entered into with SVB, and (d) otherwise be in form and substance reasonably satisfactory to SFJ. Upon the execution of such new subordination agreement with such new lender(s), references herein to SVB shall refer to such new lender(s), references herein to the SVB Loan shall refer to the loans provided by such new lender (provided that the aggregate principal amount of such loans shall not exceed [***]), references herein to the SVB Collateral shall refer to the collateral securing such new loan, and references herein to the SVB Loan Agreement shall refer to such loan and security agreement or similar document entered into with such new lender(s).

7.5 Negative Covenants.

7.5.1 Incurrence of Certain Indebtedness. PB shall not, without SFJ's prior written consent, create, incur, assume, or be liable for any Indebtedness, or permit any subsidiary of PB to do so, other than Permitted Indebtedness.

7.5.2 Subordinated Debt. PB shall not (a) make or permit any payment on any Subordinated Debt, except to the extent permitted by the terms of the subordination, intercreditor, or other similar agreement to which such Subordinated Debt is subject, or (b) amend any provision in any document relating to Subordinated Debt which would provide for earlier or greater principal, interest, or other cash payments thereon, or materially adversely affect the subordination thereof to PB Obligations owed to SFJ.

7.5.3 Encumbrances. PB shall not, without SFJ's prior written consent:

7.5.3.1 create, incur, allow, or suffer any Lien on any of the PB Intellectual Property, or assign or convey any right to receive income with respect to the PB Intellectual Property (other than royalty and other license fee obligations to licensors thereof in accordance with the applicable license agreement), including the sale of any PB Intellectual Property, or permit any of its subsidiaries to do so, other than Liens in favor of SVB (subject in all respects to the terms and conditions of the subordination agreement contemplated by Section 7.4 hereof) and other Permitted Liens that are permitted pursuant to the terms of this Agreement; or

7.5.3.2 except as and to the extent permitted by Section 7.5.6, enter into any agreement, document, instrument or other arrangement (except with or in favor of SFJ or SVB) with any Person which directly or indirectly prohibits or has the effect of prohibiting PB or any subsidiary of PB from assigning, mortgaging, pledging, granting a security interest in or upon or encumbering any proceeds from PB Intellectual Property.

7.5.4 Distributions; Investments. PB shall not, without SFJ's prior written consent, (a) pay any dividends or make any distribution or payment on account of or redeem, retire or purchase any capital stock, provided that (i) PB may convert any of its equity convertible securities into other equity securities (or cash for partial shares) pursuant to the terms of such equity convertible securities or otherwise in exchange thereof, (ii) PB may pay dividends

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





solely in common stock, and (iii) PB may repurchase the stock of former employees or consultants pursuant to stock repurchase agreements, provided that the aggregate amount of all such repurchases does not exceed [***] Dollars ($[***]) per fiscal year; or (b) directly or indirectly make any Prohibited Investment (including, without limitation, by the formation of or through any subsidiary), or permit any of its subsidiaries to do so. For the avoidance of doubt, nothing in this Section 7.5.4 shall limit the ability of PB to pay or settle on conversion (in cash or equity) any convertible indebtedness.

7.5.5 Licensing Transactions. PB shall have the right, without SFJ's consent, to enter into any Excluded Licensing Transaction. PB shall not, without SFJ's prior written consent, enter into a Licensing Transaction unless such Licensing Transaction is an Excluded Licensing Transaction (in which case such prohibition shall not apply and no such consent of SFJ shall be required); provided that SFJ shall only be entitled to withhold such consent as to a Licensing Transaction other than an Excluded Licensing Transaction in the event SFJ reasonably determines, and provides PB with written notice of its determination within [***] of PB providing to SFJ a non-binding term sheet or comparable document summarizing the material terms of the proposed Licensing Transaction [***], that PB entering into such Licensing Transaction would [***] (Material Impact). If PB disagrees with SFJ's determination, the matter shall be submitted to arbitration before a single neutral arbitrator under the American Arbitration Association's (AAA's) expedited arbitration rules, which arbitrator shall be mutually agreeable to both Parties and have significant expertise on the subject matter to be decided (provided that if the Parties have not mutually agreed on such arbitrator within [***] after the applicable demand for arbitration, the AAA shall designate such arbitrator), such arbitration to be concluded and the arbitrator's award to be rendered within [***] of the applicable demand for arbitration. The sole issue to be decided in the arbitration shall be whether the entry into such Licensing Transaction by PB would have a substantial likelihood of having a Material Impact. In the event the arbitrator agrees with SFJ, PB shall not be entitled to enter into such Licensing Transaction. In the event the arbitrator agrees with PB, PB shall be entitled to enter into the Licensing Transaction; [***], and, [***].

7.5.6 Sales of Royalty Streams. PB shall not sell, transfer or assign, directly or indirectly, in whole or in part, any rights to receive payments of royalties or license fees with respect to the Product or the PB Intellectual Property (including any Accounts with respect to such royalties or license fees), other than to a wholly owned direct or indirect subsidiary of PB (it being understood that the foregoing shall not restrict the creation of any Permitted Lien).

7.5.7 Further Negative Pledges. PB shall not, from and after the Effective Date, enter into any agreement that prohibits or limits the ability of PB to create, incur, assume or suffer to exist any Lien upon any PB Intellectual Property (including any Accounts with respect to such royalties or license fees), whether now owned or hereafter acquired, to secure the PB Obligations, other than (a) agreements with SFJ (including this Agreement), (b) any agreements governing purchase money Liens or capital lease obligations otherwise permitted hereby (in which case, any such prohibition or limitation shall only be effective on the assets financed thereby), (c) customary restrictions on assignment contained in leases, licenses or other

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





agreements or (d) the SVB Loan Agreement and any loan documents entered into in connection therewith.

7.6 Affirmative Covenants. PB shall do all of the following:

7.6.1 Execution of Additional Security Agreements and Other Further Assurances.

7.6.1.1 PB shall, upon request of SFJ from time to time hereafter, execute such security agreements, stock pledge agreements, deposit account control agreements, and take such further action, as reasonably required to perfect or continue the SFJ Security Interest or to effect the purposes of this ARTICLE 7, including without limitation by taking the following actions:

(a) (i) PB shall execute and deliver to SFJ, promptly upon PB's receipt of the Initial Development Cost Payment on the Initial Funding Date, such patent and trademark security agreements as SFJ may reasonably request, in each case in form and substance reasonably acceptable to SFJ (each an IP Security Agreement), and shall record such agreements with the U.S. Patent and Trademark Office, and shall take such other action as may be necessary or as SFJ may reasonably request to perfect SFJ's security interest in any Intellectual Property of PB in existence as of the Effective Date constituing SFJ Collateral. (ii) Within [***] of the last day of [***], PB shall notify SFJ in writing of [***], and [***].

(b) No later than [***] after PB's receipt of the Initial Development Cost Payment on the Initial Funding Date, PB shall deliver to SFJ fully executed deposit account control agreements or securities account control agreements, as applicable, in favor of SFJ in form and substance reasonably satisfactory to SFJ with respect to all deposit accounts (as such term is defined in the UCC, each a Deposit Account) and securities accounts (as such term is defined in the UCC, each a Securities Account and collectively with any Deposit Account, each a Collateral Account) maintained within the United States by PB, including without limitation the Collateral Accounts set forth on Schedule 7.6.1.1(b) to that certain disclosure letter, dated as of the Effective Date, delivered by PB to SFJ (the Disclosure Letter). PB represents and warrants to SFJ that, as of the Effective Date, it maintains no Collateral Accounts other than the Collateral Accounts described on Schedule 7.6.1.1(b) to the Disclosure Letter. In addition to and without limiting the foregoing, PB shall provide SFJ with [***] prior written notice before establishing any additional Collateral Account at or with any bank or financial institution. For each such additional Collateral Account that PB at any time maintains after PB's receipt of the Initial Development Cost Payment on the Initial Funding Date, PB shall cause the applicable bank or financial institution at or with which any Collateral Account is maintained to execute and deliver a deposit account control agreement, securities account control agreement or other appropriate instrument with respect to such account to perfect SFJ's Lien in such account in accordance with the terms hereunder within [***] after the opening of each such account (or, if later, [***] after PB's receipt of the Initial Development Cost Payment on the Initial Funding Date), which agreement may not be terminated without the prior written consent of SFJ. The provisions of this Section 7.6.1.1(b) shall not apply to deposit accounts exclusively used for payroll, payroll taxes, and other employee wage and benefit

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





payments to or for the benefit of SFJ employees and identified to SFJ by PB as such. Except to the extent permitted by the preceding sentence, PB shall [***]:

(i) [***] prior to [***];

(ii) [***] after [***]; and

(iii) [***] after [***].

For the avoidance of doubt, the Parties agree that [***].

7.6.1.2 PB shall obtain such consents from SVB and WestRiver Innovation Lending Fund VIII, L.P. as are required by the SVB Loan Agreement to grant a security interest in the SFJ Collateral to SFJ and to incur the PB Obligations as set forth herein (the SVB Consent). The failure of PB to obtain the SVB Consent within [***] of the Effective Date shall be deemed to be a Material Adverse Event.

7.6.2 Government Compliance.

7.6.2.1 Maintain its and all its subsidiaries' legal existence and good standing in their respective jurisdictions of formation and maintain qualification in each jurisdiction in which the failure to so qualify would reasonably be expected to have a material adverse effect on PB's business or operations, provided that any subsidiary may liquidate or dissolve so long as such liquidation or dissolution would not reasonably be expected to have a material adverse effect on PB's consolidated business or operations, and provided that in connection with such liquidation or dissolution all assets and property of any such subsidiary shall be transferred to PB or another subsidiary of PB. PB shall comply, and shall cause each subsidiary to comply, in all material respects, with all laws, ordinances and regulations to which it is subject noncompliance with which would reasonably be expected to have a material adverse effect on PB's business.

7.6.2.2 Obtain all of the Governmental Approvals, if any, necessary for the grant of a security interest to SFJ in the SFJ Collateral.

7.6.3 Regulatory Compliance. PB shall not become an investment company or a company controlled by an investment company under the Investment Company Act of 1940, as amended. PB shall not become engaged as one of its important activities in extending credit for margin stock (under Regulations X, T and U of the Federal Reserve Board of Governors). Neither PB's nor any of its Subsidiaries' properties or assets shall be used by PB or any Subsidiary in disposing, producing, storing, treating, or transporting any hazardous substance other than legally. PB and each of its subsidiaries shall obtain all consents, approvals and authorizations of, make all declarations or filings with, and give all notices to, all Governmental Authorities that are necessary to continue their respective businesses as currently conducted, unless such failure could not reasonably be expected to have a material adverse effect on PB's business.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





7.6.4 Protection of Intellectual Property Rights. PB shall use Commercially Reasonable Efforts in the exercise of its business judgment to prosecute, protect, defend and maintain the validity and enforceability of the PB Intellectual Property.

7.6.5 Acceleration. In the event that, following an applicable Regulatory Approval, PB shall fail to make any Approval Payment associated with such Regulatory Approval within [***] of the due date therefor in accordance with ARTICLE 6, all remaining unpaid Approval Payments that are based on such Regulatory Approval shall become immediately due and payable; provided that, in the event of any such acceleration, SFJ's rights to receive such Approval Payments, if any, shall be adjusted as set forth in Section 6.2 and reduced by any amounts previously paid to SFJ.

7.7 Certain Defined Terms. As used in this ARTICLE 7 and elsewhere in this Agreement:

7.7.1 PB Obligations means all indebtedness, liabilities and other obligations of PB to SFJ under or in connection with this Agreement and any other documents executed in connection herewith, including, without limitation, all amounts payable to SFJ pursuant to ARTICLE 6 hereof, all interest accrued thereon, all fees and all other amounts payable by PB to SFJ thereunder or in connection therewith, whether now existing or hereafter arising, and whether due or to become due, absolute or contingent, liquidated or unliquidated, determined or undetermined, and including interest that accrues after the commencement by or against PB of any bankruptcy or insolvency proceeding naming such individual or entity as the debtor in such proceeding, and including performing the PB Services but excluding obligations under the Warrant.

7.7.2 Contingent Obligation is, for any Person, any direct or indirect liability, contingent or not, of that Person for (a) any indebtedness, letter of credit or other Indebtedness of another Person, in each case, directly or indirectly guaranteed, endorsed or co-made by that Person, or for which that Person is directly or indirectly liable; (b) any obligations for undrawn letters of credit for the account of that Person; and (c) all obligations from any interest rate, currency or commodity swap agreement, interest rate cap or collar agreement, or other agreement or arrangement designated to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices, but only to the extent such transaction is entered into for speculative purposes (and not to mitigate any risk to which PB or any subsidiary is subject). The amount of a Contingent Obligation is the stated or determined amount of the primary obligation for which the Contingent Obligation is made or, if not determinable, the maximum reasonably anticipated liability for it determined by the Person in good faith; but the amount may not exceed the maximum of the obligations under any guarantee or other support arrangement.

7.7.3 Indebtedness means (a) indebtedness for borrowed money or the deferred price of property or services (excluding accounts payable incurred in the ordinary course of business, earn-out or similar obligations with respect to deferred purchase price and deferred compensation), (b) obligations evidenced by notes, bonds, debentures or similar instruments, (c) capital lease obligations (as such term is understood under GAAP as in effect on

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





the date of this Agreement, but excluding obligations treated as operating leases prior to adoption of changes described by ASC Topic 842) and (d) Contingent Obligations.

7.7.4 Investment means any beneficial ownership interest in any Person (including stock, partnership interest or other securities), and any loan, advance or capital contribution to any Person.

7.7.5 Lien means a mortgage, deed of trust, levy, charge, pledge, security interest or other encumbrance of any kind, whether voluntarily incurred or arising by operation of law or otherwise against any property.

7.7.6 Permitted Indebtedness means:

7.7.6.1 PB Obligations;

7.7.6.2 Indebtedness owed to SVB pursuant to the SVB Loan Agreement, subject in all respects to the terms and conditions of the subordination agreement contemplated by Section 7.4 hereof;

7.7.6.3 Subordinated Debt;

7.7.6.4 unsecured Indebtedness;

7.7.6.5 Indebtedness incurred as a result of endorsing negotiable instruments received in the ordinary course of business;

7.7.6.6 Indebtedness secured by Liens permitted under subsections 7.7.7.1 and 7.7.7.3 of the definition of Permitted Liens hereunder;

7.7.6.7 Letters of credit issued for the payment of purchase obligations for equipment, materials and inventory and for the payment of equipment and real estate lease obligations (including security deposits in connection therewith); and

7.7.6.8 Other Indebtedness not to exceed [***] in the aggregate at any time outstanding.

7.7.7 Permitted Liens means:

7.7.7.1 Liens in favor SVB pursuant to the SVB Loan Agreement (subject in all respects to the terms and conditions of the subordination agreement contemplated by Section 7.4 hereof) and Liens in favor of SFJ;

7.7.7.2 Liens for taxes, fees, assessments or other government charges or levies, either (i) not due and payable or (ii) being contested in good faith and for which PB maintains adequate reserves on its books and records, provided that no notice of any such Lien has been filed or recorded under the IRC;

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





7.7.7.3 Purchase money Liens or capital leases (i) on equipment acquired or held by PB incurred for financing the acquisition of the equipment securing no more than [***] in the aggregate amount outstanding, or (ii) existing on equipment when acquired, if the Lien is confined to the property and improvements and the proceeds of the equipment;

7.7.7.4 Leases or subleases of real property granted in the ordinary course of PB's business (or, if referring to another Person, in the ordinary course of such Person's business), and leases, subleases, non-exclusive licenses or sublicenses of personal property (other than Intellectual Property) granted in the ordinary course of PB's business (or, if referring to another Person, in the ordinary course of such Person's business), if the leases, subleases, licenses and sublicenses do not prohibit granting SFJ a security interest therein;

7.7.7.5 Interests of lessors and licensors under leases and licenses to PB of real property and personal property;

7.7.7.6 The Existing Licenses;

7.7.7.7 Excluded Licensing Transactions;

7.7.7.8 Liens of carriers, warehousemen, suppliers, or other Persons that are possessory in nature arising in the ordinary course of business so long as such Liens attach only to inventory, securing liabilities in the aggregate amount which are not delinquent or remain payable without penalty or which are being contested in good faith and by appropriate proceedings which proceedings have the effect of preventing the forfeiture or sale of the property subject thereto;

7.7.7.9 Liens to secure payment of workers' compensation, employment insurance, old-age pensions, social security and other like obligations incurred in the ordinary course of business (other than Liens imposed by ERISA);

7.7.7.10 Liens arising from attachments or judgments, orders, or decrees occurring after the Effective Date in circumstances not constituting or arising from a Fundamental Breach by PB;

7.7.7.11 Liens in favor of financial institutions arising in connection with PB's deposit and/or securities accounts held at such institutions, provided that SFJ has a first priority perfected security interest in the amounts held in such deposit and/or securities accounts;

7.7.7.12 Liens incurred in the extension, renewal or refinancing of the indebtedness secured by Liens described in Sections 7.7.7.1 through 7.7.7.11 (excluding Liens securing the SVB Loan, solely to the extent of any obligations thereunder permitted in accordance with the terms and conditions of the subordination agreement contemplated by Section 7.4 hereof), but any extension, renewal or replacement Lien must be limited to the property encumbered by the existing Lien and the principal amount of the indebtedness may not increase;

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





7.7.7.13 Deposits securing bids or contracts;

7.7.7.14 Liens securing the payment of purchase obligations for equipment, materials and inventory and for the payment of equipment and real estate lease obligations (including security deposits in connection therewith); and

7.7.7.15 Other Liens securing liabilities in an aggregate amount not to exceed [***].

7.7.8 Prohibited Investment means:

7.7.8.1 Investments in equity interests including convertible notes of privately held companies (other than wholly owned subsidiaries of PB and, where Applicable Law prevents whole ownership, other than subsidiaries that are wholly owned by PB except for nominal Third Party ownership that is required under Applicable Law);

7.7.8.2 Investments in or purchases of any real property (excluding real property to be occupied or used by PB or its subsidiaries) commercial or residential mortgages or mortgage backed securities;

7.7.8.3 Investments in auction rate securities, corporate high yield bonds (i.e. less than BBB quality), precious metals, derivatives including margin trades, options, futures, options on futures, short sales, forward contracts, swaps, repurchase agreements and reverse repurchase agreements (but excluding, in each case, interest rate, currency or commodity swap agreements, interest rate caps or collar agreements, or other agreements or arrangements designed to protect a Person against fluctuation in interest rates, currency exchange rates or commodity prices not entered into for speculative purposes); and

7.7.8.4 [***].

7.7.9 SFJ Collateral has the meaning set forth in Section 7.1.

7.7.10 Subordinated Debt means indebtedness incurred by PB that is subordinated to any PB Obligations (pursuant to a subordination, intercreditor, or other similar agreement in form and substance reasonably satisfactory to SFJ entered into between SFJ and the other creditor), on terms reasonably acceptable to SFJ.

ARTICLE 8

WARRANT ISSUANCE

8.1 Warrant Issuance. PB shall issue to SFJ on the Effective Date a warrant (Warrant) exercisable for two million two hundred thousand (2,200,000) shares of PB common stock (Stock) at an exercise price per share (Exercise Price) equal to the greater of (a) five dollars ($5.00) or (b) 120% of the volume weighted average closing price of the Stock over the thirty (30) consecutive trading days ending on the last trading day immediately preceding the Effective Date and exercisable as follows: (i) one million one hundred thousand (1,100,000)

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





shares may be exercised at any time after the Effective Date provided that any such shares may be transferred by SFJ to its Affiliates but may not be resold by SFJ or its Affiliates until one (1) year after the Effective Date and (ii) one million one hundred thousand (1,100,000) shares may be exercised at any time after the date of Successful Phase 3 Interim Analysis.

8.2 Form of Warrant. The Warrant shall in the form attached hereto as Exhibit H, shall have a term of ten (10) years, and shall contain net-exercise issuance provisions.

ARTICLE 9

RECORDS

9.1 Accounting. Each Party will maintain materially complete and accurate accounting records related to this Agreement in accordance with GAAP. Each Party will retain such records for [***] after the earlier of expiration or early termination of this Agreement.

9.2 Clinical Trials-Related Records. Each Party shall, and shall cause its Affiliates and its and their Permitted Third Parties conducting Development of the Product to, maintain, in good scientific manner, complete and accurate books and records pertaining to Development of the Product hereunder, in sufficient detail to verify compliance with its obligations under this Agreement. Such books and records shall (a) be appropriate for patent and regulatory purposes, (b) be in compliance with Applicable Law, (c) properly reflect all work done and results achieved in the performance of its Development activities hereunder, and (d) be retained by such Party for such period as may be required by Applicable Law.

ARTICLE 10

CONFIDENTIAL INFORMATION

10.1 Confidentiality. Except to the extent expressly authorized by this Agreement or otherwise agreed in writing by the Parties (including, if applicable, in the Program Transfer Agreement), each Party (each, a Receiving Party) agrees that, during the Term and for the [***] period following the expiration or termination of this Agreement (except that the obligations will survive thereafter with respect to any Confidential Information that constitutes a trade secret under Applicable Law) or such longer periods for which such Confidential Information may be maintained pursuant to ARTICLE 9, it will keep confidential and will not publish or otherwise disclose and will not use for any purpose other than as provided for in this Agreement or, if applicable, the Program Transfer Agreement (which includes the exercise of any rights or the performance of any obligations hereunder or thereunder) any Confidential Information furnished to it by or on behalf of the other Party (each, a Disclosing Party) or its Affiliates in connection with this Agreement or, if applicable, the Program Transfer Agreement. The foregoing obligations will not apply to any portion of such information or materials that the Receiving Party can demonstrate:

10.1.1 was publicly disclosed by the Disclosing Party before or after such Confidential Information becomes known to the Receiving Party;

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





10.1.2 was already known to the Receiving Party or any of its Affiliates, other than under an obligation of confidentiality or non-use, prior to when it was received from the Disclosing Party;

10.1.3 is subsequently disclosed to the Receiving Party or any of its Affiliates by a Third Party lawfully in possession thereof without obligation to keep such Confidential Information confidential;

10.1.4 has been published by a Third Party or otherwise enters the public domain through no fault of the Receiving Party or any of its Affiliates in breach of this Agreement; or

10.1.5 has been independently developed by the Receiving Party or any of its Affiliates, without the aid, application or use of any Confidential Information of the other Party.

10.2 Authorized Disclosure. Each Party may disclose Confidential Information belonging to the other Party to the extent such disclosure is reasonably necessary for complying with Applicable Laws, including regulations promulgated by securities exchanges, provided that the Party required to disclose such information promptly notifies the Disclosing Party prior to making any such disclosure and cooperates with the Disclosing Party's efforts to seek confidential treatment or to otherwise limit disclosure. Each Receiving Party may disclose the other Party's Confidential Information to its Affiliates, employees, agents, advisors, and independent contractors (including Permitted Third Parties) engaged by such Receiving Party, in each case (a) only to the extent such Persons need to know the Confidential Information solely in connection with the performance of this Agreement or, if applicable, the Program Transfer Agreement and (b) provided that each Person receiving Confidential Information must be bound by obligations of confidentiality and non-use at least as stringent as an equivalent in scope to those set forth in this ARTICLE 10 prior to any such disclosure and the Party making such disclosure to such Person shall be liable to the other Party for any breach of such obligations by such disclosee. PB may disclose SFJ Confidential Information to MedImmune as necessary to comply with PB's obligations or exercise PB's rights under the AZ License (it being understood that any such disclosure will be made under the terms of Article 6 of the AZ License and that PB shall not be required to enter into any further confidentiality agreement with MedImmune for such purpose). Each Party may also disclose the material terms of this Agreement (including the form of Program Transfer Agreement) or provide a copy of this Agreement or a summary of such Party's findings during its due diligence investigation of the Products (if applicable) to any bona fide potential or actual investor, investment banker, acquirer, provider of debt or royalty financing, or other potential or actual financial partner without consent of the other Party, and provided that in connection with such disclosure, each disclosee must be bound by obligations of confidentiality and non-use at least as stringent as an equivalent in scope to those set forth in this ARTICLE 10 prior to any such disclosure and the Party making such disclosure to such disclosee shall be liable to the other Party for any breach of such obligations by such disclosee. Notwithstanding anything in the foregoing to the contrary, Exhibit D constitutes PB's Confidential Information and not SFJ's Confidential Information, and PB may disclose Exhibit D to Third Parties as determined by PB in its sole discretion. In any event, each Party agrees to

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





take all reasonable action to avoid unauthorized use or disclosure of Confidential Information of the other Party hereunder.

10.3 Return of Confidential Information. Except as otherwise provided herein, upon expiration or earlier termination of this Agreement, all Confidential Information (including any copies thereof) in written or other tangible form will, at the Disclosing Party's direction, be returned to the Disclosing Party or destroyed by the Receiving Party, and any Person(s) to whom the Receiving Party disclosed (with such destruction being certified in writing by an authorized officer of the Receiving Party), except (i) to the extent such Confidential Information is necessary to exercise any license and/or rights hereunder that survive such expiration or earlier termination; and (ii) one (1) copy of each document may be retained by the Receiving Party solely to the extent necessary to permit it to comply with any ongoing rights and responsibilities with respect to such Confidential Information.

10.4 MedImmune Confidential Information. With respect to any Confidential Information of PB that constitutes MedImmune Confidential Information, SFJ hereby agrees to be bound by the provisions of Sections 6.1, 6.2 and 6.7 of the AZ License to the same extent as PB is.

10.5 Confidential Status of the Agreement. Subject to Section 10.2 and Section 10.6, the terms of this Agreement, including the form of Program Transfer Agreement (whether or not executed by the Parties), are deemed to be Confidential Information and will be subject to the confidentiality requirements of this ARTICLE 10, with each Party being deemed a Receiving Party for such purposes. The Parties each acknowledge that it will be necessary for PB to file this Agreement with the US Securities and Exchange Commission and to make other required public disclosures regarding the terms of this Agreement, and accordingly PB shall prepare a confidential treatment request in connection with such filing and provide SFJ a reasonable opportunity to review and comment on such filing as well as on such other required public disclosures and thereafter use Commercially Reasonable Efforts to obtain confidential treatment as to the terms of this Agreement.

10.6 Publicity. The Parties recognize that following the Effective Date the Parties (either individually or jointly) shall issue mutually agreed press release(s) announcing the execution of this Agreement, and thereafter each Party may from time to time desire to issue additional press releases and make other public statements or disclosures regarding the subject matter of this Agreement, and hereby agree that such additional press releases, public statements and disclosures regarding the terms of this Agreement will be permitted only with the other Party's written consent (which shall not be unreasonably withheld, conditioned or delayed). Any publication, news release or other public announcement relating to the terms of this Agreement will first be reviewed and approved in writing by both Parties; provided, however, that any disclosure of the minimum information which is required by Applicable Law (including the rules of a securities exchange), as reasonably advised by the disclosing Party's counsel, may be made without the prior consent of the other Party, although the other Party will be given prompt notice of any such legally required disclosure and to the extent practicable will be provided an opportunity to comment on the proposed disclosure and the disclosing Party will consider in

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





good faith any comments provided by the other Party on such proposed disclosure. For avoidance of doubt, this Section 10.6 shall not restrict PB from releasing public statements or disclosures regarding PB's development and Commercialization activities with respect to the Product.

10.7 Use of Name. Unless otherwise expressly permitted herein, PB will obtain the written consent of SFJ (which consent will not unreasonably be withheld, conditioned or delayed) prior to referring to SFJ in any correspondence with any Regulatory Authority or Governmental Authority, except as may be required by Applicable Law. SFJ agrees to be bound by Section 6.3 of the AZ License to the same extent as PB is.

ARTICLE 11

INTELLECTUAL PROPERTY AND PERSONALLY  IDENTIFIABLE INFORMATION

11.1 Ownership and Rights.

11.1.1 Ownership.

11.1.1.1 Existing Intellectual Property. Subject to Section 11.1.1.2, it is agreed between the Parties that each Party will retain all right, title and interest in, to and under all Intellectual Property that is Controlled by such Party as of the Effective Date.

(a) Without limiting the generality of the foregoing, as between the Parties, PB shall be and remain the sole and exclusive owner of all right, title and interest in and to all PB Intellectual Property existing as of the Effective Date (Existing PB Intellectual Property), including, in the case of Patents within the Existing PB Intellectual Property (Existing PB Patents), all patent applications filed after the Effective Date that claim priority to, or are foreign counterparts of, patent applications within the Existing PB Patents (Corresponding PB Patent Applications) and all Patents that may issue or be granted from any patent application within the Existing PB Patents or any Corresponding PB Patent Application after the Effective Date. In addition, PB shall be and remain the sole and exclusive owner of all right, title and interest in and to all PB Intellectual Property arising during the term of this Agreement independent of the conduct of the activities contemplated by this Agreement.

(b) SFJ acknowledges that the PB Intellectual Property includes Licensed Know-How and Licensed Patents licensed to PB pursuant to, and subject to the terms and conditions of, the AZ License. SFJ further acknowledges and agrees that, as required by the AZ License, MedImmune shall own and retain all right, title and interest in and to any and all Licensed Know-How and Licensed Patents (including Patents that become Licensed Patents pursuant to the last two sentences of Section 5.1.2 of the AZ License). SFJ shall, and hereby does, assign to MedImmune and will cause each of its officers, directors, employees and Affiliates, and its and their respective Permitted Third Parties, to assign to MedImmune all right, title and interest in and to all Patents filed by or on behalf of PB claiming any Licensed Know-How, without additional compensation, as is necessary to fully effect the

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





sole ownership provided for in the second sentence of this Section 11.1.1.1(b). In the event of any conflict between the terms of this Agreement (including the form of Program Transfer Agreement) and the terms of the AZ License, in each case, as applicable to Licensed Know-How or Licensed Patents, the terms of the AZ License shall prevail.

11.1.1.2 MedImmune Intellectual Property.

(a) SFJ acknowledges and agrees that, as required by the AZ License, MedImmune shall own and retain all right, title and interest in and to any and all AstraZeneca Product Improvements, AstraZeneca Product Know-How and AstraZeneca Product Patents. SFJ shall, and hereby does, assign to MedImmune and will cause each of its officers, directors, employees and Affiliates, and its and their respective Permitted Third Parties, to assign to MedImmune all right, title and interest in and to all (i) AstraZeneca Product Improvements that are conceived, discovered, developed or otherwise made by or on behalf of SFJ or any of its Affiliates (including by any of their respective Third Party contractors), (ii) AstraZeneca Product Know-How generated by or on behalf of SFJ or any of its Affiliates (including by any of their respective Third Party contractors), and (iii) AstraZeneca Product Patents claiming any such AstraZeneca Product Improvement(s) or AstraZeneca Product Know-How; in each case, without additional compensation, as is necessary to fully effect the sole ownership provided for in the first sentence of this Section 11.1.1.2(a).

(b) SFJ shall cause each employee, individual consultant and Third Party contractor that SFJ or its Affiliate proposes to engage to conduct any Clinical Trial activity under or in connection with this Agreement (including, if applicable, in connection with the Program Transfer Agreement) on its behalf who conceives, discovers, develops or otherwise makes any AstraZeneca Product Improvement under or in connection with activities conducted pursuant to this Agreement to be under an obligation to assign to PB their rights in any such AstraZeneca Product Improvement, so that PB may comply with its obligations with respect to AstraZeneca Improvements, AstraZeneca Product Know-How and AstraZeneca Product Patents under the AZ License. If (i) SFJ is unable to cause any such Third Party contractor or consultant (including any contractor who is, or a consultant who is employed by, a governmental, not-for-profit, or public institution that has standard policies against such an assignment) to agree to such assignment obligation with respect to AstraZeneca Product Improvements despite SFJ's using commercially reasonable efforts to negotiate such assignment obligation, or (ii) Applicable Law would prohibit SFJ from requiring such an assignment from such Third Party contractor or consultant, in each case ((i) and (ii)), SFJ and its Affiliates shall refrain from using such Third Party contractor or consultant to conduct activities pursuant to this Agreement unless PB obtains MedImmune's written consent thereto.

(c) The Parties acknowledge and agree that in the event of any conflict between the terms of this Agreement and the terms of the AZ License, in each case, as applicable to AstraZeneca Product Improvements, AstraZeneca Product Know-How or AstraZeneca Product Patents, the terms of the AZ License shall prevail.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





11.1.1.3 Trial Inventions.

(a) PB shall be the exclusive and sole owner of, and retain all right, title and interest in and to, all Trial Inventions (which shall constitute PB Intellectual Property), regardless of inventorship. SFJ will promptly disclose, and will cause its Affiliates and all Permitted Third Parties engaged by SFJ or its Affiliates to perform any of SFJ's obligations hereunder promptly to disclose, to PB in writing in reasonable detail each Trial Invention made, developed, created, generated, conceived or reduced to practice in whole or in part by or on behalf of SFJ, such Affiliate or such Permitted Third Party, which written disclosure shall include all available information and data necessary to support the filing of patent applications Covering such Trial Invention. SFJ, for itself and on behalf of its Affiliates, hereby assigns, and shall cause such other Permitted Third Parties to assign (subject to Section 11.1.1.3(c)), to PB all its right, title and interest in and to Trial Inventions and all information and data necessary to support the filing of patent applications Covering such Trial Inventions. SFJ will cooperate, and will cause the foregoing Persons to cooperate, with PB to effectuate and perfect the foregoing ownership, including by promptly executing and recording assignments and other documents consistent with such ownership.

(b) SFJ shall cause each employee and individual consultant of such SFJ or its Affiliates (but excluding Permitted Third Parties of SFJ and its Affiliates, which are separately addressed in Section 11.1.1.3(c)) who conceives, discovers, develops or otherwise makes any Trial Invention to be under an obligation to assign to PB their rights in any such Trial Invention. In the case of any individual consultant of SFJ or its Affiliates (excluding SFJ's and its Affiliates' Permitted Third Parties), if SFJ is unable to cause such consultant to agree to such assignment obligation despite SFJ's using commercially reasonable efforts to negotiate such assignment obligation, then SFJ shall either: (A) cause such consultant to grant an exclusive, worldwide, royalty-free, fully-paid, freely-assignable license, with the right to sublicense through multiple tiers, under their rights in such Trial Invention to develop, make, have made, use, sell, have sold, offer for sale and import the Product for any and all uses, except where Applicable Law requires otherwise and except in the case of consultants who are employed by governmental, not- for-profit, or public institutions that have standard policies against such an assignment (in which case, SFJ shall use commercially reasonable efforts to obtain a suitable license, or right to obtain such a license); or (B) refrain from using such consultant to conduct activities pursuant to this Agreement unless PB obtains MedImmune's written consent thereto.

(c) SFJ shall use commercially reasonable efforts to obtain from each Third Party contractor that SFJ or its Affiliate proposes to engage to conduct activities under or in connection with this Agreement on behalf of SFJ or its Affiliates (i) an assignment, (ii) an exclusive, worldwide, royalty-free, fully-paid, freely-assignable license, with the right to sublicense through multiple tiers, or (iii) a non‑exclusive, worldwide, royalty-free, fully-paid, freely-assignable license, with the right to sublicense through multiple tiers ((i) through (iii) in order of preference), to PB of any Trial Invention that such Third Party contractor conceives, discovers, develops or otherwise makes in connection with activities conducted relating to this Agreement. The Parties acknowledge that it may not be possible to obtain such assignment or license from any such Third Party contractor with respect to technology of broad applicability to

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





the operation of such Third Party contractor's business or improvements, or improvements to such Third Party contractor's own proprietary technology used in the performance of services on behalf of SFJ or its Affiliate, in each case, on acceptable terms or at all, and accordingly, the Parties agree that the inability of SFJ or its Affiliate, despite the use of commercially reasonable efforts, to obtain such assignment or license from a Third Party contractor on acceptable terms or at all shall not constitute a breach of SFJ's obligations under this Agreement.

11.1.1.4 Trial Data Package. SFJ shall be the sole and exclusive owner of the Trial Data Package including the Research Results included therein. In consideration of the Approval Payments to be made under this Agreement (if and to the extent applicable), and in further consideration of the payment by PB to SFJ of [***], SFJ shall sell and transfer to PB, and PB shall acquire from SFJ, the sole and exclusive ownership, even as to SFJ, of the Trial Data Package including all Research Results as set forth below in this Section 11.1.1.4. Upon the earliest of (A) receipt of Regulatory Approval of the Product for the Indication in at least one of the US, the EU, any Designated European Country, Japan or China or (B) termination of this Agreement in accordance with any termination clause or section of this Agreement, in each case, PB and SFJ will promptly enter into the Trial Data Package Purchase Agreement attached hereto as Exhibit K, and PB will purchase, and SFJ will sell to PB, sole and exclusive ownership of all Research Results, including the Trial Data Package.

11.1.1.5 Inventorship; Further Assurances. Inventorship of Trial Inventions will be determined according to the principles of US patent law. SFJ agrees to cooperate fully, to cause its Affiliates to cooperate fully, and to use Commercially Reasonable Efforts to cause its and their respective Permitted Third Parties to cooperate fully, in each case: (a) with PB in the preparation, filing, prosecution and maintenance of Patents Covering Trial Inventions; and (b) with MedImmune in the preparation, filing, prosecution and maintenance of Patents (x) Covering AstraZeneca Product Improvements described in clause (i) of Section 11.1.1.2(a) or AstraZeneca Product Know-How described in clause (ii) of Section 11.1.1.2(a) or (y) filed by or on behalf of PB claiming any Licensed Know-How. Such cooperation includes executing all papers and instruments, or requiring its employees, consultants and Permitted Third Parties, to execute such papers and instruments, so as to (i) effectuate (A) the ownership of AstraZeneca Product Improvements, AstraZeneca Product Know-How and AstraZeneca Product Patents set forth in Section 11.1.1.2, (B) the ownership of Patents that become Licensed Patents pursuant to the last two sentences of Section 5.1.2 of the AZ License as set forth in Section 11.1.1.1(b), and (C) the ownership of Trial Inventions set forth in Section 11.1.1.3(a), including Patents claiming or disclosing Trial Inventions, and (ii) enable (A) MedImmune to apply for and to prosecute patent applications claiming AstraZeneca Product Improvements and Patents that become Licensed Patents pursuant to the last two sentences of Section 5.1.2 of the AZ License in any country and (B) PB to apply for and to prosecute patent applications claiming Trial Inventions in any country.

11.1.1.6 No Other Rights. The delivery or disclosure by or on behalf of PhaseBio to SFJ of any information or materials hereunder will not be construed to grant SFJ any rights or license to use any Intellectual Property Controlled by PB other than as necessary to comply with its obligations hereunder or as expressly set forth herein. Except as otherwise

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





expressly permitted in this Agreement, SFJ may not use, publish or otherwise disclose any Intellectual Property Controlled by PB without PB's prior written consent.

11.2 Patent Prosecution. As between SFJ and PB, PB will have sole and exclusive right to prepare, file, prosecute and maintain all Patents within the PB Intellectual Property, including all Patents that cover the Trial Inventions, at its own expense (provided that PB shall use Commercially Reasonable Efforts to prosecute and maintain such Patents). At PB's request and expense (for reasonable out-of-pocket expenses), SFJ will reasonably cooperate with PB in preparing, filing, prosecuting, and maintaining such Patents.

11.3 Intellectual Property Enforcement.

11.3.1 PB Intellectual Property. PB will use Commercially Reasonable Efforts to enforce Intellectual Property Controlled by PB, including Intellectual Property that covers the Trial Inventions, against Third Party Infringements.

11.3.2 Infringement of Third Party Rights. If either Party learns of Third Party allegations that it or the other Party or any of its or the other Party's Affiliates or Permitted Third Parties, have infringed, misappropriated or otherwise violated, or are infringing, misappropriating or otherwise violating, any Intellectual Property of a Third Party in connection with either the Clinical Trials or performing its obligations or duties hereunder, such Party will promptly notify the other Party. PB will have sole control and responsibility of, and discretion with respect to, such allegations and any related actions and/or litigation.

11.4 Personally Identifiable Information.

11.4.1 In conducting the Clinical Trials and its other obligations under this Agreement and, if applicable, the Program Transfer Agreement, each Party will comply, and will use Commercially Reasonable Efforts to require each applicable Permitted Third Party of such Party to comply, with Applicable Laws relating to privacy or data protection applicable to such Party or the Clinical Trials being conducted by or on behalf of such Party, including ensuring that all necessary (a) consents from Clinical Investigators, Subjects and any others from whom Personally Identifiable Information will be received are obtained; (b) regulatory notifications are filed in all countries for which Sites have been selected; and (c) approvals are obtained in all countries for which Sites have been selected, prior to collection or transfer of such Personally Identifiable Information. Without prejudice to the generality of the foregoing, each Party shall (i) work together with the other Party in good faith to ensure the information referred to in applicable laws and, if applicable, in particular Articles 13 and 14 of the General Data Protection Regulation (2016/679) (GDPR) is made available to data subjects (as defined in the GDPR) in relation to the processing of their Personally Identifiable Information by either Party when acting as a data controller (as defined in the GDPR), and the information is in a concise, transparent, intelligible and easily accessible form, using clear and plain language as required by Article 12 of the GDPR; (ii) if either Party (the Data Receiving Party) receives any complaint, notice or communication from a supervisory authority (as defined in the GDPR) which relates directly or indirectly to the other Party's (A) processing of the Personally Identifiable Information; or (B) potential failure to comply with the provisions of the GDPR, the Data Receiving Party shall,

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





to the extent permitted by law, promptly forward the complaint, notice or communication to the other Party and provide the other Party with reasonable co-operation and assistance in relation to the same; (iii) if a data subject makes a written request to a Party to exercise their rights in relation to their Personally Identifiable Information that concerns processing in respect of which the other Party is the data controller, that Party shall forward the request to the other Party promptly and in any event within [***] from the date on which it received the request and, upon the other Party's reasonable written request, provide that other Party with reasonable co-operation and assistance in relation to that request to enable the other to respond to such request and meet applicable timescales set out under the GDPR; (iv) if either Party becomes aware of a personal data breach (as defined in the GDPR), it shall notify the other Party without undue delay, and each Party shall co-operate with the other, to the extent reasonably requested, in relation to any notifications to supervisory authorities or to data subjects which either Party is required to make under the GDPR.

11.4.2 Each Party will not process, and will use Commercially Reasonable Efforts to require each applicable Permitted Third Party of such Party to not process, any Personally Identifiable Information in a way that is contrary to Applicable Laws or any Informed Consent.

11.4.3 Each Party will use Commercially Reasonable Efforts to maintain, and will use Commercially Reasonable Efforts to require each applicable Permitted Third Party of such Party to maintain, appropriate and sufficient technical and organizational security measures to maintain the confidentiality of Personally Identifiable Information and to protect such data against accidental or unlawful destruction or accidental loss, damage, alteration, unauthorized disclosure or access, in particular where such data is transmitted over a network. These technical and organizational security measures shall ensure a level of security appropriate to the risk, including, as appropriate, (a) pseudonymisation and encryption; (b) the ability to ensure the ongoing confidentiality, integrity, availability and resilience of processing systems and services; (c) the ability to restore the availability and access to the Personally Identifiable Information in a timely manner in the event of a physical or technical incident; and (d) a process for regularly testing, assessing and evaluating the effectiveness of those measures.

11.4.4 Each Party shall notify the other Party of: (a) any unauthorized use or disclosure or breach of any Personally Identifiable Information promptly upon discovery of such occurrence; and (b) the transmittal of any related breach notification to any affected person, Governmental Authority or the media. Each Party will use Commercially Reasonable Efforts to require each applicable Permitted Third Party of such Party to notify the such Party of: (i) any unauthorized use or disclosure or breach of any Personally Identifiable Information promptly upon discovery of such occurrence and (ii) the transmittal of any related breach notification to any affected person, Governmental Authority or the media.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





ARTICLE 12

INDEMNIFICATION AND INSURANCE

12.1 Indemnification by Each Party.

12.1.1 By SFJ. SFJ will indemnify and hold PB; its Affiliates and their respective officers, directors, employees and agents (the PB Indemnified Parties), harmless from any and all Losses, net of any related tax benefit actually realized in the same year as the payment or incurrence of such Losses or any prior year, arising or resulting from any Claims by a Third Party against any PB Indemnified Parties to the extent arising from (a) the gross negligence or willful misconduct of SFJ or any of its Affiliates or any of its or their respective Permitted Third Parties in performing SFJ's obligations under this Agreement or, if applicable, the Program Transfer Agreement; (b) SFJ's material breach of this Agreement or, if applicable, the Program Transfer Agreement; (c) any material breach of a Protocol by SFJ, or its Affiliate, or any of its or their respective Permitted Third Parties; (d) any breach by SFJ of any provision of the AZ License by which SFJ has agreed to be bound in this Agreement; (e) a physical injury or death of a subject that is caused by the subject's participation in any clinical trial conducted by or on behalf of SFJ or any of its Affiliates after a Program Transfer whether or not directly attributable to the Product(other than the Product manufactured by PB); and/or (f) from any after any Program Transfer, product liability claims resulting from the Commercialization of Product other than Product manufactured by PB by or on behalf of SFJ or any of its Affiliates, licensees or sublicensees; except to the extent that any of the foregoing (a) through (f) was caused by (i) the gross negligence or willful misconduct of any PB Indemnified Party, or (ii) material breach of this Agreement, or, if applicable, the Program Transfer Agreement, by PB.

12.1.2 By PB. PB will indemnify and hold SFJ, its Affiliates, SFJ's investors and their respective officers, directors, employees and agents (the SFJ Indemnified Parties), harmless from any and all Losses, net of any related tax benefit actually realized in the same year as the payment or incurrence of such Losses or any prior year, arising or resulting from any Claims by a Third Party against any SFJ Indemnified Parties to the extent arising from (a) a Product supplied by PB; (b) a physical injury or death of a Subject that is caused by the Subject's participation in the Clinical Trials whether or not directly attributable to the Product (excluding any Clinical Trial conducted by or on behalf of SFJ or its Affiliate after a Program Transfer); (c) PB's gross negligence or willful misconduct in performing its obligations under this Agreement or, if applicable, the Program Transfer Agreement; (d) PB's material breach of this Agreement or, if applicable, the Program Transfer Agreement, (e) any material breach of a Protocol by PB, or its Affiliate, or of its or their respective Permitted Third Parties, (f) actual or alleged infringement of any Third Party's Intellectual Property by the Product or by either Party in performing its duties or obligations hereunder with respect to the Product; and (g) injuries sustained by Subjects in connection with the Clinical Trials, including Claims arising prior to the Effective Date based upon physical injury or death of a Subject in connection with the Clinical Trials, or from the Commercialization of the Product; except to the extent that any of the foregoing (a) through (g) were caused by (i) the gross negligence or willful misconduct of any

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





SFJ Indemnified Party, or (ii) material breach of this Agreement, or, if applicable, the Program Transfer Agreement by, SFJ.

12.2 Indemnification Procedure.

12.2.1 Notice of Claim. A Party believing that it is entitled to indemnification under Section 12.1.1 or 12.1.2 (an Indemnified Party) will give prompt written notice (each, an Indemnification Claim Notice) to the other Party (the Indemnifying Party) upon receipt of notice of the commencement of any Claim for which indemnification may be sought, or if earlier, upon the assertion of any such Claim by a Third Party (it being understood and agreed, however, that the failure by an Indemnified Party to give notice of a Claim of a Third Party as provided in this Section 12.2.1 will not relieve the Indemnifying Party of its indemnification obligation under this Agreement except and only to the extent that such Indemnifying Party is actually prejudiced as a result of such failure to give notice). Each Indemnification Claim Notice will contain a description of the Claim and the nature and amount of the Loss (to the extent that the nature and amount of such Loss are known at such time). The Indemnified Party will furnish promptly to the Indemnifying Party copies of all papers and official documents received in respect of any Losses.

12.2.2 Control of Defense. At its option, the Indemnifying Party may assume the defense of any Claim by giving written notice to the Indemnified Party within [***] after the Indemnifying Party's receipt of an Indemnification Claim Notice. The assumption of the defense of a Claim by the Indemnifying Party will not be construed as an acknowledgment that the Indemnifying Party is liable to indemnify the Indemnified Party in respect of the Claim, nor will it constitute a waiver by the Indemnifying Party of any defenses it may assert against the Indemnified Party's claim for indemnification. Upon assuming the defense of a Claim, the Indemnifying Party may appoint as lead counsel in the defense of the Claim any legal counsel selected by the Indemnifying Party that is reasonably satisfactory to the Indemnified Party. In the event the Indemnifying Party assumes the defense of a Claim, the Indemnified Party will promptly deliver to the Indemnifying Party all original notices and documents (including court papers) received by the Indemnified Party in connection with the Claim. Should the Indemnifying Party assume the defense of a Claim, the Indemnifying Party will not be liable to the Indemnified Party for any legal expenses subsequently incurred by such Indemnified Party in connection with the analysis, defense or settlement of such Claim.

12.2.3 Right to Participate in Defense. Without limiting Section 12.2.2, the Indemnified Party will be entitled to (a) participate in, but not control, the defense of such Claim and to engage counsel of its choice for such purpose; provided, however, that such engagement will be at the Indemnified Party's own expense unless the engagement thereof has been specifically authorized by the Indemnifying Party in writing, and (b) control its defense of such Claim and to engage counsel of its choice for such purpose, at the expense of the Indemnifying Party, if the Indemnifying Party has failed to assume the defense and engage counsel in accordance with Section 12.2.2.

12.2.4 Settlement. With respect to any Losses related solely to payment of money damages in connection with a Claim and that includes a complete and unconditional

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





release of the Indemnified Party, will not result in the Indemnified Party admitting liability, becoming subject to injunctive or other equitable relief that will otherwise adversely affect the business of the Indemnified Party in any manner, and as to which the Indemnifying Party will have acknowledged in writing the obligation to indemnify the Indemnified Party hereunder, the Indemnifying Party will have the sole right to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss, on such terms as the Indemnifying Party, in its sole discretion, will deem appropriate. With respect to all other Losses in connection with Claims, where the Indemnifying Party has assumed the defense of the Claim in accordance with Section 12.2.2, the Indemnifying Party will have authority to consent to the entry of any judgment, enter into any settlement or otherwise dispose of such Loss provided it obtains the prior written consent of the Indemnified Party (which consent will not be unreasonably withheld, conditioned or delayed). The Indemnifying Party will not be liable for any settlement or other disposition of a Loss by the Indemnified Party that is reached without the written consent of the Indemnifying Party (which consent will not be unreasonably withheld, conditioned or delayed). Regardless of whether the Indemnifying Party chooses to defend or prosecute any Claim, the Indemnified Party will not admit any liability with respect to, or settle, compromise or discharge, any Claim without the prior written consent of the Indemnifying Party, not to be unreasonably withheld or delayed.

12.2.5 Cooperation. Regardless of whether the Indemnifying Party chooses to defend or prosecute any Claim, the Indemnified Party will reasonably cooperate in the defense or prosecution thereof and will furnish such records, information and testimony, provide such witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith. Such cooperation will include access during normal business hours afforded to the Indemnifying Party to, and reasonable retention by the Indemnified Party of, records and information that are reasonably relevant to such Claim, and making employees and agents available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder, and the Indemnifying Party will reimburse the Indemnified Party for all its reasonable out-of-pocket expenses in connection therewith.

12.3 Insurance.

12.3.1 Generally. Commencing as of the Effective Date and thereafter during the Development Term, and subject to Section 12.3.2 below, each Party will carry and maintain, at its own expense, insurance coverage of the kind and with liability limits that, at a minimum, satisfy the requirements of Section 12.3.2, to protect itself and the other Party against any claims or liabilities that may arise from the conduct of the Clinical Trials and all other rights and obligations hereunder with insurers with a minimum A- A.M. Best rating. Any deductibles for such insurance policies will be assumed by the insuring Party. Such insurance policies will be primary and non-contributing with respect to any other similar insurance policies available to other Party and their Affiliates. Prior to the Effective Date, and annually, at each anniversary of the Effective Date (unless, during such year, expiration of the applicable policy occurs first, in which case, on such expiration date), at a Party's written request the other Party will supply documentation of such insurance coverage via original certificates of insurance, if applicable.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Each Party will provide the other Party a minimum of [***] prior written notice if it is unable to obtain appropriate insurance coverage or if its coverage is canceled, unable to be renewed or materially changed. For clarity, any insurance coverage or the failure to maintain adequate insurance coverage does not limit or reduce a Party's liability under this Agreement. Each Party will ensure that no subcontractor, including any Permitted Third Party, will continue to perform the work unless such subcontractor is insured as deemed appropriate by the Party engaging the Permitted Third Party.

12.3.2 Minimum Requirements. Commencing as of the start of the Clinical Trials and thereafter, during the Term (or longer if otherwise stated below), at a minimum, each Party will maintain the following types of insurance coverage at a minimum level that is the greater of (a) the highest minimum level required by Applicable Law in the countries in which the Clinical Trials and other obligations hereunder are being performed or (b) the following (to the extent different).

12.3.2.1 Commercial General Liability: [***] dollars ($[***]) per occurrence; [***] dollars ($[***]) Product and Completed Operations aggregate, including Premises & Operations, Personal Injury, Product and Completed Operations; [***] dollars ($[***]) combined single limit on all owned, non-owned and hired vehicles of such Party.

12.3.2.2 Umbrella Excess Liability: [***] dollars ($[***]) per occurrence.

12.3.2.3 Clinical Trials Liability: [***] dollars ($[***]) per occurrence. PB will obtain such Clinical Trials Liability insurance on a global basis, and, if required, supplemented Clinical Trials Liability Insurance in the US, at its expense and SFJ will obtain supplemental Clinical Trials Liability insurance for the SFJ Territory and on a country specific basis in the European Clinical Trial Countries as required by Applicable Law at its expense, which will be considered Development Costs. Coverage must be maintained for as long as required by Applicable Law in each country after release of the last Subject from the Clinical Trials or where there is no legal requirement at least [***] after the termination of this Agreement.

12.3.2.4 Professional Liability: Any subcontractor, including any Permitted Third Party, who provides professional services to such Party for the Clinical Trials, will obtain Professional Liability Insurance in lieu of Clinical Trial Insurance, with a minimum limit of [***] dollars ($[***]) per occurrence. Coverage must be maintained for at least [***] after the later of (i) expiration or early termination of this Agreement and (ii) release of the last Subject from the Clinical Trials.

12.3.3 Additional Insured. Each Party will include the other Party and its Affiliates as additional insured parties on such Party's Clinical Trial Liability insurance, as set forth in Section 12.3.2.3 for [***] after the later of termination of this Agreement or release of the last Subject from the Clinical Trials.

12.3.4 Product Liability Insurance. Prior to a Program Transfer, PB will be responsible for maintaining product liability insurance related to the Development and

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





Commercialization of the Product at its expense with SFJ to be named as an additional insured party. From and after a Program Transfer, SFJ will be responsible for maintaining product liability insurance related to the Development and Commercialization of the Product at its expense with PB to be named as an additional insured party.

ARTICLE 13

REPRESENTATIONS AND WARRANTIES

13.1 Representations, Warranties and Covenants of Both Parties.

13.1.1 Each Party hereby represents and warrants that it has the requisite corporate power and authority to enter into this Agreement and that this Agreement constitutes a legal and valid obligation binding upon such Party, enforceable in accordance with its terms.

13.1.2 Each Party hereby represents and warrants that it is not a party to any agreement that would prevent it from fulfilling its obligations under this Agreement.

13.1.3 Each Party agrees, on behalf of itself and its Affiliates, and its and their respective officers, directors, employees, agents, representatives, consultants, and Permitted Third Parties engaged in connection with the subject matter of this Agreement (Representatives), that for the performance of its obligations hereunder:

13.1.3.1 such Party, its Affiliates and its and their respective Representatives shall comply with the Anti- Corruption Laws and shall not take any action that will, or would reasonably be expected to, cause the other Party or its Affiliates to be in violation of any Anti-Corruption Laws; and

13.1.3.2 such Party shall promptly provide the other Party with written notice of the following events: (a) upon becoming aware of any breach or violation by such Party, its Affiliate or any of its or their respective Representatives of any representation, warranty or undertaking set forth in Section 13.1.3.1, or (b) upon receiving a formal notification that it is the target of a formal investigation by a Governmental Authority for a Material Anti-Corruption Law Violation or upon receipt of information from any of its Representatives connected with this Agreement that any of them is the target of a formal investigation by a governmental authority for a Material Anti-Corruption Law Violation.

13.1.4 Each Party certifies that neither it, nor its Affiliates, nor to its knowledge any Permitted Third Parties engaged by it to perform activities in relation to the Product are debarred under subsections 306(a) or (b) of the US Federal Food, Drug, and Cosmetic Act (US Generic Drug Enforcement Act of 1992; 21 USC 335a (a) or (b)), and that it has not and will not knowingly use in any capacity the services of any Person or Permitted Third Party debarred under this law to conduct the Clinical Trials. Each Party further certifies that neither it, nor any of its Affiliates are excluded from any federal health care program, including but not limited to Medicare and Medicaid. Each Party will notify the JSC immediately if either of these certifications needs to be amended in light of new information.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





13.1.5 Each Party further covenants that it and its Permitted Third Parties have, or will have at the required times, such certifications, permits, and authorizations as are required to conduct the Clinical Trials and perform any and all of their obligations in connection with the Clinical Trials supervised by it.

13.2 Additional PB Representations, Warranties and Covenants.

13.2.1 Licensure, Registration and Accreditation. PB hereby represents and warrants that it is licensed, registered, or otherwise qualified in all material respects under all Applicable Laws to do business in each jurisdiction where such licenses, registrations or other qualifications are required. PB further represents and warrants that there has not been and covenants that there will not be during the Term any breach or default by PB under AZ License which has not been or will not be, as applicable, timely cured as permitted thereunder, and that the AZ License is and shall continue to be in full force and effect during the Term, except to the extent that such a breach, default or failure as to the AZ License would not have a material adverse effect on PB's ability to satisfy its obligations under this Agreement. During the Term, PB shall: (a) not take any action that would entitle MedImmune to terminate the AZ License pursuant to Section 9.2.3 thereof (b) take such actions as are necessary to cure any action by a Sublicensee (as defined in the AZ License) that would entitle MedImmune to terminate the AZ License; and (c) not mutually agree with MedImmune to terminate the AZ License, without the prior written consent of SFJ, to be given or withheld in its sole discretion. In addition, during the Term, PB shall not take any action to terminate the AZ License without providing [***] prior written notice to SFJ of PB's intent to terminate so that SFJ may, in its sole discretion, elect to obtain the Program Transfer, and if SFJ elects in writing within such [***] period to obtain the Program Transfer, then PB shall not terminate the AZ License but shall assign it to SFJ in accordance with the Program Transfer Agreement and in such event PB shall not be entitled to any royalty payments as set forth in Section 3 of the Program Transfer Agreement.

13.2.2 Disclosure of Regulatory Notices and Communications. PB hereby represents and warrants that, as of [***] prior to the Effective Date, the regulatory communications and, if any, notices of inspection, inspection reports, warning letters and deficiency letters related to the Product made available by PB in the Data Room were true and complete copies of such documents. To the knowledge of PB, such documents comprise all material written regulatory communications related to Clinical Trials design or the chemistry, manufacturing or controls of the Product from all Regulatory Authorities in the possession of PB as of [***] prior to the Effective Date.

13.2.3 CRO Inquiry. PB hereby represents and warrants that, up to and as at the Effective Date, after due inquiry to its CRO responsible for conducting the Clinical Trials, PB has not received any verbal or written notice of the occurrence of any Serious Safety Issue in the Clinical Trials.

13.2.4 Compliance. PB represents and warrants that, prior to the Effective Date, (a) it has conducted all preclinical and clinical activities related to the development of the Product for the Indication in material compliance with Applicable Laws, and (b) to PB's knowledge, all Third Parties utilized by PB to perform any portion of the preclinical and clinical

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





activities have conducted such portion of such preclinical activities in material compliance with Applicable Laws. PB will manufacture or have manufactured the Product for the Clinical Trials in accordance with GMP.

13.2.5 Intellectual Property. PB [***]. The development, manufacture and commercialization of the Product by PB [***]. There are no outstanding options, licenses or agreements of any kind granted by PB relating to the development, manufacture and commercialization of the Product. PB has not received any communications alleging that PB has violated or that the development, manufacture and commercialization of the Product would violate any of the patents, trademarks, service marks, trade names, copyrights, trade secrets or other proprietary rights of any Third Party.

13.2.6 PB Data Provided as of the Effective Date. PB hereby represents and warrants that, up to and as of the Effective Date, (i) the CMC Information set forth in the Data Room is accurate in all material respects, (ii) the descriptions of, protocols for, and data and other results of, the Clinical Trials of the Product for the Indication conducted by or on behalf of PB set forth in the Data Room are accurate and complete in all material respects and there are no material omissions from such documents, data and other results that render such documents, data or other results materially misleading and (iii) the summaries of primary data regarding the Product and the Comparators set forth in the Data Room are accurate and complete in all material respects, and there are no material omissions from such summaries as so presented that render such summaries materially misleading.

13.3 Outstanding Indebtedness. PB hereby represents and warrants that, as at the Effective Date, PB and its subsidiaries have no indebtedness for borrowed money other than indebtedness under the SVB Loan Agreement and obligations in respect of corporate credit cards.

13.4 Contingent Liabilities. PB hereby represents and warrants that, except as reflected in PB's consolidated balance sheet for the quarter ended September 30, 2019 included its Quarterly Report on Form 10-Q for the quarter ended September 30, 2019, as of the Effective Date, PB and its subsidiaries do not have any Contingent Liabilities that would be required to be reflected on PB's balance sheet in accordance with GAAP except for (i) obligations in connection with this Agreement, and (ii) other Contingent Liabilities incurred in the ordinary course of business that are not material to the business of PB and its subsidiaries, taken as a whole.

13.5 SFJ Representation, Warranty and Covenant. SFJ hereby represents, warrants and covenants that it will have, as and when needed, sufficient funds to satisfy its obligations hereunder.

13.6 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES.

13.6.1 Each Party hereby agrees and understands that because the Clinical Trials and the Product are experimental in nature, the outcome is inherently uncertain and unpredictable. Each Party hereby agrees and understands that the other Party makes no

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





representation, guarantee or warranty, express or implied, regarding the outcome of the Clinical Trials (including achievement of the Phase 3 Success Criteria), any Research Results generated after the Effective Date, the ability to obtain Regulatory Approval or the patentability, legal protectability or usefulness of any Intellectual Property arising from the Clinical Trials.

13.6.2 EXCEPT AS OTHERWISE SET FORTH IN THIS ARTICLE 13, NEITHER PARTY MAKES, AND EACH PARTY EXPRESSLY DISCLAIMS, ANY REPRESENTATION OR WARRANTY OF ANY KIND WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, EITHER ORAL OR WRITTEN, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, INCLUDING ANY REPRESENTATION OR WARRANTY REGARDING THE USE, RESULTS OR EFFICACY OF THE PRODUCT.

ARTICLE 14

TERM AND TERMINATION

14.1 Term. The term of this Agreement (the Term) will commence on the Effective Date and will expire upon the earliest of (i) termination of this Agreement in accordance with Section 14.2, or (ii) the date of payment of the last Approval Payment due based on all applicable Regulatory Approvals which have been received.

14.2 Termination.

14.2.1 Termination for Breach.

Either Party may terminate this Agreement immediately in the event of a material breach of this Agreement by the other Party provided that the breaching Party has received written notice from the non-breaching Party of such breach, specifying in the reasonable detail the particulars of the alleged breach and such breach has not been cured within [***] after the date of the relevant notice. The non-breaching Party shall have the right to pursue remedies it may have at law or equity for such breach, including the right to seek damages from the breaching Party. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.1 then in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay SFJ, within [***] of the date of termination, an amount equal to three hundred percent (300%) of Development Costs paid or incurred by SFJ prior to such termination. Additionally, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, PB will remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such payments become due and payable (if ever) (except to the extent PB pays any Buy-Out Payment(s) pursuant to Section 6.7), provided that each Approval Payment (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and reduced by the amount previously paid by PB to SFJ pursuant to this Section 14.2.1.

In the event that PB terminates this Agreement pursuant to this Section 14.2.1 then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





therein as set forth in Section 11.1.1.4, PB shall remain obligated to pay to SFJ any Approval Payments that become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment paid by PB, as applicable) shall be adjusted as set forth in Section 6.2.

Notwithstanding the foregoing, if PB terminates this Agreement pursuant to this Section 14.2.1 above based on SFJ's failure to make any payment due to PB in accordance with ARTICLE 4, then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, PB shall remain obligated to pay to SFJ fifty percent (50%) of any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time that such payments become due and payable (if ever) pursuant to ARTICLE 6 (or, as applicable, fifty percent (50%) of any Buy-Out Payment that PB elects to pay pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall also be adjusted as set forth in Section 6.2.

14.2.2 At-Will Termination by PB. PB may terminate this Agreement at any time after SFJ has paid or incurred a total of $60 million of Development Costs and prior to the date of receipt of the first Regulatory Approval upon [***] prior written notice to SFJ. In the event that PB terminates this Agreement pursuant to this Section 14.2.2 then in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay SFJ, within [***] of the date of termination, an amount equal to three hundred percent (300%) of Development Costs paid or incurred by SFJ prior to such termination. Additionally, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, PB will remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that each Approval Payment (or the Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and reduced by the amount previously paid by PB to SFJ pursuant to this Section 14.2.2.

14.2.3 Termination by SFJ for Material Adverse Event. SFJ may terminate this Agreement at any time in the event of a Material Adverse Event immediately upon written notice to PB. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.3, then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall remain obligated to pay SFJ an amount equal to fifty percent (50%) of the Approval Payments (as adjusted as set forth in Section 6.2, subject, to the extent applicable, to Sections 2.3.3 and 3.12.2) that become due and payable under ARTICLE 6 at such time as they become due and payable (if ever) pursuant to ARTICLE 6 (or, as applicable, 50% of any Buy-Out Payment that PB elects to pay pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall also be adjusted as set forth in Section 6.2.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





14.2.4 Termination for Failure to Receive Regulatory Approval.

14.2.4.1 This Agreement will, upon written notice from either Party to the other Party, terminate with no further action from either Party if the Product has not received Regulatory Approval from at least one of (i) the FDA, (ii) EMA, (iii) PMDA, or (iv) NMPA after completion of the Clinical Trials, submission by PB of applications for Regulatory Approval to the FDA and EMA, and submission by SFJ of applications for Regulatory Approval to the PMDA and NMPA, and after Commercially Reasonable Efforts to obtain such Regulatory Approvals based on such submitted applications as may be amended from time to time. For the avoidance of doubt, if Regulatory Approval is received from any of the FDA, EMA, PMDA, or NMPA then this Agreement may not thereafter be terminated pursuant to this Section 14.2.4.1.

14.2.4.2 This Agreement will, upon written notice from either Party to the other Party, terminate with no further action from either Party, if the Phase 3 Trial is completed or terminated and either (a) the primary endpoint in the Phase 3 Trial is not achieved or (b) SFJ reasonably determines that the Research Results of the Phase 3 Trial do not support Regulatory Approval. For avoidance of doubt, if an application for Regulatory Approval is submitted to any of the FDA, EMA, PMDA or NMPA then this Agreement may not thereafter be terminated pursuant to this Section 14.2.4.2.

14.2.4.3 In the event that this Agreement is terminated pursuant to this Section 14.2.4, then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall remain obligated to make any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time that such payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2.

14.2.5 Termination for Bankruptcy. Either Party may terminate this Agreement upon written notice to the other Party if the other Party makes an assignment for the benefit of creditors, or commences a case or proceeding under any bankruptcy, reorganization, insolvency, or similar laws, has a trustee or receiver or similar officer of any court appointed for such Party, or for substantial part of the property of such Party, or bankruptcy, reorganization, insolvency, or liquidation proceedings are instituted by or against such Party without such proceedings being dismissed, in each of the foregoing cases for a period of at least [***].

14.2.5.1 In the event that PB terminates this Agreement pursuant to this Section 14.2.5, then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall remain obligated to pay to SFJ any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such Approval Payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2.

14.2.5.2 In the event SFJ terminates this Agreement pursuant to this Section 14.2.5, then in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay SFJ within [***] of the date of termination an amount equal to three hundred percent (300%) of Development Costs paid or incurred by SFJ prior to such termination. Additionally, PB will remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and reduced by the amount previously paid by PB to SFJ pursuant to this Section 14.2.5.2.

14.2.6 Termination for Change of Control of PB. PB will notify SFJ in writing promptly (and in any event within [***]) following the entering into of a definitive agreement with respect to a Change of Control of PB. SFJ may, in its sole discretion, terminate this Agreement in its entirety at any time following a Change of Control of PB that occurs prior to the date of payment by PB of the final Approval Payment. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.6, then, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay to SFJ within [***] of the date of termination an amount equal to one hundred fifty percent (150%) of Development Costs which were paid or incurred by SFJ. PB or its successor (whose performance shall be guaranteed by PB) shall be obligated to continue to exercise Commercially Reasonable Effort to develop the Product and seek Regulatory Approval as set forth herein following the date of such termination including the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such Approval Payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and shall be reduced by the amount previously paid to SFJ as set forth in this Section 14.2.6.

14.2.7 Termination for Safety Concerns. Either Party may terminate this Agreement upon written notice to the other Party if (a) the independent data monitoring committee for the Phase 3 Trial recommends termination of the Phase 3 Trial for reasons pertaining to the health or safety of the Subjects or for futility, or (b) the Parties mutually agree a material health or safety concern with respect to the Subjects exists. In the event that this Agreement terminates pursuant to this Section 14.2.7, then PB will not be obligated to pay to SFJ any Development Costs or Approval Payments. Notwithstanding the foregoing, (A) if this Agreement terminates pursuant to this Section 14.2.7 and such termination: (i) arises as a result of gross negligence on the part of PB; or (ii) is due to (x) the applicable independent data monitoring committee recommending termination of the Phase 3 Trial or (y) PB and SFJ

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





mutually agreeing to terminate the Phase 3 Trial, in either case ((x) or (y)), due to a Serious Safety Issue that was previously known, demonstrated or identified by PB as being material as of the Effective Date and the material data showing, demonstrating, or identifying such Serious Safety Issue were not included in the Data Room, disclosed in writing to SFJ or otherwise publicly known prior to the Effective Date; then, in either case ((i) or (ii)), PB will pay SFJ within [***] of the date of termination an amount equal to three hundred percent (300%) of Development Costs paid or incurred by SFJ, and (B) if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such Approval Payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2 and shall be reduced by the amount previously paid by PB to SFJ pursuant to this Section 14.2.7.

14.2.8 Termination for Certain Breaches/Actions.

14.2.8.1 SFJ may terminate this Agreement if (i) PB has breached by its own actions, or by the actions of any of its Representatives, either of Section 13.1.3 or Section 13.1.4 in any material respect, (ii) a Representative of PB has breached the policy attached as Exhibit F‑1 in any material respect and such breach results in a Material Anti-Corruption Law Violation, or (iii) SFJ learns (a) that improper payments are being or have been made to Government Officials or any other person by PB or any of its Representatives on behalf of PB or (b) that PB or any of its Representatives with respect to services performed on behalf of PB has accepted any payment, item, or benefit, regardless of value, as an improper inducement to award, obtain or retain business or otherwise gain or grant an improper business advantage from or to any other person or entity (in any such case ((i), (ii) or (iii)), a PB Compliance Breach), unless such PB Compliance Breach can be cured without having a materially adverse impact on the probability of completing the Clinical Trials or obtaining Regulatory Approval for the Product. In the event of such termination, PB will not be entitled to any further payments under ARTICLE 4, regardless of any activities undertaken or agreements with additional Third Parties entered into prior to termination. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.8.1, then (a) in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay SFJ, within [***] of the date of termination, an amount equal to one hundred fifty percent (150%) of Development Costs paid or incurred to PB by SFJ prior to such termination, and (b) if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, PB shall remain obligated to pay to SFJ any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time that such payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and reduced by the amount previously paid by PB to SFJ pursuant to this Section 14.2.8.1.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





14.2.8.2 PB may terminate this Agreement if (i) SFJ has breached by its own actions, or by the actions of any of its Representatives, either of Section 13.1.3 or Section 13.1.4 in any material respect, (ii) a Representative of SFJ has breached the policy attached as Exhibit F‑2 in any material respect and such breach results in a Material Anti-Corruption Law Violation, or (iii) PB learns (a) that improper payments are being or have been made to Government Officials or any other person by SFJ or any of its Representatives on behalf of SFJ or (b) that SFJ or any of its Representatives with respect to services performed on behalf of SFJ has accepted any payment, item, or benefit, regardless of value, as an improper inducement to award, obtain or retain business or otherwise gain or grant an improper business advantage from or to any other person or entity (in any such case ((i), (ii) or (iii)), an SFJ Compliance Breach), unless such SFJ Compliance Breach can be cured without having a materially adverse impact on the probability of completing the Clinical Trials or obtaining Regulatory Approval for the Product. In the event of such termination, SFJ will not be entitled to any further payments hereunder except as set forth below. In the event that PB terminates this Agreement pursuant to this Section 14.2.8.2, then, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall remain obligated to pay to SFJ any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time that such payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be (A) adjusted as set forth in Section 6.2, and (B) reduced by the amount of all documented out-of-pocket expenses incurred by or on behalf of PB as a result or arising out of such violation by SFJ or any of its Representatives (including any and all amounts paid by PB as penalties or fines for such violation, in settlement of legal or administrative proceedings relating to such violation, or otherwise).

14.2.8.3 If a Party learns that any of its Permitted Third Parties has materially breached Section 13.1.3 or Section 13.1.4, or Exhibit F‑1 or Exhibit F‑2, as applicable, or that improper payments are being or have been made to Government Officials by any of its Permitted Third Parties with respect to services performed on behalf of such Party or in connection with the Clinical Trials, such Party will notify the other Party and, at the other Party's option, such Party will terminate its relationship with such Permitted Third Party with respect to the Clinical Trials.

14.2.9 Termination Because of Adverse Patent Impact. SFJ may terminate this Agreement if (a) PB is enjoined from further developing or commercializing the Product for the Indication in any of the US, the Designated European Countries or the Designated Asian Countries or (b) the future value of the Product is materially adversely affected due to (i) Third Party patents that were not publicly disclosed or known to SFJ at the Effective Date that would be infringed by the manufacture, use, sale, offer for sale or import of the Product for the Indication in any of the US, the Designated European Countries or the Designated Asian Countries or (ii) invalidity or unenforceability of all Patents within the PB Intellectual Property Covering the Product for the Indication in any of the US, the Designated European Countries or the Designated Asian Countries (in either case ((a) or (b)), Adverse Patent Impact), upon

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





written notice to PB if PB does not cure such Adverse Patent Impact within a period of six (6) months from the date of SFJ's notice to PB of an Adverse Patent Impact. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.9, then in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB shall pay to SFJ, within [***] of the date of termination, an amount equal to all Development Costs paid or incurred by SFJ as of the date of termination.

14.2.10 Termination for JSC Decision. SFJ may, in its sole discretion, terminate this Agreement in its entirety at any time prior to the date of receipt of the first Regulatory Approval in the event PB exercises its decision-making authority under Section 5.2.4 to approve a matter set forth in Section 5.2.2 and, after escalation to the Executive Officers in accordance with Section 5.2.4, SFJ continues in good faith to disagree with such decision. In the event that SFJ terminates this Agreement pursuant to this Section 14.2.10, then in exchange for purchasing the Trial Data Package including the Research Results included therein as set forth in Section 11.1.1.4, PB will pay to SFJ, within [***] of the date of termination, an amount equal to the Development Costs paid or incurred by SFJ plus interest at the annual rate of twenty-five percent (25%) from the date such Development Costs were paid or incurred by SFJ and, if PB elects to continue development of the Product and obtains Regulatory Approval following such termination, PB shall remain obligated to pay any Approval Payments that become due and payable pursuant to ARTICLE 6 at such time as such Approval Payments become due and payable (if ever) pursuant to ARTICLE 6 (except to the extent of the amount of any Buy-Out Payment paid by PB pursuant to Section 6.7), provided that such Approval Payments (or Buy-Out Payment, as applicable) shall be adjusted as set forth in Section 6.2, and reduced by the amount previously paid to SFJ as set forth in this Section 14.2.10.

14.3 Certain Additional Consequences of Termination. In the event of any termination of this Agreement pursuant to Section 14.2, then, if SFJ has not caused a Program Transfer to occur pursuant to Section 3.20:

14.3.1 to the extent not previously assigned to PB pursuant to Section 11.1.1.4, SFJ shall, and it hereby does, assign sole and exclusive ownership of the Trial Data Package including the Research Results included therein to PB, such assignment to be effective in accordance with Section 11.1.1.4;

14.3.2 effective as of such termination, SFJ shall, and it hereby does, assign to PB all of SFJ's and its Affiliates' right, title and interest in and to all Product Filings then owned or Controlled by SFJ or any of its Affiliates; provided that if any such Product Filing is not immediately transferable in a country, SFJ shall provide PB with all benefit of such Product Filing and such assistance and cooperation as necessary or reasonably requested by PB to timely transfer such Product Filing to PB or its designee or, at PB's option, to enable PB to obtain a substitute for such Product Filing without disruption to PB's development or Commercialization of the Product in the SFJ Territory;

14.3.3 within [***] after assignment of the Product Filings pursuant to Section 14.3.2, SFJ shall deliver to PB: (a) true, correct and complete copies of all Product Filings in such country (in each case, whether held in the name of SFJ or any of its Affiliates),

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





and disclose to PB in writing all previously-undisclosed Research Results within the Trial Data Package; (b) formally transfer or assign, or cause to be formally transferred or assigned, into the name of PB or its designee all Product Filings in such country (in each case, whether held in the name of SFJ or any of its Affiliates); and (c) take such other actions and execute such other instruments, assignments and documents as may be necessary to effect, evidence, register and record the transfer, assignment or other conveyance of such rights to PB or its designee;

14.3.4 at PB's written request and election in PB's sole discretion, SFJ shall and hereby does, and shall cause its Affiliates to either: (i) wind down in accordance with Applicable Law and observing applicable ethical and regulatory guidelines any or all Clinical Trials being conducted by or on behalf of SFJ or its Affiliate as of the effective date of termination, at SFJ's cost and expense; or (ii) (x) transfer control to PB of any or all Clinical Trials being conducted by or on behalf of SFJ or its Affiliate as of the effective date of termination and (y) continue to conduct such Clinical Trials being conducted by or on behalf of SFJ or an Affiliate as of the effective date of termination for up to [***] to enable such transfer to be completed without interruption of any such Clinical Trial, in each case ((x) and (y)), at PB's cost and expense; and

14.3.5 SFJ shall, and shall cause its Affiliates to, promptly assign to PB or its designee any and all Clinical Trial Agreements, CRO Agreements and other Vendor Agreements to which any of them is a party and cooperate in good faith with PB to provide appropriate notice and new contact information to the applicable Sites, Clinical Investigators, CROs and other Vendors and PB shall accept such assignment of all obligations of SFJ and its Affiliates thereunder without recourse to SFJ other than any indemnification obligations which SFJ may be liable for thereunder.

14.4 Surviving Obligations.

14.4.1 Accrued Rights and Obligations. Except as expressly set forth in Sections 3.20 and 14.4.2, and, if applicable, the Program Transfer Agreement, expiration or termination of this Agreement for any reason will not release either Party from any obligation or liability which, at the time of such expiration or termination, has already accrued to the other Party or which is attributable to a period prior to such expiration or termination.

14.4.2 Exclusive Remedy. Notwithstanding anything herein to the contrary, termination of this Agreement by a Party will be without prejudice to other remedies such Party may have at law or equity; provided that the payment by PB to SFJ of the amounts specified as being payable upon a given termination in Section 14.2 shall be in lieu of any claim for damages that SFJ may have arising out of or in connection with the circumstances that formed the basis for such termination..

14.4.3 Surviving Obligations. The following provisions of this Agreement, together with any other provisions that expressly specify that they survive, will survive expiration or earlier termination of this Agreement:

14.4.3.1 ARTICLE 1, ARTICLE 9, ARTICLE 10, ARTICLE 11, ARTICLE 12, Section 13.1, Section 13.6, Section 14.4 and ARTICLE 15; and

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





14.4.3.2 solely in the case of termination of this Agreement after payment by SFJ to PB of the Initial Development Cost Payment on the Initial Funding Date, but not in the case of expiration of this Agreement, Sections 3.20, 6.1- 6.7, 7.1-7.7 (in the case of such Sections 7.1-7.7, such provisions shall terminate only after all PB Obligations, other than contingent indemnity obligations, have been paid to SFJ or otherwise satisfied in accordance with this Agreement in full), 14.2 and 14.3.

ARTICLE 15

MISCELLANEOUS

15.1 Relationship with Affiliates. Each Party will be responsible for any breach by its Affiliates of its obligations in connection with this Agreement, and each such Party will remain responsible for any responsibilities that it has delegated to an Affiliate as though such Party had performed (or failed to perform) such responsibilities itself.

15.2 Prior Agreements. The Parties agree on behalf of themselves and their respective Affiliates that any prior Confidentiality Agreement, by and between PB and SFJ (the Prior CDA) is hereby terminated and superseded by this Agreement and that all Information disclosed under or pursuant to the Prior CDAs will constitute Confidential Information disclosed pursuant to this Agreement and will be subject to the terms of ARTICLE 10, with the confidentiality and non-use provisions of ARTICLE 10 applying retroactively to such Confidential Information from the date of disclosure.

15.3 Notices. Any notice or other communication required or permitted to be given by either Party under this Agreement will be in writing and will be effective when delivered if delivered by fax, e-mail, hand, reputable courier service, or five (5) days after mailing if mailed by registered or certified mail, postage prepaid and return receipt requested, addressed to the other Party at the following addresses or such other address as may be designated by notice pursuant to this Section 15.3.:

15.3.1 If to PB:

PhaseBio Pharmaceuticals, Inc. 1 Great Valley Parkway, Suite 30 Malvern, PA 19355 USA Attn: Chief Executive Officer

with a copy to:

Attn: Vice President, Head of Legal (at the address set forth above)

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





and to:

Cooley LLP 11951 Freedom Drive Reston, VA 20190 USA Attn: Christian E. Plaza

15.3.2 If to SFJ:

SFJ Pharmaceuticals X, Ltd SIX, 2nd Floor, Cricket Square PO Box 2681 Grand Cayman, KY1-1111 Cayman Islands

Attn: Robert DeBenedetto

with a copy to:

Morrison & Foerster LLP 755 Page Mill Road Palo Alto, CA 94304-1018 Attention: Michael O'Donnell

15.4 Force Majeure. Neither Party will be liable for any breach or delay in performance of any obligation under this Agreement to the extent caused by any of the following: war, terrorism, riot, fire, explosion, accident, flood, sabotage, changes in Applicable Laws, actions of Governmental Authorities, or any other event beyond the reasonable control of such Party. The Party invoking this Section 15.4 must provide prompt written notice and full particulars of such event to the other Party and will use diligent and commercially reasonable efforts to mitigate the effects of any such force majeure event on such Party's compliance with and performance under this Agreement.

15.5 Use of Names. Neither Party will use the other Party's nor any of its Affiliates' (including the limited partners of SFJ's or its Affiliates') names or trademarks in any promotional materials or advertising without the prior written consent of the other Party except as otherwise expressly permitted in this Agreement.

15.6 Assignment. Without the prior written consent of the other Party hereto, neither Party will sell, transfer, assign, pledge or otherwise dispose of, whether voluntarily, involuntarily, by operation of law or otherwise, this Agreement or any of its rights or duties hereunder; provided, however, that either Party may assign, sublicense or transfer this Agreement and all of its rights and obligations hereunder, in their entirety, to any of its Affiliates or to a successor in connection with the sale or other transfer of all or substantially all of its business or assets to which this Agreement relates, whether by merger, sale of stock, sale of assets or otherwise, and

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





whether this Agreement is actually assigned or is assumed by a Third Party acquirer or the surviving corporation resulting from such transaction by operation of law (e.g., in the context of a reverse triangular merger). Notwithstanding the foregoing, any assignment of the rights or obligations under this Agreement by a Party (i) to an Affiliate shall require such Party to guarantee the performance of such Affiliate's financial and performance obligations hereunder or (ii) in connection with the sale or other transfer of all or substantially all of such Party's business or assets to which this Agreement relates shall require the ultimate Affiliate controlling the other party in such transaction to guarantee such Party's financial and performance obligations hereunder and such Party shall remain liable for such financial and performance obligations notwithstanding such sale or other transfer of all or substantially all of such Party's business or assets to which this Agreement relates. Notwithstanding any of the foregoing, without the consent of PB, which consent may be withheld in PB's sole discretion, SFJ shall not sell, assign, sublicense or otherwise transfer this Agreement to an entity whose primary business is the development or commercialization of pharmaceutical or biotechnology products prior to the date of Program Transfer. For the avoidance of doubt the preceding sentence shall not apply after the date of Program Transfer. Furthermore, notwithstanding any of the foregoing, SFJ may assign its right to receive Approval Payments to (a) the limited partners in SFJ, provided that such limited partners agree that a majority in interest shall be entitled to take all actions and make any consents on behalf of SFJ hereunder and provided that such limited partners notify PB of a single account to which PB can make all payments that may become due hereunder and assume sole responsibility for distributing all such payments, or to a liquidating trust or similar entity that is established to receive and distribute Approval Payments for the benefit of the limited partners in SFJ, that is required to carry out such responsibilities as a single entity, and provided that such limited partners or liquidating trust takes such rights to receive and distribute Approval Payments subject to all of PB's rights and defenses hereunder (and in any case under this clause (a), PB shall have the unconditional right to follow any instruction it receives or rely on any actions, consents and communications received from or taken by such limited partners or liquidating trust or similar entity without any duty to verify or otherwise determine the validity thereof) or (b) an other Third Party to which SFJ assigns this Agreement in its entirety as permitted by the preceding provisions of this Section 15.6, provided that, following any assignment of this Agreement by SFJ to a Third Party pursuant to the foregoing clause (b) the JSC shall terminate, such assignee shall not have any further rights under ARTICLE 5, such assignee shall not have any further rights to approve or consent (and PB shall not have any further obligation to seek SFJ's approval or consent) as to any matter relating to PB's development and Commercialization of the Product, [***]. This Agreement is binding upon and will inure to the benefit of each of the Parties, its successors and permitted assigns.

15.7 Further Assurances. The Parties will execute such further reasonable documents and perform such further reasonable acts as may be necessary to comply with or more fully effectuate the terms of this Agreement.

15.8 Fees and Expenses. Each Party to this Agreement will bear its own costs and expenses, including attorneys' fees and expenses, in connection with the closing of the transactions contemplated hereby.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





15.9 Governing Law. The construction and validity of this Agreement and the provisions hereof, and the rights and obligations of the Parties hereunder, will be governed by the internal laws of the State of Delaware, USA, and, to the extent applicable to Patents and Trademarks, the applicable federal laws of the USA, in each instance without regard to conflict of laws principles.

15.10 Dispute Resolution. The Parties recognize that disputes as to certain matters relating to this Agreement may arise from time to time. It is the objective of the Parties to establish procedures to facilitate the resolution of disputes in an expedient manner by mutual cooperation and without resort to litigation. Accordingly, the Parties agree that any dispute, controversy or claim arising under, out of or in connection with this Agreement, including any subsequent amendments, or the validity, enforceability, construction, performance or breach hereof (and including the applicability of this Section 15.10 to any such dispute, controversy or claim) (each a Dispute) shall be resolved as follows:

15.10.1 Either Party shall have the right to refer such Dispute to the Executive Officers for attempted resolution by good faith negotiations for a period of [***]. Any final decision mutually agreed to by the Executive Officers in writing shall be conclusive and binding on the Parties. With respect to any Dispute that remains unresolved after the expiration of [***] after a Dispute is notified to the Executive Officers, then such Dispute shall be submitted to the International Centre for Dispute Resolution (ICDR) for final and binding arbitration pursuant to the arbitration clause set forth in Section 15.10.2. Notwithstanding the foregoing, no matters relating to breach or alleged breach of the ownership of intellectual property or rights in intellectual property or the validity or enforceability thereof shall be resolved by arbitration, but rather shall be determined by a U.S. federal court of appropriate jurisdiction. Notwithstanding the foregoing, any dispute between the Parties as to whether entering into a Licensing Transaction would have a Material Impact shall be resolved as set forth in Section 7.5.5. Notwithstanding anything in this Agreement to the contrary, either Party shall be entitled to seek preliminary injunctive relief in any court of competent jurisdiction immediately if necessary to prevent irreparable harm to that Party.

15.10.2 Arbitration Process.

15.10.2.1 Either Party shall have the right to initiate arbitration at any time after the expiration of thirty (30) days after a Dispute is notified to the Executive Officers. Any disputes concerning the propriety of the commencement of the arbitration shall be finally settled by the arbitral tribunal.

15.10.2.2 Any Dispute including the determination of the scope or applicability of this agreement to arbitrate, shall be determined by the ICDR in accordance with its International Arbitration Rules, except as they may be modified herein. The seat, or legal place, of arbitration shall be New York, and the language of the arbitration shall be English. References herein to any arbitration rules or procedures mean such rules or procedures as amended from time to time, including any successor rules or procedures, and references herein to the ICDR include any successor thereto. The arbitration shall be before a tribunal comprised of three (3) arbitrators. Each Party shall select one arbitrator and within fifteen (15) days of the

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





second arbitrator's appointment, the two (2) Party appointed arbitrators shall select the third, who shall serve as the tribunal's chair or president. All three (3) arbitrators shall be professionals with substantial experience in development and Commercialization of biopharmaceutical products. An arbitrator shall be deemed to meet these qualifications unless a Party objects within fifteen (15) after the arbitrator is appointed. This arbitration provision, and the arbitration itself, shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1 et. seq.

15.10.2.3 Consistent with the expedited nature of arbitration, each Party will, upon the written request of the other Party, promptly provide the other with copies of documents on which the producing Party may rely in support of or in opposition to any claim or defense. At the request of a Party, the arbitrators shall have the discretion to order examination by deposition of witnesses to the extent the arbitrator deems such additional discovery relevant and appropriate. [***]. All objections are reserved for the arbitration hearing except for objections based on privilege and proprietary or confidential information. [***]. Any Dispute regarding discovery, or the relevance or scope thereof, shall be determined by the arbitrators, which determination shall be conclusive. All discovery shall be completed within [***] following the appointment of the arbitrators. All costs and/or fees relating to the retrieval, review and production of electronic discovery shall be paid by the Party requesting such discovery.

15.10.2.4 The arbitrators shall have no authority to award punitive or other damages not measured by the prevailing Party's actual damages, except as may be required by statute. Each Party expressly waives and foregoes any right to consequential, punitive, special, exemplary or similar damages or lost profits. The arbitrators shall have no power or authority, under the ICDR rules and procedures or otherwise, to relieve the Parties from their agreement hereunder to arbitrate or otherwise to amend or disregard any provision of this Agreement. The cost of the arbitration, including the fees of the arbitrators and reasonable attorney's fees of the prevailing Party, shall be borne by the Party the arbitrator determines has not prevailed in the arbitration.

15.10.2.5 If an arbitral award does not impose an injunction on the losing Party or contain a money damages award in excess of [***] dollars USD ($[***]), then the arbitral award shall be final and binding and shall only be subject to such challenges as would otherwise be permissible under the Federal Arbitration Act, 9 U.S.C. § 1 et. seq. . Judgment on such an award may be entered in any court of competent jurisdiction and the Parties undertake to carry out the award without delay. In the event that an arbitral award imposes an injunction or contains a monetary award in excess of [***] dollars USD ($[***]), the Parties agree that such award may be appealed pursuant to the AAA's Optional Appellate Arbitration Rules (Appellate Rules) and should not be considered to be final and binding until after the time for filing the notice of appeal under the Appellate Rules has expired. Appeals must be initiated within [***] of receipt of the award, as defined by the Appellate Rules, by filing a Notice of Appeal within any AAA office. Following the appeal process, the decision rendered by the appeal tribunal shall be final and binding and judgment on that award may be entered in any court of competent jurisdiction and the Parties undertake to carry out the award without delay.

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





15.10.2.6 Except as may be required by law, or to protect or pursue a legal right to enforce or challenge an award in legal proceedings, where needed for the preparation or presentation of a claim or defense in this arbitration, or by order of the arbitral tribunal upon application of a Party, neither a Party nor an arbitrator may disclose the existence, content, or results of any arbitration hereunder without the prior written consent of both Parties.

15.11 Limitation of Liability. TO THE MAXIMUM EXTENT PERMITTED BY LAW AND NOTWITHSTANDING ANY PROVISION IN THIS AGREEMENT TO THE CONTRARY, NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR ANY INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, RELIANCE OR PUNITIVE DAMAGES OR LOST OR IMPUTED PROFITS OR ROYALTIES OR COST OF PROCUREMENT OF SUBSTITUTE GOODS OR SERVICES, WHETHER LIABILITY IS ASSERTED IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT PRODUCTS LIABILITY), INDEMNITY OR CONTRIBUTION, AND IRRESPECTIVE OF WHETHER THAT PARTY OR ANY REPRESENTATIVE OF THAT PARTY HAS BEEN ADVISED OF, OR OTHERWISE MIGHT HAVE ANTICIPATED THE POSSIBILITY OF, ANY SUCH LOSS OR DAMAGE. THE PARTIES AGREE THAT THE LIMITATIONS SPECIFIED IN THIS SECTION 15.11 WILL APPLY EVEN IF ANY LIMITED REMEDY SPECIFIED IN THIS AGREEMENT IS FOUND TO HAVE FAILED OF ITS ESSENTIAL PURPOSE. WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, CONSEQUENTIAL DAMAGES WILL BE DEEMED TO INCLUDE, AND NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY OR ANY OF SUCH OTHER PARTY'S AFFILIATES, REPRESENTATIVES OR STOCKHOLDERS FOR ANY DAMAGES BASED ON OR MEASURED BY LOSS OF PROJECTED OR SPECULATIVE FUTURE SALES OF THE PRODUCT, ANY PAYMENT DUE UPON ANY UNACHIEVED EVENT UNDER ARTICLE 6, OR ANY OTHER UNEARNED, SPECULATIVE OR OTHERWISE CONTINGENT PAYMENTS PROVIDED FOR IN THIS AGREEMENT. FOR THE AVOIDANCE OF DOUBT, THIS SECTION 15.11 IS NOT MEANT TO LIMIT PB'S OBLIGATION TO PAY SFJ THE AMOUNTS SET FORTH IN ARTICLE 6 OR SECTION 14.2.

15.12 Cumulative Remedies. Unless expressly set forth in this Agreement, all rights and remedies of the Parties, including all rights to payment, rights of termination, rights to injunctive relief, and other rights provided under this Agreement, will be cumulative and in addition to all other remedies provided for in this Agreement, in law, and in equity.

15.13 Relationship of the Parties.

15.13.1 Independent Contractors. Nothing contained herein will be deemed to create a partnership, joint venture, or similar relationship between the Parties, including for tax purposes. Neither Party is the agent, employee, joint venturer, partner, franchisee, or representative of the other Party. Each Party specifically acknowledges that it does not have the authority to, and will not, incur any obligations or responsibilities on behalf of the other Party. Notwithstanding anything to the contrary in this Agreement, each Party (and its officers, directors, agents, employees, and members) will not hold themselves out as employees, agents,

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





representatives, or franchisees of the other Party or enter into any agreements on such Party's behalf.

15.13.2 Direction. Neither Party will be subject to the supervisory direction of the other Party in regard to the conduct of the Clinical Trials.

15.14 No Third Party Beneficiaries. This Agreement and the provisions herein are for the benefit of the Parties only, and are not intended to confer any rights or benefits to any Third Party.

15.15 Rights Reserved. No license or any other right is granted to either Party, by implication or otherwise, except as specifically set forth in this Agreement. All rights not exclusively granted to SFJ are reserved to PB and its Affiliates. Notwithstanding any other provision of this Agreement to the contrary, and for clarity, no Intellectual Property or other proprietary rights Controlled by PB or its Affiliates will be assigned or licensed to SFJ in connection with this Agreement, except, if executed by the Parties, as expressly set forth in the Program Transfer Agreement.

15.16 Nonsolicitation. During the Term and for a period of [***] thereafter, neither Party shall solicit an employee of the other Party who is or has been involved in the performance or oversight of any of the development activities hereunder to terminate his or her employment and accept employment or work as a consultant with the soliciting Party. Notwithstanding the foregoing, nothing herein shall restrict or preclude the Parties' right to make generalized searches for employees by way of a general solicitation for employment placed in a trade journal, newspaper or website.

15.17 Amendments; No Waiver. Unless otherwise specified herein, no amendment, supplement, or modification of this Agreement will be binding on either Party unless it is in writing and signed by both Parties. No delay or failure on the part of a Party in the exercise of any right under this Agreement or available at law or equity will be construed as a waiver of such right, nor will any single or partial exercise thereof preclude any other exercise thereof. All waivers must be in writing and signed by the Party against whom the waiver is to be effective. Any such waiver will constitute a waiver only with respect to the specific matter described in such writing and will in no way impair the rights of the Party granting such waiver in any other respect or at any other time.

15.18 Severability. If any provision (or portion thereof) of this Agreement is determined by a court or arbitration to be unenforceable as drafted by virtue of the scope, duration, extent, or character of any obligation contained herein, it is the Parties' intention that such provision (or portion thereof) will be construed in a manner designed to effectuate the purposes of such provision to the maximum extent enforceable under such Applicable Law. The Parties will enter into whatever amendment to this Agreement as may be necessary to effectuate such purposes.

15.19 Entire Agreement. This Agreement, including all Exhibits hereto and the Disclosure Letter, contains the entire understanding of the Parties and supersedes, revokes, terminates, and cancels any and all other arrangements, understandings, agreements, term sheets,

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





or representations and warranties, whether oral or written, between the Parties relating to the subject matter of this Agreement.

15.20 Counterparts. This Agreement will be executed in two (2) counterparts, one (1) for either Party, which, taken together, will constitute one and the same agreement. This Agreement will not be binding on the Parties or otherwise effective unless and until executed by both Parties.

15.21 Construction. This Agreement has been negotiated by the Parties and their respective counsel. This Agreement will not be construed in favor of or against either Party by reason of the authorship of any provisions hereof.

[Signature Page Follows]

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





IN WITNESS WHEREOF, the Parties, intending to be legally bound hereby, have caused this Agreement to be executed in duplicate by their duly authorized representatives as of the Effective Date.

PHASEBIO PHARMACEUTICALS, INC.

By: /s/ Jonathan Mow Name: Jonathan Mow Title: CEO

Date: January 9, 2020

SIGNATURE PAGE TO THE CO-DEVELOPMENT AGREEMENT

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





IN WITNESS WHEREOF, the Parties, intending to be legally bound hereby, have caused this Agreement to be executed in duplicate by their duly authorized representatives as of the Effective Date.

SFJ PHARMACEUTICALS X, LTD.

By: /s/ Robert DeBenedetto Name: Robert DeBenedetto Title: Director

Date: January 9, 2020

SIGNATURE PAGE TO THE CO-DEVELOPMENT AGREEMENT

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020





EXHIBIT LIST

Exhibit A The Product

Exhibit B Current Approved CROs

Exhibit C Current Approved Vendors

Exhibit D Development Plan

Exhibit E Executive Officers

Exhibit F‑1 PB Anti-Bribery and Anti-Corruption Practices

Exhibit F‑2 SFJ Anti-Bribery and Anti-Corruption Practices

Exhibit G SFJ European Operational Support

Exhibit H Warrant

Exhibit I Timeline

Exhibit J Manufacturer

Exhibit K Trial Data Package Purchase Agreement

Exhibit L AZ License

Exhibit M Amendment to AZ License

Exhibit N MedImmune Pharmacovigilance Agreement

Exhibit O Program Transfer Agreement

Exhibit P Terms of SVB Subordination Agreement

Source: PHASEBIO PHARMACEUTICALS INC, 10-K, 3/30/2020 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

A: Any subcontractor, including any Permitted Third Party, who provides professional services to such Party for the Clinical Trials, will obtain Professional Liability Insurance in lieu of Clinical Trial Insurance, with a minimum limit of [***] dollars ($[***]) per occurrence.
****
Q: Exhibit 10.24   ***Text Omitted and Filed Separately with the Securities and Exchange Commission. Confidential Treatment Requested Under 17 C.F.R. Sections 200.80(b)(4) and Rule 406 of the Securities Act of 1933, as amended.

   Collaboration Agreement, BII/ XENCOR



  Confidential

    COLLABORATION AGREEMENT   This Collaboration Agreement (Agreement) is made by and among     Xencor, Inc.  111 W. Lemon Ave. Monrovia, CA 91016 USA

(hereinafter called XENCOR),   and   Boehringer Ingelheim International GmbH   Binger Straße 173 55216 Ingelheim Germany   (hereinafter called BII)   (hereinafter BII an XENCOR each shall also be called Party and collectively Parties as the case may be).     EFFECTIVE DATE: February 10, 2012   1





  TABLE OF CONTENTS

                                                    1

  Definitions

  5

  1.1

  Acceptance Criteria   5

  1.2

  Affiliated Companies   5

  1.3

  Batch   5

  1.4

  BII Confidential Information and Know­How   5

  1.5

  BII Facility   6

  1.6

  BII Intellectual Property   6

  1.7

  BII Technology   6

  1.8

  Business Partner   6

  1.9

  Certificate of Analysis   6

  1.10

  Claim   6

  1.11

  CMO   6

  1.12

  Confidential Information­and Know­How   6

  1.13

  Confirmation of Compliance   6

  1.14

  Controlled Technology   6

  1.15

  cGMP   6

  1.16

  Deliverables   7

  1.17

  Due Date   7

  1.18

  Effective Date   7

  1.19

  FTE   7

  1.20

  Improvements   7

  1.21

  Knowledge   7

  1.22

  Latent Defects   7

  1.23

  Licensing Revenue   7

  1.24

  Losses   7

  1.25

  Major Territories   7

  1.26

  Material   7

  1.27

  MTA   7

  1.28

  Obvious Defects   8

  1.29

  Other Improvements   8

  1.30

  Principal Supplier   8

  1.31

  Process   8







    1.32

  Process Description   8

  1.33

  Product   8

  1.34

  Project   8

  1.35

  Project Fees   8

  1.36

  Project Manager   8

  1.37

  Project Plan   8

  1.38

  Project Team   8

  1.39

  QAA   9

  1.40

  Representatives   9

  1.41

  Service(s)   9

  1.42

  Specification(s)   9

  1.43

  Steering Committee   9

  1.44

  Technology   9

  1.45

  Technology Access Fee   9

  1.46

  Total Amount   9

  1.47

  XENCOR Confidential Information and Know­How   9

  1.48

  XENCOR Intellectual Property   9

  1.49

  XENCOR Technology   9

    2







                                                               2

  Cooperation between the Parties in the Course of a Project

  10

  2.1

  General

  10



 2.1.1   General

  10











 2.1.2   Priority

  10









  2.2

  Personnel

  10



 2.2.1   Designation of Project Manager

  10











 2.2.2   Project Team

  10











 2.2.3   Steering Committee

  11









  2.3

  Conduct of the Project and BII's Work and Tasks   11

  2.4

  Deliverables

  12

  2.5

  Nature of the Project

  12

  2.6

  Additional Work

  12

  2.7

  XENCOR Confidential Information and Know-How and Material

  12

  2.8

  Further Obligations of XENCOR

  13



 2.8.1   General

  13











 2.8.2   Obligations of XENCOR

  13











 2.8.3   Timelines and Information

  13









  3

  Payments

  14

  3.1

  Project Fee

  14



 3.1.1   Consideration for Services

  14











 3.1.2   Payment of the Project Fees

  14











 3.1.3   Invoicing

  15















     3.2

  Technology Access Fee

  15

  3.3

  VAT

  15







  4

  Delivery Terms of Product

  16

  4.1

  Delivery Terms

  16

  4.2

  Cancellation of Order

  17







  5

  Ownership and Use of Project Data

  17

  5.1

  Project Data

  17

  5.2

  Use of the Process; Right of Negotiation

  18



 5.2.1   Use of the Process outside this Agreement

  18











 5.2.2   Right of First Negotiation to Manufacture

  18











 5.2.3   Technology Access Fee and Technology Transfer

  20











 5.2.4   Payment Terms

  21











 5.2.5   License

  21









  5.3

  Acknowledgement

  21







  6

  Representations, Warranties and Indemnification

  22

  6.1

  Mutual Representations, Warranties and Covenants

  22

  6.2

  XENCOR Warranties

  22

  6.3

  BII Warranties

  22

  6.4

  Process for Defense of Infringement of Third Party Intellectual Property

  23

  6.5

  Disclaimer of Warranties

  24

    3







                                                       7

  Liability, Indemnification, Limitations and Insurance

  24

  7.1

  General

  24

  7.2

  Liability

  24

  7.3

  Indemnification

  25

  7.4

  Limitation of Liability and Indemnification Obligations

  25

  7.5

  Insurance

  26







  8

  Intellectual Property

  26

  8.1

  Existing Intellectual Property Rights

  26

  8.2

  New Intellectual Property, Project Results and Licenses

  26



 8.2.1   XENCOR

  26











 8.2.2   BII

  27











 8.2.3   Other Improvements

  27











 8.2.4   Licenses to Xencor

  27











 8.2.5   Licenses to BII

  27









  9

  Confidentiality

  28

  9.1

  General

  28

  9.2

  MTA Superseded

  30

  9.3

  Controlled Technology

  30







  10

  Term and Termination

  30

  10.1

  Term

  30

  10.2

  Termination of this Agreement

  30



 10.2.1



 30









 10.2.2



 30







  10.3

  Effects of Termination of this Agreement

  31









 10.3.2



 31









 10.3.3



 32







  10.4

  Surviving Provisions

  32







  11

  Miscellaneous

  32

  11.1

  Force Majeure

  32

  11.2

  Conflict with Improvements under the MTA

  33

  11.3

  Secrecy Agreement between the Parties

  33

  11.4

  Publicity

  33

  11.5

  Notices

  33

  11.6

  Applicable Law and Arbitration

  34

  11.7

  Entire Agreement

  34

  11.8

  Waiver; Amendment

  34

  11.9

  Severability

  35

  11.10

  Dispute Resolution

  35

  11.11

  Assignment

  35

  11.12

  Independent Contractors

  35

  11.13

  Counterparts

  35

    4

  Preamble   WHEREAS, XENCOR and an Affiliated Company (as defined below) of BII, the Boehringer Ingelheim Pharma GmbH & Co. KG, Birkendorfer Str. 65, 88397 Biberach, Germany (BI Pharma) entered into a Material Transfer and Initial Service Agreement dated as of June 28, 2011 relating to XENCOR's proprietary product, a monoclonal antibody directed against TNF­  known as Xtend­TNF or XmAb6755; and   WHEREAS, XENCOR is a company engaged in the design and development of biopharmaceutical drugs and is owner of a cell line expressing the Product (as defined below);   WHEREAS, BII has know-how and expertise to develop production processes for biopharmaceuticals towards commercial scale volumes and within international regulatory requirements;   WHEREAS, XENCOR and BII herewith agreed on a business collaboration for the mutual benefit of both Parties by having XENCOR providing the Material (as defined below) and the description of the Product and by having BII developing a fed­batch production process to have XENCOR's Product expressed from the Material in the quantity suitable for preclinical and completion of Phase 1 clinical testing; and   WHEREAS, as BII finances the Project in advance and receives a first right to negotiate to manufacture and payments at a later point in the future, XENCOR agrees, in order to make both Parties benefit from their collaboration, to use its commercially reasonable efforts to complete Phase 1 clinical testing of the Product and to find a business partner for the further development of the Product into a successful medicinal product;   NOW THEREFORE and in consideration of the mutual covenants set forth in this Agreement, BII and XENCOR hereby agree as follows:   1 Definitions   1.1 Acceptance Criteria





  shall mean either, (as the case may be) the following criteria with respect to a Batch of Product; (i) the preliminary specifications as agreed upon by the Parties with respect to the three (3) initial manufacturing runs as described in Section 2.5, or (ii) except as provided in clause (i), the Specifications accompanied by a Confirmation of Compliance and Certificate of Analysis.   1.2 Affiliated Companies   shall mean any company or business entity which controls, is controlled by, or is under common control with, either XENCOR or BII. For purposes of this definition, control shall mean the possession, directly or indirectly of the power to direct or cause the direction of the management and policies of an entity (other than a natural person), whether through the majority ownership of voting capital stock, by contract or otherwise.   1.3 Batch   shall mean Product from one fermentation run using the Process.   1.4 BII Confidential Information and Know­How   shall mean all existing or future technical or other information relating specifically to (a) the BII Facility, (b) the Process, (c) BII Intellectual Property, and/or (d) know-how for the development and manufacture of biopharmaceuticals generally, in each case (a)-(d) whether   5





  patented or not patented, including, without limitation, trade secrets, know-how, processes, concepts, experimental methods and results and business and scientific plans that are disclosed or supplied directly or indirectly to XENCOR or used in connection with the Project, but always excluding all confidential technical or other information of XENCOR specifically relating to XENCOR Technology.   1.5 BII Facility   shall mean the biotech buildings and all other buildings used by BII and/or its Affiliated Companies in performance of the Project in Fremont, CA, USA (it being understood that certain aspects of the Services may be performed in Germany, and, with respect thereto, such buildings in Germany used by BII and/or its Affiliated Companies in performance of the Project, shall also be deemed BII Facility).   1.6 BII Intellectual Property   shall have the meaning set forth in Section 8.2.2 hereof.   1.7 BII Technology   shall mean the Technology developed or obtained by or on behalf of BII or any of its Affiliated Companies without the use of the of XENCOR Confidential Information and Know-How or the Material, including without limitation, the Process.   1.8 Business Partner   shall have the meaning set forth in Section 2.8.2 hereof.   1.9 Certificate of Analysis   shall mean, with respect to a Batch, that complete and accurate document setting forth the conformance with the Specifications set forth in the QAA.   1.10 Claim   shall have the meaning set forth in section 6.4.(a)a) hereof.   1.11 CMO   shall mean Contract Manufacturing Organization.   1.12 Confidential Information­and Know­How   shall mean either or both Xencor Confidential Information and Know-How (as defined herein) or BII Confidential Information and Know- How (as defined herein), as applicable.   1.13 Confirmation of Compliance   shall mean BII's complete and accurate certificate, executed and delivered to XENCOR in connection with each Batch of Product, confirming that such Batch of Product was manufactured according to cGMP, the Process and applicable laws at the BI Facility, and setting forth any deviations therefrom and the results of final investigations performed by BII according to the QAA.   1.14 Controlled Technology   shall have the meaning specified in Section 9.3 hereof.   1.15 cGMP   shall mean current Good Manufacturing Practice regulations as codified in:   The Rules Governing Medicinal products supplied in the European Union: Volume 4 -Medicinal products supplied for Human and Veterinary Use: Good Manufacturing Practice, as amended from time to time; the United States Code of Federal Regulations, title 21, parts   6





  210, 211, 600 and 610, as amended from time to time; and the International Committee on Harmonisation and other comparable guidelines, directives or standards required by governmental authorities in the Major Territories or in any other country or countries agreed in writing by the Parties.   1.16 Deliverables   shall have the meaning specified in Section 2.4 hereof.   1.17 Due Date   shall have the meaning specified in Section 3.1.2 hereof.   1.18 Effective Date   shall mean the date of commencement of this Agreement as mentioned on the cover page above.   1.19 FTE   shall mean a fully allocated employee or consultant of BII and working on the Technology transfer with such time and effort to constitute the equivalent of one (1) employee on a full time basis consistent with normal business and scientific practice […***…].   1.20 Improvements   shall mean all discoveries and inventions, and all modifications, derivatives and improvements to Technology or new uses thereof (whether or not protectable under patent, trademark, copyright or similar laws) that are discovered, developed or reduced to practice by or on behalf of BII or any of its Affiliated Companies (alone or jointly with XENCOR) in the performance of this Agreement.   1.21 Knowledge   shall mean that which a Party knows or should have known following that inquiry a reasonable person would have made in light of the facts and circumstances.   1.22 Latent Defects   shall mean non-conformance of the Product with this Agreement other than Obvious Defects.   1.23 Licensing Revenue   shall have the meaning set forth in Section 3.1.2 hereof.   1.24 Losses   shall have the meaning set forth in Section 7.2.a hereof.   1.25 Major Territories   shall mean the United States, the European Union and/or Japan.   1.26 Material   shall mean the respective XENCOR proprietary cell line as laid down in detail in Appendix 1 and any know-how or data relating directly thereto and provided together with such cell line to BII by or on behalf of XENCOR (including any progeny or derivative thereof).   1.27 MTA   shall mean the Material Transfer and Initial Service Agreement entered into by XENCOR and BI Pharma on June 28, 2011 attached to this Agreement as Appendix 4.

***Confidential Treatment Requested   7





  1.28 Obvious Defects   shall mean any non-conformance of the Product with this Agreement, which is visible or easily detectable without any analysis in a laboratory, such as noticeable damages of the Product caused by the transport of Product.   1.29 Other Improvements   shall have the meaning set forth in Section 8.2.3 hereof.   1.30 Principal Supplier   shall mean the right to manufacture and supply commercial Product in the amount per annum of at least […***…] of the worldwide annual demand of commercial Product calculated based on XENCOR's reasonably forecasted request for commercial Product for the respective calendar year.   1.31 Process   shall mean all the respective steps involved in the process developed and performed by BII pursuant to this Agreement to produce the respective Product from the Material or having the Product expressed from the Material, including, without limitation, the manufacture, testing and packaging thereof.   1.32 Process Description   shall mean a controlled document, approved by authorized technical and quality representatives of both Parties, that documents the general outline of the respective Process. It includes all relevant Process parameters to be met and equipment and raw materials to be used.   1.33 Product   shall mean XENCOR's proprietary biopharmaceutical product, a monoclonal antibody directed against TNF­  known as Xtend­INF or XmAb6755, as further laid down in detail in Appendix 1, expressed from the Material disclosed by XENCOR to BII and formulated either as bulk drug substance or in final dosage form as drug product, as the context requires.   1.34 Project   shall mean the performance of the Services, including without limitation the Process development program for the Product.   1.35 Project Fees   shall have the meaning specified in Section 3.1 hereof.   1.36 Project Manager   shall have the meaning specified in Section 2.2.1 hereof.   1.37 Project Plan   shall mean the plan describing the Services to be performed by BII under the Project, including the Project timeline and the Project Fees, attached to this Agreement as Appendix 2.   1.38 Project Team   shall have the meaning specified in Section 2.2.2 hereof and at the Effective Date shall consist of the persons listed in Appendix 3.   1.39 QAA

***Confidential Treatment Requested   8





  shall mean the Quality (Assurance) Agreement entered into between the Parties simultaneously with this Agreement and attached hereto as Appendix 5.   1.40 Representatives   shall have the meaning specified in Section 7.3 a hereof.   1.41 Service(s)   shall mean those certain services performed by BII under this Agreement.   1.42 Specification(s)   shall mean all the tests, analytical methods and/or limits, and the results thereof, as applicable, agreed by the Parties, within which the Product has to conform to be considered acceptable by XENCOR for clinical use set forth in Appendix 6. The Parties are in agreement, that in the first instance they will agree on preliminary specifications which shall then be fixed to final Specifications in accordance with Section 2.5.   1.43 Steering Committee   shall have the meaning specified in Section 2.2.3 hereof.   1.44 Technology   shall mean all cDNA, cell lines, cell banks, master cell banks, constructs, reagents, antibodies and/or other tangible materials, methods, techniques, processes, trade secrets, copyrights, know-how, data, documentation, regulatory submissions, specifications and other intellectual property of any kind (whether or not protectable under patent, trademark, copyright or similar laws).   1.45 Technology Access Fee   is defined in Section 5.2.3.   1.46 Total Amount   shall have the meaning specified in Section 3.1.2 hereof.   1.47 XENCOR Confidential Information and Know­How   shall mean all existing or future technical or other information relating specifically to (a) the Material, (b) the Product (and any modification, derivative or fragment thereof), and/or (c) the XENCOR Technology, in each case (a), (b) and (c) whether patented or not patented, and including, without limitation, all know-how, trade secrets, inventions, patent applications, processes, concepts, experimental methods and any other information concerning XENCOR's financial situation, business plans, and its research and product designs, that are disclosed or supplied to BII in connection with the Project, but always excluding BII Confidential Information and Know-How.   1.48 XENCOR Intellectual Property   shall have the meaning specified in Section 8.2.1 hereof.   1.49 XENCOR Technology   shall mean (i) the Material, (ii) the Product, and any modifications, derivatives, or fragments thereof, and (iii) the Technology of XENCOR developed or obtained by or on behalf of XENCOR independent of and without the use of technical or other information disclosed or supplied by BII or its Affiliated Companies to XENCOR relating specifically to the BII Facility, the Process, BII Intellectual Property and/or know-how for the development and manufacturer of biopharmaceuticals generally, and which was introduced by XENCOR to the Project.   9





  2 Cooperation between the Parties in the Course of a Project   2.1 General   2.1.1 General   This Agreement sets forth the terms and conditions under which BII and XENCOR will perform their tasks regarding the Project. BII shall (by itself or by its Affiliated Companies) perform for XENCOR the Services as specified in this Agreement and the Project Plan and BII and XENCOR shall adhere to their obligations under this Agreement and the Project Plan.   2.1.2 Priority   In the event of a conflict or ambiguity between any term of this Agreement and an Appendix, the terms of this Agreement shall prevail. In case the Parties mutually agree that a specific Section of this Agreement shall be modified by the terms of a Project Plan (and that such term of the Project Plan shall prevail) for a specific Service, they may only do so by explicit reference to the Section of this Agreement that shall be modified.   2.2 Personnel   2.2.1 Designation of Project Manager   Upon commencement of the Project, BII and XFNCOR will each appoint a Project Manager, who will coordinate and supervise the Project including communication of all instructions and information concerning the Project to the other Party. The Project Manager will serve as the primary contact person for the other Party. Each Project Manager will be available on an agreed basis for consultation at prearranged times during the course of the Project. The Project Managers shall be copied on all correspondence by other Project Team members and all correspondence between the Parties. In the absence of the Project Manager, a substitute shall be appointed. Additional modes or methods of communication and decision making may be implemented with the mutual written consent of each Party. Each Party will use reasonable efforts to provide the other Party with […***…] prior written notice of any change in such Party's Project Manager.   2.2.2 Project Team   The Parties shall establish a Project Team consisting of representatives of each Party from the necessary disciplines and their respective Project Managers to (a) ensure the progress of the Project, (b) coordinate the performance of the Project, and (c) facilitate communication among the Parties. Each Project Team member shall have knowledge and ongoing familiarity with the Project and will possess the authority to make decisions on matters likely to be raised in the Project Team. Each Party shall have the right to substitute its members of the Project Team as needed from time to time by giving written notice to the other Party due time in advance.   The Project Team shall meet in person or by means of a video conference or teleconference on a periodic basis (a) as agreed by the Project Managers within [...***...] after written request for such meeting by either Party, or (b) as specified in the Project Plan (Appendix 2, as amended from time to time), but in any event, unless otherwise agreed in writing by the Parties, the Project Team shall meet at least one (1) time per calendar quarter (by means of a video conference or teleconference or in person, provided, however, that at least two (2) of these meetings per calendar year are held in person on an alternating basis between XENCOR's facilities and BII's facilities in Fremont, CA, USA).   The Project Team shall oversee the Project. Prior to each meeting of the Project Team the Parties will distribute to each other written copies of all materials, data and information arising out of the conduct of their activities hereunder.

***Confidential Treatment Requested   10





  Each Party shall bear its own costs associated with such meetings and communications. It is the right of each Party to call for a Project Team meeting according to the covenants of this Section 2.2 upon written request at any time.   The Parties shall alternate responsibility for preparing minutes of the meeting which shall be circulated promptly following the meeting.   The initial members of the Project Team and the Project Managers are set forth in Appendix 3 attached hereto which may be updated from time to time to reflect changes in the Project Team and/or Project Managers as provided in this Section 2.2.   2.2.3 Steering Committee   The Parties shall form a Steering Committee, to which each Party will appoint three (3) executive employees, including the Project Managers, all of whom shall be familiar with the Project. The Steering Committee shall have general oversight and review of the activities of the Project Team and shall resolve any issues referred to the Steering Committee by the Project Team. Each Party shall have the right to substitute its members of the Steering Committee as needed from time to time by giving written notice to the other Party due time in advance.   The Steering Committee shall meet within [...***...] after receipt of a written request by one Party to the other Party. The request shall describe the matter in dispute and the solution which the requesting Party proposes to be decided. Each Party shall bear its own costs associated with meetings and communications of the Steering Committee.   The Steering Committee will take action by unanimous consent of the Parties, with the representatives of BII collectively having a single vote and the representatives of XENCOR collectively having a single vote, or by a written resolution signed by all of the representatives. If the Steering Committee is unable to reach unanimous consent on a particular matter, then the matter will be referred to the chief executive officers of the Parties, who will use good faith efforts to resolve such matter, and the decision reached by mutual agreement of the chief executive officers of the Parties shall be final and binding on the Parties. If, (i) after good faith efforts, the chief executive officers of the Parties are unable to resolve such matter by mutual agreement, and (ii) such matter concerns the Product or the Process, but does not concern the BI Facility or the management of manufacturing slots, then the chief executive officer of XENCOR shall make the final decision about how to resolve such dispute, after good faith consideration of BII's position, which decision shall be final and binding on the Parties; provided, however, that, in resolving such matter, XENCOR's chief executive officer shall not have any authority to require BII or its Affiliated Companies to incur additional expenses or obligations not contemplated by this Agreement. In no event will the Steering Committee, or the executive officers of the Parties in resolving any Steering Committee matter, have any authority to amend or modify this Agreement; any such amendment or modification of this Agreement must be in accordance with Section 11.8. For the avoidance of doubt, nothing in this Section shall prevent any Party from seeking arbitration proceedings pursuant to Section 11.6 hereof with regard to any matters other than matters resolved by mutual agreement of the chief executive officers in accordance with this Section 2.2.3.   The members of the Steering Committee are set forth in Appendix 3 attached hereto, which may be updated from time to time to reflect changes in the Steering Committee as provided in this Section 2.2.3.   2.3 Conduct of the Project and BII's Work and Tasks   The Parties shall engage in the Project upon the terms and conditions set forth in this Agreement. In the course of this Agreement the Parties shall perform the Project as laid down and detailed in the Project Plan.   Each Party shall fully and reasonably cooperate with the other Party to provide appropriate information and assistance to the other Party in connection with the Project, responding in a

***Confidential Treatment Requested   11





  reasonable and timely manner with respect to all reasonable requests for information and approval. Neither Party shall be liable for any delays in its performance of the Project to the extent caused solely by the other Party's failure to provide in a reasonably timely manner any information or approval reasonably requested by the other Party.   The Parties shall assign a sufficient number of professionally qualified personnel to perform the Project and shall perform its tasks under this Agreement according to the generally acceptable professional and then current industry standards and subject to terms and conditions as set forth herein, at all times in compliance in all material respects with all requirements of applicable laws and regulations. The Parties will use commercially reasonable efforts to achieve the estimated timelines as laid down in the Project Plan.   Changes to the Project Plan, if any, shall require the written consent of both Parties.   2.4 Deliverables   BII will deliver such deliverables expressly laid down in detail in the Project Plan, including but not limited to the Product (the Deliverables) within the timelines laid down in the Project Plan to XENCOR. Following the completion of the activities required under the Project, BII will provide to XENCOR then available Product (if any), Batch records and a summary containing manufacturing and analytical testing, including without limitation, the information and the results of the development phase according to the workscope as further described in the Project Plan.   2.5 Nature of the Project   As the Product has never been produced by BII or on behalf of BII by its Affiliated Companies at the BI Facility, XENCOR acknowledges that the Project is experimental in nature and that no favorable or useful results can be assured by BII. However, after […***…], the Parties shall in good faith agree on a revision (if necessary) to the preliminary specifications for the Product (that have been mutually agreed upon by the Parties) that shall then be the Specifications for subsequent runs in subsequent campaigns that shall form a basis for rejection or acceptance of the respective Product produced in any additional runs at such scale under the provisions of Section 4.1, and, provided that the Process has not been materially changed (i.e. a change that is subject to the Change Control procedures of the QAA), the Project shall no longer be considered experimental in nature and the obligation to meet the respective Specification shall apply to all future runs at such scale.   2.6 Additional Work   In case the Parties mutually agree on additional work for the benefit of the Project by changing the Project Plan by written agreement of the Parties, BII shall perform such additional work to sustain the progress of the Project on conditions in terms of money, time and scope to be subject to agreement of the Parties hereto as set forth in the then amended Project plan.   2.7 XENCOR Confidential Information and Know-How and Material   To the extent not already transferred by XENCOR, XENCOR shall transfer the Material for the Project to BII to the BII Facility subject to the terms of this Section 2.7, and BII shall use or have used by its Affiliated Companies such Material solely to conduct the Project in accordance with the Project Plan, this Agreement, or as otherwise may be agreed to by the Parties in writing. The Material will not be used in connection with any animal studies or diagnosis, treatment or any activity in humans or for any use not directly related to the Project. BII's use of the Material will be in compliance with all applicable laws in the state or country where the Services are performed. BII accepts the Material with the knowledge that it is experimental. The Material may not be transferred or otherwise made available, in whole or in part, by BII to any other individual, entity or institution other than any Affiliated Companies

***Confidential Treatment Requested   12





  of BII without the prior written consent of XENCOR, which may be withheld by XENCOR for any reason. Such consent is hereby given for BII or its Affiliated Companies to transfer the Material for quality control testing performed by a third party on a blinded basis. For the avoidance of doubt, in the event of a transfer of Material to an Affiliated Company of BII or to any third party with the consent of XENCOR, BII shall ensure that the respective Affiliated Company or third party shall use such Material solely to conduct the Project in accordance with the Project Plan, this Agreement, or as otherwise may be agreed to by the Parties in writing and shall not transfer or otherwise make available, in whole or in part, the Material to any other individual, entity or institution.   The Material is the property of XENCOR. It is agreed that the transfer of the Material hereunder shall not constitute a sale of Material or a grant, option or license of any patent or other rights except to allow BII to perform the Project. XENCOR shall retain and have all right, title and interest in and to the Material.   XENCOR will inform BII in a timely manner about any safety issues of which XENCOR becomes aware relating to the handling of the Material and the Product after the date of the execution of this Agreement.   BII shall at all times take reasonable measures to protect the Material from loss or damage and in no event measures less than employed by BII in the protection of its own proprietary materials, and shall promptly notify XENCOR, if at any time it believes the Material has been damaged, lost or stolen.   XENCOR and BII hereby acknowledge and agree that XENCOR is providing XENCOR Confidential Information and Know-How to BII for its use by BII for the purposes of this Agreement, and BII will make use thereof solely for such purposes and XENCOR hereby consents to such use.   2.8 Further Obligations of XENCOR   2.8.1 General   The Parties acknowledge and agree, that. subject to the terms and conditions of this Agreement, BII substantially finances the Project at the costs and fees outlined in Appendix 2 in advance and receives payments at a later point in the future. Accordingly, XENCOR agrees, in order to make both Parties benefit from their collaboration, that the success of the collaboration between the Parties depends strongly on the fact whether or not XENCOR is able to find a suitable business partner for the further development of the Product into a successful medicinal product with one or more marketing authorisations worldwide.   2.8.2 Obligations of XENCOR   Therefore, XENCOR shall use commercially reasonable efforts to conduct and complete at its own cost and risk a Phase 1 clinical trial with the Product as described in Section 2.8.3 within the timelines set forth herein (subject to Section 2.8.3); and find one or more suitable third party/parties as business partner(s) for the further development of the Product into a medicinal product (Business Partner).   For the avoidance of doubt, XENCOR bears the sole responsibility for the conduct and completion of the clinical trials of the Product and the search for the Business Partner and shall bear all costs and expenses in connection therewith. In no event will it be a breach of this Agreement by XENCOR if the Phase 1 clinical trial or other clinical trials of the Product are not completed or an agreement is not entered into with a Business Partner so long as XENCOR uses commercially reasonable efforts to do so.   2.8.3 Timelines and Information   XENCOR shall use commercially reasonable efforts to conduct and complete a Phase 1 clinical trial of the Product in a timely fashion and to search for the Business Partner. A summary of the preliminary plan for the Phase 1 clinical trial of the Product to be conducted by XENCOR is attached as Appendix 7, it being understood that timing of such clinical trial   13





  may be delayed to the extent (i) caused primarily by BII's failure to provide Product conforming to the Specifications; or (ii) by safety issues relating to the Product; or (iii) by regulatory delays; or (iv) other causes outside the control of XENCOR.   XENCOR shall promptly provide BII notice of the completion and a summary overview of the outcome/observations of the Phase 1 clinical trial regarding the Product and a summary overview of any negotiations with a possible Business Partner regarding the further development of the Product. Moreover, XENCOR shall inform BII on an annual basis or, if there is good cause, upon request of BII (whichever is the case) about the actual status of such Phase 1 clinical trial or such negotiations, such request not to be more often than twice per year.   3 Payments   3.1 Project Fee   3.1.1 Consideration for Services   As consideration for the performance of BII's Services, XENCOR shall pay BII all fees to be paid to BII as set forth in the Project Plan (the Project Fees) according to the terms and conditions set forth in the following subsections of this Section 3.1.   The Project Fees as set forth in the Project Plan include BII's internal and out­of­pocket cost and expenses for its performance of the Project, including without limitation, ordinary and standard raw materials, components and consumables, and XENCOR shall not be obligated to make any payments with respect to any Services except the Project Fees or payments for additional work agreed upon according to Section 2.6 (which shall then be considered Project Fees).   3.1.2 Payment of the Project Fees   The Project Fees referred to in Section 3.1.1 above, together with interest at a […***…] percent ([...***...]%) annual interest rate on any unpaid Project Fees accruing from the earlier of (i) the date of completion of the clinical summary report for the Phase 1 clinical trials of the Product as planned according to Appendix 7 unless delayed as described in Section 2.8.3 or (ii) the date that is five (5) calendar years after the Effective Date (each of the alternatives above, the Due Date) until paid in full (the Project Fees together with any such interest, referred to as the Total Amount), shall become duly payable in accordance with the following schedule:   a. In case XENCOR has entered into an agreement with at least one Business Partner, then, beginning from the later of (i) the effective date of such agreement or (ii) the Due Date, XENCOR will pay BII the Total Amount in [...***...] installments of [...***...] of the [...***...] (defined below) that [...***...]; provided, however, that in no event will [...***...] of the annual Licensing Revenue [...***...]; provided that, for the avoidance of doubt, [...***...] shall be excluded from [...***...].

***Confidential Treatment Requested   14

  b. In case XENCOR decides to proceed with the further development of the Product without a Business Partner, XENCOR will pay BII the Total Amount in one or more lump sum payments within five (5) calendar years from the Due Date.   c. As long as XENCOR, notwithstanding its commercially reasonable efforts after the completion of the Phase 1 clinical trial either (i) is not able to further develop the Product for technical and/or scientific reasons or (ii) does not decide to proceed with the further development of the Product without a Business Partner and does not enter into an agreement with a Business Partner within two (2) calendar years from the Due Date, then XENCOR shall have no obligation to pay BII any or all of the Total Amount. For the avoidance of doubt, such obligations will become due as described in this Section 3.1.2, at any time XENCOR enters into an agreement with at least one Business Partner or further develops the Product within ten (10) calendar years following the Effective Date, as provided in Section 10.3.   3.1.3 Invoicing   XENCOR shall notify BII in writing of any of the circumstances listed in Section 3.1.2.a to 3.1.2.c. BII shall issue an invoice for the payments of the Total Amount agreed upon with XENCOR according to the payment schedule in Section 3.1.2 and payment of the Technology Access Fee, as applicable. The amount of the Project Fees and the interest (if any) will be shown separately in the invoice.   XENCOR shall make payments of all invoiced amounts for the payments of the Total Amount and of the Technology Access Fee due and payable in accordance with Section 5.2.3 and 5.2.4, as applicable [...***...] from the date of receipt of BII's invoice. If XENCOR fails to make timely payment of the invoiced amount, interest shall accrue on the amount of the Project Fees shown in the invoice at a fixed annual rate equal to the highest rate of interest quoted as the prime rate in The Wall Street Journal on the day that payment was due. All payments due under this Agreement shall be paid in US dollars by wire transfer or by such other means agreed to in writing by the Parties. XENCOR will provide at least twenty-four (24) hours advance notice to BII of each wire transfer to the bank account identified below or such other bank accounts as BII shall designate in writing.

       Account Name:

  [...***...]

  Account Number:

  [...***...]







Bank:

  [...***...]

  BIC (SWIFT-CODE):

  [...***...]

  IBAN:

  [...***...]

    3.2 Technology Access Fee   The Technology Access Fee (if any) is due according to Section 5.2.3 and 5.2.4 below. Section 3.1.3 shall apply accordingly.   3.3 VAT   All payments under this Agreement (including the Technology Access Fee) shall be understood as net payments without value added tax (VAT). VAT, if applicable, shall be added to the respective payment. The Parties will reasonably cooperate in completing and filing documents required under applicable law in connection with any refund of or credit for any such payment of VAT.

***Confidential Treatment Requested   15





  4 Delivery Terms of Product   4.1 Delivery Terms   BII shall (a) deliver to XENCOR or, (b) at the request of XENCOR, store, the agreed amounts of the Product produced according to the Project Plan in accordance with agreed upon schedule, at the price set forth in the Project Plan. Delivery of Product by BII shall be made [...***...] BII Facility (Incoterms 2010).   BII shall package and arrange for shipment of Product to the delivery address specified by XENCOR, all in accordance with the instructions of XENCOR provided that BII shall not be responsible for any damages with respect to Product or third party claims arising out of such arrangements for shipment of Product after delivery of such Product to the shipper in accordance with such instructions in accordance with XENCOR's instructions. Each shipment of cGMP Product will include a Certificate of Analysis, a Confirmation of Compliance and such other documentation as reasonably required to meet all applicable statutory and regulatory requirements. Delivery of the Product shall be subject to quality and other provisions set forth in the QAA. The Parties shall cooperate reasonably to obtain all customs licenses or permits necessary to ship the Product (the evaluation of which customs licenses or permits required shall be performed by XENCOR), and no shipment shall be made until such licenses or permits, if any, have been obtained.   XENCOR shall diligently examine all Product delivered under this Agreement as soon as practicable after receipt. Notice of all claims arising out of or relating to Obvious Defects shall be given in writing to BII within [...***...] after the date of XENCOR's receipt of Product, otherwise, such Product shall be considered free of any Obvious Defects as between BII and XENCOR. XENCOR shall make a damaged Product available for inspection and shall comply with the requirements of any insurance policy covering the Product, and BII shall offer XENCOR all reasonable assistance, at the cost and expense of XENCOR, in pursuing any claims arising out of the transportation of the Product.   Except as otherwise provided herein and as set forth in Section 2.5, XENCOR shall have [...***...] after the date of XENCOR's receipt of Product, for all claims arising out of or relating to any Latent Defects and to reject such delivered Product for Latent Defects; provided, however that XENCOR shall only be permitted to reject the Product if the Acceptance Criteria are not met.   If XENCOR determines after reviewing the relevant documentation and performing reasonable testing that any Batch does not meet the Acceptance Criteria, or if Product is determined by BII to be unsuitable for release, then the Parties will mutually agree, as promptly as reasonably possible, whether (a) to produce a new Batch at BII's cost and expense, including the costs of materials used in the manufacture of such Batch, or (b) to rework or reprocess the Batch, at BII's cost and expense, so that the Batch can be deemed to have been manufactured in compliance with cGMP and the agreed Process Description, and to conform to the Acceptance Criteria (provided that the Parties have mutually agreed in writing on any procedures for reworking or reprocessing a Batch). If the remedy set forth in either (a) or (b) is agreed to be performed by BII, then BII shall start the applicable work as soon as reasonably practicable, such that the next reasonably available (taking into consideration BII's entire contract manufacturing business) manufacturing slot shall be used by BII to produce Product, and BII will use commercially reasonable efforts to resupply within [...***...] but in any event no later than [...***...] from time of rejection by XENCOR. For the avoidance of doubt, if Product is not accepted by XENCOR as provided above, then BII's obligations set forth above shall apply both to the drug product and the bulk drug substance contained therein.   In the event XENCOR rejects the Product for Obvious Defects or Latent Defects as provided above, BII shall have the right to sample and retest the Product, which shall be done as soon as

***Confidential Treatment Requested   16





  practicable, provided that, if BII does not notify XENCOR in writing of its election to retest the Product within [...***...] after notice of rejection from XENCOR, BII shall be deemed to agree with XENCOR's rejection of the Product. In the event of a discrepancy between XENCOR's and BII' s test results such that one Party's results fall within the Acceptance Criteria and the other Party's test results fall outside the Acceptance Criteria, or there exists a dispute over whether such failure is due (in whole or in part) to acts or omissions of XENCOR or any third party after delivery, the Parties shall cause a testing laboratory agreeable to both Parties to perform comparative tests and/or analyses on samples of the alleged defective Product. The testing laboratory's results shall be in writing and shall be final and binding save for manifest error on the face of its report. Unless otherwise agreed to by the Parties in writing, the costs associated with such testing and review shall be borne by the Party against whom the testing laboratory result finally rules. The testing laboratory shall be required to enter into written undertakings of confidentiality no less burdensome than set forth or referred to by this Agreement.   4.2 Cancellation of Order   If XENCOR at any time cancels or postpones any campaign set forth in the Project Plan for the manufacture of Product for non-technical reasons later than [...***...] prior to the date on which inoculation of the respective production fermenter is to take place, XENCOR shall nevertheless be obliged to pay [...***...] percent ([...***...]%) of the Project Fees for such campaign to the extent that BII is not able to adequately use the respective capacity for such campaign alternatively (e.g. for production of any other material for any third party or itself) provided always that BII shall use its commercially reasonable efforts to use such capacity and mitigate any losses that may incur arising from such cancellation or postponement, including, for the avoidance of doubt, the reapplication of raw materials, if possible.   5 Ownership and Use of Project Data   5.1 Project Data   In consideration of the Project Fees:   a. BII shall carry out the Project by itself or by its Affiliated Companies) and provide XENCOR with a summary of the results from the Project, including manufacturing and analytical release and also shall provide XENCOR with a summary report about the results on the various stages of Process development;   b. BII shall supply XENCOR with data, results and information required to comply with any mandatory request of any applicable regulatory body in the Major Territories to comply with such regulatory body's requirements. BII shall provide complete Batch records for all cGMP runs and will provide to XENCOR all data reasonably necessary from all process development and manufacturing activities to enable XENCOR's preparation of any regulatory filings; and shall not unreasonably reject supplying data results and information required to comply with any requirement of any applicable regulatory body outside the Major Territories or cooperating with XENCOR's preparation of the chemistry, manufacturing and controls section of any regulatory filing supporting the clinical development of the Product in and outside the Major Territories.   BII shall bear the cost of such supply and cooperation by BII, provided that, if there are specific requirements of a given country that are significant and in addition to requirements of the Major Territories, the Parties will enter into good faith discussions whether additional resources and costs are required, with the intent of minimizing any additional cost to XENCOR.

***Confidential Treatment Requested   17





  c. Certain trade secret information may be provided by BII via DMF or similar filing (e.g. to a notified body) directly to the respective authorities.   d. For the avoidance of doubt, all summaries and/or reports generated as a result of the BII's performance under this Agreement and delivered to XENCOR by BII will be part of the Process and the sole and exclusive property of BII. Subject to XENCOR's confidentiality and non-use obligations hereunder and without affecting the ownership of Improvements as set forth in Section 8, BII hereby grants to XENCOR a non-exclusive, worldwide license to use and reproduce all such summaries and/or reports for all uses in connection with development activities relating to Product that do not involve manufacturing of Product (e.g., formulation work, toxicology studies or the development of a manufacturing process), regulatory activities relating to the Product and, to the extent necessary, any commercial activities relating to the Product, which XENCOR may sublicense in connection with any license of rights to the Product.   5.2 Use of the Process; Right of Negotiation   5.2.1 Use of the Process outside this Agreement   Except as set forth in this Agreement, the Process shall not be used by XENCOR or any third party outside the scope of this Agreement without the prior written consent of BII.   5.2.2 Right of First Negotiation to Manufacture   a. XENCOR hereby grants and will make an eventual Business Partner do so, BII a first right to negotiate to manufacture and supply Product for use in Phase 2 and 3 clinical trials. XENCOR shall provide BII written notice (i) of the completion of the Phase 1 clinical trials of the Product, which notice shall include reasonable documentation of the results of such Phase 1 clinical trials of the Product or (ii) that XENCOR has entered into an agreement with at least one Business Partner, whichever of (i) and (ii) occurs earlier. If BII provides XENCOR written notice of its exercise of the first right to negotiate within [...***...] after receipt of such written notice from XENCOR, then for a period of [...***...] following such written notice from BII or such longer period as agreed in writing by BII and XENCOR (or its Business Partner) (the Clinical Negotiation Period), XENCOR (or its Business Partner) and BII will negotiate in good faith an agreement for the manufacture and supply of Product for use in Phase 2 and 3 clinical trials, at market rate terms and conditions common for the contract manufacture of monoclonal antibodies within the contract manufacturing industry, to be mutually agreed in writing by the Parties. If BII does not provide written notice of its exercise of the first right to negotiate within such [...***...] period, XENCOR and any Business Partner shall be free to enter into one or more agreements with third parties for the manufacture and supply of Product for use in Phase 2 and 3 clinical trials. If BII provides written notice of its exercise of the first right to negotiate within such [...***...] period but BII and XENCOR (or its Business Partner) do not enter into such a contract manufacturing agreement within the Clinical Negotiation Period, XENCOR and any Business Partner shall be free to enter into one or more agreements with third parties for the manufacture and supply of Product for use in Phase 2 and 3 clinical trials (which may include an agreement for any Business Partner or its affiliate to manufacture and supply Product for clinical trials), provided that the supply price for Product is no more than [...***...] percent ([...***...]%) of the clinical supply price of Product last proposed by BII during the negotiations between the Parties (or BII and the Business Partner). If the supply price for Product proposed by a third party (which may include a Business Partner or its affiliate) is more than [...***...] percent ([...***...]%) of the clinical supply price of Product last proposed by BII during the negotiations between the Parties (or BII and the Business Partner) , XENCOR (or its Business Partner) shall provide written notice to BII that XENCOR (and its Business Partner) will accept the clinical supply price last proposed by BII, and BII and XENCOR (or its Business Partner) will enter into a contract manufacturing agreement reflecting such clinical supply price; provided that, if BII does not agree to enter into such contract

***Confidential Treatment Requested   18





  manufacturing agreement within [...***...] after such written notice, XENCOR (or its Business Partner) shall be free to enter into an agreement with a third party (or an agreement for the Business Partner or its affiliate to manufacture and supply Product).   b. In addition, if BI has exercised its first right of negotiation in Section 5.2.2.a, XENCOR hereby grants and will make an eventual Business Partner do so, BII a first right to negotiate to manufacture and supply commercial Product as Principal Supplier for a period up to the [...***...], starting with the first commercial launch of the Product. XENCOR shall provide BII written notice (i) of the decision to have the Product manufactured at a commercial scale and to launch the Product commercially or (ii) that XENCOR has entered into an agreement with at least one Business Partner, whichever of (i) and (ii) occurs earlier. If BII provides XENCOR written notice of its exercise of the first right to negotiate within [...***...] after receipt of such written notice from XENCOR, then for a period of [...***...] following such written notice, or such longer period as agreed in writing by BII and XENCOR (or its Business Partner) (the Commercial Negotiation Period), XENCOR (or its Business Partner) and BII will negotiate in good faith an agreement for the manufacture and supply of commercial Product as Principal Supplier, at market rate terms and conditions common for the contract manufacture of monoclonal antibodies within the contract manufacturing industry to be mutually agreed in writing by the Parties. If BII does not provide written notice of its exercise of the first right to negotiate within such [...***...] period, XENCOR and any Business Partner shall be free to enter into one or more agreements with third parties for the manufacture and supply of commercial Product (which may include an agreement for any Business Partner or its affiliate to manufacture and supply commercial Product). If BII provides written notice of its exercise of the first right to negotiate within such [...***...] period but BII and XENCOR (or its Business Partner) do not enter into such a contract manufacturing agreement within the Commercial Negotiation Period, XENCOR and any Business Partner shall be free to enter into one or more agreements with third parties for the manufacture and supply, of commercial Product (which may include an agreement for any Business Partner or its affiliate to manufacture and supply commercial Product); provided that the supply price for Product is no more than [...***...] percent ([...***...]%) of the commercial supply price of Product last proposed by BII during the negotiations between the Parties (or BII and the Business Partner). If the supply price for Product proposed by a third party (which may include a Business Partner or its affiliate) is more than [...***...] percent ([...***...]%) of the commercial supply price of Product last proposed by BII during the negotiations between the Parties (or BII and the Business Partner), XENCOR (or its Business Partner) shall provide written notice to BII that XENCOR (and its Business Partner) will accept the commercial supply price last proposed by BII, and BII and XENCOR (or its Business Partner) will enter into a contract manufacturing agreement reflecting such commercial supply price; provided that, if BII does not agree to enter into such contract manufacturing agreement within [...***...] after such written notice, XENCOR (or its Business Partner) shall be free to enter into an agreement with a third party (which may include an agreement for any Business Partner or its affiliate to manufacture and supply Product).   c. The right set forth in Section 5.2.2.b shall automatically terminate if BII does not exercise the first right of negotiation set forth in Section 5.2.2.a. The rights set forth in Section 5.2.2.a and b shall automatically terminate if BII does not produce a viable Process for manufacture of Product as evidenced by failure to produce cGMP Product within a timeframe reasonably and customary in the biopharmaceutical industry for companies of comparable size and the respective activities.   d. In both cases set forth above, in Section 5.2.2.a. and b., if BII exercises its first right of negotiation, BII and XENCOR (and/or its Business Partner, as applicable) will negotiate in good faith a respective contract manufacturing agreement based on the market rate

***Confidential Treatment Requested   19





  terms and conditions common for the contract manufacture of monoclonal antibodies within the contract manufacturing industry, it being understood that any such contract manufacturing agreement would provide for Technology transfer, payment of the Technology Access Fee (if applicable), and other terms set forth in Sections 5.2.3, 5.2.4 and 5.2.5 below.   e. Any use of the Process by XENCOR or any third party outside the terms and conditions set forth in such contract manufacturing agreement is always subject to the provisions set forth in Section 5.2.3 below.   f. In the event that BII elects not to exercise its first right of negotiation described in Section 5.2.2.a or 5.2.2.b, or, despite their commercially reasonably efforts and good faith negotiations the Parties (or BII and the Business Partner) are unable to agree upon a manufacturing agreement within the Clinical Negotiation Period or, Commercial Negotiation Period, as applicable; and/or XENCOR (and/or XENCOR's Business Partner) wishes to use the Process outside the terms and conditions set forth in a contract manufacturing agreement with BII, BII shall transfer the Process in accordance with Section 5.2.3 below.   g. All of BII's rights of negotiation set forth in this Secti6n 5.2.2 shall terminate upon payment of the Technology Access Fee by XENCOR.   5.2.3 Technology Access Fee and Technology Transfer   In the event that XENCOR wishes to use or have used (e.g. by a Business Partner) the Process outside this Agreement or the terms and conditions set forth in a contract manufacturing agreement with BII, except as provided below, XENCOR shall pay BII a technology access fee of three million five hundred thousand (3,500,000.00) US dollars (the Technology Access Fee).   In the event that XENCOR pays the Technology Access Fee set forth above, XENCOR shall have the right to use or have used (e.g. by a Business Partner) the Process worldwide for the manufacture of Product in accordance with the terms and conditions of this Agreement, without entering into a contract manufacturing agreement with BII.   Notwithstanding the foregoing, no Technology Access Fee shall be due or payable if BII does not produce a viable Process for manufacture of Product as evidenced by failure to produce cGMP Product within the timeframe agreed in the Project Plan or, if factors outside of the reasonable control of BII (such as e.g. a cell-line not suitable for production, delay in the growth of the cell line; shortage of raw materials and supplies, delay or non­performance of BII's suppliers, requests or orders of governments or regulatory authorities, etc.) require the timeframe in the Project Plan to be extended, the extended timeframe agreed upon in writing between BII and XENCOR that is reasonable and customary for paying customers in the biopharmaceutical industry for companies of comparable size and the respective activities. In addition, no Technology Access Fee shall be due or payable in connection with XENCOR's election to use or have used (e.g. by a Business Partner) the Process if (i) BII does not exercise its first right to negotiate under either Section 5.2.2.a or 5.2.2.b, (ii) BII exercises its first right to negotiate but demands a supply price for clinical/commercial supply of Product that exceeds the bid price for the clinical/ commercial supply of Product of a comparable quantity and quality by a third party biopharmaceutical CMO of comparable size and respective activities to BII and with registered headquarters in the Major Territories, or (iii) XENCOR (or its Business Partner) has entered into a contract manufacturing agreement with BII, but BII is not able to supply XENCOR and its Business Partners [...***...] of the Product required. For the avoidance of doubt, nothing in this Section 5.2.3 (ii) shall affect such contract manufacturing agreement or BII's position as Principal Supplier, but XENCOR may solely request the Technology Transfer pursuant to the following sentences of this Section without paying the Technology Access Fee in order to have manufactured the amount of Product missing to satisfy XENCOR's and its Business Partners' demand.

***Confidential Treatment Requested   20





  For the avoidance of doubt, the Technology Access Fee is only due one time, and if XENCOR pays the Technology Access Fee, except for the Project Fees, no additional amount will be payable for use or having used the Process worldwide.   The Technology Access Fee includes Technology transfer support of [...***...] FTEs of BII for a period of [...***...] for each of the [...***...] FTEs in a time frame of [...***...] beginning with XENCOR's written request to use or have used (e.g. by a Business Partner) the Process outside the terms and conditions set forth in a contract manufacturing agreement with BII. Further support of BII requested by XENCOR shall be reimbursed at an hourly rate of [...***...] US dollars. The Parties will agree upon the times when to render such Technology transfer support in good faith.   Promptly following XENCOR's election to use the Process, BII shall start to transfer the Process and all reasonably necessary related BII Confidential Information and Know-How) to XENCOR or such designee experienced in the biopharmaceutical production and shall use commercially reasonable efforts, taking into consideration BII's entire contract manufacturing business and other contract manufacturing contracts, to transfer the Process as quickly as possible (and in any event within [...***...] from receipt of XENCOR's written election notice). Both Parties agree and XENCOR will make its Business Partner agree that BII may, however, select the way how to render such support of any Technology transfer at its own discretion, in particular but not only any support of such Technology transfer to a company whose primary business is providing biopharmaceutical CMO services (including e.g. a Technology transfer outside the BI Facility), provided, however, that BII's exercise of such discretion is not unreasonable.   XENCOR and/or any third party may not use the Process outside the terms and conditions set forth in a contract manufacturing agreement with BII except as set forth in Section 5.2.2 and this Section 5.2.3 and provided that XENCOR or it Business Partner strictly adhere to the license conditions set forth in Sect ion 5.2.5 herein.   5.2.4 Payment Terms   The Technology Access Fee, as applicable, shall be paid to BII upon completion of the Technology transfer described in Section 5.2.3 and shall be payable in accordance with the provisions set forth under Sections 3.2 and 3.3 above. Parties agree that the Technology transfer shall be completed upon the transfer of Process and all reasonably necessary related BII Confidential Information and Know-How.   5.2.5 License   Subject to XENCOR's adherence to the obligations under this Agreement, BII hereby grants XENCOR a worldwide, irrevocable, exclusive, sublicensable and royalty free license to use the Process and all reasonably necessary related BII Confidential Information and Know- How, BII Technology and BII Intellectual Property for the sole purpose of making and having made the Product; provided that such license shall become effective only upon complete payment of the Technology Access Fee, as applicable.   5.3 Acknowledgement   The Parties acknowledge that nothing in this Agreement shall limit or restrict XENCOR, itself or with or through any third party, from developing and using any process (except for the Process) for the manufacture of any of its products, including the Product, provided that no BII Confidential Information and Know-How is used and XENCOR adheres to its confidentiality and non-use obligations hereunder and complies with the ownership of intellectual property and Improvements as set forth in Section 8 below.

***Confidential Treatment Requested   21





  6 Representations, Warranties and Indemnification   6.1 Mutual Representations, Warranties and Covenants   Each Party hereby represents, warrants and covenants to the other Party as follows as of the Effective Date:   a. it is a corporation duly organized and validly existing under the laws of the state or other jurisdiction of incorporation or formation; and   b. the execution, delivery and performance of this Agreement by such Party has been duly authorized by all requisite corporate action; and   c. it has full corporate authority to execute and deliver this Agreement and to perform its obligations hereunder, and the Agreement is binding upon it in accordance with it terms; and   d. it has the right, without restriction, to grant the licenses granted under this Agreement.   6.2 XENCOR Warranties   XENCOR hereby warrants that:   a. XENCOR has the right to provide the Material, the XENCOR Technology, the XENCOR Intellectual Property and all XENCOR Confidential. Information and Know-How under this Agreement and to the best of its Knowledge at the Effective Date that there are no third party rights that will limit or restrict use thereof by BII in accordance with this Agreement; and   b. to the best of its Knowledge at the Effective Date XENCOR is not aware of any special or unusual hazards involved in handling the Materials and/or Product of which it has failed to inform BII; and that it will inform BII immediately of any changes related thereto after the date of execution of this Agreement; and   c. at the Effective Date, no third party has asserted any claim or lawsuit against XENCOR claiming that use of the Material, XENCOR Technology, the XENCOR Intellectual Property and the XENCOR Confidential Information and Know-How infringes any intellectual property owned by a third party, and it will promptly notify BII in writing should it become aware of any claims by a third party asserting that use of such infringes any third part intellectual property rights owned by such third party.   d. it will use commercially reasonable efforts to conduct and complete a clinical trial phase 1 regarding the Product; and   e. it will use commercially reasonable efforts to find and enter into an agreement with a suitable Business Partner.   For avoidance of doubt, all XENCOR liability or indemnification obligations that might result from representations and the warranties under this Section 6 are always subject to the limitations set forth in Section 7.4 of this Agreement.   6.3 BII Warranties   BII hereby warrants that:   a. BI is entitled to use the BI Facility and BII Confidential Information and Know-How, for the purposes set forth in this Agreement; and   b. BII at the Effective Date, it is not aware of any special or unusual hazards that would arise as a result of its carrying out of the Projects as planned; and   c. at the Effective Date, it has not been debarred, nor is it subject to a pending debarment, and that it will not, to the best of its Knowledge, use in any capacity in connection with   22





  the Services under this Agreement any person, who has been debarred pursuant to section 306 of the FDCA, 21 U.S.C. § 335a, or who is the subject of a conviction described in such section. BII agrees to notify XENCOR in writing immediately if it has Knowledge that BII or any person who is performing Services is debarred or is the subject of a conviction described in section 306, or if any action, suit, claim, investigation, or proceeding is pending, or to BII's Knowledge, is threatened, relating to the debarment or conviction of BII or any person performing Services under this Agreement; and   d. to the best of its Knowledge at the Effective Date its performance under this Agreement including, but not limited to, the BII Technology and its use in the Process, by BII, XENCOR or a third party manufacturer of XENCOR does not infringe the intellectual property rights of any third party and it will promptly notify XENCOR in writing should it become aware of any claims asserting such infringement or of any third party intellectual property rights, that would be infringed by the BII Technology and its use in the Process. For the avoidance of doubt, the currently pending Cabilly dispute is excluded and will be addressed/ compensated by XENCOR once applicable: and   e. as of the Effective Date no third party has asserted any claim or lawsuit against BII claiming infringement of any intellectual property owned by a third party with relation to BII Technology and/or the Process, or any part or component thereof.   For avoidance of doubt, all BII liability or indemnification obligation that might result from representations and the warranties under this Section 6 are always subject to the limitations set forth in Section 7.4 of this Agreement.   6.4 Process for Defense of Infringement of Third Party Intellectual Property   Subject to each Party's indemnification obligations, in the event that there occurs a Claim (as defined below), the Parties shall follow the following procedures with respect to the defense of the Claim:   a. BII agrees that if a third party threatens or asserts any claim or files any lawsuit, claiming that BII Intellectual Property utilized under this Agreement and necessary for manufacture and production of the Product in accordance with this Agreement, including, without limitation, the BII Technology or the Process, or the use thereof, constitutes infringement of any intellectual property owned by a third party (each, a Claim), BII will promptly and timely inform XENCOR of such Claim, and BII shall have the first right to negotiate, litigate and/or settle any such Claim, and shall defend any such Claim unless it would not be commercially reasonable for BII to bear the reasonably anticipated losses, damages, costs and expenses arising from any settlement or judgment resulting from such Claim. For the avoidance of doubt, the term commercially reasonable, as used in this paragraph a. shall be determined (i) in the context of BII's entire business related to the intellectual property that is the subject to the Claim, where the Claim asserts infringement that impacts aspects of BII's business beyond the XENCOR relationship, and (ii) if the Claim asserts infringement that is limited only to activities performed for XENCOR, in the context of the entire relationship between XENCOR and BII.   b. BII will keep XENCOR reasonably informed about such negotiation or litigation at all times, including all material events related thereto, and in the event that the amounts paid or to be paid by BII in settlement of any such Claim or group of related or unrelated Claims appear reasonably likely to exceed, individually or in the aggregate, BII's indemnification obligations, or any contemplated settlement would place any obligations or restrictions upon XENCOR or the Product, then BII shall immediately inform XENCOR.   c. XENCOR shall not be responsible to pay for any costs of any settlement by BII of any Claim(s) (including, without limitation, any payments resulting of such settlement) that   23





  exceed BII's indemnification obligations or be bound by any obligations or restrictions agreed to by BII in any such settlement, in case such settlement is made without the prior written consent of XENCOR, which may be granted or withheld in its sole discretion.   d. In the case that BII decides not to negotiate, litigate or settle any Claim, XENCOR shall have the right to negotiate, litigate and settle any such Claim, and, provided that XENCOR decides to pursue such negotiation, litigation or settlement, BII will provide all commercially reasonable cooperation to XENCOR such that XENCOR may appropriately defend such Claims.   6.5 Disclaimer of Warranties   EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO ANY INTELLECTUAL PROPERTY, TECHNOLOGY, RIGHTS, RESULTS OF THE PROJECTS, MATERIAL, THE DELIVERABLES OR OTHER SUBJECT MATTER OF THIS AGREEMENT OR THAT THE PROJECTS WILL RESULT IN A COMMERCIALLY-VIABLE PROCESS, INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABIIITY AND FITNESS FOR A PARTICULAR PURPOSE.   7 Liability, Indemnification, Limitations and Insurance   7.1 General   BII has no control over the manner in which XENCOR intends to use the results of the Project, the Product or the Deliverables, if any, obtained in the Project and in particular does not know or control how XENCOR intends to use such Product or results in clinical studies.   7.2 Liability   a. Of BII   Always subject Section 7.4, in consideration of the aspects set forth in Section 7.1, BII shall only be liable for any losses, damages, costs or expenses including, without limitation, reasonable attorneys' fees of any nature (Losses) incurred or suffered by XENCOR or its Affiliated Companies or any third party (including but not limited to Business Partners) to the extent such Losses are arising from either (i) BII's non­compliance with the warranties given under Sections 6.1 and 6.3 of this Agreement, or (ii) gross negligence or willful acts or omissions of BII or its Affiliated Companies in performing its obligations under this Agreement.   BII shall not be liable to XENCOR or be obligated to indemnify XENCOR or its Representatives under Section 7.3 for any Losses incurred or suffered by XENCOR, its Affiliated Companies or by any third party, arising out of any dispute or other claims or proceedings made by or brought against XENCOR and/or its Affiliated Companies with respect to XENCOR's use of any results of the Project, the Deliverables (including but not limited to the Product, if any), the Process, the BII Technology and/or the BII Confidential Information and Know-How, obtained (including but not limited to the use under a license that may be granted under this Agreement) under this Agreement including, without limitation, product liability claims, except to the extent such Losses are caused by the gross negligence or wilful acts or omissions of BII or its Affiliated Companies in performing its obligations under this Agreement, nor shall BII be responsible in any way for dealing with any such disputes, claims or proceedings.   24

  b. Of XENCOR   Always subject to Section 7.4, XENCOR shall be liable for any Losses incurred or suffered by BII, its Affiliated Companies or by any third party arising from either (i) XENCOR's non­compliance with the warranties given under Sections 6.1 and/or 6.2 of this Agreement, or (ii) BII's or XENCOR's use of XENCOR Confidential Information and Know­How, the Material, the XENCOR Intellectual Property and/or the XENCOR Technology in accordance with this Agreement, or (iii) XENCOR's use of the Deliverables (including but not limited to the Product, if any), or (iv) XENCOR' s use of the Process, the BII Technology, the BII Confidential Information and Know-How, and/or any other results of the Project or this Agreement, not in accordance with this Agreement.   XENCOR shall not be liable to BII or its Affiliated Companies or be ob1igated to indemnify BII or its Representatives under Section 7.3 for any Losses incurred or suffered by BII or its Affiliated Companies or any third party arising out of any dispute or other claims or proceedings made by or brought against BII or its Affiliated Companies with respect to BII's use of the BII Confidential Information and Know-How, the Material, the XENCOR Intellectual Property, and/or the XENCOR Technology or BII's use of the license granted to BII under Section 8.2.5.a outside the scope of this Agreement, in each case except to the extent such liability is caused by the gross negligence or wilful acts or omissions of XENCOR, or its Affiliated Companies in performing its obligations under this Agreement, nor shall XENCOR be responsible in any way for dealing with any such disputes, claims or proceedings.   7.3 Indemnification   a. BII's Indemnification Obligations   Always subject to Section 7.4, BII shall indemnify, defend and hold XENCOR, its Affiliated Companies and their respective officers, employees and agents (the Representatives) harmless from and against all Losses incurred by them as a result of third





party claims based on or resulting from (i) BII's non­compliance with the warranties given under Sections 6.1 and 6.3 of this Agreement, or (ii) any gross negligence or wilful acts or omissions of BII or any of its Affiliated Companies in performing its obligations under this Agreement.   b. XENCOR's Indemnification Obligations   Always subject to Section 7.4, XENCOR shall indemnify, defend and hold BII and its Representatives harmless from and against all Losses incurred by them as a result of third party claims based on or resulting from (i) BII's use of the XENCOR Confidential Information and Know-How, the Material, the XENCOR Intellectual Property and/or the XENCOR Technology in accordance with this Agreement; or (ii) XENCOR's non­compliance with the warranties given under Sections 6.1 and 6.2 of this Agreement, or (iii) XENCOR's use of the Deliverables (including but not limited to the Product, if any), or (iv) XENCOR' s use of the Process, the BII Technology, the BII Confidential Information and Know-How, and/or any other results of the Project or this Agreement, not in accordance with this Agreement.   7.4 Limitation of Liability and Indemnification Obligations   With the exception of wilful misconduct by a Party, and such cases where a limitation of liability and/or indemnification is not possible under applicable law, for which cases there shall be no limitation, any and all liability and/or indemnification obligations of each of BII and XENCOR under this Agreement shall be:   a. excluded for incidental, indirect, consequential, punitive or special damages (provided that the foregoing shall not exclude a Party's right to consequential or incidental   25





  damages for any negligent or intentional breach of confidentiality and non-use obligations under Section 9); and   b. each Party's aggregate liability and/or indemnification obligations towards the other Party under this Agreement shall not exceed an amount equal to the average annual aggregate amount paid or to be paid by XENCOR to BII hereunder; provided, however, that in the case of a Party's negligent or intentional breach of confidentiality and non­use obligations pursuant to Section 9, this limitation of liability shall be increased to twice the average annual aggregate amount paid or to be paid by XENCOR to BII hereunder;   provided however that the foregoing Subsections a. and b. of this Section 7.4 shall not limit XENCOR' s liability and indemnification obligation towards BII with respect to any third party claims according to clause (iii) and (iv) of Section 7.3 b. regarding any use of the Deliverables (in particular the Product) in humans and/or with respect to any third party claim that BII's use of the Material to manufacture the Product infringes any issued patent owed by such third party (excluding any such claim based specifically on use of the Process but not on the use of the Material).   7.5 Insurance   XENCOR and BII shall obtain and/or maintain during the term of this Agreement and for a period of [...***...] thereafter, liability insurance in amounts which are reasonable and customary in the biopharmaceutical industry for companies of comparable size and the respective activities (i.e. BII as CMO and XENCOR as sponsor/pharmaceutical company) at the respective place of business and such liability insurance shall insure against all mandatory liability, including liability for personal injury, physical injury and property damage. BII shall have the right to reasonably self insure.   8 Intellectual Property   8.1 Existing Intellectual Property Rights   BII hereby acknowledges that XENCOR is the owner of XENCOR Confidential Information and Know-How and the XENCOR Technology and BII shall acquire no rights, title or interest whatsoever in or to any of XENCOR Confidential Information and Know-How and/or XENCOR Technology, except as specifically provided for in this Agreement.   XENCOR hereby acknowledges that BII is the owner of BII Confidential Information and Know-How and the BII Technology and XENCOR shall acquire no rights, title or interest whatsoever in or to any of BII Confidential Information and Know-How and/or the BII Technology, except as specifically provided for in this Agreement.   8.2 New Intellectual Property, Project Results and Licenses   8.2.1 XENCOR   Improvements that (i) relate specifically to XENCOR Confidential Information and Know-How and/or the Product (or any modification, derivative or fragment thereof), and (ii) do not relate to BII Confidential Information and Know­How (collectively, XENCOR Intellectual Property), will be exclusively owned by XENCOR and XENCOR shall control patent prosecution and maintenance thereof. BII (on behalf of itself and its Affiliated Companies) agrees to assign and hereby assigns to XENCOR all right title and interest it may have in any XENCOR Intellectual Property. BII shall provide reasonable assistance to XENCOR for any action which may be necessary to assign or otherwise transfer any rights to XENCOR Intellectual Property contemplated by this Section 8.2.1. BII shall notify XENCOR within [...***...] of becoming aware of such XENCOR Intellectual Property.

***Confidential Treatment Requested   26





  8.2.2 BII   Improvements that (i) relate specifically to BII Confidential Information and Know-How, and (ii) do not relate to XENCOR Confidential Information and Know­How (collectively, BII Intellectual Property) will be exclusively owned by BII, and BII shall control patent prosecution and maintenance thereof. XENCOR agrees to assign and hereby assigns to BII all right title and interest it may have in any BII Intellectual Property. XENCOR shall provide reasonable assistance to BII for any action which may be necessary to assign or otherwise transfer such rights to BII Intellectual Property contemplated by this Section 8.2.2.   8.2.3 Other Improvements   Any Improvements that are neither XENCOR Intellectual Property nor BII Intellectual Property shall be defined as Other Improvements and shall be jointly owned by BII and XENCOR, with the Parties entitled to practice the same as joint owners, without duty of accounting to the other Party and with the right to license to others without consent of the other Party. BII shall notify XENCOR within [...***...] days of becoming aware of such Other Improvements. Each Party agrees to assign and hereby assigns to the other Party such right title and interest it may have in any Other Improvements as necessary to effect joint ownership of the Other Improvements by BII and XENCOR. Each Party shall provide reasonable assistance for any action which may be necessary to assign or otherwise transfer such rights to Other Improvements to Parties as joint owners. BII shall have the first right to prosecute and maintain patent rights within the Other Improvements, at its expense, provided that if BII elects not to prosecute or maintain an Other Improvement it shall provide written notice to XENCOR, and XENCOR may elect to take over responsibility for prosecution and maintenance of such Other Improvement, at its own expense, by providing written notice to BII, in which case all rights to such Other Improvement shall be assigned to XENCOR. For the avoidance of doubt, except as expressly stated otherwise in Section 10.3, Parties agree that XENCOR's use of the Process is always subject to Section 5.2.3, 5.2.4 and 5.2.5.   For the avoidance of doubt, (i) know-how pertaining to manufacturing of biopharmaceuticals generally and gained during the course of performing this Agreement may be freely used by BII in its biopharmaceutical business without any restrictions, provided, that, notwithstanding the foregoing, BII may not use any Other Improvement that relates specifically to the Product.   a. Each Party shall ensure that all of such Party's (or its Affiliated Company's) employees or contractors acting on its behalf pursuant to this Agreement are and will be obligated under a binding written agreement or by law to assign to such Party all inventions and rights on the inventions made under this Agreement so that such Party can comply with the terms of this Agreement.   b. Subject to the terms and conditions contained in this Agreement, BII shall be responsible for filing, prosecution and maintenance of patent applications and patents granted or generated under this Agreement and owned by BR. XENCOR shall be responsible for filing, prosecution and maintenance of patent applications and patents granted or generated under this Agreement and owned by XENCOR.   c. BII shall keep XENCOR and XENCOR shall keep BII reasonably informed about prosecution of any patent applications and maintenance of any patents generated under this Agreement.   8.2.4 Licenses to Xencor   BII grants to XENCOR the license set forth in Section 5.2.5 as provided therein.   8.2.5 Licenses to BII   a. Freedom to operate XENCOR hereby grants to BII and BII herewith accepts a non exclusive, worldwide, irrevocable, sublicensable (in several cascades), perpetual, royalty-free/fully paid up license under the XENCOR Intellectual Property to the extent it is generally applicable to the manufacturing of biopharmaceutical products, handling   27





  of cell lines and/or development of manufacturing processes, to use such XENCOR Intellectual Property in for the manufacture of biopharmaceutical products, handling of cell lines and/or development of manufacturing processes, but excluding any use with respect to the Product (or any modification, derivative or fragment thereof). BII expressly agrees not to practice any XENCOR Intellectual Property specific to the Product or for any purpose other than as expressly provided in this Section 8.2.5.   b. Performance of Project: During the term of this Agreement, XENCOR hereby grants to BII and BII hereby accepts for the purpose of pursuing the Project a non-exclusive, non-sub-licensable (except to Affiliated Companies), royalty-free, license to use the XENCOR Confidential Information and Know-How, the Material, the XENCOR Intellectual Property and/or any part of the Other Improvements for the sole purpose to develop the Process, and for the manufacturing of the Product for clinical purposes in accordance with this Agreement. BII expressly agrees not to use or practice any XENCOR Confidential Information and Know- How, the Material, and/or the XENCOR Intellectual Property for any purpose other than performance or the Services in accordance with this Agreement, except if otherwise expressly permitted in this Agreement.   9 Confidentiality   9.1 General   The Parties agree, for the duration of this Agreement and a term of [...***...] after the Effective Date: (a) to hold in strict confidence all Confidential Information and Know­How of a Party (Disclosing Party) or its Affiliated Companies which has been or will be made available to the other Party (Receiving Party) or its Affiliated Companies, and not to disclose such Confidential Information and Know­ How of the Disclosing Party to any third party whatsoever, (b) not to use such Confidential Information and Know-How of the Disclosing Party for any purpose other than those set forth herein. For clarification, all XENCOR Confidential Information and Know-How, XENCOR Technology and XENCOR Intellectual Property shall be Confidential Information and Know-How of XENCOR and XENCOR shall be the Disclosing Party and BII shall be the Receiving Party with respect thereto, and all BII Confidential Information and Know-How, BII Technology and BII Intellectual Property shall be Confidential Information and Know-How of BII and BII shall be the Disclosing Party and XENCOR shall be the Receiving Party with respect thereto.   The Receiving Party undertakes to protect the Disclosing Party's Confidential Information and Know ­How against unauthorized access by third parties using all commercially reasonable efforts.   If Confidential Information and Know-How is disclosed by Disclosing Party or its Affiliated Companies other than in written or electronic form, then Receiving Parties' obligations of confidentiality and non­use shall only apply if the Confidential Information and Know­How is indicated upon disclosure as being confidential and is then summarised electronically or in writing and provided to Receiving Party within [...***...] after initial disclosure. Notwithstanding the foregoing, in no event shall a failure to provide such an electronic or written summary preclude either Party from asserting that such information is Confidential Information and Know-How.   The obligations to keep secret, not to disclose and not to use the Disclosing Party's Confidential Information and Know­How or parts thereof shall not apply in the event that the respective Confidential Information or and Know-How such parts thereof:

***Confidential Treatment Requested   28





  a. can be shown by written documentation to have been known to Receiving Party or its Affiliated Companies prior to disclosure by the Disclosing Party or its Affiliated Companies hereunder or under the MTA (in no event will Confidential Information and Know- How of the Disclosing Party that is generated by the Receiving Party or its Affiliated Companies (e.g., Improvements that are XENCOR Intellectual Property) be considered to be known by the Receiving Party or its Affiliated Companies prior to disclosure by the Disclosing Party or its Affiliated Companies),   b. is or comes into the public domain by publication or otherwise through no breach of this Agreement or the MTA, or   c. can be shown by written documentation to have been made known to Receiving Party or its Affiliated Companies from another source free from any obligation of confidentiality and was not obtained either directly or indirectly from Disclosing Party or its Affiliated Companies, or   d. can be shown by written documentation to have been independently developed or created by Receiving Party or its Affiliated Companies without access to the other Party's Confidential Information and Know­How (in no event will Confidential Information and Know-How of the Disclosing Party that is generated by the Receiving Party or its Affiliated Companies (e.g., Improvements that are XENCOR Intellectual Property) be considered to be independently developed by the Receiving Party or its Affiliated Companies).   Confidential Information and Know-How not be deemed to be in the public domain merely because they may be derived from one or more items which are publicly known.   Receiving Party shall not disclose Disclosing Party Confidential Information and Know-How to any third party without the prior written consent of Disclosing Party, except to such of the Receiving Party's or its Affiliated Companies' responsible employees and/or advisors to whom it is necessary to disclose such Confidential Information and Know-How for purpose set forth herein. Before such Confidential Information and Know-How is disclosed to such employees and/or advisors, Receiving Party shall first impose on such employees and/or advisors confidentiality and non-use obligations not less stringent than those set forth herein, however, the imposition of such obligations shall not relieve Receiving Party of its obligations hereunder.   In the event that Receiving Party or its Affiliated Companies are required by law, regulation, rule, act or order of any governmental authority or agency to disclose the Disclosing Party's Confidential Information and Know­How, the Receiving Party or its Affiliated Companies shall be entitled to do so provided that Receiving Party shall first notify Disclosing Party forthwith of any such required disclosure and limit such disclosure as far as is possible under applicable law. Such disclosure shall, however, not relieve Receiving Party of its other obligations contained herein.   Furthermore, a Receiving Party may make such disclosures of the Disclosing Party's Confidential Information and Know­How to governmental entities to the extent reasonably necessary in connection with pursuit of intellectual property protection, development and commercialization activities related to the Product as contemplated by this Agreement, and approvals to use and sell the Product. Moreover, XENCOR may disclose BII Confidential Information and Know-How to entities (i) with whom XENCOR has (or may have) a marketing and/or development collaboration for the Product (including an actual or potential Business Partner) or (ii) that are actual or potential investors in or acquirers of XENCOR, to the extent reasonably necessary for the pursuit of such actual/ potential collaboration or relationship pursuant to (i) or (ii), and, in both cases, who have a specific need to know such information and who are bound by obligations of confidentiality and restrictions on use similar to those set forth in this Agreement, provided always that XENCOR may not disclose any BII   29





  Confidential Information and Know-How to any company whose primary business is providing biopharmaceutical CMO services except with BII's prior written consent.   9.2 MTA Superseded   The confidentiality and non-use obligations under the MTA shall be superseded hereby and all information disclosed pursuant to the MTA shall be Confidential Information and Know-How subject to this Agreement.   9.3 Controlled Technology   XENCOR hereby agrees and covenants that if it or its Affiliated Companies intend to provide Confidential Information and Know-How to BII or its Affiliated Companies that XENCOR has Knowledge may be listed on the Commerce Control List or the Chemical Weapons Convention Schedules of Chemicals, both contained within the U.S. Export Administration Regulations (hereinafter Controlled Technology), then XENCOR shall notify promptly BII of such Knowledge as soon as possible prior to such intended disclosure. In order for BII to take any appropriate precautionary actions before receipt of such Controlled Technology and to ensure compliance with U.S. export laws, XENCOR shall, before providing the Controlled Technology:   a. identify all Confidential Information and Know-How of XENCOR that may be Controlled Technology; and   b. inform BII, to the extent known to XENCOR, where the Controlled Technology is listed on the Commerce Control List or the Chemical Weapons Convention Schedules of Chemicals and what restrictions apply to the export or disclosure of the Controlled Technology under U.S. law.   XENCOR further agrees to cooperate with BII by providing upon request information and other assistance necessary for the export classification, export documentation and export licensing, if required, for the Controlled Technology under U.S. export laws.   In any event, XENCOR hereby agrees that it will not disclose Controlled Technology to BII or its Affiliated Companies without the express prior consent of BII.   10 Term and Termination   10.1 Term   This Agreement shall take effect as of the Effective Date and shall expire upon completion of the Project as set forth in the Project Plan and after payment of all payments due and payable according to this Agreement, unless terminated earlier in accordance with this Agreement.   10.2 Termination of this Agreement   10.2.1 If it is apparent to either Party at any stage of the Project that it will not be possible to carry out the Project for scientific, technical or business reasons, such Party may terminate this Agreement upon one hundred eighty (180) days prior written notice to the other Party.   10.2.2 Termination for Material Breach: This Agreement may be terminated at once by written notice by either Party, if the other Party breaches this Agreement in any material manner and shall have failed to remedy such default within thirty (30) days after written notice thereof from the terminating Party.   10.3 Effects of Termination of this Agreement   30





  10.3.1 Effect of Termination prior to completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3.   a. In the event of termination by XENCOR according to Section 10.2.1 prior to completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3 for technical and/or scientific reasons, XENCOR shall have no obligation to pay BII any or all of the Total Amount. For the avoidance of doubt, in such case, XENCOR may not use the Process outside BII, except as otherwise agreed in writing by XENCOR and BII.   b. In the event of termination by XENCOR according to Section 10.2.1 prior to completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3. for any other reason than the reasons set forth under Section 10.3.1.a the Total Amount shall be limited to all non-cancellable expenses reasonably incurred by BII in accordance with the Project Plan prior to such termination in respect of the purchase of supplies or raw materials, and reasonable wind-down costs not to exceed sixty (60) days. BII shall mitigate all wind-down costs and non-cancellable expenses to the extent possible. Campaigns cancelled shall be paid as provided for in Section 4.2 above. For the avoidance of doubt, in such case, XENCOR many not use the Process outside BII, except as otherwise agreed in writing by XENCOR and BII.   c. In the event of termination by BII according to Section 10.2.1 prior to completion of the Phase 1 clinical trial with the Product, XENCOR shall have no obligation to pay BII any or all of the Total Amount. The use of the Process is subject to Section 5.2.3, 5.2.4 and 5.2.5.   d. In all of the foregoing cases a.-c., at the request of XENCOR and to the extent available at BII, BII shall destroy the Material or deliver the Material to XENCOR at XENCOR's cost and shall promptly return all XENCOR Confidential Information and Know­How to XENCOR; except for a copy and/or sample of each material for documentation purposes only, which shall remain to the confidentiality and non­use provisions in Section 9, and shall refrain from using the Material. Except for the foregoing, BII's responsibility to keep and store the Material and any other materials shall terminate one hundred eighty (180) days after expiration or termination of the respective Project or this Agreement.   In the foregoing cases a.-c., XENCOR shall promptly return all BII Confidential Information and Know-How to BII, except for a single copy and/or sample for documentation purposes only, which shall remain to the confidentiality and non-use provisions in Section 9, and shall refrain from using the Process, except as contemplated in Section 10.3.1.c or 10.3.1.d.   For the a voidance of doubt, in the event of a termination by XENCOR as contemplated in clause b of this Section 10.3.1, Section 3.1.2.c shall continue in effect, but Section 3.1.2 shall not survive in the event of any termination described in clause a. and c.   10.3.2 Effect of Termination after completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3.   a. In the event of termination by XENCOR according to Section 10.2.1 after completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3 for technical and/or scientific reasons, XENCOR shall have no obligation to pay BII any or all of the Total Amount. For the avoidance of doubt, in such case, XENCOR may not use the Process outside BII, except as otherwise agreed in writing by XENCOR and BII. For the avoidance of doubt, in the event of a termination as contemplated in this Section 10.3.2a, Section 3.1.2 c shall survive.   b. In the event of termination by XENCOR according to Section 10.2.1 after completion of the Phase 1 clinical trial with the Product as described in Section 2.8.3 for a reason not listed in Section 10.3.2.a, the Total Amount shall be limited to all non-cancellable expenses reasonably incurred by BII in accordance with the Project Plan prior to such   31





  termination in respect of the purchase of supplies or raw materials, and reasonable wind-down costs not to exceed sixty (60) days. BII shall mitigate all wind-down costs and non-cancellable expenses to the extent possible. Campaigns cancelled shall be paid as provided for in Section 4.2 above. For the avoidance of doubt, in the event of a termination as contemplated in this Section 10.3.2b, Section 3.1.2.c shall continue in effect. The use of the Process is subject to Sections 5.2.3, 5.2.4 and 5.2.5.   c. In the event of termination by BII according to Section 10.2.1 after completion of the Phase 1 clinical trial with the Product, XENCOR shall have no obligation to pay BII any or all of the Total Amount. The use of the Process is subject to Sections 5.2.3, 5.2.4 and 5.2.5. For the avoidance of doubt, in the event of a termination as contemplated in this Section 10.3.2c, Section 3.1.2 shall not survive.   10.3.3 Effect of Termination due to Material Breach   a. In case of a termination by BII according to Section 10.2.2, the Total Amount shall become immediately due and BII shall be free to claim for damages according to the applicable law and, subject to Section 7.4 above. All licenses granted by either Party to the other Party hereunder shall be null and void. For the avoidance of doubt, XENCOR may not use the Process outside BII, except as otherwise agreed in writing by XENCOR and BII; except that, if XENCOR has already exercised its rights under Sections 5.2.3, 5.2.4 and 5.2.5, all such rights granted prior to termination shall remain in effect.   b. In case of a termination by XENCOR according to Section 10.2.2, XENCOR shall have no obligation to pay BII any or all of the Total Amount, and subject to Section 7.4 above, XENCOR shall be free to claim for damages according to the applicable law. All licenses granted by XENCOR to BII hereunder shall be null and void. For the avoidance of doubt, Section 3.1.2 shall not survive in the event of termination as described in this Section 10.3.3.b. The use of the Process is subject to Sections 5.2.3, 5.2.4 and 5.2.5.   10.4 Surviving Provisions   Upon any expiration or termination of this Agreement by either Party pursuant to Section 10.2, all rights and obligations of the Parties under this Agreement shall terminate and be of no further force or effect, except as otherwise expressly set forth below in this Section 10.4 and in Section 10.3. The expiration or termination of this Agreement for any reason shall not release either Party from any liability that, at the time of such expiration or termination, has already accrued to the other Party or that is attributable to a period prior to such expiration or termination. The following provisions of this Agreement shall survive expiration or termination of this Agreement for any reason: Section 1 (Definitions), Section 3 (Payments) except as expressly set forth in Section 10.3; Section 5 (Ownership and Use of Project Data), Section 6.4 (Process for Defense of Infringement of Third Party Intellectual Property); Section 6.5 (Disclaimer of Warranties); Section 7 (Liability, Indemnification, Limitations and Insurance); Section 8 (Intellectual Property), but excluding the last sentence of the first paragraph of Section 8.2.3 (Other Improvements) referring to Sections 5.2.3, 5.2.4 and 5.2.4 except to the extent that those sections are expressly stated to survive termination as set forth in Section 10.3, and excluding Section 8.2.5b; Section 9 (Confidentiality); Section 10.3 (Effects of Termination of this Agreement), including the provisions referenced in Section 10.3 as continuing after termination, as applicable; Section 10.4 (Surviving Provisions); and Section 11 (Miscellaneous).   11 Miscellaneous   11.1 Force Majeure   Neither Party shall be in breach of this Agreement if there is any failure of performance under this Agreement (except for payment of any amounts due hereunder) occasioned by any reason   32





  beyond the control of either Party, including, without limitation, any act of God, fire, act of government or state, war, civil commotion, insurrection, embargo, prevention from or hindrance in obtaining energy or other utilities, or labour disputes of whatever nature.   11.2 Conflict with Improvements under the MTA   The Parties agree that with respect to the ownership of intellectual property rights and/or ownership of Improvements, this Agreement shall prevail over the terms and conditions of the MTA and shall also cover the term of the MTA.   11.3 Secrecy Agreement between the Parties   The Parties agree that all information exchanged pursuant to the Secrecy Agreement between the Parties with effectiveness as of June 28, 2011 shall be Confidential Information and Know-How protected in accordance with this Agreement, and such Secrecy Agreement shall be superseded by the terms of this Agreement and shall have no further force or effect.   11.4 Publicity   XENCOR or BII may issue the mutually agreed press release attached as Appendix 8 announcing the execution of this Agreement. Except as provided in the preceding sentence, no press release or other form of publicity regarding a Project or this Agreement shall be permitted by either Party to be published unless both Parties have indicated their consent to the form of the release in writing. The same applies, to any changes in the press release attached as Appendix 8. Nothing in this Section shall prevent the Parties from disclosing this Agreement, if and as far as required by applicable laws, rules or regulations. However, the disclosing Party shall inform the other Party well in advance whenever reasonably possible and shall provide the opportunity to comment on such required disclosure (e.g. under SEC rules). In addition, subject to XENCOR's compliance with Section 9.1, nothing in this Section shall prevent XENCOR from disclosing the status of development, regulatory approval or commercialization of the Product.   11.5 Notices   Any notice required or permitted to be given hereunder by either Party shall be in writing and shall be (i) delivered personally, (ii) sent by registered mail, return receipt requested, postage prepaid or (iii) delivered by facsimile with immediate confirmation of receipt, to the addresses or facsimile numbers set forth below:   If to BII:   Boehringer Ingelheim International GmbH Binger Straße 17355216 Ingelheim Federal Republic of Germany Attention: Mr. Alois Konrad (Global Dept. Biopharma Contract Manufacturing Business) Fax: 0049- 7351/54 - 4845 Phone: 0049- 7351/54 - 96145   33





  If to XENCOR:   111 West Lemon Avenue Monrovia, CA 91016 Attention: Chief Executive Officer Phone: (626) 305-5900 Fax: (626) 305-0350   11.6 Applicable Law and Arbitration   This Agreement shall be exclusively governed by and construed in accordance with the laws of the State of New York, USA without regard to its conflict of laws provisions.   The application of the UN Convention on Contracts for the International Sale of Goods is excluded.   The Parties agree that all disputes, claims or controversies arising out of, relating to, or in connection with this Agreement, including any question regarding its formation, existence, validity, enforceability, performance, interpretation, breach or termination, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce (ICC) by one arbitrator appointed in accordance with said rules.   The exclusive place of arbitration shall be New York State of New York, USA and the proceedings shall be conducted in English language.   The award for arbitration shall be final and binding and may be enforced in any court of competent jurisdiction against BII or XENCOR. Nothing in this Section shall prevent any Party, before an arbitration has commenced hereunder or any time thereafter during such arbitration proceedings, from seeking conservatory and interim measures, including, but not limited to temporary restraining orders or preliminary injunctions, or their equivalent, from any court of competent jurisdiction.   The Parties further agree that   a. except as may be otherwise required by applicable laws, rules or regulations, neither Party, its witnesses, or the arbitrator may disclose the existence, content, results of the arbitration hereunder without prior written consent of both Parties; and   b. neither Party shall be required to give general discovery of documents, but may be required only to produce specific, identified documents, or narrow and specific categories of documents, which are relevant to the case and material to its outcome and reasonably believed to be in the custody, possession or control of the other Party; and   c. decisions ex aequo et bono or in equity are not permissible.   11.7 Entire Agreement   This Agreement (including the Exhibits and Schedules attached hereto) constitutes the entire agreement between the Parties relating to its subject matter and supersedes all prior or contemporaneous agreements, understandings or representations, either written or oral, between XENCOR and BII with respect to such subject matter (including the Secrecy Agreement effective as of June 28, 2011).   11.8 Waiver; Amendment   No waiver of any term, provision or condition of this Agreement whether by conduct or otherwise in any one or more instances shall be deemed to be or construed as a further or continuing waiver of any such term, provision or condition or of any other term, provision or   34

  condition of this Agreement. No amendment or modification of any provision of this Agreement shall be effective unless in writing signed by a duly authorized representative of each Party. No provision of this Agreement shall be varied, contradicted or explained by any oral agreement, course of dealing or performance or any other matter not set forth in an agreement in writing and signed by a duly authorized representative of each Party.   11.9 Severability   If any provision of this Agreement is held to be invalid or unenforceable by a court of competent jurisdiction all other provisions shall continue in full force and effect. The Parties hereby agree to attempt to substitute for any invalid or unenforceable provision a valid and enforceable provision which achieves to the greatest extent possible the economic legal and commercial objectives of the invalid or unenforceable provision.   11.10 Dispute Resolution   Any dispute relating to the Project shall first be submitted for resolution to the Steering Committee.   11.11 Assignment   This Agreement shall be binding upon the successors and assigns of the Parties and the name of a Party appearing herein shall be deemed to include, the names of its successors and assigns. This Agreement shall not be assignable by either Party, except with the written





consent of the other Party hereto; provided, however, that either Party may assign this Agreement without the other Party's consent to an acquiring party in connection with the transfer or sale of all or substantially all of the business of such Party to which this Agreement relates to such acquiring party, whether by merger, sale of stock, sale of assets or otherwise, provided that in the event of such a sale or transfer (whether this Agreement is actually assigned or is assumed by the acquiring party by operation of law (e.g,. in the context of a reverse triangular merger)).   11.12 Independent Contractors   Nothing in this Agreement is intended, or shall be deemed, to establish a joint venture or partnership (or any fiduciary duty) between XENCOR and BII. Neither Party to this Agreement shall have any express or implied right or authority to assume or create any obligations on behalf of, or in the name of, the other Party, or to bind the other Party to any contract, agreement or undertaking with any third party.   11.13 Counterparts   This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.   35





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





  Monrovia, February 16 2012

  Biberach, February 13, 2012









  XENCOR, Inc.

  Boehringer Ingelheim International GmbH











 ppa.   ppa.







  /s/ Bassil Dahiyat





 /s/ Alois Konrad



 /s/ Dr. Andreas Felder   Bassil Dahiyat





 Alois Konrad



 Dr. Andreas Felder   President and CEO













  36





  List of Appendices:   Appendix 1: Material and Product   Appendix 2: Project Plan   Appendix 3: Members of the Project Team, Steering Committee and Chief Executive Officers   Appendix 4: MTA   Appendix 5: Quality Agreement   Appendix 6: Specifications, incl. shipping and packing instructions agreed by the Parties (to be attached upon agreement of the Parties)   Appendix 7: Summary Plan for Phase 1 Clinical Trials   Appendix 8: Press Release   37





  Appendix 1:   XmAb®6755 : Anti­TNF_Adalimumab_lgG1/2_M428L/N434S_Xtend Heavy Chain ORF (Protein) [...***...] [...***...]   [...***...]   [...***...] [...***...]   [...***...]

***Confidential Treatment Requested   38





  [...***...]   [...***...]   [...***...]

      [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]



***Confidential Treatment Requested   39









 [...***...]   [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]



***Confidential Treatment Requested   40





  [...***...]

     [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

    [...***...]

      [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]



***Confidential Treatment Requested   41









 [...***...]



 [...***...]



 [...***...]



 [...***...]









 [...***...]



 [...***...]



 [...***...]



 [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]



 [...***...]



 [...***...]



 [...***...]



 [...***...]

    [...***...]   [...***...]

              [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]

  [...***...]



 [...***...]



 [...***...]



 [...***...]

  [...***...]

  [...***...]

  [...***...]



 [...***...]



 [...***...]



 [...***...]



 [...***...]



 [...***...]



 [...***...]



***Confidential Treatment Requested   42









  [...***...]   […***…]

                       […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



 […***…]



***Confidential Treatment Requested   43





  Appendix 2:   Appendix 2.1: Project Plan and Price Project Plan Xtend-TNF Process Development Manufacturing of Clinical Grade Material   44



  Appendix 2.1: Project Plan and Price Project Plan Xtend-TNF Process Development Manufacturing of Clinical Grade Material   Version of December 19, 2011   45





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   46





  [...***...]   […***…]   […***…]

***Confidential Treatment Requested   47





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…] […***…] […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]       […***…]   […***…]

***Confidential Treatment Requested   48





  [...***...]   […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   49







    [...***...]

  […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]

***Confidential Treatment Requested   50





  [...***...]   […***…]   […***…]   […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   51





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]

***Confidential Treatment Requested   52







    [...***...]

  […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]     […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   53





  [...***...]   […***…]   […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]

***Confidential Treatment Requested   54

  [...***...]

    […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]     […***…]   […***…]

***Confidential Treatment Requested   55









  [...***...]

      […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]

     […***…]

  […***…]   […***…] […***…]



[…***…]

[…***…]

  […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   56





  [...***...]   […***…]   […***…]   […***…]   […***…]

    […***…]

  […***…]   […***…]

  […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   57







      [...***...]



  […***…]





[…***…]

  […***…]





[…***…]

  […***…]





[…***…]

  […***…]





  […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

    […***…]

  […***…]   […***…]

  […***…]

***Confidential Treatment Requested   58





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

     […***…]

  […***…]





[…***…]

  […***…]





[…***…]

  […***…]





  […***…]   […***…]   […***…]   […***…]

    […***…]

  […***…]





[…***…]

  […***…]







***Confidential Treatment Requested   59





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

    […***…]

  […***…]   […***…]

  […***…]

***Confidential Treatment Requested   60





  [...***...]   […***…]   […***…]

      […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]

     […***…]

  […***…]   […***…] […***…]



[…***…]

[…***…]

  […***…]     […***…]   […***…]   […***…]

       […***…]

  […***…]   […***…]

  […***…]   […***…]







[…***…]

  […***…]   […***…]









    […***…]

  […***…]   […***…]

  […***…]

***Confidential Treatment Requested   61







    [...***...]





 […***…]   […***…]



 […***…]     […***…]   […***…]   […***…]

    [...***...]





 […***…]   [...***...]





 […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   62





  [...***...]

                            […***…]

  […***…]   […***…]







[…***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]   […***…]

  […***…]

***Confidential Treatment Requested   63





  [...***...]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   64

  Appendix 3:   Members of the Project Team and Steering Committee   […***…]   […***…]   […***…]   […***…]     […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   65





  Appendix 4:   MTA   […***…]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   66





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   67





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   68





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   69





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   70





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   71





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   72





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   73





  [...***...]   […***…]   […***…]   […***…]     […***…]   […***…] […***…]   […***…]     […***…] […***…]     […***…]   […***…]     […***…]     […***…]   […***…]     […***…]

***Confidential Treatment Requested   74

  [...***...]   […***…]     […***…]   […***…]     […***…]

***Confidential Treatment Requested   75





  Appendix 5   Quality Agreement     […***…]   […***…]   […***…]     […***…]     […***…]   […***…]   […***…]   […***…]   […***…]     […***…]     […***…]     […***…]   […***…]   […***…]     […***…]

***Confidential Treatment Requested   76





  [...***...]   […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…] […***…]

***Confidential Treatment Requested   77





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   78





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   79





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   80





  [...***...]     […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   81





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   82





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   83





  [...***...]   […***…]     […***…]   […***…]     […***…]   […***…]   […***…]

***Confidential Treatment Requested   84

  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   85





  [...***...]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   86





  [...***...]   […***…]   […***…]     […***…] […***…]     […***…] […***…]     […***…]     […***…] […***…]     […***…] […***…]

***Confidential Treatment Requested   87





  Exhibit 1     [...***...]

        [...***...]



  [...***...]



  [...***...]





 [...***...]

  [...***...]













[...***...] [...***...]



 [...***...] [...***...] [...***...]



  [...***...]





 [...***...]



 [...***...] [...***...]





 [...***...] [...***...] [...***...]



  [...***...]





 [...***...]



 [...***...] [...***...]





 [...***...] [...***...] [...***...]



  [...***...]





 [...***...]



 [...***...] [...***...]





 [...***...] [...***...] [...***...]



  [...***...]









 [...***...] [...***...]





 [...***...] [...***...] [...***...]





***Confidential Treatment Requested   88





  Exhibit 2     [...***...]

          […***…]





  […***…]





[…***…]   […***…] […***…]   […***…]





[…***…]





[…***…]





[…***…]







       […***…]

  […***…]   […***…]   […***…]

***Confidential Treatment Requested   89





  Exhibit 3     [...***...]   […***…]   […***…]

      […***…]

  […***…]

  […***…]





































    […***…]   […***…]

      […***…]

  […***…]

  […***…]







































***Confidential Treatment Requested   90





  Exhibit 3     [...***...]     […***…]   […***…]

      […***…]

  […***…]

  […***…]







































***Confidential Treatment Requested   91





  Exhibit 4     [...***...]





  […***…]

  […***…]

  […***…]

  […***…]   […***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]



















[…***…]





















***Confidential Treatment Requested   92





  Exhibit 5     [...***...]

              […***…]

















  […***…] […***…] […***…]



 […***…] […***…]

[…***…]

[…***…]



 […***…] […***…] […***…]





[…***…]



 […***…] […***…] […***…] […***…]





[…***…] […***…]

  […***…]





   […***…] […***…]   […***…]   […***…]



 […***…]     […***…]

  […***…]



   […***…]     […***…]

  […***…]



   […***…]   […***…] […***…]



 […***…] […***…] […***…] […***…] […***…]





[…***…]



 […***…] […***…] […***…]





[…***…]













***Confidential Treatment Requested   93







    [...***...]

  […***…]       Exhibit 5     […***…]

       […***…]

    […***…] […***…]   […***…] […***…]     […***…] […***…]     […***…] […***…]   […***…]

***Confidential Treatment Requested   94

  Exhibit 6   […***…]   […***…]





  […***…]





  […***…]

  […***…]

  […***…]

  […***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]













 […***…]     […***…]

[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









[…***…]   […***…]















 […***…]





 […***…]











***Confidential Treatment Requested   95





  […***…]





  […***…]





  […***…]

  […***…]

  […***…]



 [...***...]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]











***Confidential Treatment Requested   96





  […***…]





  […***…]





  […***…]

  […***…]

  […***…]



 [...***...]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









[…***…]   […***…]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









[…***…]   […***…]















 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]



















 […***…]





 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





[…***…]   […***…]















 […***…]









 […***…]





 […***…]





 […***…]



















 […***…]





 […***…]









 […***…]





[…***…]   […***…]















 […***…]









 […***…]









 […***…]       […***…]

 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]





 […***…]











***Confidential Treatment Requested   97





  […***…]





  […***…]





  […***…]

  […***…]

  […***…]













 […***…]





[...***...]

  […***…]















 […***…]





 […***…]









 […***…]





 […***…]









[…***…]   […***…]















 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





 […***…]





 […***…]









 […***…]





 […***…]









 […***…]









 […***…]





[…***…]   […***…]















 […***…]





 […***…]











***Confidential Treatment Requested   98





  Appendix 6:   Specifications, incl. shipping and packing instructions agreed by the Parties (to be attached upon agreement of the Parties)   […***…]

***Confidential Treatment Requested   99





  Appendix 7:   Summary Plan for Phase I Clinical Trials   […***…]

        […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]     […***…]

        […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]   […***…]

***Confidential Treatment Requested   100





  Appendix 8:   Press Release   February 8th, 2012   Boehringer Ingelheim GmbH Corporate Communications: Heidrun Thoma +49/6132 77 3966 Heidrun.Thoma@boehringer-ingelheim.com Twitter: www.twitter.com/boehringer   Xencor Media Contact Heidi Chokeir, Ph.D. Canale Communications Tel: 619-849-5377 heidi@canalecomm.com   Boehringer Ingelheim and Xencor Enter a Collaboration Agreement for the  Development, Manufacture, and Supply of Biosuperior Monoclonal Antibodies   Antibodies engineered with Xencor's proprietary Xtend™ technology for increasing antibody half­life   MONROVIA, Calif., USA and INGELHEIM, Germany — February 14 , 2012 — Xencor, Inc., a company using its proprietary Protein Design Automation® (PDA) platform technology to engineer next­generation antibodies, and Boehringer Ingelheim announced today a collaboration agreement for certain Xencor biosuperior monoclonal antibodies. Under the terms of the agreement, Boehringer Ingelheim will provide all manufacturing and product supply from preclinical through Phase I development. Xencor is responsible for preclinical and clinical studies and retains all development and commercial rights to products under the agreement. Upon successful advancement of clinical programs beyond Phase 1 development, Boehringer Ingelheim has certain manufacturing rights to supply clinical and commercial material to Xencor. Xencor has developed deep portfolio of biosuperior antibodies with the potential for superior clinical and commercial performance, and this collaboration agreement with Boehringer Ingelheim allows us to establish an important relationship with the leading global contract manufacturer of biologics, said Bassil Dahiyat, Ph.D., president and CEO of Xencor. Xencor and Boehringer Ingelheim will share the financial risk in early preclinical and clinical development with the incentive of sharing in future success of the programs.   We are delighted to start this collaboration with Xencor. It reflects one of our new business models in the contract manufacturing in which both parties are enabled to focus on their core competencies, stated Corporate Senior Vice President Simon Sturge at Boehringer Ingelheim Biopharmaceuticals. We are convinced that this creates a win­win situation for both parties. Xencor's lead biosuperior compound is an anti­TNF antibody engineered using the company's proprietary Xtend™ antibody engineering technology for increasing antibody half­life. Xencor expects to initiate a Phase 1 trial in 2013 potentially resulting in key human pharmacokinetic data validating Xtend technology.   101

th





  About Xencor, Inc.   Xencor, Inc. engineers superior biotherapeutics using its proprietary Protein Design Automation® technology platform, and is a leader in the field of antibody engineering to significantly improve antibody half-life, immune-regulatory function and potency. The company is advancing multiple XmAb® antibody drug candidates in the clinic, including XmAb®5871 targeting CD32b and CD19 for autoimmune diseases, and an anti­ CD30 candidate XmAb®2513 for the treatment of Hodgkin's lymphoma. Xencor is also advancing a portfolio of biosuperior versions of blockbuster antibody drugs engineered for superior half-life and dosing schedule. Xencor has entered into multiple partnerships with industry leaders such as Amgen, Pfizer, Centocor, MorphoSys, Boehringer Ingelheim, CSL Ltd. and Human Genome Sciences. In these partnerships Xencor is applying its suite of proprietary antibody Fc domains to improve antibody drug candidates for traits such as sustained half-life and/or potency. For more information, please visit www.xencor.com.   About Boehringer Ingelheim   The Boehringer Ingelheim group is one of the world's 20 leading pharmaceutical companies. Headquartered in Ingelheim, Germany, it operates globally with 145 affiliates in 50 countries and more than 42,000 employees. Since it was founded in 1885, the family-owned company has been committed for 125 years to researching, developing, manufacturing and marketing novel products of high therapeutic value for human and veterinary medicine.   Today, Boehringer Ingelheim is one of the world's leading companies for contract development and manufacture of biopharmaceuticals. All types of services from mammalian cell line or microbial strain development to final drug production can be delivered within a one-stop-shop concept. Boehringer Ingelheim delivers services for pre-clinical development up to global market supply with a strong commitment to its customers at its global manufacturing facilities for mammalian cell culture and microbial fermentation. Boehringer Ingelheim has brought 19 molecules to market and has many years of experience in multiple molecule classes such as monoclonal antibodies, recombinant proteins, interferons, enzymes, fusion molecules and plasmid DNA. Furthermore, high-titer platform technologies for new antibody mimetic formats such as scaffold proteins and antibody fragments are available for the manufacture of customer products. www.biopharma-cmo.com.   For more information, please contact:   Xencor Inc. Heidi Chokeir, Ph.D. Canale Communications for Xencor Tel: 619-849-5377 heidi@canalecomm.com   Boehringer Ingelheim GmbH Heidrun Thoma Corporate communications Boehringer Ingelheim GmbH 55216 Ingelheim/Germany Phone: +49/6132 77 3966   Twitter: www.twitter.com/boehringer More information: bio-cmo@boehringer-ingelheim.com   102 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

A: XENCOR and BII shall obtain and/or maintain during the term of this Agreement and for a period of [...***...] thereafter, liability insurance in amounts which are reasonable and customary in the biopharmaceutical industry for companies of comparable size and the respective activities (i.e. BII as CMO and XENCOR as sponsor/pharmaceutical company) at the respective place of business and such liability insurance shall insure against all mandatory liability, including liability for personal injury, physical injury and property damage.
****
Q: Exhibit 10.1

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS EXHIBIT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

SERVICES OUTSOURCING AGREEMENT

Between

CCA INDUSTRIES, INC. (Company)

And

EMERSON HEALTHCARE, LLC (Contractor)

DATED AS OF January 20, 2014





CONFIDENTIAL TREATMENT REQUESTED

This Services Outsourcing Agreement (this Agreement) is made as of January 20, 2014 (Date), between CCA Industries, Inc. (Company), and Emerson HealthCare, LLC, a Pennsylvania limited liability company (Contractor).

RECITALS

WHEREAS, the Company will own, develop, manufacture or have manufactured, market and sell the products set forth on Exhibit A attached hereto, as the same may be amended from time to time in accordance with the terms hereof (the Products), and desires to outsource certain logistical and administrative services with respect to the Products; and

WHEREAS, the Company desires to engage Contractor to provide certain logistical and administrative services with respect to the Products and Contractor is willing to provide such services in connection therewith, on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Contractor agree as follows:

ARTICLE I

GENERAL TERMS

1.01 Certain Defined Terms. For the purposes of this Agreement, the following capitalized terms shall have the meanings set forth below.

(a) Accounts Receivable shall mean all accounts receivable, notes receivable and other indebtedness due and owed by any Customer and arising or held in connection with the sale of any of the Products.

(b) Agreement shall mean this Agreement, including all Exhibits attached hereto, as the same may be amended, modified or supplemented from time to time in accordance with the terms hereof.

(c) Claim shall have the meaning set forth in Section 7.01.

(d) Company shall have the meaning set forth in the Preamble to this Agreement.

(e) Confidential Information shall have the meaning set forth in Section 5.04.

(f) Contractor shall have the meaning set forth in the Preamble to this Agreement.

(g) Customer means any current or prospective customer of the Company with respect to the Products.

(h) Disclosing Party shall have the meaning set forth in Section 5.04.

1





CONFIDENTIAL TREATMENT REQUESTED

(i) Effective Date shall have the meaning set forth in Section 2.01.

(j) Files and Work Papers shall have the meaning set forth in Section 5.05.

(k) Force Majeure Event shall have the meaning set forth in Section 8.03.

(l) Governmental Authority' means any supranational, national, federal, provincial, state or local judicial, legislative, executive or regulatory authority, body or instrumentality.

(m) Gross Invoiced Sales means the gross selling price (before the application of any non-cash discounts, rebates, credits, allowances or similar deductions or adjustments) less any cash discounts, of all Products that are invoiced to and paid by Customers.

(n) Intellectual Property means all intellectual property rights, including all rights in patents, patent applications, formulae, trademarks, trademark applications, trade names, confidential information, trade secrets, inventions, copyright, industrial designs and know-how.

(o) Notice Period shall mean the period between the termination date of this Agreement and the date that is six (6) months after the date on which the Company provides Contractor with written notice of its election to terminate this Agreement.

(p) OHL means Ozbum-Hessey Logistics, LLC and its Affiliates.

(q) Person means an individual, a limited liability company, a joint venture, a corporation, a partnership, an association, a trust, a division or an operating group of any of the foregoing or any other entity or organization.

(r) Products shall have the meaning set forth in the Recitals to this Agreement.

(s) Receiving Party shall have the meaning set forth in Section 5.04.

(t) Sales Representation Agreement means the sales representation agreement, dated as of the date hereof, between Company and Contractor.

(u) Service Fees shall have the meaning set forth in Section 4.01.

(v) Services means any of the services to be provided by or on behalf of Contractor to the Company under this Agreement and set forth on Exhibit B.

(w) Term shall have the meaning set forth in Section 2.01.

(x) Termination Fee shall mean an amount equal to the average Service Fees per day over the 180 day period immediately preceding the date written notice of termination is provided pursuant to Section 8.01(d) and (e) multiplied by number of days by which the Notice Period will be less than 180.

(y) Territory means the United States, excluding its territories and possessions.

2





CONFIDENTIAL TREATMENT REQUESTED

1.02 Interpretation. The words hereof, herein, hereto and hereunder and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The terms defined in the singular shall have a comparable meaning when used in the plural and vice versa. The term including shall mean including, without limitation. When a reference is made in this Agreement to an Article, a Section or an Exhibit, such reference shall be to an Article or a Section of, or an Exhibit to, this Agreement unless otherwise indicated.

ARTICLE I1

TERM: EFFECTIVE DATE

2.01 Term. This agreement shall commence on January 20, 2014 (the Effective Date) and shall continue in effect for six (6) months (the Initial Term). This agreement shall automatically renew for successive six (6) month periods unless written notice is provided of either party's intent not to renew at least six (6) months before the end of the then-current term.

2.02 Effective Date. This Agreement shall have no force or effect unless and until the Effective Date. If the Effective Date does not occur, then this Agreement shall be void ab initio and shall have no force or effect.

ARTICLE III

OBLIGATIONS OF CONTRACTOR

3.01 Contractor Services. Contractor shall perform during the Term of this Agreement the Services set forth on Exhibit B in respect of the Products in the Territory.

3.02 Meetings. Contractor shall meet with the Company on at least a monthly basis, or more often to the extent reasonably requested by the Company, to review historical sales results by Product SKU, forward-looking sales forecasts by Product SKU, current inventories of the Products on hand, production scheduled and to be scheduled of the Products, and any other matters as the parties shall determine. Such meetings shall take place at the offices of the Company (or, at the election of the Company, by video or telephone conference) no later than the fifteenth (15th) day of each calendar month during the Term of this Agreement or at such other time as the parties shall mutually agree.

3.03 Access. From time to time during the Term of this Agreement, upon reasonable advance notice, Contractor shall permit the Company and its agents, representatives, auditors and designees to visit, inspect and have full access, during normal business hours, to properties, assets, books, records, agreements, documents, data, files and personnel of Contractor.

3.04 Ownership of Accounts Receivable & Inventory. Contractor acknowledges and agrees that it is acting solely as a collection agent on behalf of the Company with respect to all Accounts

3





CONFIDENTIAL TREATMENT REQUESTED

Receivable collected from Customers, and such Accounts Receivable and the proceeds therefrom are and shall remain at all times property of the Company. Contractor further acknowledges and agrees that it has no ownership interest whatsoever in any of the Company's Inventory.

ARTICLE IV

PAYMENT

4.01 Service Fees. In consideration of providing the Services set forth in Exhibit B, the Company agrees to pay to Contractor [ ** ] percent ([ *∗ ]%]) of Company's Gross Invoiced Sales (the Service Fees). Company agrees to have Fesnak & Associates, LLP pay the Service Fees directly to Contractor. Service Fees shall be paid to Contractor within five (5) days after the end of each month.

4.02 Remittance. Contractor shall deposit into bank accounts designated by the Company an amount equal to the following: all amounts received from any Customer that are related to Accounts Receivable, less each of the following that is applicable to any such Accounts Receivable (and has not already been applied to reduce any Accounts Receivable): (i) Service Fees, (ii) commissions pursuant to the Sales Representation Agreement, (iii) returns, (iv) quantity and cash discounts, (v) trade allowances or markdowns granted on account of unsalable or discontinued Products, (vi) all sales or use taxes, tariffs, duties or similar charges of any Governmental Authority paid by or for the benefit of the Company, (vii) freight, warehousing (storage and labor) and other charges associated with the distribution of the Products using Contractor's warehouse, logistics terminal and shipping facility (see Exhibit C), (viii) the Company's pro rata portion of product liability insurance (approximately $800 per million dollars of sales) purchased by the Contractor in connection with performance of the Services, and (ix) any other deductions, rebates, credits, allowances or adjustments, in each case, which has been specifically identified by such Customer as being applicable to any such Accounts Receivable. Contractor shall use its best efforts to deposit the foregoing amounts within five (5) business days, following the receipt thereof.

4.03 Retention of Monies. During the Term of this agreement, and for a period of twenty four (24)months after Termination (the Withholding Period), Contractor may retain monies (collections in Accounts Receivable) against any reasonable anticipated deductions for product recalls, unsalables, rebates, allowances or any audits or other adjustments it deems necessary. The retention of monies shall only be to the extent that the reasonable anticipated deductions exceed the anticipated accounts receivables. At the end of the Withholding Period, Contractor shall remit to the Company the retained monies less any deductions charged by Customers against Company's Products. After the Withholding Period, Company will remain liable to Contractor for any additional audits, deductions, rebates, credits, allowances or other adjustments taken by the Customers against the Company's Products.

4





CONFIDENTIAL TREATMENT REQUESTED

4.04 Expenses. Other than as specifically provided herein, each party shall be responsible for its own expenses incurred in connection with the performance of its obligations under this Agreement; provided, that the Company shall reimburse Contractor for reasonable documented out-of-pocket travel expenses associated with any meeting specifically requested by the Company and not otherwise contemplated by this Agreement.

ARTICLE V

ADDITIONAL AGREEMENTS

5.01 New Products. The Company may amend Exhibit A to add new products to the scope of this Agreement, including line extensions of the then-existing Products and new brands acquired by the Company that are sold into the same classes of trade as the then-existing Products.

5.02 Intellectual Property. All rights to either party's Intellectual Property, including all rights in patents, patent applications, formulae, trademarks, trademark applications, trade names, confidential information, trade secrets, inventions, copyright, industrial designs and know-how, (Intellectual Property) shall remain that party's absolute property during and after the Term of this Agreement. The Products and any Intellectual Property owned by the Company in connection therewith shall be the absolute property of the Company during and after the Term of this Agreement. Neither party shall apply for registration of any trademarks, trade names, or brand names of the other party and each party hereby renounces all rights that it may acquire to such trademarks, trade names or brand names according to law or customs because of this Agreement or because of its use of such trademarks, trade names, or brand names under this Agreement.

5.03 Grant of Sublicense. Solely to the extent necessary to enable Contractor to provide the Services in accordance with the terms herein, the Company hereby grants Contractor a royalty-free, non-exclusive sublicense, without the right to grant further sublicenses, under any and all applicable trademarks and other Intellectual Property owned or controlled by or licensed to the Company or any of its Affiliates to provide, during the Term of this Agreement, the Services in respect of the Products in the Territory. Nothing contained herein shall give Contractor any right to use any of the Company's Intellectual Property used in connection with the Products or trademarks or trade names that may appear on the labeling for the Products, except for providing the Services in accordance with the terms herein. Except as provided in this Section 5.03, Contractor shall not obtain any right, title or interest in any of the Company's Intellectual Property or trademark or any other trademark designation or trade name by virtue of this Agreement or Contractor's performance of its obligations hereunder.

5.04 Confidentiality. In performing its obligations under this Agreement, each party may receive information (the Receiving Party) of a confidential and proprietary nature regarding the other party, including information about such party's intellectual property and its operations, research,

5





CONFIDENTIAL TREATMENT REQUESTED

marketing plans, strategies and customer lists (collectively, Confidential Information). The Receiving Party shall hold the other party's Confidential Information in strict confidence, shall not use such Confidential Information, except as permitted hereunder, and shall not disclose such Confidential Information to any third party without the prior written consent of the disclosing party (the Disclosing Party). Each party shall use the same degree of care to protect the Disclosing Party's Confidential Information as it uses to protect its own Confidential Information of like nature, but in no circumstances less than a commercially reasonable level of care. The Receiving Party shall ensure that its employees and agents are bound to the same obligations of confidentiality as the Receiving Party. Confidential Information shall not be deemed to include: (a) information which is known to the Receiving Party prior to the date of receipt and not obtained or derived in any manner related to this Agreement, (b) information which is or becomes part of the public domain through no fault of the Receiving Party, or (c) information which is obtained from a third party that lawfully possesses such Confidential Information and is under no obligation to keep such Confidential Information confidential. The Receiving Party may disclose Confidential Information of the Disclosing Party in response to a valid court order, law, rule, regulation or other governmental action, provided that the Disclosing Party is notified in writing prior to disclosure of such Confidential Information to permit the Disclosing Party to oppose such disclosure by appropriate legal action. Upon the termination or expiration of this Agreement or upon the earlier request of the Disclosing Party, the Receiving Party shall (i) promptly return to the Disclosing Party all Confidential Information, or (ii) upon written request by the Disclosing Party, destroy all Confidential Information and provide the Disclosing Party with written certification of such destruction. Upon the termination or expiration of this Agreement, the Receiving Party shall cease all further use of any Confidential Information, whether in tangible or intangible form.

5.05 Records Management. All paper or electronic records, files, documents, work papers and other information in any form, whether marked confidential or not, provided by the Company, its employees, agents or Affiliates or generated pursuant to this Agreement shall remain the exclusive property of the Company (collectively, Files and Work Papers). During the Term of this Agreement and for a reasonable transitional period thereafter, Contractor shall maintain adequate levels of information technology system redundancy, security and emergency back-up as the Company may reasonably require to protect the Files and Work Papers of the Company.

5.06 Vendors. Contractor shall retain Fesnak & Associates, LLP to provide accounting services in connection with Contractor's performance of the Services and shall not engage a different accountant to provide such services without the Company's prior written consent (not to be unreasonably withheld). Contractor and the Company are arranging for OHL to provide certain warehousing, shipping and other logistical services related to the Products, as mutually agreed by the parties, and Contractor shall not engage a different vendor with respect to such services without the Company's prior written consent (not to be unreasonably withheld).

6





CONFIDENTIAL TREATMENT REQUESTED

ARTICLE VI

REPRESENTATIONS AND WARRANTIES

6.01 Representations and Warranties of Contractor. As of the date hereof, Contractor hereby represents and Warrants to the Company that the execution and delivery of this Agreement, and the performance of Contractor's obligations hereunder, do not and will not conflict with, violate or breach, or constitute a default or require any consent under, any contractual obligation or court or administrative order by which Contractor is bound.

6.02 Representations and Warranties Company. As of the date hereof, the Company hereby represents and warrants to Contractor that the execution and delivery of this Agreement, and the performance of the Company's obligations hereunder, do not and will not conflict with, violate or breach, or constitute a default or require any consent under, any contractual obligation or court or administrative order by which the Company is bound.

ARTICLE VII

INDEMNIFICATION AND INSURANCE

7.01 Indemnification by the Company. The Company hereby agrees to indemnify and hold Contractor, including its Affiliates and its and their respective officers, directors, partners, members, employees and agents, harmless from and against any and all claims, actions, suits, losses, demands, damages, costs and expenses (including reasonable attorneys' fees) of every kind, nature, or description (each, a Claim) brought in connection with, arising out of or related to the Products or the Company's breach of its representations, warranties or covenants hereunder, except those Claims arising out of Contractor's or its Affiliates' fraud, willful misconduct, negligence or material breach of this Agreement or any other agreement with the Company.

7.02 Indemnification by Contractor. Contractor hereby agrees to indemnify and hold the Company, including its Affiliates and its and their respective officers, directors, partners, members, employees and agents, harmless from and against any and all Claims brought in connection with or arising out of or related to Contractor's or its Affiliates' fraud, willful misconduct, negligence or material breach of this Agreement.

7.03 Insurance. Company shall maintain Products Liability Insurance and in an amount satisfactory to Contractor, under which Contractor is named as an additional insured. All insurance coverages are to be placed with insurers which have a Best's rating of no less than A. Such insurance requirements shall be maintained during the Term and shall continue for a minimum of three years following termination of this Agreement. Failure to comply with the insurance requirements shall place Company in material breach of this Agreement.

ARTICLE VIII

7





CONFIDENTIAL TREATMENT REQUESTED

TERMINATION

8.01 Termination. This Agreement shall be terminable as follows:

(a) In the event that a party hereto commits a material breach of any of the terms or conditions of this Agreement the other party may terminate this Agreement (i) if such breach may be cured, upon written notice if the breaching party fails to cure such breach within thirty (30) days after its receipt of written notice thereof, or (ii) if such breach is incapable of cure, upon written notice to the other party thereof (it being understood that any breach of Section 5.04 would be incapable of cure);

(b) Notwithstanding the provisions of Section 8.01, in the event that a party hereto fails to pay any amounts payable hereunder when due, the other party may terminate this Agreement (i) if such breach may be cured, upon written notice if the breaching party fails to cure such breach within three (3) business days after its receipt of written notice thereof; or, (ii) if such breach is incapable of cure, upon written notice to the other party thereof;

(c) In accordance with the provisions of Section 8.03; or,

(d) Either party hereto may terminate this Agreement after the Initial Period upon at least six (6) months' prior written notice to the other party thereof. The Company may terminate this Agreement in accordance with the immediately preceding sentence but with less than six (6) months' prior written notice to Contractor; provided, that in such event, the Company shall pay Contractor an amount equal to the Termination Fee.

8.02 Effect of Termination. Subject to Section 4.03, upon termination or expiration of this Agreement, other than with respect to any amounts then the subject of a good faith dispute, the Company shall pay to Contractor and Contractor shall pay to the Company all monies due in respect of the Services provided.

8.03 Force Majeure. If either party is prevented from or delayed in performing any of its obligations hereunder due to any cause which is beyond the nonperforming party's reasonable control, including, without limitation, fire, explosion, flood, or other acts of God; acts, regulations, or laws of any Governmental Authority; war or civil commotion; acts of terrorism, strike, lock-out or labor disturbances; or failure of public utilities or common carriers (a Force Majeure Event), such non-performing party shall not be liable for breach of this Agreement with respect to such non-performance or delay to the extent any such non-performance or delay is due to a Force Majeure Event; provided, that the non-performing party gives immediate written notice to the other party of the Force Majeure Event. If a Force Majeure Event asserted as the basis of a party's non-performance continues to prevent performance for more than one (1) month, the other party may terminate this Agreement by giving written notice to the nonperforming party before the non-performing party resumes performance. Notwithstanding anything contained in this Section 8.03,

8





CONFIDENTIAL TREATMENT REQUESTED

such non-performing party shall exercise commercially reasonable efforts to eliminate the Force Majeure Event and to resume timely performance of its affected obligations as soon as practicable.

ARTICLE IX

MISCELLANEOUS

9.01 Relationship of the Parties. The relationship of the Company and Contractor established by this Agreement is that of independent contractors, and nothing contained herein shall be construed to (a) give either party any right or authority to create or assume any obligation or incur any expense of any kind on behalf of the other without the other party's prior written approval, or (b) constitute the parties as partners, joint venturers, co-owners, employer and employee or otherwise as participants in a joint or common undertaking.

9.02 Notices. All notices and other communications shall be in writing and shall be deemed to have been duly given when: (a) delivered personally, or (b) transmitted by facsimile (with receipt confirmed), or (c) if mailed, five (5) days after being deposited in the United States mail, postage prepaid, or by certified or registered mail, return receipt requested, postage prepaid, or (d) if sent by overnight courier for delivery on the next day, the day following deposit of the notice with Federal Express or another nationally recognized overnight courier service (billed to sender), to the parties at the following addresses:

If to Contractor: Emerson HealthCare, LLC Attention: Scott Emerson 407 East Lancaster Avenue Wayne, Pennsylvania 19087 Telephone: (610) 971-9600 Facsimile: (610) 971-9616 With a copy to: Steven L. Gershman, Esq. The Navy Yard Corporate Center One Crescent Drive Suite 400 Philadelphia, PA 19112 Telephone (215) 271-6102 Facsimile: (215) 218-2039 If to the Company: CCA Industries, Inc. Attention: Chief Executive Officer 200 Murray Hill Parkway East Rutherford, NJ 07073

9





CONFIDENTIAL TREATMENT REQUESTED

Telephone (201) 935-3232 Facsimile: (201) 842-6049

With a copy to: CCA Industries, Inc. Attention: Chief Financial Officer 200 Murray Hill Parkway East Rutherford, NJ 07073 Telephone (201) 935-3232 Facsimile: (201) 842-6049   9.03 Failure to Exercise. The failure of either party to enforce at any time for any period any provision hereof shall not be construed to be a waiver of such provision or of the right of such party thereafter to enforce each such provision, nor shall any single or partial exercise of any right or remedy hereunder preclude any other or further exercise thereof or the exercise of any other right or remedy. Remedies provided herein are cumulative and not exclusive of any remedies provided at law.

9.04 Assignment. This Agreement may not be assigned by either party without the prior written consent of the other party, except that, without such consent, (i) Company may make an assignment of this Agreement as collateral security in favor of its lenders, and (ii) the Company may assign this Agreement to a purchaser of all or substantially all of the assets of the Company's business related to the Products. Subject to the foregoing sentence, this Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns.

9.05 No Third Party Beneficiaries. Nothing in this Agreement, express or implied, is intended to confer upon any Person other than the Company and Contractor, or their successors or permitted assigns, any rights or remedies under or by reason of this Agreement.

10





CONFIDENTIAL TREATMENT REQUESTED

9.06 Severability. Any term or provision of this Agreement that is deemed invalid or unenforceable in any jurisdiction shall, to the extent the economic benefits conferred by such Agreement to both parties remain substantially unimpaired, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction.

9.07 Governing Law. This Agreement shall be deemed to have been entered into in the State of New Jersey, and shall be construed and interpreted in accordance with the laws of that State applicable to agreements made and to be performed in the State of New Jersey. Any and all disputes, controversies and claims arising out of or relating to this Agreement, or with respect to the interpretation of this Agreement, or the rights or obligations of the parties and their successors and permitted assigns, whether by operation of law or otherwise, shall be settled and determined by arbitration in New Jersey pursuant to the then existing rules of the American Arbitration Association for commercial arbitration. The arbitrators shall have the power to award specific performance, rescission or injunctive relief in addition to damages or other monetary awards, but shall not have the power to modify, alter, enlarge upon or otherwise change any of the provisions or terms and conditions of this Agreement. The arbitration shall be final and binding upon the parties and judgment there on may be entered in the courts of the State of New Jersey and the United States federal courts in said State, and the parties hereby consent to the jurisdiction of such courts for such purposes. Service of any notice, process, motion or other document in connection with any arbitration proceeding, any arbitration award or any other action or proceeding, maybe by personal service or by certified or registered mail return receipt requested, addressed to the party intended at its address for the receipt of notices as herein set forth.

9.08 Headings. The headings used herein have been inserted for convenience only and shall not affect the interpretation of this Agreement.

9.09 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and together shall constitute one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other party, it being understood that both parties need not sign the same counterpart.

9.10 Entire Agreement. NO VARIATIONS OR MODIFICATIONS OF THIS AGREEMENT SHALL BE DEEMED VALID UNLESS REDUCED TO WRITING AND SIGNED BY THE PARTIES HERETO. THIS AGREEMENT CONTAINS THE ENTIRE AGREEMENT AMONG THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDES ALL PRIOR AGREEMENTS AND UNDERSTANDINGS, ORAL OR WRITTEN, WITH RESPECT TO SUCH MATTERS, EXCEPT FOR ANY WRITTEN AGREEMENT OF THE PARTIES THAT EXPRESSLY PROVIDES THAT IT IS NOT SUPERSEDED BY THIS AGREEMENT. ANY PROVISION OF THIS AGREEMENT MAY BE AMENDED OR WAIVED

11





CONFIDENTIAL TREATMENT REQUESTED

IF, AND ONLY IF, SUCH AMENDMENT OR WAIVER IS IN WRITING AND SIGNED (I) IN THE CASE OF AN AMENDMENT, BY THE COMPANY AND CONTRACTOR AND (II) IN THE CASE OF A WAIVER, BY THE PARTY AGAINST WHOM THE WAIVER IS TO BE EFFECTIVE.

9.11 Survival. Sections 5.02, 5.04, 5.05 and 8.02, and Articles Article IV, Article VII and Article IX shall survive the expiration or termination of this Agreement in accordance with the respective terms thereof.

IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be executed as of the date first written above.

EMERSON HEALTHCATE, LLC Contractor

By: /s/s Scott Emerson Scott Emerson

and

CCA INDUSTRIES, INC. Company

By: /s/ Richard Kornhauser Richard Kornhauser, President & CEO

12





CONFIDENTIAL TREATMENT REQUESTED

EXHIBIT A TO SERVICES OUTSOURCING AGREEMENT

List of Products:

List to be furnished by CCA

13





CONFIDENTIAL TREATMENT REQUESTED

EXHIBIT B TO SERVICES OUTSOURCING AGREEMENT

SEE-ATTACHED FLOW CHARTS



14





CONFIDENTIAL TREATMENT REQUESTED

EXHIBIT C - LOGISTIC EXPENSES

• Outbound freight costs - average out to be approximately [ ** ] cents per lb.

• Warehouse labor [ ** ] cents per case.

• There is no charge for unloading and putting away inbound product as long as product arrives on standardized configured pallets. The labor charge only occurs when the product is shipped outbound to customers/retailers.

• Storage cost of [ ** ] cents per month per case - First [ ** ] days for each case no charge - If case sits longer than [ *∗ ] days the monthly charge applies going forward.

• For International Sales the above warehouse labor and storage costs apply. There will be no Service Fee paid for international sales, but Company understands that Contractor will not be performing any services. It is assumed buyer will be paying for freight for International Sales.

15 
Question: Highlight the parts (if any) of this contract related to Insurance that should be reviewed by a lawyer. Details: Is there a requirement for insurance that must be maintained by one party for the benefit of the counterparty?

A:
All insurance coverages are to be placed with insurers which have a Best's rating of no less than "A."
****