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: CONFIDENTIAL

  PSiTECHCORPORATION   WEBSITE CONTENT LICENSE AGREEMENT     This Content License Agreement (Agreement), dated as of Feb 10, 2014 (the Effective Date), is by and between PSiTech Corporation, a BVI Corporation, with offices located at 303, 3rdFl, St. Georges Bldg, 2 Ice House St, Central, Hong Kong(Licensor), and Empirical Ventures, Inc., a Nevada corporation with offices located at 100, 40 Lake Bellevue Dr, Bellevue, WA(Licensee).     WHEREAS, Licensee owns, operates and controls the Licensee Site (as defined below);     WHEREAS, Licensor owns or otherwise has the right to license the Licensed Content (as defined below);     WHEREAS, Licensee wishes to make Licensed Content accessible on the Licensee Site; and     WHEREAS, Licensor is willing to license the Licensed Content to Licensee, subject to all terms and conditions set forth herein.     NOW, THEREFORE, in consideration of the mutual covenants, terms and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:     1. Definitions. For purposes of this Agreement, the following terms have the following meanings. Other terms defined in the body of the Agreement shall have the meanings so given.   Affiliate of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such Person. The term control (including the terms controlled by and under common control with) means the direct or indirect ownership of more than fifty percent (50 %) of the voting securities of a Person.   Confidential Information means any information that is treated as confidential by a party, including, without limitation, trade secrets, technology, information pertaining to business operations and strategies, and information pertaining to customers, pricing and marketing, in each case to the extent it is: (a) if in tangible form, marked as confidential; or otherwise, identified at the time of disclosure as confidential, or (b) would be considered as confidential information by one who is reasonably knowledgeable and experienced in the field to which the information relates. With respect to each party, the terms of this Agreement are Confidential Information of the other party.

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Content Item means each discrete creative work (for example, article, photograph or video), as designated by the Licensor, that is included in the Licensed Content.   End User means each natural person that has access to Licensed Content on the Licensee Site.   Gross Revenues means the gross revenues received by the Licensee and derived from or in connection with the Licensee Site, from any sources whatsoever, including but not limited to fees for access to and use of the Licensee Site and advertising, sponsorship, marketing and other paid-for placements, andmaintenance, support and other services.   Law means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement or rule of law of any federal, state, local or foreign government or political subdivision thereof, or any arbitrator, court or tribunal of competent jurisdiction.   Licensed Content means those materials and content identified in Schedule 2, as may be amended by the parties as set forth herein.   Licensee Site means the website operated by Licensee on or through which the Licensed Content is displayed.   Losses means losses, damages, liabilities, deficiencies, actions, judgments, interest, awards, penalties, fines, costs or expenses of whatever kind, including reasonable attorneys' fees and the cost of enforcing any right to indemnification hereunder and the cost of pursuing any insurance providers.]   Mark means any trademark, trade name, service mark, design, logo, domain name or other indicator of the source or origin of any product or service. Licensor's Mark as used in Section 3.3shall mean the Mark Go­Page, either in standard character or stylized format.   Multi­level Marketing or MLM means a direct sales or marketing strategy in which the sales force is compensated both for sales they personally generate and for sales made by sales people they recruit.   Person means an individual, corporation, partnership, joint venture, limited liability entity, governmental authority, unincorporated organization, trust, association or other entity.   Related Media means those mobile sites, mobile applications (apps), widgets, gadgets, RSS feeds, e-mail newsletters and other content delivery media owned, operated and controlled by Licensee.   Territory means Canada, United States and Mexico.

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2. Delivery of Content. During the Term, except as otherwise set forth herein, Licensor shall make available to Licensee the Licensed Content for display on the Licensed Site. Licensor reserves the right to modify the Licensed Content in its reasonable discretion. Licensor shall notify Licensee of any such modifications. Licensor is not liable for delays or failures of delivery beyond its reasonable control. Licensor's sole responsibility for any such delay or failure is to deliver or re-deliver the relevant Licensed Content as soon as reasonably possible.   3. License Grants.   3.1 Content License. Subject to Licensee's on­going compliance with Section 3.2 and all other terms and conditions of this Agreement, Licensor grants to Licensee an exclusive (save for rights reserved to Licensor hereunder), non-transferable (except as provided in Section 11.7) and non- sublicensable license, during the License Term, to reproduce, perform, display, transmit and distribute the Licensed Content on the Licensee Siteand Related Media intended solely for use by End Usersin the Territory within the scope set forth in Schedule 1 (License Scope), which is attached hereto and incorporated herein by this reference. The foregoing includes the right to permit End Users to access the Licensed Content solely for their own end use and not for redistribution and otherwise subject to Terms of Use that comply with Section 4.3. Licensee is not granted any right to, and shall not, permit any other use of the Licensed Content by End Users, or any use of the Licensed Content by any other Person (including Licensee's Affiliates).   3.2 Content License Restrictions. The license granted in Section 3.1 is subject to the following:   (a) Licensee shall not include Licensed Content on the Licensee Site or any Related Media other than as expressly permitted herein and in accordance with all terms and conditions of Section 4.   (b) Licensee shall not make the Licensed Content available, or otherwise use the Licensed Content, except as expressly licensed pursuant to Section 3.1. Any use by Licensee of the Licensed Content on any other website, mobile site or application or other media of Licensee other than the Licensee Site and Related Media as expressly provided herein requires a separate written agreement between Licensor and Licensee, and Licensor has no obligation to enter into any such agreement.   (c) Licensee shall not permit the Licensed Content to be, or appear to be, reproduced, displayed or distributed on, as part of or in connection with any website or other online (including mobile) area other than the Licensee Site and Related Media, whether by framing, in-line linking, appearing in a new window or otherwise.   (d) Licensee shall not edit, alter, modify, combine with other content or create any derivative works of the Licensed Content without the prior written consent of Licensor.   (e) Licensee shall not display, and shall not permit others to display, on the Licensee Site any images or content that is or could be reasonably construed to be offensive, pornographic, defamatory or libelous, infringing the intellectual property rights of any third party, promoting terrorism or other unlawful violence, or for any other purpose that violates applicable Law.

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(f) If Licensor instructs Licensee to delete or make inaccessible any Content Item because such Content Item may contain errors, is or could be subject to a third-party claim or for any other good faith reason, Licensee shall comply with such instruction as promptly as reasonably possible and, in any case, within twenty-four (24) hours. The License Term for each such Content Item terminates at the end of such 24-hour period.   All uses of the Licensed Content that do not comply fully with the provisions of this Section 3.2 shall for all purposes be deemed beyond the scope of the license granted hereunder. Any violation of this Section 3.2 by Licensee shall be a material breach of this Agreement for which Licensor may terminate this Agreement as set forth in Section 6.2(a).     3.3 Trademark License.   (a) Licensor grants to Licensee a limited, non-exclusive, non-transferable (except as provided in Section 11.7) and non-sublicensable royalty-free license during the Term to those of Licensor's Marks designated by Licensor from time to time to:   (i)display such Marks on the Licensee Site: (x) with the Licensed Content to provide source attribution; or (y) as links to the Licensed Content;   (ii)comply with its express obligations under this Agreement; and   (iii)advertise, market and promote the availability of the Licensed Content or the Licensee Site and identify the Licensor as a content provider;   provided, that all uses of Licensor's Marks shall require Licensor's prior written approval.

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  (b) Licensee shall use the Marks solely in accordance with Licensor's trademark usage guidelines and quality control standards as the same may be updated from time to time by Licensor. If Licensor notifies Licensee that any use does not so comply, Licensee shall immediately either remedy the use to the satisfaction of Licensor or terminate such use. Licensee shall not use, register or attempt to register in any jurisdiction any Mark that is confusingly similar to or incorporates any of the Licensor's Marks. All uses of the Licensor's Marks, and all goodwill associated therewith, shall inure solely to the benefit of Licensor.   3.4 Reservation of Rights. Neither this Agreement nor the licenses granted hereunder convey any ownership right in any of the Licensed Content, Licensor's Marks or other materials provided by or on behalf of Licensor under this Agreement. Except for the express licenses granted in this Agreement, all right, title and interest in and to the Licensed Content and Licensor's Marks are and will remain with Licensor and its licensors.   4. Licensee Obligations.   4.1 Content Display. Throughout the Term, Licensee shall provide the Licensed Content on the Licensee Site and Related Media solely to the extent of and within the scope of the license granted in this Agreement and otherwise in accordance with the following:   (a) Licensee shall present the Licensed Content solely in accordance with the specifications and restrictions set forth in Schedule 4.   (b) Licensee shall update Licensed Content on the Licensee Site and Related Media promptly upon receipt of such updates from the Licensor.   (c) Licensee shall present each Content Item solely in its entirety (without any addition, modification or deletion).   (d) Licensee shall remove the Licensed Content from the Licensee Site and Related Media immediately upon the expiration or earlier termination of the License Term for such Content Item.   4.2 Required Notices. Licensee shall display with each Content Item the appropriate copyright and trademark notices and any other source attribution required by Licensor. Licensee shall not alter, remove or obstruct any such notices or attribution included with any Content Item as delivered by Licensor.

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4.3 Terms of Use. Throughout the Term, Licensee shall have in effect and maintain accessible on the Licensee Site and Related Media website terms of use (Terms of Use) and privacy policy (Privacy Policy) on which use of the Licensee Site and Related Media, including the Licensed Content, is expressly conditioned, and which in form and substance are reasonably acceptable to Licensor.   4.4 Content Hosting and Support; User Complaints. Throughout the Term, Licensee shall host, operate, maintain and make accessible to End Users the Licensed Content on the Licensee Site. The service level standards and procedures used by Licensee with respect to the Licensed Content, including but not limited to those regarding End User requests and communications, will be consistent with those it employs with respect to other content on the Licensee Site. Without limiting the foregoing, if Licensee receives any notice claiming that the Licensed Content infringes or otherwise violates any intellectual property or other third-party right, Licensee shall:   (a) immediately notify Licensor in writing (which may include e-mail), including such detail as is available and necessary for Licensor to evaluate and address such complaint; and   (b) fully cooperate with Licensor in addressing such claims.   5. Fees and Payment.   5.1 License Fees. In consideration of the licenses granted and other undertakings by Licensor hereunder, Licensee shall pay Licensor a License Fee in the amount of two hundred thousand dollars (US$200,000) (License Fee). The License Fee shall be due and payable as follows:   (a) US$50,000 upon signing the Memorandum of Understanding (MOU) between the Parties (provided, however, that Licensor hereby acknowledges receipt of this portion of the License Fee);   (b) US$50,000 upon signing of this Agreement; and   (c) US$100,000 upon on or before March 28, 2014.   The License Fees are non-cancellable and non-refundable.

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5.2 In addition to the License Fee payable in accordance with Section 5.1, Licensee shall pay a royalty (Royalty) to Licensor according to the following schedule (Royalty Schedule):   Subscribers Royalty Payable as Percentage of Gross Revenue 0 - 5000 6.25% 5001 - 7500 6.75% 7501 - 10,000 7.00% 10,001 - 15,000 8.00% 15,001 - 20,000 8.50% 20,001 - 25,000 9.25% 25,001+ 9.75%   5.3 Reports and Payment   (a) Not later than the fifteenth (15th) calendar day of each calendar quarter (or the first business day thereafter), Licensee shall deliver to Licensor (i) a report accurately showing Gross Revenues of the Licensee for the previous quarter, the number of Subscribers on the last day of such previous quarter and the amount of Royalties due thereon, and (ii) payment of the Royalties payable for such previous quarterbased on the Subscriber information as reflected in the report. All payments under this Agreement shall be made in US dollars.   (b) If Licensee fails to make any payment when due:   (i)Licensor shall have the right to terminate this Agreement and all licenses granted hereunder as provided in Section 6.2; and]   (ii)If any License Fees or Royalties are more than ten (10) days past due, Licensor may assess interest on the past due amount at the rate of one and a half percent (1.5%) per month or, if lower, the highest rate permitted under applicable Law.

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5.4 Taxes. All License Fees are exclusive of sales, use, value added, and similar taxes, which are the responsibility of Licensee. If Licensee is required under any applicable Law to withhold any amount from such payment, Licensee shall hold such funds in trust for Licensor and shall cooperate with Licensor in completing and filing all forms and other documents required for the release of the funds withheld for payment to Licensor.   5.5 Audit Right. During the Term and for five (5) years thereafter, Licensee shall maintain complete and accurate books and records regarding its business operations relevant to the calculation of License Fees and any other information required to be reported to Licensor under this Agreement. Licensee shall make such books and records, and appropriate personnel, available during normal business hours for audit by Licensor or its authorized representative; provided that Licensor shall:   (a) provide Licensee with reasonable prior notice of any audit;   (b) undertake an audit no more than once per calendar year, unless a prior audit has disclosed a balance due; and   (c) conduct or cause to be conducted such audit in a manner designed to minimize disruption of Licensee's normal business operations.   Licensor may take copies and abstracts of materials audited. Licensor will pay the cost of such audits unless an audit reveals a discrepancy in payment or reporting of five percent (5%) or more, in which case the Licensee shall reimburse the Licensor for the reasonable cost of the audit. Licensee shall immediately upon notice from Licensor pay Licensor the amount of any underpayment revealed by the audit, including interest calculated in accordance with Section 5.3(b)(ii), together with any reimbursement pursuant to the preceding sentence.

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  6. Term and Termination.   6.1 Term. The initial term of this Agreement commences as of the Effective Date and, unless terminated earlier pursuant to any express provision of this Agreement, shall continue until five (5) years following the Effective Date (the Initial Term). Thereafter, this Agreement shall renew automatically for one (1) additional three (3) year period (the Renewal Term and collectively, together with the Initial Term, the Term) unless either party provides the other with written notice of non-renewal at least ninety (90) days before the expiration of the Initial Term].   6.2 Termination.   (a) Either party may terminate this Agreement, effective upon written notice to the other party, if the other partymaterially breaches this Agreement, and such breach is incapable of cure or, if capable of cure, (i) fails to commence a plan of action approved by Licensor to cure such breach within thirty (30) days, or (ii) fails to cure such breach within ninety (90) days after receiving written notice thereof, in either case after receiving notice of the breach. Provided, however, that if the breach giving rise to the termination right under this Section 6.2is non-payment of License Fees or Royalties, the cure period shall be ten (10) days.   (b) Either party may terminate this Agreement by written notice to the other party if the other party: (i) becomes insolvent or admits its inability to pay its debts generally as they become due; (ii) becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully stayed within ten (10) business days or is not dismissed or vacated within sixty (60) days after filing; (iii) is dissolved or liquidated or takes any corporate action for such purpose; (iv) makes a general assignment for the benefit of creditors; or (v) has a receiver, trustee, custodian or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.   6.3 Effect of Expiration or Termination. Upon any expiration or termination of this Agreement:   (a) All licenses granted under this Agreement shall also terminate, and Licensee shall immediately delete from its systems and servers all Licensed Content, Licensor's Marks and any other materials provided by Licensor. Upon Licensor's written request, Licensee shall promptly provide Licensor with written certification of such deletion.   (b) Licensee shall promptly pay all unpaid License Fees that relate to the period prior to the effective date of expiration or termination.

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(c) If termination is by Licensor pursuant to Section 6.2(a), all License Fees that would have been payable through the end of the then- current Term had the Agreement not been terminated early shall become immediately due and payable.   (d) If termination is by Licensee pursuant to Section 6.2(a), Licensee shall be relieved of any obligation to pay License Fees that relate to the period after the effective date of termination.   (e) Each party shall (i) return to the other party all documents and tangible materials (and any copies) containing, reflecting, incorporating or based on the other party's Confidential Information, (ii) permanently erase all of the other party's Confidential Information from its computer systems and (iii) certify in writing to the other party that it has complied with the requirements of this Section 6.3(e).   6.4 Surviving Terms. The provisions set forth in the following Sections, and any other right or obligation of the parties in this Agreement that, by its nature, should survive termination or expiration of this Agreement, will survive any expiration or termination of this Agreement: Section 3.4, Section 5.5,Section 6.3, this Section 6.4, Section 7, Section 8, Section 9, Section 10 and Section 11.   7. Representations and Warranties.   7.1 Mutual Representations and Warranties. Each party represents and warrants to the other party that:   (a) it is duly organized, validly existing and in good standing as a corporation or other entity as represented herein under the laws and regulations of its jurisdiction of incorporation, organization or chartering;   (b) it has the full right, power and authority to enter into this Agreement, to grant the rights and licenses granted hereunder and to perform its obligations hereunder;   (c) the execution of this Agreement by its representative whose signature is set forth at the end hereof has been duly authorized by all necessary corporate action of the party; and   (d) when executed and delivered by such party, this Agreement will constitute the legal, valid and binding obligation of such party, enforceable against such party in accordance with its terms.

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7.2 DISCLAIMER. EXCEPT FOR THE EXPRESS WARRANTIES IN THIS AGREEMENT, (A) EACH PARTY HEREBY DISCLAIMS ANY WARRANTY, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, UNDER THIS AGREEMENT; AND (B) LICENSOR SPECIFICALLY DISCLAIMS ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON- INFRINGEMENT.   8. Indemnification.   8.1 By Licensor. Licensor shall indemnify, defend and hold harmless Licensee against all Losses arising out of or resulting from any claim, suit, action or proceeding (each, an Action) by an unaffiliated third party related to or arising out of a claim that the Licensed Content or Licensor's Marks, or Licensee's use thereof solely in compliance with this Agreement, infringes a copyright or trademark right of any third party registered in any country in the Territory. The foregoing obligation shall not apply to Losses for which Licensee is required to indemnify Licensor pursuant to Section 8.2.   8.2 By Licensee. Licensee shall indemnify, defend and hold harmless Licensor against all Losses arising out of or resulting from any Action by a third party related to or arising out of: (a) the Licensee Site or Related Media, including any material displayed or services provided thereon but excluding Licensed Content and Marks used in accordance with this Agreement; (b) Licensee's use of the Licensed Content and/or Licensor's Marks in a manner not permitted by this Agreement (including Licensee's continued use of any Content Item in violation of Section 4.1(d) or any of Licensor's Marks after Licensor has directed Licensee to cease using any such Marks; or (c) Licensee's failure to comply fully with Section 4.3.   8.3 Indemnification Procedure. The indemnified party shall promptly notify the indemnifying party in writing of any Action and cooperate with the indemnifying party at the indemnifying party's sole cost and expense. The indemnifying party shall not settle any Action in a manner that adversely affects the rights of the indemnified party without the indemnified party's prior written consent, which shall not be unreasonably withheld or delayed. The indemnified party may retain counsel of its choice to observe the proceedings at its own cost and expense.   9. LIMITATIONS OF LIABILITY.   9.1 No Consequential or Indirect Damages. NEITHER PARTY SHALL BE LIABLE UNDER OR IN CONNECTION WITH THIS AGREEMENT FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, LIQUIDATED, SPECIAL OR EXEMPLARY DAMAGES OR PENALTIES, INCLUDING WITHOUT LIMITATION, LOSSES OF BUSINESS, REVENUE OR ANTICIPATED PROFITS, REGARDLESS OF WHETHER SUCH DAMAGE WAS FORESEEABLE AND WHETHER LICENSOR HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

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9.2 Cap on Monetary Damages. EACH PARTY'S LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT WILL NOT EXCEED AN AMOUNT EQUAL TO THE AGGREGATE AMOUNTS PAID OR PAYABLE TO LICENSOR IN THE TWELVE (12) MONTHS PRECEDING THE COMMENCEMENT OF THE CLAIM.   9.3 Exceptions. The provisions of Section 9.1 and Section 9.2 will not apply to limit the Licensee's indemnification obligations under Section 8.2, or in the case of Licensee's gross negligence or wilful misconduct.   10. Confidentiality. Obligation of Confidentiality. Each party (the Recipient) acknowledges that in connection with this Agreement such party may gain access to Confidential Information of the other party (the Disclosing Party). As a condition to being furnished with Confidential Information, the Recipient agrees, during the Term and for five (5) years thereafter. Confidential Information excludes such information required to be disclosed pursuant to federal or state securities rules and regulations, including but not limited to, disclosure of the Company in their filings with the Securities and Exchange Commission: to   10.1    (a) not use the Disclosing Party's Confidential Information other than in connection with performing its obligations under this Agreement and shall make no use of any such Confidential Information, directly or indirectly, in any manner to the detriment of the Disclosing Party or in order to obtain any competitive benefit with respect to the Disclosing Party; and   (b) maintain the Disclosing Party's Confidential Information in confidence and, subject to Section 10.2 below, not disclose any of the Disclosing Party's Confidential Information without the Disclosing Party's prior written consent; provided, however, that Recipient may disclose the Disclosing Party's Confidential Information to its officers, employees, consultants and legal advisors (Representatives) who: (i) have a need to know for purposes of the Recipient's performance under this Agreement, (ii) have been apprised of this restriction; and (iii) are themselves bound by nondisclosure restrictions at least as restrictive as those set forth in this Section 0.   The Recipient shall be responsible for ensuring its Representatives' compliance with, and shall be liable for any breach by its Representatives, of this Section 10. The Receiving Party shall employ the same efforts it uses with respect to its own confidential information to safeguard the Disclosing Party's Confidential Information from use or disclosure to anyone other than as permitted hereby.

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10.2 Exceptions.   (a) Confidential Information does not include information of the Disclosing Party that:   (i)is already known to the Recipient without restriction on use or disclosure prior to receipt of such information from the Disclosing Party;   (ii)is or becomes generally known by the public other than by breach of this Agreement by, or other wrongful act of, the Recipient; or   (iii)is received by the Recipient from a third party who is not under any obligation to the Disclosing Party to maintain the confidentiality of such information.   (b) If the Recipient becomes legally compelled to disclose any of the Disclosing Party's Confidential Information, the Recipient shall:   (i)provide prompt written notice to the Disclosing Party notice so that the Disclosing Party may seek a protective order or other appropriate remedy or waive its rights under this Section 10; and   (ii)disclose only the portion of Confidential Information that it is legally required to furnish.   If a protective order or other remedy is not obtained, or the Disclosing Party waives compliance, the Recipient shall, at the Disclosing Party's expense, use reasonable efforts to obtain assurance that confidential treatment will be afforded the Confidential Information.

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11. Miscellaneous.   11.1 Further Assurances. Upon a party's reasonable request, the other party shall, at its sole cost and expense, promptly execute and deliver all such further documents and instruments, and take all such further actions, necessary to give full effect to the terms of this Agreement.   11.2 Relationship of the Parties. The relationship between the parties is that of independent contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever. Public Announcements. Neither party shall issue or release any announcement, statement, press release or other publicity or marketing materials relating to this Agreement or, unless expressly permitted under this Agreement, otherwise use the other party's Marks, in each case, without the prior written consent of the other party, which shall not be unreasonably withheld or delayed; except the provisions of this paragraph excludes such information required to be disclosed pursuant to federal or state securities rules and regulations, including but not limited to, disclosure of the Company in their filings with the Securities and Exchange Commission.   11.3 Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and addressed to the parties as follows (or as otherwise specified by a party in a notice given in accordance with this Section):

If to Licensor: Room 303, 3rd Floor, St. George's Building, 2 Ice House Street, Central, Hong Kong Facsimile: (852) 3526 0355 E-mail:angela@sg-cs.com Attention: Angela Jen If to Licensee: 100, 40 Lake Bellevue Dr, Bellevue, WA, 98005 Facsimile: [FAX NUMBER] E-mail: Peter@go-page.com Attention: Peter Schulhof, President



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    Notices sent in accordance with this Section shall be deemed effectively given: (a) when received, if delivered by hand (with written confirmation of receipt); (b) when received, if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail (in each case, with confirmation of transmission), if sent during normal business hours of the recipient, and on the next business day, if sent after normal business hours of the recipient; or (d) on the third business day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid.     11.4 Interpretation.   For purposes of this Agreement, (a) the words include, includes and including are deemed to be followed by the words without limitation; (b) the word or is not exclusive; (c) the words herein, hereof, hereby, hereto and hereunder refer to this Agreement as a whole; (d) words denoting the singular have a comparable meaning when used in the plural, and vice-versa; and (e) words denoting any gender include all genders. Unless the context otherwise requires, references in this Agreement: (x) to sections, exhibits, schedules, attachments and appendices mean the sections of, and exhibits, schedules, attachments and appendices attached to, this Agreement; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof; and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. The parties intend this Agreement to be construed without regard to any presumption or rule requiring construction or interpretation against the Party drafting an instrument or causing any instrument to be drafted. The exhibits, schedules, attachments and appendices referred to herein are an integral part of this Agreement to the same extent as if they were set forth verbatim herein.   11.5 Headings. The headings in this Agreement are for reference only and do not affect the interpretation of this Agreement.   11.6 Entire Agreement. This Agreement, together with the attached Schedules and any other documents incorporated herein by reference, constitutes the sole and entire agreement of the Parties with respect to the subject matter of this Agreement and supersedes all prior and contemporaneous understandings, agreements, representations and warranties, both written and oral, with respect to such subject matter.   11.7 Assignment. This Agreement is personal to Licensee. Licensee shall not assign or otherwise transfer any of its rights, or delegate or otherwise transfer any of its obligations or performance, under this Agreement, in each case whether voluntarily, involuntarily, by operation of law or otherwise, without Licensor's prior written consent. For purposes of the preceding sentence, and without limiting its generality, any merger, consolidation or reorganization involving Licensee (regardless of whether Licensee is a surviving or disappearing entity) will be deemed to be a transfer of rights, obligations or performance under this Agreement for which Licensor's prior written consent is required. No delegation or other transfer will relieve Licensee of any of its obligations or performance under this Agreement. Any purported assignment, delegation or transfer in violation of this Section 11.7 is void from the outset and shall be of no force or effect. Licensor may freely assign or otherwise transfer all or any of its rights, or delegate or otherwise transfer all or any of its obligations or performance, under this Agreement without Licensee's consent. This Agreement is binding upon and inures to the benefit of the parties hereto and their respective permitted successors and assigns.

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11.8 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Agreement.   11.9 Amendment and Modification; Waiver. No amendment to or modification of this Agreement is effective unless it is in writing and signed by an authorized representative of each party. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.   11.10 Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.   11.11 Governing Law; Submission to Jurisdiction. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Nevada without giving effect to any choice or conflict of law provision or rule.   11.12 Dispute Resolution. In the event of a dispute arising out of this Agreement, the parties shall first negotiate in good faith in an effort to reach a settlement of the dispute. If having negotiated in good faith, the parties are unable to resolve their dispute, the parties shall submit the dispute to binding arbitration by a single arbitrator. The arbitration shall be governed by the Commercial Rules of Arbitration of the American Arbitration Association. The arbitration shall take place at an agreed location, or if the parties cannot agree on a venue in Reno, Nevada or Vancouver, BC, as determined by the flip of a coin. The arbitrator shall have jurisdiction over the conduct of discovery prior to the hearing. Notwithstanding the foregoing, nothing in this Section 11.13 shall be construed to prohibit either party from seeking appropriate injunctive or other equitable relief in a court of competent jurisdiction.

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11.13 Attorneys' Fees. In the event that any action, suit, or other legal or administrative proceeding is instituted or commenced by either party hereto against the other party arising out of this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and court costs from the non-prevailing party.   11.14 Counterparts. This Agreement may be executed in counterparts, each of which is deemed an original, but all of which together are deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission is deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.  PSITech Corporation    By /s/Cameron Investments Limited   Name: Cameron Investments Limited Title: Director

 Empirical Ventures, Inc.    By /s/Peter Schulhof Name: Peter Schulhof Title: President



17

Source: GO-PAGE CORP, 10-K, 2/21/2014







  SCHEDULE 1   LICENSE SCOPE

    Display the Licensed Content on the Licensee Site to actual and prospective customers or End-Users located within Canada, the United States or Mexico engaged in any vertical market business except(i) the offer or brokering of vacation home rentals, and (ii) the offering or sale of any products or services using a Multi-level Marketing system.





18

Source: GO-PAGE CORP, 10-K, 2/21/2014







  SCHEDULE 2   LICENSED CONTENT     The Licensed Content consists of content and images and code.





19

Source: GO-PAGE CORP, 10-K, 2/21/2014







Source: GO-PAGE CORP, 10-K, 2/21/2014 
Question: Highlight the parts (if any) of this contract related to Cap On Liability that should be reviewed by a lawyer. Details: Does the contract include a cap on liability upon the breach of a party’s obligation? This includes time limitation for the counterparty to bring claims or maximum amount for recovery.

A: NEITHER PARTY SHALL BE LIABLE UNDER OR IN CONNECTION WITH THIS AGREEMENT FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, LIQUIDATED, SPECIAL OR EXEMPLARY DAMAGES OR PENALTIES, INCLUDING WITHOUT LIMITATION, LOSSES OF BUSINESS, REVENUE OR ANTICIPATED PROFITS, REGARDLESS OF WHETHER SUCH DAMAGE WAS FORESEEABLE AND WHETHER LICENSOR HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
****
Q: Exhibit 10.6

      OUTSOURCING AGREEMENT        dated as of , 2012        TWIN CITIES POWER HOLDINGS, LLC        and        REDWATER LLC

      $50,000,000.00        Renewable Unsecured Subordinated Notes





     TABLE OF CONTENTS                                                                                                               ARTICLE I DEFINITIONS    1            Section 1.01 Defined Terms    1





Section 1.02 Accounting Terms    4            ARTICLE II APPOINTMENT OF THE AGENT AND RELATED AGREEMENTS    5            Section 2.01 Appointment; Exclusivity    5   Section 2.02 Scope of Agency    5   Section 2.03 Compensation to the Contractor    6   Section 2.04 Brokers and Dealers    8   Section 2.05 The Contractor's Unrelated Activities    8   Section 2.06 Best Efforts; Independent Contractor    8   Section 2.07 Issuance and Payment    8            ARTICLE III SERVICES; STANDARD OF CARE    8            Section 3.01 Services for the Notes    8   Section 3.02 Maintenance of Files and Records    11   Section 3.03 Monthly Reports to the Company    12            ARTICLE IV REPRESENTATIONS AND COVENANTS OF THE COMPANY    13            Section 4.01 Representations, Warranties and Agreements of the Company    13   Section 4.02 Covenants of the Company    20            ARTICLE V REPRESENTATIONS AND COVENANTS OF THE AGENT; CONDITIONS    22            Section 5.01 Representations and Warranties of the Contractor    22   Section 5.02 Covenants of the Contractor    24            ARTICLE VI CONDITIONS    25            Section 6.01 Conditions of the Contractor's Obligations    25   Section 6.02 Conditions of the Company's Obligations    31            ARTICLE VII INDEMNIFICATION AND CONTRIBUTION    31







    Section 7.01 The Company's Indemnification of the Contractor    31   Section 7.02 The Contractor's Indemnification of the Company    32   Section 7.08 Intellectual Property Infringement    35   Section 7.09 Confidentiality    35            ARTICLE VIII TERM AND TERMINATION    36            Section 8.01 Effective Date of this Agreement    36   Section 8.02 Termination Prior to Initial Closing Date    36   Section 8.03 Notice of Termination    37   Section 8.04 Termination After Initial Closing Date    37   Section 8.05 Termination Without Termination of Offering    38            ARTICLE IX MISCELLANEOUS    38







   ii

                              Section 9.01 Survival    38   Section 9.02 Notices    38   Section 9.03 Successors and Assigns; Transfer    39   Section 9.04 Cumulative Remedies    39   Section 9.05 Attorneys' Fees    39   Section 9.06 Entire Agreement    39   Section 9.07 Choice of Law; Venue    39   Section 9.08 Rights to Investor Lists    39   Section 9.09 Waiver; Subsequent Modification    40   Section 9.10 Severability    40   Section 9.11 Joint Preparation    40   Section 9.12 Captions    40   Section 9.13 Counterparts    40   Section 9.14 Third Party Contractors    40





     OUTSOURCING AGREEMENT     This OUTSOURCING AGREEMENT is entered into as of this  day of , 2012 by and between Twin Cities Power Holdings, LLC, a  Minnesota limited liability company (the Company), and Redwater LLC, a Minnesota limited liability company (the Contractor).     RECITALS     WHEREAS, the Company has registered for public offer and sale an aggregate principal amount of $50,000,000.00 of renewable,  unsecured, subordinated notes of the Company; and     WHEREAS, subject to the termination rights set forth herein, the Company desires to retain the Contractor to perform certain ministerial  tasks on behalf of the Company, and Contractor desires to accept such duties, all as provided for by the terms of this Agreement.     NOW, THEREFORE, in consideration of the above and for other good and valuable consideration, receipt of which is acknowledged, and  in consideration of the mutual promises, covenants, representations and warranties hereinafter set forth, the parties hereto agree as follows:     ARTICLE I  DEFINITIONS     Section 1.01 Defined Terms. Whenever used in this Agreement, the following terms have the respective meanings set forth below. The  definitions of such terms are applicable to the singular as well as to the plural forms of such terms.     Accepted Note Practices. As applicable to the context in which this term is used, those procedures and practices with respect  to the servicing and administration of the Notes that satisfy the following: (i) the use of reasonable care; (ii) compliance with  all Governmental Rules; (iii) compliance with the provisions of this Agreement and the Indenture; and (iv) give due  consideration to the accepted standards of practice of prudent servicing firms that service or administer comparable programs  for publicly offered notes or securities and the reliance of the Company on the Contractor for the servicing and administration  of the Renewable Note Program.     Contractor. Redwater LLC, a Minnesota limited liability company, or its successors in interest or assigns, if approved by the  Company as provided in Sections 5.02(c) and 9.03, below.     Agreement. This Outsourcing Agreement, including any exhibits or attachments hereto, as originally executed, and as  amended or supplemented from time to time in accordance with the terms hereof.     Business Day. Any day other than (a) a Saturday or Sunday or (b) another day on which banking institutions in the the State  of Minnesota are authorized or obligated by law, executive order, or governmental decree to be closed.

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     Commission or SEC. The Securities and Exchange Commission.     Company. Twin Cities Power Generation, or its successors or assigns, if approved by Contractor as provided in Section 9.03,  below.     Due Period. The monthly, quarterly, semi-annual, or annual periods, or the full term of the Note if interest is due at maturity, for  which scheduled payments of interest will be paid on any Note.     Exchange Act. The Securities Exchange Act of 1934, as amended, and as hereafter amended, and the rules and regulations  thereunder.     Governmental Rules. Any law, rule, regulation, ordinance, order, code, interpretation, judgment, decree, policy, decision or  guideline of any governmental agency, court or authority.     Holder. The registered owner of any Note as it appears on the records of the Registrar, including any purchaser or any  subsequent transferee or other holder thereof.     Incorporated Documents. All documents that, on or at any time after the effective date of the Registration Statement, are  incorporated by reference therein, in the Prospectus, or in any amendment or supplement thereto.     Indenture. That certain Indenture dated on or about , 2012, by and between the Company and the Trustee with respect to the  Notes as the same may be amended or supplemented in accordance with its terms, and including a supplement dated , 2012.     Investor. Any person who purchases Notes or who contacts the Contractor expressing an interest in purchasing the Notes or  requesting information concerning the Notes.     Material Agreement. With respect to a person, any agreement, contract, joint venture, lease, commitment, guaranty or other  contractual arrangement or any bond, debenture, indenture, mortgage, deed of trust, loan or security agreement, note,  instrument or other evidence of indebtedness, which in the case of any of the foregoing is material to the business, assets,  operations, condition or prospects, financial or otherwise, of such person or which is material to the ability of such person to  perform its obligations under this Agreement.     FINRA. Financial Industry Regulatory Authority.     Note Confirmation. With respect to the issuance and ownership of the Notes in book-entry form, an appropriate written  confirmation of the issuance and ownership or transfer of ownership of a Note to a Holder, the format of which shall comply  with the provisions of the Indenture.     2





     Note Portfolio. The aggregate of individual Notes, as it exists from time to time, which, unless the context otherwise requires or  provides, determined by the principal balances of the outstanding Notes.     Notes. The renewable, unsecured, subordinated notes of the Company that are being offered and sold pursuant to the  Registration Statement and that have an aggregate principal amount up to $50,000,000 and such other terms as described in  the Prospectus, and any additional principal amount of the same or similar notes as may be registered from time to time  pursuant to the Registration Statement.     Offering. The offer and sale of the Notes in accordance with the terms and subject to the conditions set forth in the  Registration Statement.     Paying Agent. Bank, National Association or its successors or assigns, or such other paying agent with respect to the Notes  as may be subsequently appointed by the Company pursuant to the Indenture.     Paying Agent Agreement. That certain agreement by and between the Company and the Paying Agent relating to the  Company's engagement of the Paying Agent to act as the paying agent for the Notes.     Paying Agent Fees. All fees and expenses payable to the Paying Agent in accordance with the Paying Agent Agreement.     Proprietary Rights. All rights worldwide in and to copyrights, rights to register copyrights, trade secrets, inventions, patents,  patent rights, trademarks, trademark rights, confidential and proprietary information protected under contract or otherwise  under law, and other similar rights or interests in intellectual or industrial property.     Prospectus. The prospectus included in the Registration Statement at the time it was declared effective by the Commission, as  supplemented by all prospectus supplements (including interest rate supplements) related to the Notes that are filed with the  Commission pursuant to Rules 424(b) or (c) under the Securities Act. References to the Prospectus shall be deemed to refer to  and include the Incorporated Documents to the extent incorporated by reference therein.     Redemption Payment. The payment of principal plus any accrued and unpaid interest that is being made at the discretion of  the Company in accordance with the Indenture.     Registration Statement. That certain Registration Statement on Form S-1 (File No. - ) of the Company with respect to the Notes  filed with the Securities and Exchange Commission under the Securities Act on or about , 2012, as amended and declared  effective by the Commission, including the respective copies thereof filed with the Commission. References to the     3





     Registration Statement shall be deemed to refer to and include the Incorporated Documents to the extent incorporated by  reference therein.     Renewable Note Program. The marketing, administration, customer service and investor relations, registration of ownership,  reporting, payment, repurchase, redemption, renewal and related activities associated with the Notes.     Repurchase Payment. The payment of principal plus any accrued and unpaid interest, less any penalties upon the repurchase  of any Note, that is being made at the request of the Holder in accordance with the Indenture.     Scheduled Payment. For any Due Period and any Note, the amount of interest and/or principal indicated in such Note as  required to be paid by the Company under such Note for the Due Period and giving effect to any rescheduling or reduction of  payments in any insolvency or similar proceeding and any portion thereof.     Securities Act. The Securities Act of 1933, as amended, and as hereafter amended, and the rules and regulations thereunder.     Subscription Agreement. A subscription agreement entered into by a Person under which such Person has committed to  purchase certain Notes as identified thereby, in such form and substance as mutually agreed by the parties and as filed as an  exhibit to the Registration Statement.     Trust Account. The trust account established by the Trustee pursuant to the Indenture.     Trust Indenture Act. The Trust Indenture Act of 1939, as amended, and as hereafter amended, and the rules and regulations  thereunder.     Trustee. Bank, National Association, or its successors or assigns, or any replacement Trustee under the terms of the  Indenture.     Trustee's Fees. All fees and expenses payable to the Trustee in accordance with the Indenture.     Section 1.02 Accounting Terms. Unless otherwise specified in this Agreement, all accounting terms used in this Agreement shall be  interpreted, all accounting determinations under this Agreement shall be made, and all financial statements required to be delivered by any person  pursuant to this Agreement shall be prepared, in accordance with U.S. generally accepted accounting principles, as in effect from time to time and  as applied on a consistent basis. To the extent such principles do not apply to certain reports or accounting practices of the Contractor, the parties  will mutually agree on the accounting practices and assumptions.     4

   ARTICLE II  RETENTION OF THE CONTRACTOR AND RELATED AGREEMENTS     Section 2.01 Retention.  On the basis of the representations, warranties and agreements herein contained, and subject to the terms,  conditions and covenants set forth herein during the term of this Agreement, the Company retains the Contractor to perform the tasks specified  herein on behalf of the Company related to servicing of the Notes, in each case, under the Renewable Note Program upon the terms and conditions  set forth herein, including, without limitation, compliance and conformity with Accepted Note Practices and Governmental Rules, and the  Contractor agrees to use its best efforts perform such tasks until the later of the termination of the Offering or the sale of all of the Notes, or until  the termination of this Agreement, if earlier. In connection with the servicing of the Renewable Note Program, the Contractor will carry out the  duties provided for herein.     Section 2.02 Scope of Duties. In the performance of its duties hereunder, the Contractor shall have only such power and authority to take  action for purposes of servicing the Notes, under the Renewable Note Program that the Company, in its discretion, deems necessary or  appropriate, subject in all respects to compliance and conformity with Accepted Note Practices and Governmental Rules. Initial instructions of the  Company to the Contractor are set forth in Exhibit B to this Agreement, which Company may, in its discretion, amend and supplement from time to  time. In the performance of its duties hereunder, the Contractor shall (i) act as the agent of the Company in connection with the Renewable Note  Program; (ii) promptly forward to the Company all Subscription Agreements, notices or other documents received by it in connection with the  Renewable Note Program for the sole and exclusive use and benefit of the Company; and (iii) make dispositions of the items in clause (ii) only in  accordance with this Agreement or at the written direction of the Company. Except as set forth in this Agreement with respect to the Renewable  Note Program, the Contractor shall have no authority, express or implied, to act in any manner or by any means for or on behalf of the Company.     Section 2.03 Compensation to the Contractor.     (a) The Contractor's Fees. In consideration of the agreement of the Contractor to provide its services as set forth in this  Agreement, the Company will pay the Contractor the following amounts:     (i) a monthly service fee of $7.50 per note based on the maximum number of notes outstanding during the  month, subject to a monthly minimum of $2,500;     (ii) a fee for media services further described in Exhibit A equal to the 15% gross/net differential or the fee  equivalent thereof;     (iii) a fulfillment fee of $2.00 per investment kit mailed;     (iv) a fulfillment fee of $1.00 per address for each bonus offer or marketing postcard mailed, subject to a $10,000  maximum per project.     5









     (b) The Contractor's Expenses. Except as otherwise provided in this Agreement, each party shall bear all of its own expenses.  To the extent that the Company agrees herein to pay specified offering-related expenses such as all marketing and advertising costs,  the Company will pay or cause to be paid such expenses whether incurred prior or subsequent to the date of this Agreement     (c) Payment of Fees. On the first Business Day of each month, or as soon thereafter as practicable, the Contractor shall provide  the Company with a written invoice for the previous month's fees and expenses that are payable with respect to Notes issued up to the  last day of such month.. Such fees and expenses will be due and payable by the later of the fifteenth (15 ) day of every month or fifteen  (15) days after the date such invoice is received.     Section 2.04 Brokers and Dealers. At the discretion of the Company, the Company may, at no additional obligation or expense to the  Contractor, use the services of brokers or dealers who are members in good standing of FINRA in connection with the offer and sale of the Notes.  The Company may enter into agreements with any such broker or dealer to act as its agents for the sale of the Notes and shall be solely  responsible for the payment of any portion of the Contractor's compensation hereunder to such broker or dealer. The Contractor's administrative  services will apply to all notes sold by brokers or dealers and the Company will compensate the Contractor for such services in accordance with  Section 2.03.     Section 2.05 The Contractor's Unrelated Activities. The Company agrees that the Contractor may service renewable note programs for  other issuers during the course of the Offering, but such activities shall not prevent the Contractor from promptly and efficiently performing its  duties hereunder. The Contractor (and the Agency as defined in Section 3.01(b) below) may direct other issuers to advertise the securities of other  issuers on websites, in print, by radio, or by any other means and at such times as they may determine; provided, however, that any such  advertising which refers to the Notes shall not refer to, mention, or advertise any securities or notes of any other issuer, nor include any links to  any other issuer, renewable note program or offering. The Contractor shall have the right to advertise or otherwise disclose to unrelated  prospective issuers, at its own expense, its relationship with the Company, the services it provides in connection with the Notes and the amount of  money that it raised through the Offering and the performance of the Offering, subject to the Company's consent, which shall not be unreasonably  withheld.     Section 2.06 Independent Contractor. The Contractor shall have no obligation to purchase Notes for its own account. During the term of  this Agreement, all actions taken by the Contractor pursuant to this Agreement shall be in the capacity of an independent contractor, and in no  event shall the Contractor have any obligations under the Notes.     Section 2.07 Issuance and Payment. The Notes shall be issued pursuant to the Indenture and all Scheduled Payments, Redemption  Payments and Repurchase Payments shall be made by automated clearing house (i.e., ACH) remittance from the Trust Account by the Paying  Agent in accordance with the Paying Agent Agreement and the Indenture.     6

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     ARTICLE III  SERVICES; STANDARD OF CARE     Section 3.01 Services for the Notes. The services to be provided to the Company by the Contractor pursuant to and during the term of  this Agreement shall include the following:     (a) Marketing and Advertising. During the term of this Agreement, the Contractor shall develop and execute a direct response  marketing strategy for the Notes designed to meet the Company's capital goals in a timely manner, which shall be subject to the prior  approval of the Company. The Contractor shall also oversee designing and printing all marketing materials (subject to the prior  approval of the Company), in accordance with the Securities Act, including the applicable rules and regulations and any other  requirements of the SEC and any other Governmental Rules. The Contractor will provide the Company with media planning, media  buying, media production and media placement services related to the Offering. All ad placements and use of all marketing materials  shall be subject to the prior written approval of the Company. The Company will pay all marketing and advertising costs related to the  offering, including printing, postage, advertising and web site hosting.     (i) During the term of this Agreement, the Company hereby grants the Contractor a limited license to use the  Company's logo, corporate colors, trademarks, trade names, fonts, and other aspects of corporate identity in  advertisements and marketing materials related to the Notes and on the Contractor's website, subject to the Company's  prior written approval of the specific use of these items in writing in each instance (which shall not be unreasonably  withheld). The Contractor will not make use of the Company's logo, corporate colors, trademarks or trade names in any  manner that would reasonably be expected to disparage or damage such marks or the reputation of the Company or  diminish the Company's goodwill. It is expressly agreed that the Contractor is not acquiring any right, title or interest in  the Company's logo, corporate colors, trademarks, trade names or other intellectual property.     (b) Subscription, Sale and Ownership. During the term of this Agreement, the Contractor shall promptly forward to the  Company each Subscription Agreement for the Notes received from an Investor. The Company shall be responsible for determining  whether (i) such subscription shall be accepted, (ii) such agreement is complete and accurate in all material respects, including without  limitation the execution thereof by such Investor, (iii) such Investor timely remits the proper purchase price for the Notes in accordance  with the Subscription Agreement, and (iv) the principal amount, interest rate and term to maturity and any other material terms of the  Notes are verified for accuracy and completeness. Upon delivery by each Investor of a completed Subscription Agreement for Notes  and full payment of the principal amount of such Notes in accordance with the Investor's Subscription Agreement, and subject to the  acceptance of the Subscription Agreement by the Company, the Company shall promptly notify the Contractor and the Contractor shall  promptly (i) verify that the payment of the principal amount of such Investor's accepted subscription for the Notes     7





     is being remitted to the Company in accordance with the Subscription Agreement in an account established by the Company for such  purpose or in such other manner as may be directed by the Company from time to time, and (ii) remit to the Trustee electronic or hard  copies of all accepted Subscription Agreements and related records as may be reasonably requested by the Trustee, including without  limitation, a record of each deposit relating to the payment of the subscription amount of the Notes. Pursuant to the preceding  sentence, Notes shall be issued by the Contractor as the Company's Registrar in book-entry form only and the Contractor shall deliver  a Note Confirmation to each Holder with respect to such Holder's respective accepted Subscription Agreement and the receipt of full  payment for such Holder's Notes. In the event that the Company rejects a Subscription Agreement, the Contractor shall promptly  return the Subscription Agreement and the related subscription amount to the related Investor. The Company hereby appoints the  Contractor, and the Contractor hereby accepts such appointment, as its initial Registrar (as such term is defined in the Indenture) for  the Notes pursuant to the terms of the Indenture. For so long as the Contractor shall serve as the Registrar for the Notes, the  Contractor shall perform, in accordance with the terms of the Indenture, all of the duties and obligations of the Registrar under the  Indenture, including, without limitation, the obligation to maintain a book-entry registration and transfer system for the ownership of  the Notes in accordance with the terms of the Indenture.     (c) Investor Relations and Reporting. During the term of this Agreement the Contractor, in conjunction with the Trustee, shall perform  ministerial tasks included in the customer service and investor relations functions with respect to the Offering, as directed from time to time by the  Company, which may include, but not be limited to, handling inquiries from Investors in a manner consistent with Section 3.01(d), mailing  investment kits, delivering to each Investor the Prospectus and Subscription Agreement, and processing Subscription Agreements. The  Contractor shall to the best of its knowledge ensure that each person submitting a Subscription Agreement shall have received the Prospectus. An  Investor who visits the offering web site shall be deemed to have received the Prospectus, provided such person either delivers an Electronic  Delivery Consent Form with such Investors Subscription Agreement or certifies under penalties of perjury that he, she or it has received the  Prospectus.     (d) The Contractor shall forward to the Company written or telephonic questions by Investors and Holders relating to the Notes regarding  topics that are not addressed in the Prospectus or its supplements, including without limitation questions relating to the Company's finances and  business, the Company's performance and practices with regard to the Notes, and substantive matters regarding an investment in the Notes,  unless such questions can be answered solely by reference to the Company's SEC filings. Notwithstanding the foregoing, the Contractor may  respond to questions that are purely administrative or ministerial in nature. The Contractor shall also be responsible for recording changes in  Holders' addresses or accounts, preparing and issuing maturity and renewal notices, quarterly statements, newsletters, reports and analyses to  Holders and to the Company, directing the Paying Agent to make Scheduled Payments, Repurchase Payments and Redemption Payments to  Holders in a timely manner, and directing the Paying Agent to issue Form 1099INT's to Holders as required by law. In addition, the Contractor  shall provide the Trustee (and copy the Company) with management reports regarding the Notes as required under the Indenture.     8





     (e) Web Site Development. Subject to compliance and conformity with Accepted Note Practices by the Contractor, the Contractor (or a  third party service provider working at the Contractor's direction) shall assist the Company in developing a dedicated Internet web site separate  from the Company's corporate site to allow Investors to view online and download copies of the Offering documents (including the Prospectus  and Subscription Agreement) and marketing materials that are included in the investment kit or comparable information.     (f) Ownership of Web Pages. Any and all web pages used by Contractor in connection with the Offering (the Web Pages), and all  associated Proprietary Rights, shall be owned exclusively by the Company.     (g) Daily Payment Reports to Company. On each Business Day during the term of the Notes, the Contractor shall furnish daily reports to  the Company that detail and summarize the amount of cash that is required to pay interest and principal on the Notes.     Section 3.02 Maintenance of Files and Records. The Contractor shall establish and maintain at all times during the term of this  Agreement files and records (including, without limitation, computerized records) regarding the Notes and the Note Portfolio, with full and correct  entries of all transactions or modifications in a reasonably secure, up-to-date manner and in accordance with the following:     (a) Location. All Note and Note Portfolio files and records shall be stored and maintained at the Contractor's principal place of  business, or other location as designated by the Company. The Contractor shall keep in such files all correspondence received or sent  regarding each Note, each Investor, and each Holder, whether upon any purchase or transfer of a Note.     (b) Original Documents. The Contractor will store all original Subscription Agreements, Note Confirmations, correspondence  from Investors and Holders and other materials relating to the Renewable Note Program in a reasonably secure manner at the  Contractor's principal offices or such other location as may be designated by the Company. The Contractor shall exercise due care in  handling and delivering the original documents and the other documents in the Note files and records. The Contractor shall not grant  or allow any person an interest in original documents or rights thereunder, and all original documents in the possession of the  Contractor shall be deemed to be in the possession of the Company.     (c) Examination. At any time the Company and its agents and representatives may physically inspect any documents, files or  other records relating to the Renewable Note Program and discuss the same with the Contractor's officers and employees. The  Contractor shall supply copies of any such documents, files, or other records upon the request of the Company, as soon as is  reasonably and commercially practicable at the Company's cost and expense.     (d) Retention. Unless otherwise requested by the Company, or unless otherwise required by Governmental Rules, the  Contractor shall retain, with respect to     9





     each Note, for a period of 24 months from the date the Note is fully paid, all records, files and documents related to each such Note. At  the end of such 24-month period, unless otherwise directed by the Company, all such items shall be transferred to the Company, or to a  third party as designated by the Company, at the Company's sole cost and expense. The Contractor shall be permitted to retain copies  of any such documents for its own files for its own account and at its own expense. The Contractor shall maintain the privacy of the  Investors and Holders in accordance with all applicable Governmental Rules.     (e) Return. If this Agreement is terminated, or otherwise at the instruction of the Company, the Contractor shall promptly  deliver to the Company or its designee, as the case may be, all Note files and records (including, without limitation, copies of  computerized records and servicing and other software, except as may be prohibited by any third party contract or license) related to  the administration of the Notes and all monies collected by it relating to the Renewable Note Program (less any fees or expenses due to  the Contractor). The Contractor shall be entitled to make and keep copies of such records, at its cost and expense. In addition to  delivering such data and monies, the Contractor shall use its best efforts to effect the orderly and efficient transfer of the administration  of the Notes to the Company or other party designated by the Company to assume responsibility for such administration, including,  without limitation, directing Holders to remit all repurchase or other notices to the address designated by the Company. All costs of  conversion and transfer of such records to the Company or another agent shall be paid by the Company.     (f) Security. The parties shall take appropriate security measures to protect customer nonpublic personal information (NPI),  as defined in the Gramm-Leach-Bliley Act of 1999, Title V, and its implementing regulations, against accidental or unlawful destruction  and unauthorized access, tampering, and copying during storage in either party's computing or paper environment. Access to NPI  must be restricted to only the personnel that have a business need relating to the Renewable Note Program. NPI must be stored in a  secured format within all systems at both parties' location and any other locations where the data may reside. Transmission of such  NPI between the parties or vendors must be done in a secure manner, in a method mutually agreed upon by both parties. Each party will  engage appropriate and industry-standard measures necessary to meet information security guidelines as required by the Gramm- Leach-Bliley Act, Title V and its implementing regulations as applicable to such party to effectuate this Agreement.     Section 3.03 Information to the Company. As agreed by the parties, the Contractor shall make reports and analyses available to the  Company regarding the status of the Note Portfolio, the marketing results and the amount of Notes remaining available for issuance under the  Registration Statement. The Contractor shall also provide interim or custom reports at the Company's request as is commercially reasonable,  including, without limitation, a weekly update via email identifying new Holders by name, address and principal amount of Notes purchased. The  Contractor shall also furnish statements, reports and information to the Paying Agent to the extent that the Company is required to furnish or  cause to be furnished such statements, reports or information to the Paying Agent under the Paying Agent Agreement.     10





     ARTICLE IV  REPRESENTATIONS AND COVENANTS OF THE COMPANY     Section 4.01 Representations, Warranties and Agreements of the Company. The Company represents and warrants to and agrees with  the Contractor as follows, which representations and warranties shall be deemed to be made continuously from and as of the date hereof until this  Offering is terminated and all then outstanding Notes have been paid in full or such earlier date that this Agreement has been terminated, except  for those representations and warranties that address matters only as of a particular date, which representations and warranties shall be deemed to  be made as of such date.     (a) The Company satisfies all of the requirements for the use of Form S-1 with respect to the offer and sale of securities as  contemplated by the Offering. The Commission has not issued any order preventing or suspending the use of the Registration  Statement or Prospectus and no proceeding for that purpose has been instituted or, to the Company's knowledge, threatened by the  Commission or the securities authority of any state or other jurisdiction.     (b) The Company has full requisite power and authority to enter into this Agreement and perform the transactions  contemplated hereby. This Agreement has been duly authorized, executed and delivered by the Company and is a valid and binding  agreement on the part of the Company, enforceable against the Company in accordance with its terms subject to bankruptcy,  insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors'  rights and to general principles of equity. The performance of this Agreement and the consummation of the transactions herein  contemplated will not result in a breach or violation of any of the terms and provisions of, or constitute a default under:     (i) any Material Agreement to which the Company or any subsidiary is a party or by which the Company or  any subsidiary or their respective properties may be bound;     (ii) the articles of incorporation or bylaws of the Company, or     (iii) any applicable law, order, rule, regulation, writ, injunction, judgment or decree of any court, government or  governmental agency or body, domestic or foreign, having jurisdiction over the Company or any subsidiary or their  respective properties.     (c) No consent, approval, authorization or order of or qualification with any court, governmental agency or body, domestic or  foreign, having jurisdiction over the Company or over its properties is required for the execution and delivery of this Agreement and  the consummation by the Company of the transactions herein contemplated, except such as may be required under the Securities Act,  the Exchange Act, the Trust Indenture Act, or under state or other securities or blue sky laws, all of which requirements have been  satisfied.     11





     Section 4.02 Covenants of the Company. The Company hereby covenants and agrees with the Contractor as follows:     (a) The Company will notify the Contractor promptly of the time when the Registration Statement or any post-effective  amendment to the Registration Statement has become effective or any supplement to the Prospectus has been filed and of any request  by the Commission for any amendment or supplement to the Registration Statement or Prospectus or additional information. In the  event that the Company files any amendment or supplement to the Registration Statement or Prospectus to which the Contractor shall  reasonably object, the Contractor will be relieved of its obligations with respect to the Offering (but not the administration) of the Notes  until such time as the Company shall have filed such further amendments or supplements such that the Contractor is reasonably  satisfied with the Registration Statement and the Prospectus, as then amended or supplemented.     (b) The Company will advise the Contractor, promptly after it shall receive notice or obtain knowledge thereof, of the issuance  by the Commission of any stop order suspending the effectiveness of the Registration Statement, of the suspension of the qualification  of the Notes for offering or sale in any jurisdiction, or of the initiation or receipt of any specific threat of any proceeding for any such  purpose.     (c) The Company will furnish to the Contractor copies of the Registration Statement, the Prospectus, and all amendments and  supplements to such documents, in each case as soon as available and in such quantities as the Contractor may from time to time  reasonably request.     (d) For such period as this Agreement may be in effect, the Company shall make available to the Contractor, as soon as the  same shall be sent to its stockholders generally, copies of all annual or interim stockholder reports of the Company and will, for the  same period, also furnish the Contractor one copy of any report, application or document (other than exhibits, which, however, will be  furnished on the Contractor's request) filed by the Company with the Commission, The Nasdaq Stock Market or any other securities  exchange.     (e) At all times during the term of this Agreement, the Company shall provide all information reasonably requested by the  Contractor that relates to the Renewable Note Program in a timely manner and shall use its best efforts to insure that such information  is complete and accurate.     (f) The Company will, during the term of this Agreement, furnish directly to the Contractor quarterly profit and loss statements  and reports of the Company's cash flow as reported on the applicable quarterly report on Form 10-Q.     12

   ARTICLE V  REPRESENTATIONS AND COVENANTS OF THE CONTRACTOR; CONDITIONS     Section 5.01 Representations and Warranties of the Contractor. The Contractor hereby represents and warrants to the Company as  follows, which representations and warranties shall be deemed to be made continuously from and as of the date hereof until this Offering is  terminated or such earlier date that this Agreement has been terminated:     (a) The Contractor (i) has been duly organized, is validly existing and in good standing as a Minnesota limited liability  company, (ii) has qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the character of  its properties or the nature of its activities (including without limitation activities of the Contractor hereunder) makes such qualification  necessary, and (iii) has full power, authority and legal right to own its property, to carry on its business as presently conducted, and to  enter into and perform its obligations under this Agreement.     (b) The Contractor has full requisite power and authority to enter into this Agreement and perform the transactions  contemplated hereby. This Agreement has been duly authorized, executed and delivered by the Contractor and is a valid and binding  agreement on the part of the Contractor, enforceable against the Contractor in accordance with its terms subject to bankruptcy,  insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors'  rights and to general principles of equity. The performance of this Agreement and the consummation of the transactions herein  contemplated will not result in a breach or violation of any of the terms and provisions of, or constitute a default under:     (i) any Material Agreement to which the Contractor is a party or by which the Company or its properties may  be bound;     (ii) the articles of incorporation or bylaws of the Contractor, or     (iii) any applicable law, order, rule, regulation, writ, injunction, judgment or decree of any court, government or  governmental agency or body, domestic or foreign, having jurisdiction over the Contractor or over its properties.     (c) The Contractor has obtained all governmental consents, licenses, approvals and authorizations, registrations and  declarations which are necessary for the execution, delivery, performance, validity and enforceability of the Contractor's obligations  under this Agreement.     (d) The Contractor has operated and is operating in compliance with all authorizations, licenses, certificates, consents, permits,  approvals and orders of and from all state, federal and other governmental regulatory officials and bodies necessary to conduct its  business as contemplated by and described in this Agreement, all of which are, to the Contractor's knowledge, valid and in full force  and effect. The     13





     Contractor is conducting its business in compliance with all applicable Governmental Rules, laws, rules and regulations of the  jurisdictions in which it is conducting business, and the Contractor is not in violation of any applicable Governmental Rules, law, order,  rule, regulation, writ, injunction, judgment or decree of any court, government or governmental agency or body, domestic or foreign,  having jurisdiction over the Contractor or over its properties.     (e) The Contractor maintains insurance, which is in full force and effect, with insurers of recognized financial responsibility of  the types and in the amounts generally deemed adequate for its business and, to the best of the Contractor's knowledge, in line with  the insurance maintained by similar companies and businesses; and the Contractor has no reason to believe that it will not be able to  renew its existing insurance coverage as and when such coverage expires or obtain similar coverage from similar insurers as may be  necessary to continue its business at a cost that would not materially and adversely affect the financial condition or business  operations of the Contractor.     Section 5.02 Covenants of the Contractor. The Contractor hereby covenants to the Company as follows, which covenants shall be  deemed in force unless and until this Agreement is terminated as provided herein:     (a) The Contractor shall punctually perform and observe all of its obligations and agreements contained in this Agreement.     (b) The Contractor shall conduct its business in compliance with all applicable Governmental Rules, and its activities shall not  violate any governmental rules relating to the registration or the activities of securities brokers and dealers. To the extent that this  covenant to comply with all Governmental Rules conflicts with any other covenant contained in this Agreement, the covenant to  comply with all Governmental Rules shall control.     (c) Except as provided in this Agreement, the Contractor shall not take any action, or permit any action to be taken by others,  which would excuse any person from any of its covenants or obligations under any Note, or under any other instrument related to a  Note, or which would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or  effectiveness of, any Note or any such instrument or any right in favor of the Company in a Note or such instrument, without the  written consent of the Company.     (d) The Contractor shall not assign this Agreement or any of its rights, powers, duties or obligations hereunder without the  express prior written consent of the Company, which shall not be unreasonably withheld.     (e) At all times during the term of this Agreement, the Contractor shall provide all information relating to the Offering, the  Renewable Note Program or the Note Portfolio reasonably requested by the Company in a timely manner and shall use its best efforts  to insure that such information is complete and accurate in all material respects.     14





     (f) The Contractor shall take such additional action as is reasonably requested by the Company in order to carry out the  purposes of this Agreement. Such reasonable additional action includes, but is not limited to, cooperating with Company in verification  of Contractor's compliance, such as by providing copies of certificates of insurance and of other books and records of Contractor, and  by permitting inspection of the premises, books and records of Contractor.     ARTICLE VI  CONDITIONS     Section 6.01 Conditions of the Contractor's Obligations. The obligation of the Contractor to administer the Offering on a best efforts  basis as provided herein shall be subject to the accuracy of the representations and warranties of the Company, to the performance by the  Company of its obligations hereunder, and to the satisfaction of the following additional conditions:     (a) The Registration Statement shall be effective, and no stop order suspending the effectiveness thereof shall have been  issued and no proceedings for that purpose shall have been initiated or, to the knowledge of the Company, or the Contractor,  threatened by the Commission or any state securities commission or similar regulatory body. Any request of the Commission for  additional information (to be included in the Registration Statement or the Prospectus or otherwise) shall have been complied with to  the reasonable satisfaction of the Contractor and the Contractor's counsel.     (b) The Contractor shall not have advised the Company of its reasonable belief that the Registration Statement or Prospectus,  or any amendment thereof or supplement thereto, contains any untrue statement of a fact which is material or omits to state a fact which  is material and is required to be stated therein or is necessary to make the statements contained therein, in light of the circumstances  under which they were made, not misleading, or, if the Contractor has so advised the Company, the Company shall not have taken  reasonable action to investigate such belief and, where appropriate, amend the Registration Statement or supplement the Prospectus so  as to correct such statement or omission or effect such compliance.     (c) The Indenture shall have been duly authorized, executed and delivered by the Company and duly qualified under the Trust  Indenture Act.     (d) All corporate proceedings and other legal matters in connection with this Agreement, the form of Registration Statement  and the Prospectus, and the registration, authorization, issue, sale and delivery of the Notes shall have been reasonably satisfactory to  the Contractor's counsel, in all material respects, and the Contractor's counsel shall have been furnished with such papers and  information as it may reasonably have requested to enable it to pass upon the matters referred to in this Section.     15





     ARTICLE VII  INDEMNIFICATION AND CONTRIBUTION     Section 7.01 The Company's Indemnification of the Contractor. The provisions of Exhibit A hereto, entitled Responsibility of and  Indemnification by Agency are hereby incorporated herein by reference.     Section 7.02 The Contractor's Indemnification of the Company. The provisions of Exhibit A hereto, entitled Responsibility of and  Indemnification by Company are hereby incorporated herein by reference.     Section 7.03 Intellectual Property Infringement. The Contractor agrees that it shall defend, indemnify and hold harmless, at its own  expense, all suits and claims against the Company and any officers, directors, employees and affiliates of the Company (collectively, the Company  Indemnified Parties), for infringement or violation of any patent, trademark, copyright, trade secret or other intellectual property rights of any third  party that relates to this Agreement or the Offering, or servicing of the Notes. The Contractor agrees that it shall pay all sums, including without  limitation, reasonable attorneys' fees and other costs incurred by the Company, in defense of, by final judgment or decree, or in settlement of any  suit or claim asserted or assessed against, or incurred by, any of the Company Indemnified Parties on account of such infringement or violation,  provided that the Company Indemnified Parties involved shall cooperate in all reasonable respects with the Contractor and its attorneys in the  investigation, trial and defense of such lawsuit or action and any appeal arising therefrom; provided, however, that the Company Indemnified  Parties may, at their own cost, participate in the investigation, trial and defense of such lawsuit or action and any appeal arising therefrom. The  parties shall cooperate with each other in any notifications to insurers.     Section 7.04 Confidentiality. The parties to this Agreement acknowledge and agree that all information, whether oral or written,  concerning a disclosing party and its business operations, prospects and strategy, which is furnished by the disclosing party to the other party is  deemed to be confidential, restricted and proprietary to the disclosing party (the Proprietary Information). Proprietary Information supplied shall  not be disclosed, used or reproduced in any form except as required to accomplish the intent of, and in accordance with the terms of, this  Agreement and the Indenture. The receiving party shall provide the same care to avoid disclosure or unauthorized use of Proprietary Information  as it provides to protect its own proprietary information, including without limitation retaining Proprietary Information in a secure place with limited  access, but in no event shall the receiving party fail to use reasonable care under the circumstances to avoid disclosure or unauthorized use of  Proprietary Information. Unless otherwise specified in writing, all Proprietary Information shall (i) remain the property of the disclosing party, (ii) be  used by the receiving party only for the purpose for which it was intended under this Agreement and the Indenture, and (iii) together with all  copies of such information, be returned to the disclosing party or destroyed upon request of the disclosing party, and, in any event, upon  termination of this Agreement, except as otherwise provided or contemplated by this Agreement, including Sections 3.02(b) and (e) and 8.05  hereof. Proprietary Information does not include information which is: (a) published or included as disclosure within the Registration Statement or  otherwise available in the public domain through no fault of the receiving party; (b) lawfully received from a third party having rights in the  information without     16





     restriction of the third party's right to disseminate the information and without notice of any restriction against its further disclosure; or (c)  produced under order of a court of competent jurisdiction or other similar requirement of a governmental agency or authority, so long as the party  required to disclose the information provides the other party with prior notice of such order or requirement and its cooperation to the extent  reasonable in preserving its confidentiality. Because damages may be difficult to ascertain, and without limiting any other rights and remedies  specified herein, an injunction may be sought against the party who has breached or threatened to breach this Section.     ARTICLE VIII  TERM AND TERMINATION     Section 8.01 Effective Date of this Agreement. This Agreement shall become effective as of the date first set forth above, and shall  continue in full force and effect until terminated as provided below.     Section 8.02 Termination. The Company or the Contractor may terminate this Agreement at any time in whole or in part as more  specifically provided below, and in such case, the Contractor will be paid fees incurred up to the date of such termination plus its expenses  accrued as of such date within 30 days of such termination. The Company will have the ability to terminate this Agreement by giving 60 days' prior  written notice to the Contractor. The Contractor will have the ability to terminate this Agreement by giving 90 days' prior written notice to the  Company.     Section 8.03 Termination Without Termination of Offering. Anything to the contrary notwithstanding, the termination of this  Agreement shall not prevent the Company from commencing or cause the Company to terminate the Offering. In the event this Agreement is  terminated without a termination of the Offering, then the Company, or its agents, shall be entitled to use all materials developed by the Contractor  related to the Notes as provided elsewhere herein.     ARTICLE IX  MISCELLANEOUS     Section 9.01 Survival. The respective indemnity and contribution agreements of the Company and the Contractor set forth herein and the  respective representations, warranties, covenants and agreements of the Company and the Contractor set forth herein, shall remain operative and  in full force and effect, regardless of any investigation made by, or on behalf of, the Contractor, the Company, any of its officers and directors, or  any controlling person referred to in Article VII and shall survive the sale of the Notes and any termination or cancellation of this Agreement. Any  successor of any party or of any such controlling person, or any legal representative of such controlling person, as the case may be, shall be  entitled to the benefit of the respective indemnity and contribution agreements.     Section 9.02 Notices. All notices or communications hereunder, except as herein otherwise specifically provided, shall be in writing and  shall be mailed, delivered or transmitted by any standard form of telecommunication, as follows:     17







   Section 9.03 Successors and Assigns; Transfer. This Agreement shall inure to the benefit of and be binding upon the Contractor and  the Company and their respective successors and permitted assigns. Nothing expressed in this Agreement is intended or shall be construed to  give any person or corporation, other than the parties hereto, their respective successors and assigns, any legal or equitable right, remedy or claim  under, or in respect of, this Agreement or any provision herein contained; this Agreement and all conditions and provisions hereof being intended  to be and being for the sole and exclusive benefit of the parties hereto and their respective executors, administrators, successors, and for the  benefit of no other person or corporation. Neither party may assign its rights and obligations under this Agreement without the written consent of  the other party.     Section 9.04 Cumulative Remedies. Unless otherwise expressly provided herein, the remedies of the parties provided for herein shall be  cumulative and concurrent, and may be pursued singularly, successively or together, at the sole discretion of the party for whose benefit such  remedy is provided, and may be exercised as often as occasion therefor shall arise.     Section 9.05 Attorneys' Fees. In the event of any action to enforce or interpret this Agreement, the prevailing party shall be entitled to  recover reasonable attorneys' fees and costs, whether or not such action proceeds to judgment.     18

            If to the Contractor, to:



Redwater LLC   5400 Opportunity Court   Suite 160   Minneapolis, Minnesota 55343   Attention: K. Edward Elverud   Tel. (952) 345-3385                   If to the Company, to:



   Twin Cities Power Holdings, LLC   16233 Kenyon Avenue   Suite 210   Lakeville, Minnesota 55044      Attn: Chief Executive Officer      Tel. 952-431-0400                   with a copy to:



Leonard, Street and Deinard   150 South Fifth Street — Suite 2300   Minneapolis, Minnesota 55402      Attention: Mark S. Weitz      Tel. 612-335-1517





     Section 9.06 Entire Agreement. Except as otherwise expressly provided herein, this Agreement constitutes the entire agreement of the  parties hereto with respect to the matters addressed herein and supersedes all prior or contemporaneous contracts, promises, representations,  warranties and statements, whether written or oral (including, but not limited to, the Proposal), with respect to such matters.     Section 9.07 Choice of Law; Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of  Minnesota, without regard to conflict of law principles. Any dispute shall be heard in the courts of the state of Minnesota.     Section 9.08 Rights to Investor Lists. The parties acknowledge that the Offering will produce a list of investors that purchase Notes, a  list of prospects that respond to advertisements, but do not purchase any Notes, a list of former investors who redeemed their Notes, and a list of  former investors whose Notes the Company redeemed. Subject to any privacy laws, both the Company and the Contractor will be able to use these  lists for their own business purposes as long as doing so does not interfere with the marketing, sale or administration of the Notes.     Section 9.09 Waiver; Subsequent Modification. Except as expressly provided herein, no delay or omission by any party in insisting upon  the strict observance or performance of any provision of this Agreement, or in exercising any right or remedy, shall be construed as a waiver or  relinquishment of such provision, nor shall it impair such right or remedy, and no waiver by any party or any failure or refusal of the other party to  comply with its obligations under this Agreement shall be deemed a waiver of any other or subsequent failure or refusal to so comply by such  other party. No waiver or modification of the terms hereof shall be valid unless in writing and signed by the party to be charged, and then only to  the extent therein set forth.     Section 9.10 Severability. If any term or provision of this Agreement or application thereof to any person or circumstance shall, to any  extent, be found by a court of competent jurisdiction to be invalid or unenforceable, the remainder of this Agreement, or the application of such  term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby and  each term or provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law.     Section 9.11 Joint Preparation. The preparation of this Agreement has been a joint effort of the parties and the resulting document shall  not, solely as a matter of judicial construction, be construed more severely against one of the parties than the other.     Section 9.12 Captions. The title of this Agreement and the headings of the various articles, section and subsections have been inserted  only for the purpose of convenience, are not part of this Agreement and shall not be deemed in any manner to modify, explain, expand or restrict  any of the provisions of this Agreement.     Section 9.13 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original,  but all of which together shall constitute one instrument.     Section 9.14 Third Party Contractors. In the event that the Company engages a third party to perform any of the obligations of the  Contractor under this Agreement, the Company      19





     shall provide written notice to the Contractor of such engagement, the Contractor shall thereafter be relieved of any such obligations for which the  third party was engaged.     [Remainder of page intentionally left blank]     20





     IN WITNESS WHEREOF, this Outsourcing Agreement is hereby entered into by the undersigned parties as of the date first set forth  above.

   21

Exhibit A    Media Services     The following describes the advisory services to be provided by Redwater LLC (Contractor) to Twin Cities Power Generation (Company) in  connection with the administration of Company's renewable, unsecured, subordinated notes (the Notes), as more specifically defined in, and  pursuant to the terms of, the Outsourcing Agreement to which this description is an exhibit.     1. Agent Services.     Agent will perform the following services for Company:     · Acting on the study, analysis and knowledge of the product described above, formulate and recommend a media plan to the  Company and coordinate the execution of such a plan as directed by the Company.     · Check and verify insertions, displays, broadcasts or other means used.     · Audit invoices for space and time and other marketing services performed on Company's behalf.     · Coordinate creative and copy development, direct mail services, literature fulfillment, commercial printing, list management, list  brokering, efficiency analysis and other similar activities.     2. General Provisions.

                                 TWIN CITIES POWER HOLDINGS, LLC                                        By:

          Name:

          Title:



                    REDWATER LLC.                                        By:

          Name:     K. Edward Elverud          Title:     Manager





     Approval of Expenditures: Contractor agrees to secure Company's written approval of all expenditures in connection with Company's  plans.     Cancellation of Plans: Company reserves the right to modify, reject, cancel or stop any and all plans, schedules or work in progress. In  such event Contractor shall take reasonable steps to carry out Company's instructions as promptly as practicable. Company agrees to assume  liability for all commitments made by Contractor on its behalf, and to reimburse Contractor for any losses (including cancellation penalties) that  Contractor may sustain derived therefrom and for all expenses incurred in connection with Company approved plans on its authorization, and to  pay Contractor any service charges relating thereto, in accordance with the provisions hereof.     Failure of Suppliers to Perform: Contractor will endeavor to the best of its knowledge and ability guard against any loss to Company  through failure of media or suppliers to properly execute their commitments, but shall not be held responsible for any failure on their part.     Confidentiality: Contractor acknowledges its responsibility to use all reasonable efforts to preserve the confidentiality of any proprietary  or confidential information or data developed by Contractor on behalf of Company or disclosed by Company to Contractor.     22





     Responsibility of and Indemnification by Agency: Contractor agrees to indemnify and hold Company, its officers, directors, agents and  employees harmless from and against any claims, liabilities, losses, costs, expenses, or the like, including reasonable attorneys' fees, incurred in  respect to any material breach by Contractor hereof or Contractor's negligence and/or intentional wrongdoing in connection with the services.     Responsibility of and Indemnification by Company: Company agrees to indemnify and hold Contractor, its officers, managers, directors,  agents and employees harmless from and against any claims, liabilities, losses, costs, expenses, or the like, including reasonable attorneys' fees,  incurred in respect to any material breach by Company of this Agreement or Company's negligence and/or intentional wrongdoing in connection  with the services. Company shall be responsible for the accuracy, completeness and propriety of information concerning its products and services  that it furnishes to Contractor in connection with the performance of the services.     3. Expenses and Fees.     · Company agrees to pay or prepay advertising, graphic design and printing expenses either directly to the respective vendors or to  the Contractor as required. The Company will pay the Contractor the difference between the published gross rates and the net  rates for all advertisements, graphic design services or printing services or an equivalent mark-up. All Contractor fees will be  subject to the approval of the Company.     · Refunds: Contractor shall refund or credit Company any other refunds received in connection with advertisements.     · Other Marketing Expenses. Subject to its prior approval, the Company agrees to pay Contractor for all reasonable out of pocket,  non-media charge marketing expenses related to the development and production of all direct marketing and promotional  materials.     5. Termination.     · Period of Services: The services described herein to be provided by Agency shall begin upon execution and delivery of the  Outsourcing Agreement and shall continue until termination of Contractor's activities to administer the Notes thereunder.     · Payment for Purchases and Work Done: Any materials, services, etc. Contractor has committed to purchase for Company's  account, or with Company's approval (or any uncompleted work previously approved by Company either specifically or as part  of a plan) prior to termination of the Services shall be paid for by Company in accordance with the provisions of this Agreement.     23





  Exhibit B   Service Standards     Initial Instructions of Company to Contractor pursuant to that certain Outsourcing Agreement dated as of , 2012, between Twin Cities Power  Holdings, LLC and Redwater LLC.     Geographical Limitations. Contractor shall not communicate with Investors resident in any state that is identified in the then-current Prospectus as  a state in which the Notes are not offered, other than to communicate, in substance, that the Notes are not offered to persons resident in such  states. The initial list of such states is as follows, but the Company may, in its discretion, amend such list by filing an amended Prospectus or a  supplement to Prospectus:     . [TBD]     24 
Question: Highlight the parts (if any) of this contract related to Third Party Beneficiary that should be reviewed by a lawyer. Details: Is there a non-contracting party who is a beneficiary to some or all of the clauses in the contract and therefore can enforce its rights against a contracting party?

A: Any  successor of any party or of any such controlling person, or any legal representative of such controlling person, as the case may be, shall be  entitled to the benefit of the respective indemnity and contribution agreements.
****
Q: [ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.   Exhibit 10.11      COLLABORATION AGREEMENT

BY AND BETWEEN

ASTELLAS PHARMA INC.

AND

FIBROGEN, INC.      June 1, 2005





CONFIDENTIAL   EXECUTION COPY   TABLE OF CONTENTS   ARTICLE 1 DEFINITIONS     1

1.1   Actions     1  1.2   Affiliate     1  1.3   Astellas Indemnitees     1  1.4   Astellas Territory     1  1.5   Authorized Designee     1  1.6   Bridging Strategy     1  1.7   Bulk Product     2  1.8   Commercialize     2  1.9   Completion     2  1.10   Confidential Information     2  1.11   Control or Controlled     2  1.12   Controlling Party     2  1.13   Data     2  1.14   Delivery or Delivered     2  1.15   Development Plan     2  1.16   Development Program     2  1.17   Enforcement Action     2  1.18   Event     2  1.19   Expanded Field     2  1.20   Expenses     2  1.21   FDA     2  1.22   FG Acquired Patents     3  1.23   FG Development Program     3  1.24   FG Indemnitees     3  1.25   FG Technology     3  1.26   FG Patents     3  1.27   FG Technical Information     3  1.28   FG Territory     3  1.29   Field     4  1.30   First Commercial Sale     4  1.31   Force Majeure Event     4  1.32   Fully Burdened Costs     4  1.33   Future Third Party Intellectual Property     4  1.34   GMP Guidelines     4  1.35   [ * ]     4  1.36   [ * ] Percentage     5  1.37   HIF     5    -i-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





TABLE OF CONTENTS (continued)           Page   1.38   IND     5  1.39   Indemnitee     5  1.40   Indemnitor     5  1.41   Indications     5  1.42   Initial Development Plan     5  1.43   Initiate or Initiation     5  1.44   Inspected Party and Inspecting Party     5  1.45   Joint Development Committee or JDC     5  1.46   Lead Compound     5  1.47   Listed Price     5  1.48   Litigation Agreement     5  1.49   Major Indication     6  1.50   Marketing Approval     6  1.51   Marketing Approval Application or MAA     6  1.52   Net Sales     6  1.53   Phase I     6  1.54   Phase II     6  1.55   Phase III     6  1.56   Product Specification     7  1.57   Preexisting Third Party Intellectual Property     7  1.58   Proof of Concept     7  1.59   Prosecution and Interference Activities     7  1.60   Protected Field     7  1.61   Reference Materials     7  1.62   Relevant Standards     7  1.63   Sales Price     7  1.64   Standard Materials     7  1.65   Sublicensee     8  1.66   Technical Product Failure     8  1.67   Third Party Agreements     8  1.68   Third Party Licensor     8

ARTICLE 2 JOINT DEVELOPMENT COMMITTEE     8

2.1   Joint Development Committee     8  2.2   Membership     8  2.3   JDC Meetings     8  2.4   Decisions     9

ARTICLE 3 DEVELOPMENT PLANS     9

3.1   General     9  3.2   Annual Review     9  3.3   Periodic Reviews     9

ARTICLE 4 DEVELOPMENT PROGRAM     10

4.1   Development Program for the Astellas Territory     10    -ii-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





TABLE OF CONTENTS (continued)           Page  4.2   Global Harmonization     10  4.3   Selection of Lead Compounds     10  4.4   Regulatory Matters     11

ARTICLE 5 RECORDKEEPING; PUBLICATION     13

5.1   Reports and Records     13  5.2   Review of Publications     14

ARTICLE 6 DEVELOPMENT PROGRAM FUNDING     15

6.1   Payments for Reimbursement; Net Payments     15

ARTICLE 7 USE OF PRECLINICAL AND CLINICAL DATA     17

7.1   Exchange     17  7.2   Disclosure     18  7.3   Regulatory Requirements     18  7.4   Review of Protocols     18

ARTICLE 8 MARKETING RIGHTS     19

8.1   Astellas     19  8.2   FibroGen     19  8.3   Covenants     19

ARTICLE 9 TRANSFER PRICING     20

9.1   Transfer for Non-Commercial Purpose     20  9.2   Transfer for Commercial Purpose     21  9.3   Payment     22  9.4   Reference Materials; Standard Materials     22

ARTICLE 10 ADDITIONAL PAYMENTS; BOOKS AND RECORDS     22

10.1   Quarterly Reports     22  10.2   Payment Method     22  10.3   Currency Conversion     23  10.4   Taxes     23  10.5   Records; Inspections     24

ARTICLE 11 DUE DILIGENCE     24

11.1   Astellas' Due Diligence     24  11.2   FG's Due Diligence     24  11.3   Development Diligence     25

ARTICLE 12 MANUFACTURING RIGHTS     26

12.1   Procedures     26  12.2   FG Right     27  12.3   Manufacture and Supply     27  12.4   Product Specifications     27  12.5   Orders Forecast     27    -iii-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





TABLE OF CONTENTS (continued)           Page   12.6   Shipment     28  12.7   Inspection of Shipment/Right to Reject     28  12.8   Inspection of Facilities     28  12.9   Recall     29  12.10   Warranty     29  12.11   Interruption in Supply     29  12.12   Reference and Standard Materials     29

ARTICLE 13 LICENSE GRANTS     29

13.1   Grant to Astellas     29  13.2   Sublicenses     29  13.3   No Rights Beyond Lead Compounds     30  13.4   Expanded Field Negotiation     30

ARTICLE 14 INTELLECTUAL PROPERTY     30

14.1   Ownership of Inventions     30  14.2   Patent Prosecution     31  14.3   Defense of Third Party Infringement Claims     31  14.4   Enforcement     32  14.5   Third Party Agreements     33

ARTICLE 15 REPRESENTATIONS AND WARRANTIES     34

15.1   FG Warranties     34  15.2   Astellas Warranties     34  15.3   Disclaimer of Warranties     34

ARTICLE 16 CONFIDENTIALITY     35

16.1   Confidential Information     35  16.2   Permitted Disclosures     35  16.3   Clinical Data     36  16.4   Press Releases     36

ARTICLE 17 INSURANCE; INDEMNIFICATION     36

17.1   Insurance     36  17.2   Indemnification of FG     36  17.3   Indemnification of Astellas     37  17.4   Procedure     37

ARTICLE 18 TERM AND TERMINATION     37

18.1   Term     37  18.2   Termination for Cause or Technical Product Failure     37  18.3   Termination in case of Generic Competition     38  18.4   Negative Advice from Authorities     39  18.5   Admission of Invalidity or Unenforceability of FG Patent     39  18.6   Termination upon Notice     39    -iv-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





TABLE OF CONTENTS (continued)           Page   18.7   Effect of Termination     39

ARTICLE 19 DISPUTE RESOLUTION     40

19.1   Disputes     40  19.2   Full Arbitration     40

ARTICLE 20 MISCELLANEOUS     41

20.1   Confidential Terms     41  20.2   Governing Law     41  20.3   Force Majeure     41  20.4   No Implied Waivers; Rights Cumulative     42  20.5   Independent Contractors     42  20.6   Notices     42  20.7   Assignment     43  20.8   Modification     43  20.9   Severability     43  20.10   Counterparts     43  20.11   Headings     43  20.12   Export Laws     43  20.13   Language     43  20.14   Entire Agreement     43

EXHIBIT A LIST OF PATENTS     45

EXHIBIT B INDICATIONS     46

EXHIBIT C INITIAL DEVELOPMENT PLAN     47    -v-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   COLLABORATION AGREEMENT

This COLLABORATION AGREEMENT (Agreement), effective as of June 1, 2005 (the Effective Date), is made by and between FibroGen, Inc., a Delaware corporation having offices at 225 Gateway Boulevard, South San Francisco, California 94080 (FG or FibroGen), and Astellas Pharma Inc., a Japanese corporation having offices at 3-11 Nihonbashi-Honcho, 2-Chome, Chuo-ku, Tokyo, 103-8411 Japan (Astellas).

BACKGROUND

A. FG has a research and development program focused on the development of small molecule prolyl hydroxylase inhibitors which stabilize hypoxia inducible factor (HIF), for the treatment of anemia.

B. Astellas desires to collaborate with FG on the development and commercialization of, and license the rights to use as therapeutics, certain small molecule prolyl hydroxylase inhibitors on the terms and conditions set forth below for use in the Astellas Territory (as defined below).

NOW THEREFORE, for and in consideration of the covenants, conditions, and undertakings hereinafter set forth, it is agreed by and between the parties as follows:

ARTICLE 1 DEFINITIONS

1.1 Actions shall have the meaning as set forth in Section 14.3 below.

1.2 Affiliate shall mean any entity which controls, is controlled by or is under common control with Astellas or FG. For purposes of this definition only, control shall mean beneficial ownership (direct or indirect) of at least fifty percent (50%) of the shares of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority).

1.3 Astellas Indemnitees shall have the meaning as set forth in Section 17.3 below.

1.4 Astellas Territory shall mean the country of Japan.

1.5 Authorized Designee shall mean an officer of FG or Astellas, as the case may be, designated by the Chief Executive Officer of the respective corporation, that has been granted full authority to resolve a dispute arising between FG and Astellas as required under Section 2.4 or Section 19.1 hereof.

1.6 Bridging Strategy shall mean the decision by Astellas to file an MAA in the Astellas Territory by submitting the data from the Phase III clinical trial of FG or its Affiliate or Sublicensee.   -1-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.7 Bulk Product shall mean a Lead Compound supplied by FG to Astellas as a bulk formulated drug (such as in a form, including, but not limited, to a capsule, tablet or caplet formulation) without packaging.

1.8 Commercialize shall mean directly or indirectly develop, manufacture, sell, market or distribute.

1.9 Completion shall be deemed to occur, with respect to a particular clinical trial for a Lead Compound, upon clinical database lock for such trial.

1.10 Confidential Information shall have the meaning as set forth in Section 16.1 below.

1.11 Control or Controlled shall mean possession of the ability to grant a license or sublicense as provided for herein without violating the terms of an agreement with a third party.

1.12 Controlling Party shall have the meaning as set forth in Section 14.3 below.

1.13 Data shall have the meaning as set forth in Section 7.1 below.

1.14 Delivery or Delivered shall mean when Lead Compound is made available by FG to Astellas at the Ex Works location.

1.15 Development Plan shall mean the plan for the Development Program in effect from time to time, as established in accordance with Article 3 below.

1.16 Development Program shall mean all Astellas activities with respect to the development and commercialization of Lead Compounds for applications within the Field in the Astellas Territory, in accordance with the Development Plan in effect at that time.

1.17 Enforcement Action shall have the meaning as set forth in Section 14.4 below.

1.18 Event shall have the meaning as set forth in Article 6 below.

1.19 Expanded Field shall mean the treatment of any indications in which therapeutic utility is derived from [ * ], including, without limitation, [ * ]. The Expanded Field shall not include the Field.

1.20 Expenses shall have the meaning as set forth in Section 14.3 below.

1.21 FDA shall mean the U.S. Food and Drug Administration, or any successor agency.   -2-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.22 FG Acquired Patents shall mean those FG Patents that are in-licensed or otherwise acquired by FG.

1.23 FG Development Program shall mean those activities by or on behalf of FG directly related to the development and commercialization of Lead Compounds for applications within the Field in the FG Territory that are directly useful or necessary for Commercialization in the Astellas Territory.

1.24 FG Indemnitees shall have the meaning as set forth in Section 17.2 below.

1.25 FG Technology shall mean FG Patents and FG Technical Information.

1.26 FG Patents shall mean all patents including all reissues, renewals, re-examinations and extensions thereof, and any patent applications therefor, including all divisionals or continuations, in whole or in part, thereof, which claim or otherwise cover the composition, manufacture, sale or use of a Lead Compound and that are Controlled by FG or its Affiliates during the term of this Agreement, subject to Section 14.5.1. For purposes of this definition, a patent or patent application shall be deemed to cover a Lead Compound if the manufacture, use or sale of such Lead Compound would, but for the license granted herein, infringe, contributorily infringe or constitute inducement to infringement of such patent or patent application, if issued or granted as pending. All patents and patent applications listed on Exhibit A, as revised from time to time to remove patents and/or patent applications by mutual agreement or to add patents and/or patent applications by FG, shall be within the scope of definition of the FG Patents, provided, however, that in the event FG designates any additional Lead Compounds, FG shall add to the list on Exhibit A patents and patent applications which claim or otherwise cover the composition, or manufacture, sale or use of the additional Lead Compounds within the Field and the Astellas Territory, and upon the cessation of the designation as any compound as Lead Compound and Astellas' cessation of development of such Lead Compound, FG shall remove at its sole discretion the related patent or patent application from Exhibit A.

1.27 FG Technical Information shall mean confidential information, tangible and intangible, and materials, including, but not limited to: trade secrets and know how, pharmaceutical, chemical, biological and biochemical compositions; and technical and non-technical data and information, and/or the results of tests, assays, methods and processes; and plans, specifications and/or other documents containing said information and data; in each case that is possessed by FG as of the Effective Date or discovered, developed or Controlled by FG or its Affiliates during the term of this Agreement, to the extent such relates to the development, manufacture, sale or use of a Lead Compound subject to Section 14.5.1, and such information related to a candidate for use as a Lead Compound provided by FG to Astellas in connection with the Lead Compound selection decision consultation process described in Section 4.3.

1.28 FG Territory shall mean all areas of the world outside of the Astellas Territory.   -3-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.29 Field shall mean the treatment of anemia solely in the Indications, by means of the stabilization of HIF causing the stimulation of erythropoiesis (including an increase in endogenous erythropoietin production) and/or a subsequent increase in hematocrit through modulation of prolyl hydroxylase and/or asparaginyl hydroxylase. For purposes of clarity, FG and Astellas agree and acknowledge that the Field and the Indications exclude [ * ].

1.30 First Commercial Sale shall mean, with respect to each Lead Compound, the first bona fide commercial sale of such Lead Compound to a non-Affiliate third party by or under authority of Astellas or FG, or their Affiliates or Sublicensees, as the case may be, in the FG Territory or the Astellas Territory, respectively.

1.31 Force Majeure Event shall mean the occurrence of any event causing a failure to perform where failure to perform is beyond the reasonable control of the non-performing party, as described in Section 20.3.

1.32 Fully Burdened Costs with respect to a Lead Compound shall mean all costs to produce, package and distribute the product to Astellas or its carrier at the Ex Works location (in compliance with Section 12.6) and any royalties or other consideration (not reimbursed by Astellas) paid to third parties related to the acquisition or sale of product, with costs to produce and package the product to include the direct material, labor and indirect costs that are incurred by FG or its Affiliate(s) associated with the manufacture, filling, packaging, labeling, preparation of product for shipment and/or other preparation of such Lead Compound, as applicable, including, but not limited to taxes, fees, and customs incurred, as applicable. Costs will be determined in accordance with U.S. Generally Accepted Accounting Principles (U.S. GAAP) and will include but not be limited to the costs of facilities, labor, purchasing, depreciation of equipment, materials, payments to third parties for any necessary contract work related to the manufacture or testing of the product, the validation studies, quality assurance, quality control and other testing, storage, shipping (if requested by Astellas), costs related to distribution and a reasonable allocation of general and administrative overhead. Costs related to distribution include the labor, materials and overhead necessary to prepare and package the final product for shipment to the Ex Works location.

1.33 Future Third Party Intellectual Property shall mean any intellectual property rights, including without limitation all patents, trademarks, or copyrights, and any applications therefor, including any applications for registration, issuance, or grant thereof, owned or Controlled by a third party that are necessary for the practice of the license granted hereunder that were not owned or Controlled by FG as of the Effective Date and that do not qualify as Pre-existing Third Party Intellectual Property under Section 1.56.

1.34 GMP Guidelines shall mean then-current applicable Good Manufacturing Practices guidelines and regulations of the FDA.

1.35 [ * ] shall have the meaning as set forth in Section 1.36 below.   -4-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.36 [ * ] Percentage shall be determined, for any Lead Compound, (i) by dividing (a) the [ * ], which shall be defined as the difference between (x) the [ * ], and (y) the [ * ], by (b) the [ * ]; and (ii) multiplying the result of (i) above by 100.

1.37 HIF shall mean hypoxia inducible factor.

1.38 IND shall mean an Investigational New Drug application, as defined in the U.S. Federal Food, Drug and Cosmetic Act and the regulations promulgated thereunder, or comparable filing in a foreign jurisdiction, in each case with respect to a Lead Compound for use within the Field.

1.39 Indemnitee shall have the meaning as set forth in Section 17.4 below.

1.40 Indemnitor shall have the meaning as set forth in Section 17.4 below.

1.41 Indications shall mean those indications listed on Exhibit B and any other indications to be agreed upon hereafter between FG and Astellas, each of which shall be referred to as an Indication.

1.42 Initial Development Plan shall mean the Initial Development Plan as described in Section 3.2.1 hereof.

1.43 Initiate or Initiation shall mean with respect to a particular clinical trial for a Lead Compound, the initial dosing of the first patient in such trial in accordance with the protocol therefor.

1.44 Inspected Party and Inspecting Party shall have the meanings as set forth in Section 10.5 below.

1.45 Joint Development Committee or JDC shall have the meaning as set forth in Section 2.1 below.

1.46 Lead Compound shall mean any compound Controlled by FG that is designated by FG as a lead compound for clinical development in an Indication in accordance with Section 4.3 for the duration of such designation. Any Lead Compound which receives a Marketing Approval in the Astellas Territory shall remain a Lead Compound for the duration of such Marketing Approval. As of the Effective Date, FG-2216 shall be deemed to be a Lead Compound.

1.47 Listed Price shall have the meaning as set forth in Section 9.2.

1.48 Litigation Agreement shall have the meaning as set forth in Section 14.4 below.   -5-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.49 Major Indication shall have the meaning set forth in Section 11.3.1 below.

1.50 Marketing Approval shall mean, with respect to each Lead Compound, approval in the Astellas Territory by the Japanese Ministry of Health, Labour and Welfare, or in the FG Territory by U.S. or European regulatory authorities, as the case may be, to market such Lead Compound for an indication within the Field. It is understood that pricing or reimbursement approval shall constitute a part of the Marketing Approval. In any event, Marketing Approval shall be deemed to have occurred with respect to a Lead Compound no later than the date of the First Commercial Sale of such Lead Compound in the FG Territory or the Astellas Territory as the case may be, by or under authority of FG or Astellas respectively, or their Affiliate or Sublicensee, as the case may be, whether or not formal approval by the relevant health regulatory authority is required for the First Commercial Sale of such Lead Compound.

1.51 Marketing Approval Application or MAA shall mean, within the FG Territory, a New Drug Application or similar application as required under the U.S. Federal Food, Drug and Cosmetics Act and the regulations promulgated thereunder, or such similar filing in Europe, or a comparable filing for Marketing Approval in the Astellas Territory, in each case with respect to a Lead Compound for use within the Field.

1.52 Net Sales shall mean the gross amount billed or invoiced by Astellas, its Affiliates and its Sublicensees to unaffiliated third parties for the Lead Compound(s) in bona fide arm's length transaction, less the following deductions:

  i) credits or allowances, if any, given or made on account of rejection or return of the Lead Compound(s);

  ii) trade and quantity discounts actually allowed and taken in such amounts as are customary in the trade;

  iii) duties, sales taxes, excise taxes, insurance and transportation charges actually paid; and

  iv) charge back payments or rebates actually paid to wholesalers.

1.53 Phase I shall mean human clinical trials, the principal purpose of which is preliminary determination of safety in healthy individuals or patients as required in 21 C.F.R. §312.21, or similar clinical study in a country other than the United States, and for which there are no primary endpoints relating to efficacy included in the protocol.

1.54 Phase II shall mean human clinical trials, for which the primary endpoints include a determination of dose ranges and/or a preliminary determination of efficacy in patients with the Indication being studied as required in 21 C.F.R. §312.21, or similar clinical study in a country other than the United States.

1.55 Phase III shall mean human clinical trials, the principal purpose of which is to establish safety and efficacy of one or more particular doses in patients with the Indication being studied as required in 21 C.F.R. §312.21, or similar clinical study in a country   -6-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   other than the United States. For purposes of this Section 1.55, and Sections 1.53 and 1.54 above, a particular trial that (i) is intended to overlap two phases of trials, (ii) combines the elements of two phases of trials, or (iii) is treated by the FDA or comparable foreign agency as two phases of trials, such as a Phase I/II trial or a Phase II/III trial, shall be deemed a trial of the later, as well as the earlier, phase (i.e., a Phase II and a Phase III, respectively).

1.56 Product Specification shall mean, with respect to a Bulk Product, the written document describing, the testing procedures and results required to determine compliance with release specifications, including, and quality control testing procedures to be determined, and be amended from time to time, by mutual agreement of both parties. The release specifications of such Product Specifications shall be determined taking into account and shall be designed to meet the shelf life requirements of the Japanese Ministry of Health, Labor and Welfare for the Lead Compound, provided, that the Product Specifications shall not require compliance with such shelf life requirements.

1.57 Preexisting Third Party Intellectual Property shall mean any intellectual property rights, including without limitation all patents, trademarks, copyrights, and any applications therefor, including any applications for registration, issuance, or grant thereof, owned or Controlled by a third party that are necessary for the practice of the license granted hereunder and that the existence of which was discoverable or otherwise could have been known on or prior to the Effective Date and were not owned or Controlled by FG as of the Effective Date.

1.58 Proof of Concept shall mean for any Indication, a demonstration of correction of anemia in relevant patients in a human clinical study.

1.59 Prosecution and Interference Activities shall mean the preparation, filing, prosecution and maintenance of patent applications and patents and any continuing applications thereof, and any re-examinations, reissues, renewals and requests for patent term extensions therefor, and any U.S., international or foreign counterparts of any of the foregoing, together with the conduct of any interference, opposition or other similar proceeding pertaining to patent applications or patents.

1.60 Protected Field shall have the meaning as set forth in Section 14.1.

1.61 Reference Materials shall have the meaning as set forth in Section 12.12 below.

1.62 Relevant Standards shall have the meaning as set forth in Section 12.8 below.

1.63 Sales Price shall mean the price per unit obtained by dividing the Net Sales during the relevant calendar quarter by the number of units sold during the same period.

1.64 Standard Materials shall have the meaning as set forth in Section 12.12 below.   -7-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   1.65 Sublicensee shall mean a third party to whom FG or Astellas has directly or indirectly granted the right in its respective territory to make, use and sell a Lead Compound or a third party to whom FG or Astellas has directly or indirectly granted the right to distribute a Lead Compound supplied by FG or Astellas (respectively). For purposes of this Agreement, FG and Astellas shall not be deemed Sublicensees of the other.

1.66 Technical Product Failure shall mean as a [ * ], which is not attributed to Astellas' failure to fulfill its obligations hereunder.

1.67 Third Party Agreements shall mean collectively those agreements between FG and a third party existing as of the Effective Date, pursuant to which FG obtained rights applicable to the development, manufacture, sale or use of Lead Compounds hereunder (but excluding options or similar agreements to acquire such rights). If, after the Effective Date, FG enters into an agreement to license or acquire rights from a third party with respect to subject matter to be utilized in connection with Lead Compounds in accordance with Section 14.5 below, such agreements shall also be deemed Third Party Agreements for purposes of this Agreement.

1.68 Third Party Licensor shall have the meaning as set forth in Section 14.5.1 below.

ARTICLE 2 JOINT DEVELOPMENT COMMITTEE

2.1 Joint Development Committee. Astellas and FG shall establish a joint development committee to oversee, review and coordinate the research and development of Lead Compounds for applications within the Field pursuant to the Development Program (Joint Development Committee or JDC). From time to time, the JDC may establish subcommittees or project teams to oversee particular projects or activities, and such subcommittees or project teams will be constituted as the JDC agrees (e.g., for oversight of the development or other day-to-day matters).

2.2 Membership. The JDC shall be comprised of an equal number of representatives from each of Astellas and FG, selected by such party. The exact number of such representatives shall be [ * ] for each of Astellas and FG, or such other number as the parties may agree. Subject to the foregoing provisions of this Section 2.2, FG and Astellas may replace its respective JDC representatives at any time, upon prior written notice to the other party.

2.3 JDC Meetings. The JDC shall meet no fewer than [ * ] times each calendar year, or as otherwise agreed by the parties, with the understanding that [ * ] meetings are to be held at mutually agreed locations alternating among Japan, California, Hawaii, or at such other locations as the parties agree, and the other [ * ] meetings are to be held by means of telecommunication, videoconference or correspondence as deemed appropriate. The parties shall conduct team meetings at the same time and location as the JDC meetings. At its meetings, the JDC will, as applicable, (i) formulate and review the Development Program objectives, including approval of all proposed pre-clinical and clinical studies to be performed, (ii) monitor the progress of the Development Program toward those objectives, (iii) review and approve the   -8-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   Development Plan, pursuant to Section 3.3 of this Agreement, including review, approve and monitor the progress of the clinical and regulatory plans, (iv) resolve issues surrounding the marketing of the Lead Compounds, (v) discuss the selection of Lead Compounds, (vi) coordinate manufacturing issues, including the development of standards, scheduling of batch production, and qualification with regulatory requirements for the Astellas Territory, (vii) resolve issues arising out of the Development Program or this Agreement, and (viii) undertake and/or approve such other matters as are specifically provided for the JDC under this Agreement. One meeting each year will be focused specifically on setting Development Program goals and strategy. Other representatives of FG or Astellas may attend JDC or subcommittee meetings as non-voting observers. Astellas' lead representative shall chair the meetings and shall be responsible for preparing the agenda and minutes for such meetings, and shall provide such minutes to FG in English. Such minutes as approved by the JDC shall constitute the official record of the actions of the JDC. The JDC may also convene or be polled or consulted from time to time by means of telecommunications, videoconferences or correspondence, as deemed necessary or appropriate. Each party shall bear its own personnel, travel and lodging expenses relating to JDC meetings.

2.4 Decisions. Decisions of the JDC shall be made by unanimous agreement of the members present in person or by other means (e.g., teleconference) at any meeting; provided that at least two (2) representatives of each party is present at such meeting. In the event that the JDC is unable to reach unanimous agreement on an issue, the issue shall be referred for resolution in accordance with Article 19 hereof.

ARTICLE 3 DEVELOPMENT PLANS

3.1 General. Subject to Section 3.2 below, Astellas shall prepare and propose to the JDC a detailed Development Plan pursuant to which the Development Program will be performed. The Development Plan shall specify the objectives and work plan activities by Astellas with respect to the Development Program.

3.2 Annual Review

3.2.1 Initial Development Plan. The initial Development Plan is attached hereto as Exhibit C (the Initial Development Plan), and shall be fixed for the period from the Effective Date through March 31, 2006, unless otherwise agreed by the JDC.

3.2.2 Other. Beginning upon the date of signing of this Agreement and by December 31 of each year thereafter until expiration or termination of this Agreement, Astellas shall submit to the JDC the proposed plan required under Section 3.1 above for the following fiscal year, including for regulatory activities within the Astellas Territory. The JDC shall review such proposals as soon as possible and shall approve the Development Plan for such following fiscal year, with such changes as the JDC may agree to the plan proposed by Astellas, no later than March 15 of the current fiscal year.

3.3 Periodic Reviews. The JDC shall review the Development Plan on an ongoing basis and may make changes thereto including variances to the Development Plan in effect.   -9-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   ARTICLE 4 DEVELOPMENT PROGRAM

4.1 Development Program for the Astellas Territory. Astellas shall follow FG's development activities for the Lead Compounds, (i.e., Astellas shall develop, and shall have the right and obligation to develop, only those compounds that FG has designated as Lead Compounds, for the duration of such designation and for which FG or its Sublicensee is pursuing clinical development in the FG Territory), for those Indications being developed by FG or its sublicensee, and such Astellas development shall comply with, without limitation the procedures set forth in Section 11.3.1. In fulfillment thereof, Astellas shall conduct, directly or through third parties, the Development Program for the Astellas Territory, all in accordance with the Development Plan then in effect, and shall be responsible for all costs related to the Astellas Territory. Astellas agrees to keep the JDC informed as to the progress of its activities under the Development Program for Lead Compounds hereunder. FG shall, subject to Section 4.2.2, provide reasonable assistance to Astellas regarding Astellas' performance of its development activities within the scope of the Development Program hereunder and provide updates to Astellas as to the FG Development Program. It is understood and agreed that the Development Program for the Astellas Territory shall include all clinical trials and other development activities necessary to obtain Marketing Approvals for Lead Compounds for the Astellas Territory.

4.2 Global Harmonization

4.2.1 Reporting; Redundant Activities. FG shall provide to Astellas regular reports with respect to the FG Development Program with respect to the Lead Compounds. Such reports may be provided at the JDC meetings provided for in Section 2.3. Recognizing that the Lead Compounds may be developed on a global basis and that regulatory and budget efficiencies can be achieved through the worldwide use of appropriate data and files, the parties will seek to design pre-clinical and clinical development activities included in the Development Plan in a manner to maximize global clinical and regulatory harmonization.

4.2.2 Additional Activities. Without limiting the obligations set forth in 4.2.1, the costs of any non-clinical or clinical developmental work, whether performed by Astellas or FG, to support needs specific to the Astellas Territory and not required to be performed for the FG Territory, or at the request of Astellas, shall be borne by Astellas.

4.3 Selection of Lead Compounds. FG shall consult with Astellas with respect to Lead Compound selection, and shall provide to Astellas information as reasonably necessary to evaluate Lead Compound candidates in connection with the Lead Compound selection process, including without limitation the information relating to patent situations in the Astellas Territory. For the avoidance of doubt, such Lead Compound candidates shall potentially include any and all compounds Controlled by FG during the term hereof for use in the Field. Notwithstanding anything contained in this Agreement, FG shall designate, at its sole discretion but in line with the basic policy that the same Lead Compound shall be Commercialized both in Astellas Territory and FG Territory for the same Indication(s), Lead Compound(s) in accordance with the terms of this Section 4.3, and shall notify the JDC of such designations. At any one time, FG may designate up to two (2) Lead Compounds for Commercialization in any Indication; provided, that in the event that FG designates two (2) Lead   -10-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   Compounds for Commercialization in an Indication, it shall designate one (1) as the primary Lead Compound and one (1) as the secondary Lead Compound. In the event FG determines to cease development of a primary Lead Compound in an Indication, FG may designate the secondary Lead Compound as the primary Lead Compound for such Indication. In the event, prior to Marketing Approval in the Astellas Territory, FG determines to stop development of a Lead Compound, FG shall notify the JDC, and upon such notification, such compound shall no longer be considered a Lead Compound; provided, however, that Astellas may complete those development activities on-going at the time of such notification for such Lead Compound for a reasonable period of time, unless such notification is based on safety concerns. In the event FG determines to [ * ], FG shall [ * ] within [ * ] days of such [ * ]. In the event that FG [ * ], Astellas may, subject to the [ * ], [ * ], provided, however, that the [ * ] shall apply upon the [ * ] set forth in such Sections, rather than the [ * ].

4.4 Regulatory Matters

4.4.1 Regulatory Filing. FG shall be responsible, directly or through third parties, for the preparation, filing and maintenance of all regulatory documents in the FG Territory with respect to the Lead Compound(s), which shall be filed in the name of FG or its designee. Astellas shall be responsible for all preparation, filing and maintenance of all regulatory documents in the Astellas Territory with respect to the Lead Compound(s), which shall be filed in the name of Astellas. Astellas shall select and own the trademark(s) to be used to identify any Lead Compound in the Astellas Territory.

4.4.2 Reporting Adverse Experiences

(a) With respect to adverse drug experiences relating to any Lead Compound, the parties shall promptly report such experiences to the appropriate regulatory authorities in the countries in which such Lead Compound is being developed or commercialized, in accordance with the appropriate laws and regulations of the relevant countries and authorities, and each party shall ensure that its Affiliates and Sublicensees comply with such reporting obligations. In addition, in order that each party may be fully informed of these experiences, each party shall report to the other party all adverse events involving such Lead Compound. Serious adverse events for all fatal and life-threatening adverse events shall be reported to the designated safety contact person of the other party by e-mail within five (5) calendar days of a party's and/or its agent's becoming aware of such an event (a reporting party), and all other serious adverse events shall be forwarded to the other party within seven (7) calendar days of the reporting party's and/or its agent's becoming aware of such an event. To the extent legally possible, FG and Astellas shall report to the other all serious adverse events with respect to a Lead Compound in the Field at least twenty-four (24) hours prior to reporting the same to a regulatory authority, and shall report adverse events which may constitute a dose limiting toxicity in a reasonably prompt time after the occurrence of such event. The reporting party shall report all non-serious adverse events on a monthly basis; provided that, non- serious adverse event data arising from a clinical trial will be included in the clinical trial report which   -11-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   shall be prepared and sent to the other party as soon as practicable following completion of the final clinical report.

(b) An adverse event is any negative symptom experienced at the time of or after the taking of a medicinal (investigational) product, whether or not considered a medicinal (investigational) product related, including any side effects, injury, toxicity or sensitivity reaction, or significant failure of expected pharmacological action. Also included are instances of symptomatic overdose, abuse or withdrawal reactions.

(c) A serious adverse event includes any of the following outcomes: death, a life-threatening event; that is, an adverse event that puts the patient at risk of dying, requires hospitalization, prolongs existing hospitalization or results in persistent or significant incapacity or disability, congenital anomaly/birth defect. Other important medical events that may otherwise jeopardize a patient or may require intervention to prevent one of the statuses of patients listed in the preceding sentence shall also be considered serious.

(d) The parties also agree to develop and implement such other procedures as may be necessary or appropriate to ensure that each party remains in compliance with all reporting requirements imposed by any regulatory authority in the Astellas Territory, and in the FG Territory. Upon the Initiation of Phase III, FG shall implement and be responsible for the maintenance of a complete global safety database. FG will be responsible for preparing, with Astellas' cooperation set forth below in this Section 4.4.2(d), Periodic Safety Reports for clinical studies requested by European and U.S. authorities, and Periodic Safety Update Reports (PSURs). FG shall send a draft PSUR for review to Astellas in the beginning of week 5 after database lock point. Astellas has one week for review. FG shall provide copies of the final PSURs to Astellas in the same timing as they are submitted to the authorities. Astellas will provide FG with the data needed for making the PSURs. Maintenance of Company Core Safety Information (CCSI) is under the responsibility of FG who will communicate all revisions to Astellas. FG shall prepare the periodic safety reports for clinical studies requested by European and U.S. authorities and provide Astellas with the copy of such reports at the time of submission to the regulatory authorities in the FG Territory. Astellas will provide FG with the data needed for making such periodic safety reports.

(e) Each party shall immediately inform the other party of measures taken in order not to jeopardize public health or hygiene including but not limited to, discontinuation of manufacture, import and marketing, clinical trial suspension, recall and disposal of the Lead Compound or the product or the prescription product, irrespective of whether it is due to regulatory actions or voluntary actions.   -12-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   (f) Both parties hereby nominate the safety contact persons as follows:

Medical Affairs Department FibroGen, Inc. 225 Gateway Boulevard San Francisco, California 94080 Attn: Vice President, Medical Affairs Tel: 1-650-866-7875 Fax: 1-650-866-7360 E-mail:dyeowell@fibrogen.com

With a copy to: Chief Executive Officer FibroGen, Inc. 225 Gateway Boulevard San Francisco, California 94080 Tel: 1-650-866-7200 Fax: 1-650-866-7201 E-mail:tneff@fibrogen.com Pharmacovigilance Department, QA, RA, and Pharmacovigilance Division Astellas Pharma Inc. [ * ]

The safety contact persons for each party hereto may be updated from time to time as necessary upon notice to the other party.

ARTICLE 5 RECORDKEEPING; PUBLICATION

5.1 Reports and Records. Each of Astellas and FG shall use best efforts to maintain (or cause such records to be maintained) records of the Development Program and FG Development Program, respectively, in sufficient detail and in good scientific manner as will properly reflect all work done and results achieved in the performance of the Development Program or FG Development Program, as the case may be. Upon [ * ] days advance notice or such shorter time period as may be required in order to meet any regulatory requirements, each party shall allow the other party to have access to all records, materials and data generated by or on behalf of such party with respect to each Lead Compound for applications within the Field at reasonable times, in a reasonable manner and, upon request, to the extent required under Article 7 hereof.   -13-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   5.1.1 Retention. Each of Astellas and FG shall retain its records for the minimum period of time required by applicable law in all cases, and for not less than [ * ] following the expiration or termination of this Agreement.

5.1.2 Reports. Not less than [ * ] prior to each JDC meeting under Section 2.3 above, each of Astellas and FG shall provide the JDC with a written report in English; Astellas' report summarizing the progress of the Development Program, including the developmental, clinical and other activities performed by Astellas, its Affiliates and/or Sublicensees with respect to each Lead Compound during the preceding period; and FG's report summarizing the progress of the FG Development Program.

5.1.3 Activities Outside the Field. The parties understand and acknowledge that FG is engaged in other research and development activities directed to prolyl hydroxylase inhibition and/or the stabilization of HIF, and that the focus of this collaboration and the Development Program is directed to the Field. Accordingly, it is understood that, notwithstanding any other provision of this Agreement, the obligations of FG specified herein to make available and disclose to Astellas data, technical information, scientific results and findings and other subject matter is limited in each case to subject matter directed to Lead Compounds within the Field.

5.2 Review of Publications. As soon as is practicable prior to the oral public disclosure, and prior to the submission to any outside person for publication of scientific data resulting from the Development Program, in each case to the extent the contents of the oral disclosure or publication have not been previously disclosed pursuant to this Section 5.2 before such proposed disclosure, FG or Astellas, as the case may be, shall provide to the other party a copy of the publication, or a written summary of any oral disclosure, to be made or submitted, and shall allow the other party at least [ * ], to determine whether such disclosure or publication contains subject matter for which patent protection should be sought prior to publication or which either party believes should be modified to avoid disclosure of Confidential Information or regulatory or other issues. With respect to publications by investigators or other third parties of scientific data resulting from the Development Program, such disclosures and publications shall also be subject to review by the reviewing party under this Section 5.2.

5.2.1 Publication Rights. Subject to the provisions of Articles 7 and 16, after the expiration of [ * ] from the date of receipt of such disclosure or publication, unless the authoring party has received the written notice specified below, the authoring party shall be free to submit such publication or to orally disclose or publish the disclosed research results in any manner consistent with academic standards.

5.2.2 Disapproval of Publication. Prior to the expiration of the [ * ] period specified in Section 5.2.1 above, the reviewing party may notify in writing the submitting party of its determination that such oral presentation or publication contains Confidential Information of the reviewing party or objectionable material or material that consists of patentable subject matter of the reviewing party for which patent protection should be sought. In such event, and unless otherwise mutually agreed, the submitting party shall withhold publication of its disclosure.   -14-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   ARTICLE 6 DEVELOPMENT PROGRAM FUNDING

6.1 Payments for Reimbursement; Net Payments. FG hereby acknowledges receipt of U.S. $[ * ] on February 13, 2004, U.S. $[ * ] on January 28, 2005, and U.S. $[ * ] on March 22, 2005 as initial payments for reimbursement of historical research and development expenditures for the Lead Compounds. Astellas agrees to pay to FG the amounts set forth in Section 6.1.1 below. The parties hereto acknowledge that the Development Program hereunder involves a high degree of risk and uncertainty; accordingly, both parties hereto expressly disclaim any implied warranty as to the results of the Development Program.

6.1.1 Reimbursement Payments. As reimbursement and payment for FG's historical research and development expenditures with respect to pre-clinical and clinical development of Lead Compounds, Astellas agrees to make the following non-refundable, non-creditable (except as set forth in Section 14.3 below) reimbursement payments to FG upon the first occurrence of each event specified below (each, an Event):       EVENT   AMOUNT 1.   Upon [ * ], provided, that U.S. $[ * ] million of such amount shall be paid no later than [ * ] irrespective of whether the [ * ] has occurred.   U.S. $[ * ]

2.  Upon each of [ * ], for a total of U.S. $[ * ]   U.S. $[ * ]

3.   Upon [ * ] or in the event that Astellas chooses to utilize the Bridging Strategy, the payment shall be made concurrent with the payment required in paragraph 4 of this Section 6.1.1 below.   U.S. $[ * ]

4.  Upon the first [ * ].   U.S. $[ * ]

6.1.2 Product Approval Payments. As reimbursement and payment for FG's historical and ongoing research and development expenditures with respect to pre-clinical and clinical development of Lead Compounds and as payment for the successful marketing and sales of Lead Compound(s), Astellas agrees to make the following non-refundable, non-creditable (except as set forth in Section 14.3 below) reimbursement payments to FG upon the first occurrence of each Event (other than paragraph 5 of this Section 6.1.2 below) specified below. Notwithstanding the foregoing, in the event that Astellas decides not to pursue Commercialization in [ * ] set forth in paragraph 3 or 4 of this Section 6.1.2, the milestone payment associated with the [ * ] set forth in paragraph 3   -15-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   shall be due and payable upon the first [ * ] of either [ * ], and the milestone payment associated with the [ * ] set forth in paragraph 4 shall be due and payable upon the second [ * ] for a [ * ]; and in the event Astellas decides to pursue only [ * ] set forth in paragraph 3 or 4 of this Section 6.1.2, and pursues Commercialization of either of the [ * ], the milestone payment for associated with the [ * ] for the [ * ] shall be due and payable upon the first [ * ] for a [ * ]; and in the event that Astellas decides to pursue [ * ] set forth in paragraphs 3 and 4 of this Section 6.1.2 and also does not pursue [ * ], the parties shall a [ * ] for which the milestone payments associated with the [ * ] set forth in paragraph(s) 3 and/or 4 of this Section 6.1.2, as the case may be, shall be due, as negotiated in good faith by the parties hereto.       EVENT   AMOUNT 1.   Upon the first [ * ] for the [ * ]; provided, that in the event Astellas chooses the Bridging Strategy, such payment shall be increased by an additional U.S. $[ * ] for a total of U.S. $[ * ]   U.S. $[ * ]

2.   Upon the first [ * ] in the Astellas Territory for the [ * ]; provided, that in the event Astellas chooses the Bridging Strategy, such payment shall be increased by an additional U.S. $[ * ] for a total of U.S. $[ * ].   U.S. $[ * ]

3.   Upon the first [ * ] in the Astellas Territory for the [ * ]; provided, that in the event Astellas chooses the Bridging Strategy, such payment shall be increased by an additional U.S. $[ * ] for a total of U.S. $[ * ].   U.S. $[ * ]

4.



Upon the first [ * ] in the Astellas Territory for the first indication within [ * ] (see Exhibit B); provided, that in the event Astellas chooses the Bridging Strategy, such payment shall be increased by an additional U.S. $[ * ] for a total of U.S. $[ * ].

U.S. $[ * ]

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[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY

5.   Upon [ * ] in the Astellas Territory for each of up to [ * ] indications listed on Exhibit B, including separate indications within [ * ] up to a total of U.S. $[ * ].   U.S. $[ * ]

6.1.3 Sales Success Payments. As reimbursement and payment for FG's historical and ongoing research and development expenditures with respect to pre-clinical and clinical development of Lead Compounds and as payment for the successful marketing and sales of the Lead Compound(s), Astellas agrees to make the following non-refundable, non-creditable (except as set forth in Section 14.3 below) reimbursement payments to FG upon the first occurrence of the Event specified below.   EVENT   AMOUNT Upon receipt of [ * ] aggregate annual Net Sales achieved for the first time in the Astellas Territory for all indications and Lead Compounds by Astellas and its Affiliates and Sublicensees.   U.S. [ * ]

If at the occurrence of an Event (except for Event 2) as set forth in Section 6.1.1 above with respect to a particular Lead Compound the payment corresponding to the occurrence of any preceding Event (except for Event 2) (i.e., previous as contemplated by the Event number sequence specified above) has not been made, then the corresponding payment(s) for such preceding Event (except for Event 2) shall then be due.

The payments set forth in Sections 6.1.1, 6.1.2 and 6.1.3 hereof shall each be due and payable within [ * ] after occurrence of the corresponding Event. Astellas agrees to promptly notify FG in writing of its achievement of any Event under Sections 6.1.1, 6.1.2 and 6.1.3.

ARTICLE 7 USE OF PRECLINICAL AND CLINICAL DATA

7.1 Exchange. Subject to the provisions of this Article 7 and Article 16 below, the parties shall have access to the underlying preclinical and clinical data (including raw data thereof), analysis, reports, protocols and correspondence (collectively with such filings, Data), at reasonable times, upon fifteen (15) days advance notice or such shorter notice as may be required in order to meet any regulatory requirements and (upon request) in English, (it being understood and agreed that Astellas shall provide in English without cost to FG summaries of all final reports and all documents necessary to comply with regulatory and legal requirements, and   -17-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   shall provide all other documents in English with reasonable costs shared equally between the parties) of the other party in accordance with the following:

(a) FG shall have access to and the right to use for any purpose, any Data developed by or on behalf of Astellas or its Affiliates or Sublicensees in the course of the Development Program with respect to indications within the Field for Lead Compounds. Astellas shall obtain from such Sublicensees access to all Data prepared by or for such Sublicensee with respect to a Lead Compound, with the right to provide such Data and/or access to FG and its Sublicensees, and any sublicense failing to provide such obligation on the part of the Sublicensee shall be voidable at the option of FG.

(b) Astellas shall have access to and the right to use solely for the purpose of this Agreement, any Data developed by or on behalf of FG or its Affiliates or Sublicensees with respect to Lead Compounds in connection with the Field (i) to the extent necessary to support the application to the regulatory authority in the Astellas Territory or to fulfill other Japanese Ministry of Health, Labor and Welfare regulatory requirements, or (ii) if not necessary to support such application or to fulfill such Japanese Ministry of Health, Labor and Welfare regulatory requirements, to the extent FG is permitted subject to FG's third party obligations; provided that FG shall [ * ] negotiate the availability of such Data to Astellas from such Sublicensee, and provided, further, that Astellas agrees not to use or disclose to third parties any such data for purposes outside the Field except as authorized under this Agreement.

7.2 Disclosure. Subject to the provisions of this Section 7.2, FG and Astellas may each provide copies or summaries of Data to its Affiliates and/or its permitted Sublicensees to the extent reasonably necessary for the development and commercialization of Lead Compounds in accordance with this Agreement, or in the case of FG of products other than Lead Compounds. It is understood that the foregoing shall include the right to disclose Data to third parties with whom Astellas or FG are discussing entering into agreements for such permitted purposes, subject to reasonable conditions of confidentiality, provided, that Astellas may not disclose any Data to any third party competitor of FG within the Field worldwide without the prior written consent of FG.

7.3 Regulatory Requirements. Notwithstanding the provisions of Section 7.2, in all agreements with third parties or Affiliates involving the development of Data, FG and Astellas, respectively, shall require that such third parties and Affiliates provide the other party with all such Data, to the extent such Data is required in order for each party to meet its obligations to the other party under Section 4.4.2 above.

7.4 Review of Protocols. Astellas agrees that all final protocol summaries for all clinical trials and GLP toxicology studies to be conducted by or under authority of Astellas will be subject to the review and approval of the JDC, in accordance with the following procedures set forth in this Section 7.4. Astellas shall submit to FG and the JDC the original draft protocol summary in English for any clinical trial or GLP toxicology study it proposes to conduct, and such protocol summary shall be reviewed and approved by the JDC. The protocol summary shall contain all information as may be requested by the JDC. Upon Astellas' completion of the final protocol for the proposed clinical trial or GLP toxicology study, in the   -18-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   event that such protocol deviates from the original protocol summary, Astellas shall resubmit to FG and the JDC for review and approval a revised, final protocol summary that indicates all changes from the original protocol summary. Notwithstanding the foregoing, FG reserves the right to request and Astellas shall provide any portion of full text of the protocols in English for review by the JDC, which portion is at issue. In the event FG requests such a full text protocol, it shall review and provide comments to the JDC as soon as practicable, and within five (5) business days of receipt.

ARTICLE 8 MARKETING RIGHTS

8.1 Astellas. Astellas shall have the exclusive right to market, sell and distribute the Lead Compounds supplied by FG for use in the Astellas Territory within the Field under the license granted in Article 13. Astellas may exercise its rights under this Section 8.1 through one or more Sublicensees; provided, that any such Sublicensee agrees to terms identical in all material respects to those contained in this Agreement, and, provided, further, that any arrangement between Astellas and an Astellas Sublicensee with respect to a Lead Compound shall be subject to the requirements of Section 13.2.

8.2 FibroGen. FG shall have the exclusive right, including the right to authorize others, to market, sell and distribute the Lead Compounds for any use in the FG Territory. Subject to the restrictions contained in Section 8.3.4 hereof, FG retains the exclusive right, including the right to authorize others, to market, sell and distribute worldwide the Lead Compounds for use outside the Field.

8.3 Covenants

8.3.1 General. It is understood that, with respect to any particular Lead Compound, whether or not the use and sale of such Lead Compound by FG and/or Astellas in any country requires a license under intellectual property rights of the other, neither FG nor Astellas shall market, sell or distribute a Lead Compound anywhere in the world except in accordance with this Agreement, including this Article 8.

8.3.2 Independent Activities by Astellas. During the term of this Agreement, in the event Astellas seeks to Commercialize any molecules for the Field or the Expanded Field, except for actions taken within the Field in the course of the exercise of the license granted under Section 13.1 hereof and expressly authorized under this Agreement, Astellas shall notify FG immediately upon the commencement of any such activities, and provided that [ * ] such activities are and will be in the future conducted completely independently of any of FG Technology and/or any other FG materials, confidential information, intellectual property or other related information provided by or on behalf of FG to Astellas under this Agreement or any other agreement between FG and Astellas relating to the subject matter hereof, Astellas may proceed with such Commercialization, subject at all times to the obligations contained in this Agreement with respect to any intellectual property in connection with or related to such activities and FG's right to terminate this Agreement pursuant to Section 18.2.1 hereof.   -19-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   8.3.3 Use of FG Technology by Astellas. Astellas shall use the FG Technology only to exercise the rights granted under Section 13.1 of this Agreement and as expressly authorized under the Development Program, and shall not under any circumstances use or apply any FG Technology, including without limitation any FG know-how and/or any other FG materials, confidential information, intellectual property or other related information provided by FG to Astellas under this Agreement or any other agreement between FG and Astellas relating to the subject matter hereof, for any use outside the Field at any time or within the Field after the expiration or termination of this Agreement.

8.3.4 Activities Outside Field by Astellas. Without limiting the foregoing, Astellas agrees that during the term of this Agreement it will not (and will not authorize any third party, including, without limitation, any Affiliates or Sublicensees, to) (i) Commercialize any Lead Compound within the Field in the Astellas Territory, except a Lead Compound that has been designated a Lead Compound by the JDC and that has received Marketing Approval in the Astellas Territory for use in the Field, (ii) Commercialize any Lead Compound for use outside the Field or outside the Astellas Territory, (iii) provide any supplies of any Lead Compound to any third party, including, without limitation, any Affiliates or Sublicensees, which Astellas knows or has reason to know is being marketed, sold or distributed for use outside the Field or outside the Astellas Territory, (iv) conduct or sponsor, or provide any supplies of any Lead Compound for use in, any clinical trial designed to demonstrate that a Lead Compound can be used outside the Field, or (v) seek regulatory approval of, or use labeling for a Lead Compound stating that such Lead Compound is for use outside the Field.

8.3.5 Activities in Astellas Territory by FG During the term of this Agreement, FG shall not Commercialize by itself or through its Sublicensee any Lead Compound or other compound, whether or not designated as a Lead Compound, within the Field in the Astellas Territory, or any Lead Compound outside the Field in the Astellas Territory, provided, however, that FG may develop a Lead Compound or other compound in the Astellas Territory in those Indications for which Astellas has determined not to pursue Commercialization or for which Astellas has lost the right to pursue Commercialization due to failure to meet diligence obligations hereunder; and provided, further, that FG may Commercialize compounds other than Lead Compounds outside the Field in the Astellas Territory, irrespective of whether such compound has the effect of stabilizing HIF causing the stimulation of erythropoiesis (including an increase in endogenous erythropoietin production) and/or a subsequent increase in hematocrit through modulation of prolyl hydroxylase and/or asparaginyl hydroxylase.

ARTICLE 9 TRANSFER PRICING

9.1 Transfer for Non-Commercial Purpose. In exchange for the transfer of any Lead Compound to Astellas for a non-commercial purpose, Astellas shall pay FG the total amount of the Fully Burdened Costs for such Lead Compound as reasonably determined by FG. Lead Compound transferred to Astellas for a non-commercial purpose shall not be used for a commercial purpose.   -20-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   9.2 Transfer for Commercial Purpose. For any Lead Compound transferred to Astellas to be used for any commercial purpose, in exchange for the transfer of such Lead Compound to Astellas, Astellas shall pay FG the amounts set forth in this Section 9.2. All transfers of Lead Compound for use following Marketing Approval shall be deemed transfers for a commercial purpose, except transfers under Section 9.2(c), and transfers for the purpose of conducting clinical trials, which shall be considered transfers for a non-commercial purpose.

(a) For any quantities of Lead Compound shipped by FG to Astellas prior to the issuance of the national health insurance price as determined by the Japanese Ministry of Health, Labour and Welfare (the Listed Price), Astellas shall pay for such quantities at a price equal to [ * ] of the estimate of the Listed Price as determined in good faith by FG and Astellas, subject to adjustment upon the issuance of the actual Listed Price. Upon the issuance of such Listed Price by the Japanese Ministry of Health, Labour and Welfare, Astellas shall pay to FG, or FG shall reimburse Astellas, as the case may be, the amount of any difference between the payment made for such Lead Compound at the estimated Listed Price and the payment required based upon the actual Listed Price.

(b) For all other transfers of Lead Compound, except as set forth in subparagraphs (c) or (d) below, Astellas shall pay for such quantities at a price equal to [ * ] of the Listed Price. In the event that a new Listed Price has been notified to Astellas by the Japanese Ministry of Health, Labour and Welfare before implementation of the new Listed Price, then such new Listed Price shall be used for calculation of the price of Lead Compound to be shipped on and after the later to occur of (i) [ * ] before implementation of the new Listed Price, and (ii) the date upon which Astellas has amended the price of Lead Compound to wholesalers in response to such notification by the Japanese Ministry of Health, Labour and Welfare, even before implementation of the new Listed Price.

(c) With respect to Lead Compound to be distributed as samples to medical providers and for which Astellas shall not receive any payment or other consideration, Astellas shall pay to FG the sum of its Fully Burdened Costs for amounts of Lead Compound shipped to Astellas; provided, however, that the parties shall mutually agree upon the amount of such samples for distribution without consideration in the Astellas Territory.

(d) Upon the later of (i) the initial retail sale of a generic equivalent (as defined by the Japanese Ministry of Health, Labour and Welfare) of such Lead Compound in the Territory, and (ii) and the expiration of the last to expire of the FG Patents with respect to such Lead Compound effectively precluding third parties from selling said generic equivalent, for any quantities shipped by FG to Astellas, Astellas shall pay FG for such quantities [ * ] of the Sales Price; provided, however, that in the event that the payment of the [ * ] of the Sales Price would result in FG's [ * ] Percentage falling below [ * ], FG shall have the option to initiate a renegotiation of the transfer price upon notice to Astellas, in which case the parties shall use best efforts in good faith to renegotiate reasonable terms for the transfer price; provided, further, that in the event the transfer price is not renegotiated to FG's satisfaction or FG elects not to initiate a renegotiation, FG may elect to terminate its manufacturing obligations by written notice to Astellas, and FG and Astellas shall negotiate reasonable terms for transfer of manufacturing. During such period of renegotiation, FG shall transfer the Lead Compound to Astellas at a price   -21-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   equal to the greater of [ * ] of the Sales Price and the price resulting if FG's [ * ] Percentage for such Lead Compound is equal to [ * ].

9.3 Payment. Any payments to be made with respect to the transfer of any Lead Compound in accordance with Section 9.1 or 9.2 above shall be immediately due to FG upon shipment, which shall be paid by Astellas to FG no later than [ * ] of the date of invoice, which invoice FG shall deliver to Astellas upon Delivery of Lead Compound to Astellas pursuant to Section 9.2(a), (b) or (c), and shall be made in U.S. dollars. For transfer of any Lead Compound in accordance with Section 9.1 or 9.2(c) above, FG shall deliver to Astellas, within ten (10) days of receipt of a firm commitment order from Astellas, an invoice for the estimated Fully Burdened Costs of the Lead Compound to be transferred to Astellas. Within [ * ] after the transfer of the Lead Compound to Astellas, FG shall provide a revised final invoice to Astellas that shall indicate the actual Fully Burdened Costs of the Lead Compound. If the actual Fully Burdened Costs are less than the estimated Fully Burdened Costs, FG shall include a reimbursement payment to Astellas for the difference between the initial estimated Fully Burdened Costs and the actual Fully Burdened Costs. If the actual Fully Burdened Costs are greater than the estimated Fully Burdened Costs, Astellas shall pay such difference within [ * ] of receipt of an invoice from FG for such amounts. For payments for the transfer of Lead Compound under Section 9.2(d) hereof, FG's invoice to Astellas shall be calculated based on the current Listed Price as set by the Japanese Ministry of Health, Labour and Welfare. Upon calculation of the Sales Price, Astellas shall submit, for any amounts actually sold, the Sales Price to FG, and FG shall credit Astellas for the difference between the invoice cost, cost calculated based on the Listed Price and the cost calculated based on the Sales Price.

9.4 Reference Materials; Standard Materials. In exchange for the transfer by FG of any Reference Materials or Standard Materials for the purposes of conducting analytical, release, stability and other studies authorized under the Development Program, Astellas shall pay to FG, FG's Fully Burdened Costs of such materials as reasonably determined by FG.

ARTICLE 10 ADDITIONAL PAYMENTS; BOOKS AND RECORDS

10.1 Quarterly Reports. Astellas shall make quarterly reports to FG within sixty (60) days after the end of each calendar quarter (April 1 though June 30, July 1 through September 30, October 1 though December 31, January 1 through March 31), which reports shall include, (a) the Net Sales, unit shipments and other distributions, including samples, by Astellas, and its Affiliates and Sublicensees, in such calendar quarter and (b) such other information as may be reasonably requested by FG to ensure either proper payment by Astellas of amounts required under this Agreement or to calculate payments with respect to FG's Third Party Agreements. Concurrently with making such report, Astellas shall remit payment to FG for any payments due under this Agreement.

10.2 Payment Method. All payments under this Agreement shall be made by bank wire transfer in immediately available funds to an account designated by the payee. All   -22-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   such payments made by or on behalf of Astellas hereunder shall be made by a Japanese entity. All dollar amounts specified in this Agreement, and, except as specifically authorized under Section 10.3 hereof, all payments made hereunder, are and shall be made in U.S. dollars. Any payments due under this Agreement which are not paid by the date such payments are due under this Agreement shall bear interest to the extent permitted by applicable law at the U.S. prime rate per annum quoted in the Money Rates column of The Wall Street Journal (U.S., Western Edition) on the first business day after such payment is due, plus an additional [ * ], calculated on the number of days such payment is delinquent. This Section 10.2 shall in no way limit any other remedies available to either party.

10.3 Currency Conversion. In the event that the amount of an Astellas payment obligation in U.S. dollars must be determined by the calculation of an underlying amount received by Astellas in Japanese Yen utilizing the U.S. dollar-Japanese Yen exchange rate (i.e., a transfer payment under Section 9.2(a), (b) or (d) hereof), currency conversion from Japanese Yen to U.S. dollars shall be made using the closing exchange rate reported in the Wall Street Journal (U.S. Western Edition) for the date on which the Lead Compound is Delivered to Astellas. If any such payment is not made by the due date, the exchange rate utilized for determination of such payment obligation shall be the exchange rate [ * ] reported in the Wall Street Journal (U.S. Western Edition) during the period from the date of invoice through the due date, not including any additional amounts owed under Section 10.2 hereof.

10.4 Taxes

10.4.1 Generally. Each party shall bear and, except as otherwise expressly provided in this Section 10.4, pay any and all taxes, duties, levies, and other similar charges (and any related interest and penalties), however designated, imposed on that party as a result of the existence or operation of this Agreement. If laws or regulations require that taxes be withheld, the paying party will (i) timely pay the taxes to the proper taxing authority, and (ii) send proof of payment to the other party within [ * ] following that payment.

10.4.2 Certain Payments. Notwithstanding Section 10.4.1, all payments by Astellas required under this Agreement above, including under Section 6.1.1 are expressed as net amounts and shall be made free and clear of, and without reduction for, any withholding taxes, provided, however, that in the event that any withholding taxes are due on the payments Astellas shall make to FG under Sections 6.1.2 and 6.1.3, Astellas shall make such payments directly to the Japanese Tax Authority and shall be entitled to reduce the amount paid to FG by [ * ] of the amount of the withholding taxes paid to Japanese Tax Authority in respect of such payment, unless the amount of such withholding taxes is reduced by a decision of the Japanese tax authority, or is subsequently adjusted downward as result of appeal, in which event the next payment due hereunder, including, without limitation, a transfer payment or a payment upon termination, shall be increased by such amount. Any such taxes which are otherwise imposed on payments to FG shall be the sole responsibility of Astellas. Astellas shall provide FG with official receipts issued by the appropriate taxing authority or such other evidence as is reasonably requested by FG to establish that such taxes have been paid. Astellas and FG shall cooperate to minimize the withholding taxes due on the amounts payable by Astellas to FG hereunder to the extent permissible under law, including, but not limited to,   -23-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   making appropriate application(s) to the tax authorities within the Astellas Territory. If possible, FG shall use its reasonable efforts to apply for the tax refund from U.S. tax authorities for the withholding taxes paid to the Japanese Tax Authority on the payment U.S. $[ * ] payment made by Astellas to FG on January 13, 2004 as set forth in Section 6.1 when such application for the tax refund becomes possible, and if FG has received any such tax refund, FG shall reimburse to Astellas for the amounts corresponding to the withholding taxes paid in Astellas' accounts as set forth above.

10.5 Records; Inspections. Astellas shall keep, and require its Affiliates and Sublicensees to keep, complete, true and accurate books of accounts and records for the purpose of determining payments due pursuant to this Agreement. Such books and records shall be kept for at least [ * ] following the end of the calendar quarter to which they pertain. FG shall keep, and require its Sublicensee(s) to keep, complete, true and accurate books of accounts and records for the purpose of verifying the accuracy of the [ * ] Percentage and Fully Burdened Costs. Such records will be open for inspection at the principal place of business of each party (the Inspected Party) during such [ * ] period by an independent auditor chosen by the other party (the Inspecting Party) and reasonably acceptable to the Inspected Party for the purpose of verifying the amounts payable by Astellas to FG hereunder or the accuracy of the [ * ] Percentage and/or Fully Burdened Costs. Such inspections may be made no more than once each calendar year, at reasonable times and on reasonable notice. Any books of accounts or records shall not be inspected more than once. The independent auditor retained by the Inspecting Party shall be obligated to execute a reasonable confidentiality agreement with the Inspected Party prior to commencing any such inspection, which, among other customary clauses, contains the provisions to the effect that such auditor shall not disclose to the Inspecting Party any information other than as necessary to accomplish the purpose of the inspection. Inspections conducted under this Section 10.5 shall be at the expense of the Inspecting Party. Any underpaid or overcharged amounts that are discovered will be paid by the Inspected Party, and with interest on such underpaid or overcharged amounts at the rate set forth in Section 10.2 above. The parties will endeavor to minimize disruption of the Inspected Party's normal business activities to the extent reasonably practicable.

ARTICLE 11 DUE DILIGENCE

11.1 Astellas' Due Diligence. Astellas shall use its commercially reasonable efforts (i) to conduct any development work undertaken under the Development Program, and any and all clinical trials (including without limitation Phase III) required to obtain, and thereafter to take such other actions as are necessary to obtain, Marketing Approvals for any Lead Compound in the Astellas Territory as soon as practicable, and (ii) to launch each such Lead Compound in the Astellas Territory as soon as practicable after receiving Marketing Approval in the Astellas Territory for such Lead Compound.

11.2 FG's Due Diligence. FG shall use its commercially reasonable efforts to conduct, and to the extent possible taking into account safety and other applicable issues, complete a Phase II clinical trial with FG-2216 or another Lead Compound in the FG Territory.   -24-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   11.3 Development Diligence

11.3.1 Astellas shall pursue development of Indications according to the following terms: (i) Astellas shall pursue Commercialization in Treatment of anemia in patients with chronic kidney disease undergoing dialysis and Treatment of anemia in patients with chronic kidney disease not undergoing dialysis; (ii) Astellas shall notify FG within six (6) months of the execution of this Agreement whether it shall pursue Commercialization in [ * ]; (iii) Astellas shall notify FG within six (6) months of the date FG notifies Astellas that it has demonstrated Proof of Concept whether it will pursue Commercialization in [ * ]; (iv) Astellas shall notify FG within six (6) months of the date FG notifies Astellas that it has demonstrated Proof of Concept whether it will pursue Commercialization in [ * ]; and (v) Astellas shall notify FG, upon Marketing Approval for any Lead Compound in each of the following Indications, whether it will pursue Commercialization of such Indication: [ * ], and any other indications to be added hereafter to the definition of the Indication by mutual agreement; and (vi) if FG is pursuing Commercialization of [ * ], Astellas shall notify FG after Marketing Approval whether it shall pursue Commercialization of such Indication. Should Astellas inform FG that it does not wish to pursue Commercialization of any Indication, or should Astellas fail to meet the due diligence obligations under Section 11.3.2 for any Indication as set forth in Section 11.3.1(iv) or under Section 11.3.3 for any Indication as set forth in Section 11.3.1(v), such Indication shall no longer be considered an Indication for the purposes of this Agreement, and Astellas shall have no right or shall lose any right with respect to such Indication under this Agreement including, without limitation, the licenses granted under Sections 8.1 and 13.1 hereof. Each Indication for which Astellas is obligated to pursue Commercialization under Section 11.3.1(i) or for which it decides to pursue Commercialization under Sections 11.3.1(ii), (iii) or (iv) shall be a Major Indication.

11.3.2 In addition to the obligations set forth in Section 11.1 and 11.3, for each Major Indication, until such time as Astellas obtains Marketing Approval in the Astellas Territory for such Major Indication, with respect to each Lead Compound for each Major Indication, Astellas shall:

(a) If required for development of a Lead Compound in an Indication, Initiate Phase I clinical trials within [ * ] after the later of (i) the Effective Date, for Indications for which FG has commenced clinical trials prior to the execution of this Agreement, and (ii) FG's or its Sublicensees Initiation of a Phase I clinical trial for other such Indications.   -25-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   (b) Initiate Phase II clinical trials within the later of (i) [ * ] after FG's, or its Sublicensee's, Initiation of Phase II, (ii) [ * ] after Astellas' Completion of its Phase I clinical trial(s), (iii) if Astellas' obligations under this Subsection 11.3.2(b) are triggered upon FG's notification of demonstration of Proof of Concept in an Indication, [ * ] after the date Astellas notifies FG that it will pursue Commercialization in such Indication, and (iv) in the event Astellas' obligations under this Section 11.3.2(b) are triggered by the designation of a secondary Lead Compound as a primary Lead Compound, [ * ] after such designation.

(c) Either notify FG of its intent to employ the Bridging Strategy, if applicable, or Initiate Phase III clinical trials within [ * ] of the later of (i) FG's, or its Sublicensee's Initiation of a Phase III clinical trial and (ii) Astellas' Completion of its Phase II clinical trial(s).

11.3.3 For each of the Indications set forth in Section 11.3.1(v), Astellas shall Initiate Phase II clinical studies within [ * ] of its notification to FG that it will pursue Commercialization in such Indication.

11.3.4 Astellas' diligence obligations set forth in Section 11.3.2 shall apply to all Lead Compounds designated by FG, provided, that for each Indication for which such diligence obligations apply, the diligence obligations shall only apply to the primary Lead Compound designated by FG, and for the secondary Lead Compound, Astellas' diligence obligations shall be limited to those set forth in Section 11.3.2(a) until the designation of the secondary Lead Compound as the primary Lead Compound, provided, further, upon such designation, that such diligence obligation shall be expanded to include the requirement that Astellas complete the Phase I clinical studies required to Initiate Phase II clinical studies in the Indication with such secondary Lead Compound.

ARTICLE 12 MANUFACTURING RIGHTS

12.1 Procedures. FG shall have the exclusive right to determine the methods and procedures for the manufacture of all Lead Compounds. If FG intends to make any change in the methods or procedures, including, without limitation, manufacturing process, analyzing process and/or site change for manufacture of the Lead Compounds, FG shall notify Astellas in writing of such intended change; provided, that if in Astellas' reasonable opinion, such change may lead to any amendment to the relevant Marketing Approval or Marketing Approval Application, Astellas shall use best efforts to (i) as soon as possible petition the Japanese Ministry of Health, Labor and Welfare to make the change without an amendment to the Marketing Approval or MAA and shall concurrently prepare an application for amendment to the Marketing Approval or MAA, and (ii) if the Japanese Ministry of Health, Labor and Welfare determines such an amendment is required, shall notify FG and submit the application for amendment immediately following notice of such requirement, and FG shall not make the intended change without a prior written consent from Astellas, such consent not to be unreasonably withheld or delayed, provided, further, that consent shall be deemed granted upon notice that an amendment is not required or approval of an amendment from the Japanese   -26-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   Ministry of Health, Labor and Welfare. FG shall provide Astellas with all the data and information necessary for Astellas to amend the Marketing Approval or MAA in Astellas Territory and shall continue to supply Astellas with the Lead Compound as manufactured with the manufacturing methods and procedures or at the manufacturing site described in Astellas' (or its Affiliate's or Sublicensee's) then current Marketing Approval or MAA until Astellas will have finished the necessary amendment to the relevant Marketing Approval or MAA or received notice that an amendment is not required.

12.2 FG Right. FG shall have the worldwide exclusive right (itself or through third party vendors) to manufacture (or have manufactured) Lead Compounds. Astellas and its Affiliates and Sublicensees shall not directly or indirectly make, produce or manufacture any Lead Compounds.

12.3 Manufacture and Supply. FG shall have the exclusive right and obligation to supply the Lead Compounds to Astellas and its Affiliates and Sublicensees for all development and commercial purposes, and Astellas and its Affiliates and Sublicensees shall purchase such Lead Compounds exclusively from FG. It is understood that FG may engage subcontractors with respect to the manufacture of such Lead Compounds to fulfill its supply obligations to Astellas hereunder. In all cases, supply by FG of Lead Compounds hereunder shall be Ex Works (Incoterms 2000) the manufacturing facility. Subject to Section 8.3.5 hereof, nothing herein is intended to preclude FG from granting rights to supply or supplying (a) any Lead Compound outside of the Astellas Territory to any third party for use within or outside the Field, or (b) any compound Controlled by FG within the Astellas Territory except for a Lead Compound for the duration of its designation in compliance with the terms and conditions of this Agreement.

12.4 Product Specifications. The Lead Compounds to be supplied by FG hereunder shall meet the Product Specifications. In addition to, but not in limitation of, the foregoing, FG and Astellas agree that upon Marketing Approval for any Lead Compound, FG's obligation to supply Astellas with Lead Compound shall be limited to, and all payment obligations set forth in Section 9.2 shall be based on, the supply of Bulk Product, unless otherwise agreed by the parties. The packaging for the Lead Compound to be distributed commercially by Astellas shall contain a clearly visible acknowledgment that the Lead Compound was manufactured by FG, and shall contain a registered trademark of the FG logo or other trademark approved by FG.

12.5 Orders Forecast

12.5.1 Orders for Non-Commercial Use. In connection with the supply of any Lead Compound for non-commercial use in the Territory, Astellas shall provide FG with a firm purchase order as early as possible prior to its requirements, and in no event less than [ * ] prior to the shipment or other release date(s) requested by Astellas for such Lead Compound. FG shall provide such Lead Compound to Astellas as soon as practicable within such time period, subject, prior to Marketing Approval, to the reasonable lead time requirements of third party contract manufacturers. All forecasts shall be prepared in good faith in order to facilitate FG's manufacture and shipment of the Lead Compound in compliance with this Agreement.   -27-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   12.5.2 Forecast and Order for Commercial Use. In connection with the supply of any Lead Compound for commercial use in the Astellas Territory upon FG's request, Astellas and FG shall negotiate in good faith appropriate forecasting and firm purchase order lead times, taking into consideration the reasonable notice requirements of FG and its third party manufacturers. All forecasts shall be prepared in good faith in order to facilitate FG's manufacture and shipment of the Lead Compound in compliance with this Agreement.

12.6 Shipment. Astellas, or FG at Astellas' request if specified in a purchase order by Astellas, shall arrange for shipment of the Lead Compound as specified in each purchase order by Astellas, Ex Works (Incoterms 2000) the manufacturing facility. For purposes of this Agreement, and notwithstanding anything to the contrary contained within the term Ex Works, it is hereby acknowledged and agreed that title and risk of loss shall transfer to Astellas from receipt by Astellas at the manufacturing facility. Astellas shall bear the costs of such carrier, including the costs of insurance of the shipment, and all customs, duties, sales taxes and other governmental charges related to the importation and sales of the Lead Compound.

12.7 Inspection of Shipment/Right to Reject. Each shipment of Lead Compound from FG to Astellas shall contain such laboratory and quality control certificate as are necessary to show that the Lead Compound is in conformity with the Product Specifications. Astellas shall promptly inspect each shipment. In the event that any portion of the shipment fails to conform to the Product Specifications, Astellas shall notify FG within [ * ] of Astellas' receipt of such shipment. Such notice shall specify the manner in which the Lead Compound fails to meet the Product Specifications. In the absence of such notification, Astellas shall be deemed to have accepted the shipment. FG and Astellas agree to consult with each other to resolve any discrepancy between each other's determinations regarding any possible nonconformity of the Lead Compound. If such consultation does not resolve the discrepancy, the parties agree to nominate a reputable independent laboratory or other independent third party, in each case acceptable to both parties, to carry out tests on representative samples taken from such shipment, and the results of such tests shall be binding on both parties. If the results of such tests demonstrate that the Lead Compound does not meet the Product Specifications, then FG shall pay the costs of such tests; otherwise, Astellas shall pay for the costs of such tests. FG shall, at its expense, promptly replace any Lead Compound to the extent that, in accordance with this Section 12.7, it is determined that it does not conform to the Product Specifications. Unless otherwise instructed by FG, all non-conforming Lead Compound shall be returned to FG at the place of manufacture at FG's direction and at FG's expense. If Astellas detects at any time any defect in the Lead Compound which has not been found through Astellas' inspection, it shall notify FG to that effect within [ * ] of the discovery of such defect, and the procedures set forth above in this Section 12.7 shall be applied to such defective Lead Compound, provided, that FG shall only be responsible to pay for costs of defects that are the result of FG's gross negligence or willful misconduct.

12.8 Inspection of Facilities. Astellas shall have the right, upon reasonable advance notice and during regular business hours, to inspect and audit, either by itself or through its Affiliates or consultants, the facilities (including any facilities of sub-contractors) being used by FG for production of the Lead Compound to assure compliance with applicable laws, rules and regulations, including, without limitation, Japanese regulatory standards and FG quality control procedures (Relevant Standards). FG shall also reasonably comply with inspection   -28-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   requests of the Japanese Ministry of Health, Labor & Welfare. Such inspection and audit shall be conducted at Astellas' sole cost and expense in a manner so as to minimize disruption of FG's, or its subcontractor's or Sublicensee's, business operations. FG shall, within [ * ] after FG's receipt of written notice from Astellas detailing any deficiencies which may be noted in any such audit which relate to the Relevant Standards use good faith efforts to remedy such deficiencies, and submit a plan to the Astellas outlining steps proposed to be taken.

12.9 Recall. In the event that Astellas deems it necessary to recall any Lead Compound from the market, it may do so in its sole discretion, after notification to the FG. The costs and expenses for such recall shall be borne by Astellas unless caused by a failure for which FG is required to indemnify Astellas pursuant to Section 17.3, or by FG's gross negligence or willful misconduct, in which event it shall be borne by FG.

12.10 Warranty. FG represents and warrants that the Lead Compounds to be supplied to Astellas under this Agreement shall conform to the Product Specifications and shall, as appropriate, be manufactured in compliance with GMP Guidelines. Subject to Sections 12.9 and 17.3 hereof, FG's sole obligation and Astellas' sole remedy with respect to Lead Compound which does not meet the warranty contained herein is limited to replacement of such Lead Compound and reimbursement of Astellas' out of pocket expenses for shipping to FG at the address designated by FG.

12.11 Interruption in Supply. For any particular Lead Compound, in order to minimize any interruptions in supply hereunder, FG and Astellas agree that within [ * ], FG shall maintain two separate, validated manufacturing sites (which may either be its own manufacturing facilities or facilities of a contract manufacturer) for such Lead Compound.

12.12 Reference and Standard Materials. For any Lead Compound provided to Astellas hereunder, upon Astellas' request and pursuant to Section 9.4 hereof, FG shall provide to Astellas reasonable quantities of reference materials, including analogs, metabolites, impurities, degradates and radio-labeled compounds (Reference Materials) and standard materials, i.e. defined, highly purified Lead Compound (Standard Materials) for such Lead Compound for the purposes of conducting analytical, release, stability and other studies as may be authorized by the JDC under the Development Program.

ARTICLE 13 LICENSE GRANTS

13.1 Grant to Astellas. Subject to the terms and conditions of this Agreement including Article 12 above, FG hereby grants to Astellas an exclusive license under the FG Technology to: use, package, sell, have sold, import, market and otherwise distribute the Lead Compounds for use solely in the Field in the Astellas Territory

13.2 Sublicenses. The licenses granted under Section 13.1 above include the right to grant and authorize sublicenses, subject to the requirements of this Agreement and Section 7.2. Notwithstanding the foregoing, Astellas shall not have the right to authorize a Sublicensee to market, sell or distribute Lead Compounds without FG's prior written consent   -29-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   (which consent shall not be unreasonably withheld). For the purposes of the foregoing, and without limitation, it shall be deemed reasonable for FG to withhold consent for competitive concerns.

13.3 No Rights Beyond Lead Compounds. Except as expressly provided herein, nothing in this Agreement shall be deemed to grant to Astellas rights in FG Technology other than the rights granted hereunder to the Lead Compounds, or for applications outside the Field or outside the Astellas Territory, or to manufacture Lead Compounds; nor shall any provision of this Agreement be deemed to restrict FG's right to exploit any FG Technology and/or the Lead Compounds outside the Astellas Territory.

13.4 Expanded Field Negotiation. Following the signing of this Agreement, FG agrees to negotiate in good faith with Astellas for a license to develop compounds for the Expanded Field in the Astellas Territory, exclusively for a period of [ * ] following such date, and non- exclusively thereafter until the execution of a license agreement with a third party to develop compounds for the Expanded Field. FG and Astellas hereby agree that FG's obligation to negotiate non-exclusively for the Expanded Field shall not constitute a right of first offer, right of first refusal, right of first negotiation or any obligation to enter into any agreement with Astellas at any time, and the failure of such negotiations to result in an agreement between FG and Astellas with respect to the Expanded Field shall not constitute a breach of this Agreement.

ARTICLE 14 INTELLECTUAL PROPERTY

14.1 Ownership of Inventions. Subject to Section 14.1.1, title to all inventions and other intellectual property made related to (i) the Development Program, (ii) the Lead Compounds, (iii) FG Technology or FG Confidential Information, (iv) the Field, or (v) the Expanded Field (subsections 14.1(i)-(v), collectively, the Protected Field) shall be owned by or is hereby assigned to FG; provided, however that Astellas shall own inventions of general applicability relating solely to drug delivery systems created exclusively by Astellas under subsection 14.1(i), excluding inventions related to or based on subsections 14.1(ii), (iii), (iv), or (v), and provided, further, that Astellas hereby grants to FG a worldwide, fully paid non-exclusive license with the right to sublicense to practice such inventions with respect to the FG Technology. Astellas agrees to execute any and all assignments and other documents necessary to effectuate the foregoing.

14.1.1 Notwithstanding Section 14.1, in the event that Astellas develops, completely independently from any FG Technology and/or any other FG materials, confidential information, intellectual property or other related information provided by or on behalf of FG to Astellas under this Agreement or any other agreement between FG and Astellas relating to the subject matter hereof, any inventions or intellectual property rights related to the Field or the Expanded Field, [ * ], Astellas shall own such intellectual property and hereby grants to FG and its Sublicensees a non-exclusive, royalty-free, irrevocable license to such intellectual property for the FG Territory. Astellas agrees to execute any and all assignments and other documents necessary to effectuate the foregoing.   -30-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   14.2 Patent Prosecution

14.2.1 FG Inventions. FG shall control all Prosecution and Interference Activities pertaining to FG Patents and patent applications and patents related to its, its Affiliate's or its Sublicensee's inventions in the Protected Field worldwide using counsel of its choice and shall bear the costs of such Prosecution and Interference Activities, provided, however, that; and Astellas shall reimburse to FG, within [ * ] of receipt by Astellas of invoice therefor, any such costs to the extent incurred in connection with or reasonably allocable to the FG Patents registered and/or to be registered in the Astellas Territory and related to the Field and the Lead Compounds, provided, further, that, with respect to patents or patent applications excluding those covering composition of matter claims and all patents listed on Exhibit A hereto as of the Effective Date, Astellas may postpone such reimbursement until the respective FG Patent will have been registered in the Astellas Territory if [ * ], on condition that once the respective FG Patent has been registered in the Astellas Territory, Astellas shall pay to FG such costs, plus interest to the extent permitted by applicable law at the U.S. prime rate per annum quoted in the Money Rates column of The Wall Street Journal (U.S., Western Edition), calculated in each case from the date such costs were incurred, plus an additional [ * ] thereof.

14.2.2 Astellas Inventions. Astellas shall not file for or otherwise seek to obtain (directly or indirectly) patent or other intellectual property protection for inventions that are related to the Protected Field, without the prior written consent of FG, which may be withheld at FG's sole discretion, subject to Section 14.1.1, and provided also that Astellas may file for or otherwise seek to obtain patent protection for inventions related to drug delivery systems as described in Section 14.1. To the extent that FG consents to the filing of any patent application or other intellectual property protection related to the foregoing, such patent application or other intellectual property protection shall be subject to Section 14.1, unless otherwise agreed in writing.

14.2.3 Cooperation. Astellas shall cooperate with and assist FG in connection with Prosecution and Interference Activities and shall use best efforts to consult with FG regarding the prosecution and maintenance of the FG Patents for the FG Territory and the Astellas Territory for those FG Patents for which Astellas or its Affiliates, Sublicensees or investigators are inventors, except solely for inventions (i) of general applicability relating solely to drug delivery systems created by Astellas under subsection 14.1(i), or (ii) created in compliance with Section 14.1.1 as determined solely by FG in good faith.

14.3 Defense of Third Party Infringement Claims. If the development, manufacture, sale or use of any Lead Compound pursuant to this Agreement results in a claim, suit or proceeding (collectively, Actions) alleging patent infringement against FG or Astellas (or their respective Affiliates or Sublicensees), such party shall promptly notify the other party hereto in writing. The party subject to such Action (for purposes of this Section 14.3, the Controlling Party) shall have the exclusive right to defend and control the defense of any such Action using counsel of its own choice; provided, however, that if such Action is directed to the subject matter of a patent of the other party (i.e., for Astellas, a FG Patent), such other party may participate in the defense and/or settlement thereof at its own expense with counsel of its choice.   -31-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   Except as agreed in writing by Astellas and FG, Astellas shall not enter into any settlement relating to a Lead Compound, if such settlement admits the invalidity or unenforceability, or limits any claim, of any patent within the FG Technology. The Controlling Party agrees to keep the other party hereto reasonably informed of all material developments in connection with any such Action. Any cost, liability or expense associated with such action (including amounts paid in settlement) (together, Expenses) shall be borne by the Controlling Party; provided, that if Astellas is the Controlling Party, and the Action is related to Future Third Party Intellectual Property, with respect to Expenses related solely to such Future Third Party Intellectual Property, it shall be entitled to deduct up to [ * ] of the Expenses incurred on an annual basis from [ * ] in such year under this Agreement, provided, however, that (i) the total amount deducted shall not exceed [ * ] thereunder, and (ii) notwithstanding (i) above, Astellas' right to deduct Expenses incurred shall be further limited such that in no event shall the sum of (a) the Expenses deducted by Astellas under this Section 14.3, and (b) the consideration FG contributes for the acquisition of intellectual property from Third Party Licensors for the Astellas Territory as set forth in Section 14.5, exceed [ * ] hereunder, and, provided further, that if FG is the Controlling Party, it shall be entitled to reimbursement by Astellas of [ * ] of such Expenses, as incurred. Notwithstanding the foregoing, Astellas shall be solely responsible (without right of deduction) for all Expenses related to any Action relating to Preexisting Third Party Intellectual Property.

14.4 Enforcement. Subject to the provisions of this Section 14.4, in the event that FG or Astellas reasonably believes that any FG Technology necessary for the development, manufacture, use or sale of a Lead Compound is infringed or misappropriated by a third party or is subject to a declaratory judgment action arising from such infringement, in each case with respect to the development, manufacture, sale or use of a product within the Field and within the Astellas Territory, Astellas or FG (respectively) shall promptly notify the other party hereto. Promptly after such notice the parties shall meet to discuss the course of action to be taken with respect to an Enforcement Action (as defined below) with respect to such infringement or misappropriation, including the control thereof and sharing of costs and expenses related thereto, for the purposes of entering into a litigation agreement setting forth the same (Litigation Agreement). If the parties do not enter such Litigation Agreement, FG shall have the initial right (but not the obligation) to enforce the intellectual property rights with respect to the FG Technology, or defend any declaratory judgment action with respect thereto (such action, for purposes of this Section 14.4, an Enforcement Action).

14.4.1 Information. Absent a Litigation Agreement, the party initiating or defending any such Enforcement Action within the Field shall keep the other party hereto reasonably informed of the progress of any such Enforcement Action, and such other party shall have the right to participate with counsel of its own choice at its own expense.

14.4.2 Enforcement Costs; Recoveries. Absent a Litigation Agreement, FG shall have the initial right to initiate such an Enforcement Action, and shall notify Astellas within a reasonable time whether it elects to exercise such right. In the event that FG elects to initiate or defend such Enforcement Action, FG shall be responsible for [ * ] of the costs and expenses while Astellas shall be responsible for [ * ] of the costs and expenses, and all amounts recovered shall first be applied to reimbursement of each   -32-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   party's costs and expenses with the remainder to be allocated to FG and Astellas at the ratio of [ * ] and [ * ]. In the event that FG elects not to initiate or defend such Enforcement Action, Astellas shall have the right to initiate or defend such Enforcement Action in its own name, and to the extent permitted under Third Party Agreements, in the name of FG or in the names of both FG and Astellas, in which case, Astellas shall be responsible for [ * ] of the costs and expenses while FG shall be responsible for [ * ] of the costs and expenses, and all amounts recovered shall first be applied to reimbursement of each party's costs and expenses with the remainder to be allocated to Astellas and FG at the ratio of [ * ] and [ * ].

14.4.3 Cooperation in Enforcement Action. Absent a Litigation Agreement, at the request of the party which has the right to initiate or defend an Enforcement Action, the other party shall reasonably cooperate in the Enforcement Action, such cooperation to include, without limitation, furnishing records, information and testimony, and attending conferences, discovery proceedings, hearings, trials and appeals; provided, that the requesting party shall reimburse to the cooperating party for the out-of-pocket expenses incurred for such cooperation pursuant to the reimbursement regime set forth in Section 14.4.2.

14.5 Third Party Agreements

14.5.1 Future Agreements. It is understood that FG may find it necessary to utilize in connection with a Lead Compound intellectual property that is controlled by a non-Affiliate third party (such party, a Third Party Licensor), in addition to or in lieu of the FG Technology existing as of the Effective Date. FG shall have the right to obtain (by purchase, license, or otherwise) rights to such intellectual property with the right to sublicense to Astellas. In the event that FG determines that it must obtain such rights, it shall provide notice and submit a description of such rights to Astellas, and shall discuss with Astellas the need to obtain such rights. Astellas shall inform FG within [ * ] of receipt of such notice whether it believes it is necessary to obtain such rights for the Astellas Territory and wishes to obtain such rights. In the event Astellas determines to obtain such rights, FG shall obtain a worldwide license for the rights under such terms and conditions as are [ * ], and such intellectual property of the Third Party Licensor shall be deemed to be the part of FG Technology, provided, however, that, notwithstanding anything contained in this Agreement (i) for Preexisting Third Party Intellectual Property, [ * ] shall pay [ * ] of all consideration due in connection with the acquisition of such rights for the Astellas Territory, and (ii) for Future Third Party Intellectual Property, [ * ] shall [ * ] pay [ * ] of all consideration due in connection with the acquisition of such rights for the Astellas Territory, provided, however, notwithstanding FG's obligation to contribute to the consideration due for Future Third Party Intellectual Property under (ii) above, FG's obligation to contribute shall be limited such that in no event shall the sum of (a) the consideration FG contributes for the acquisition of intellectual property from Third Party Licensors for the Astellas Territory, and (b) the Expenses for which Astellas has the right to deduct under Section 14.3 exceed [ * ] hereunder, and Astellas shall be responsible for all consideration related to the acquisition of rights from Third Party Licensors in excess of such amount. In the event Astellas determines not to obtain such rights for the Astellas Territory, FG shall obtain a license for the FG Territory but not the Astellas Territory, and Astellas shall be solely responsible for the defense of any infringement   -33-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   Action, for all Expenses related to any such Action, and any right of Astellas to deduct Expenses under this Agreement against payments required to be made to FG hereunder shall not apply to any action brought with respect to such rights.

14.5.2 Payment; Reports. If FG is obligated to pay amounts to a Third Party Licensor, FG shall notify Astellas [ * ] in advance of the due date of such payment obligation (or such later date as FG may determine), and Astellas shall reimburse its share of such payments within [ * ] after receipt of notice therefor.

14.5.3 Limitation. To the extent that FG Patents includes any intellectual property licensed under FG's License Agreement with Imigen, Inc. relating to HIF stabilization technology dated as of October 30, 2003, and amended as from time to time of which a redacted copy shall have been provided to Astellas prior to the Effective Date, Astellas shall be considered a sublicensee and be subject to the applicable requirements thereunder.

14.5.4 Compliance with Third Party Agreements. Notwithstanding anything to the contrary contained herein, Astellas agrees to comply with the requirements (upon sublicensees or otherwise) of FG's License Agreement with Imigen, Inc. relating to HIF stabilization technology dated as of October 30, 2003. In addition, Astellas agrees to comply with the requirements (upon sublicensees or otherwise) of any future Third Party Agreements for which Astellas obtains rights through an FG license pursuant to Section 14.5.1 hereof.

ARTICLE 15 REPRESENTATIONS AND WARRANTIES

15.1 FG Warranties. FG warrants and represents to Astellas, as of the execution of this Agreement, that (i) it is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware; (ii) the execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate action on the part of FG; (iii) there is no pending litigation which alleges or any communication alleging that Commercialization of any Lead Compound or any compound Controlled by FG for use in the Field has infringed or misappropriated the intellectual property rights of any Third Party or has been obtained by misappropriating any Third Party's intellectual property right; and (iv) subject to the terms and conditions of the agreements for the FG Acquired Patents, FG has complete title to and ownership of the FG Patents, free and clear from any mortgages, pledges, liens, security interests, conditional and installment sale agreements, encumbrances, charges or claims of any kind.

15.2 Astellas Warranties. Astellas warrants and represents to FG, as of the execution of this Agreement, that (i) it is a corporation duly organized, validly existing and in good standing under the laws of Japan; and (ii) the execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate action on the part of Astellas.

15.3 Disclaimer of Warranties. EXCEPT AS OTHERWISE SET FORTH HEREIN, FG AND ASTELLAS EXPRESSLY DISCLAIM ANY WARRANTIES OR CONDITIONS, EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, WITH RESPECT TO   -34-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   THE DEVELOPMENT PROGRAM, OR THE FG TECHNOLOGY OR LEAD COMPOUNDS, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF FG TECHNOLOGY, PATENTED OR UNPATENTED, AND NONINFRINGEMENT OF THE INTELLECTUAL PROPERTY RIGHTS OF THIRD PARTIES.

ARTICLE 16 CONFIDENTIALITY

16.1 Confidential Information. Except as expressly provided herein, the parties agree that the receiving party shall not publish or otherwise disclose and shall not use for any purpose other than this Agreement any information furnished to it by the other party hereto pursuant to this Agreement which if disclosed in tangible form is marked Confidential or with other similar designation to indicate its confidential or proprietary nature or if disclosed orally is indicated orally to be confidential or proprietary by the party disclosing such information at the time of such disclosure and is confirmed in writing as confidential or proprietary by the disclosing party within a reasonable time after such disclosure (collectively, Confidential Information). Notwithstanding the foregoing, Confidential Information shall not include information that, in each case is demonstrated by written documentation:

(a) was already known to the receiving party, other than under an obligation of confidentiality directly or indirectly to the disclosing party at the time of disclosure hereunder;

(b) was generally available to the public or otherwise part of the public domain at the time of its disclosure to the receiving party hereunder;

(c) became generally available to the public or otherwise part of the public domain after its disclosure and other than through any act or omission of the receiving party in breach of this Agreement; or

(d) was subsequently lawfully disclosed to the receiving party by any third party without any confidentiality obligation directly or indirectly to the disclosing party or developed by the receiving party without reference to any information or materials disclosed by the disclosing party.

It is agreed and understood that all matters discussed and presented at the meetings of the JDC shall be considered Confidential Information hereunder, subject to the terms and conditions of this Agreement.

16.2 Permitted Disclosures. Notwithstanding the provisions of Section 16.1 above, each party hereto may disclose the other party's Confidential Information to the extent such disclosure is reasonably necessary to exercise the rights granted to it, or reserved by it, under this Agreement (including, without limitation, entering into and/or performing business or scientific relationships with respect to products outside the Field as permitted hereunder), in filing or prosecuting patent applications, prosecuting or defending litigation, complying with applicable governmental regulations, submitting information to tax or other governmental   -35-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   authorities (including regulatory authorities), or conducting clinical trials hereunder with respect to Lead Compounds, provided that if a party is required by law to make any such disclosure of the other party's Confidential Information, to the extent it may legally do so, it will give reasonable advance notice to the latter party of such disclosure and, save to the extent inappropriate in the case of patent applications or otherwise, will use its reasonable efforts to secure confidential treatment of such Confidential Information prior to its disclosure (whether through protective orders or otherwise).

16.3 Clinical Data. Except as expressly permitted under Sections 7.2 and 16.2, and for publications or disclosures in accordance with Section 5.2, neither party shall disclose to third parties pre-clinical data, clinical data or regulatory filings, comprising Confidential Information of the other party.

16.4 Press Releases. Except as may already be, or is agreed to be, publicly disclosed, in the event that either party proposes to release a press release with respect to this Agreement or the Development Program, such party shall obtain the prior written consent of the other party, which shall not be unreasonably withheld.

ARTICLE 17 INSURANCE; INDEMNIFICATION

17.1 Insurance. Each party shall secure and maintain in effect during the term of this Agreement and for a period of five (5) years thereafter insurance policy(ies) underwritten by a reputable insurance company and in a form and having limits standard and customary for entities in the biopharmaceutical industry for exposures related to the Lead Compounds. Such insurance shall include general liability, clinical trial liability and products liability coverage with respect to such party's performance of the Development Program and commercialization of Lead Compounds hereunder. Upon request by the other party hereto, certificates of insurance evidencing the coverage required above shall be provided to the other party.

17.2 Indemnification of FG. Astellas shall indemnify each of FG and its Affiliates and the directors, officers, and employees of FG and such Affiliates and the successors and assigns of any of the foregoing (the FG Indemnitees), and hold each FG Indemnitee harmless from and against any and all liabilities, damages, settlements, claims, actions, suits, penalties, fines, costs or expenses (including, without limitation, reasonable attorneys' fees and other expenses of litigation) incurred by any FG Indemnitee to the extent not otherwise covered by insurance, arising from or occurring as a result of any claim, action, suit, or other proceeding brought by third parties against a FG Indemnitee arising from or occurring as a result of any development, testing, manufacture, importation, use, offer for sale, sale or other distribution of any Lead Compound by or for the benefit of Astellas or its Affiliates or Sublicensees, distributors or agents (including, without limitation, product liability and infringement claims) except to the extent caused by failure of the Lead Compound supplied by FG to meet the Product Specifications in effect at the time of manufacture, or material deviation by FG or its sub-contractor from GMP Guidelines in manufacturing the Lead Compound, or FG's breach of this Agreement or willful misconduct.   -36-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   17.3 Indemnification of Astellas. FG shall indemnify each of Astellas and its Affiliates and the directors, officers, and employees of Astellas and such Affiliates and the successors and assigns of any of the foregoing (the Astellas Indemnitees), and hold each Astellas Indemnitee harmless from and against any and all liabilities, damages, settlements, claims, actions, suits, penalties, fines, costs or expenses (including, without limitation, reasonable attorneys' fees and other expenses of litigation) incurred by any Astellas Indemnitee to the extent not otherwise covered by insurance, arising from or occurring as a result of any claim, action, suit, or other proceeding brought by third parties against an Astellas Indemnitee to the extent caused by failure of the Lead Compound supplied by FG to meet the Product Specifications in effect at the time of manufacture, or material deviation by FG or its sub-contractor from GMP Guidelines in manufacturing the Lead Compound, except in each case in this Section 17.3 to the extent caused by Astellas' breach of this Agreement or willful misconduct.

17.4 Procedure. A party (for purposes of this Section 17.4, the Indemnitee) that intends to claim indemnification under any provision of this Agreement shall promptly notify the indemnifying party (the Indemnitor) in writing of any claim, action, suit, or other proceeding brought by third parties in respect of which the Indemnitee or any of its Affiliates, or their directors, officers, employees, successors or assigns intend to claim such indemnification hereunder. As between the parties hereto the Indemnitor shall have the right to control the defense and settlement of such claim, action, suit, or other proceeding; provided, that the Indemnitee shall have the right to participate in such defense or settlement with counsel of its own choosing at its expense. The Indemnitee shall not make any settlement of any loss, claim, damage, liability or action without the consent of the Indemnitor, to the extent such consent is not withheld unreasonably or delayed. The failure to deliver written notice to the Indemnitor within a reasonable time after the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such Indemnitor of any liability to the Indemnitee under this Article 17 but the omission so to deliver written notice to the Indemnitor shall not relieve the Indemnitor of any liability that it may have to any Indemnitee otherwise than under this Article 17. Without limiting the foregoing, the Indemnitee shall keep the Indemnitor fully informed of the progress of any claim, action, suit, or other proceeding for which it intends to claim indemnification under this Article 17.

ARTICLE 18 TERM AND TERMINATION

18.1 Term. This Agreement shall become effective as of the Effective Date and, shall continue in full force and effect until terminated pursuant to this Article 18.

18.2 Termination for Cause or Technical Product Failure

18.2.1 Material Breaches. FG may forthwith terminate this Agreement in the event Astellas fails to make any payment due under Articles 6, 9 or 14, within [ * ] following receipt of written notice of such default, or materially breaches its obligations under Articles 8 or 14, and fails to cure such breach within [ * ] following receipt of written notice of such default. Astellas may forthwith terminate this Agreement in the   -37-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   event FG materially breaches its obligations under Article 7 or Article 12, and fails to cure such breach within [ * ] following receipt of written notice of such default. Any termination shall become effective at the end of such [ * ] or [ * ] period unless the defaulting or breaching party (or any other party on its behalf) has cured any such default prior to the expiration of the [ * ] or [ * ] period, as the case may be.

18.2.2 Independent Activities. Notwithstanding anything contained in Section 8.3.2 or Section 14.1.1, in the event that Astellas Commercializes any molecules for the Field or the Expanded Field, except for actions taken within the Field in the course of the exercise of the licenses granted under Sections 8.1 and 13.1 hereof and expressly authorized under this Agreement, even if FG determines that Astellas' activities are completely independent of any FG Technology and/or any other FG materials, confidential information, intellectual property or other related information provided by FG to Astellas under this Agreement or any other agreement between FG and Astellas relating to the subject matter hereof, FG shall have the right at its sole discretion to terminate this Agreement upon [ * ] notice to Astellas.

18.2.3 Technical Product Failure. Astellas may terminate this Agreement upon [ * ] notice to FG upon Technical Product Failure.

18.2.4 Development Diligence Failure. FG may terminate this Agreement upon thirty (30) days notice to Astellas in the event Astellas fails to meet any of its development diligence requirements as set forth in Article 11 hereof, provided, however, that with respect to the development diligence obligations set forth in Section 11.3.2, such termination right on behalf of FG shall be triggered only upon Astellas' failure to meet such development diligence obligations for a Major Indication (except those Major Indications set forth in Section 11.3.1(iv)), and Astellas may terminate this Agreement upon thirty (30) days notice to FG in the event FG fails to meet the development diligence requirement as set forth in Section 11.2 hereof.

18.2.5 Other Material Non-Performance/Misrepresentation. Other than a breach giving rise to a termination right as set forth in Sections 18.2.1 or 18.2.4, or a termination pursuant to a Technical Product Failure as set forth in Section 18.2.3 in the event of (i) a party's breach or default in any other material respect in the performance or observance of any other material term, covenant or provision of this Agreement, or (ii) if any representation by a party contained in this Agreement shall prove to have been incorrect in any material respect when made, resulting in material adverse consequences for the other party, (any such default or material incorrect representation a Material Non-Performance), such Material Non-Performance shall be remedied only as provided in Section 18.7.4 below.

18.3 Termination in case of Generic Competition. In the event generic equivalents has captured the [ * ] of the quantity of Lead Compound sold by Astellas during the [ * ] preceding such termination calculated on a annual basis; or in the event, after the entry into the market of generic equivalents, that Astellas' annual sales fall below $[ * ] for all Lead Compounds, Astellas may terminate this Agreement upon [ * ] written notice to FG; provided, that Astellas does not Commercialize any Lead Compound after such termination until the expiration of the last to expire FG Patents applicable to such Lead Compound.   -38-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   18.4 Negative Advice from Authorities. Astellas may terminate this Agreement upon [ * ] notice to FG in the event Astellas has commenced Phase III clinical studies in those of the following Indications that FG is developing: Treatment of anemia in patients with chronic kidney disease undergoing dialysis, Treatment of anemia in patients with chronic kidney disease not undergoing dialysis and [ * ], and the Japanese Ministry of Health, Labor & Welfare has provided written notification that it will not approve the Lead Compounds in such Indications or the JDC determines, after the submission by Astellas of Marketing Approval Applications for such Indications, and the receipt of a response or request of the Japanese Ministry of Health, Labor & Welfare that contains development demands that are so onerous that it is not reasonable to continue with Development of the Lead Compounds in such Indications.

18.5 Admission of Invalidity or Unenforceability of FG Patent. Astellas may terminate this Agreement upon [ * ] notice to FG in the event that FG enters into a settlement under Section 14.3 that admits the invalidity or unenforceability of all patents within the FG Technology, including patents covering Lead Compounds.

18.6 Termination upon Notice. Subject to Section 18.7.2, Astellas may terminate this Agreement upon six (6) months notice to FG for any reason or no reason.

18.7 Effect of Termination

18.7.1 Accrued Obligations. Termination of this Agreement for any reason shall not release either party hereto from any liability which, at the time of such termination, has already accrued to the other party or which is attributable to a period prior to such termination nor preclude either party from pursuing all rights and remedies it may have hereunder or at law or in equity with respect to any breach of this Agreement.

18.7.2 Termination. In the event of (a) a termination by Astellas under Section 18.6 during the period from the execution of this Agreement until the last to expire of the FG Patents, or (b) by FG under Section 18.2.1, 18.2.2, 18.2.4 or 18.2.5 hereof, Astellas shall, upon the effective date of such termination, pay to FG (i) a termination fee of $[ * ] U.S. dollars and (ii) any payments to which FG is otherwise entitled to receive hereunder in the period from the date of such termination notice until the [ * ].

18.7.3 Survival. Articles 1, 5, 14, 16, 17, 18, 19 and 20, and Sections 8.3.3 and 10.5, shall survive any termination of this Agreement, along with FG's rights and Astellas' obligations (but not Astellas' rights or FG's obligations, except to the extent required by the Japanese Ministry of Health, Labor and Welfare) under Section 5.1.1 and Article 7. In addition, the following provisions shall survive termination of this Agreement for any reason: Astellas shall assign or cause to be assigned to FG (or if not so assignable, Astellas shall take all reasonable actions to make available to FG) all regulatory filings and registrations (including MAAs and Marketing Approvals) with respect to the Lead Compounds that have been filed or made by or under authority of Astellas, and the rights in trademark with respect to each Lead Compound as provided for in Section 4.4.1, in each case such assignment (or availability)   -39-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   shall be made within [ * ] after the notice of termination. From and after the date of a notice of termination, FG shall have no further obligations under this Agreement beyond those obligations that survive termination in such events as specified in this Section 18.7.3.

18.7.4 Material Non-Performance. In the event of any Material Non-Performance by a party, the other party shall, without reasonable delay following discovery of such Material Non-Performance notify the defaulting party in writing, and the parties shall consult with each other in good faith to endeavor to agree upon the most effective means to cure such Material Non-Performance and, if necessary, to effect a remedy in favor of the non-defaulting party for the consequences of such Material Non-Performance by the defaulting party (collectively, the Resolution). In the event (i) the parties are unable to agree upon Resolution, or (ii) the defaulting party, in the exercise of reasonable diligence shall have been unable to remedy such Material Non-Performance, then in either such event the remedy of the non-defaulting party with respect to the Material Non-Performance by the defaulting party shall be determined by arbitration pursuant to Section 19.2 hereof, and the arbitrators shall be authorized to fashion such remedy, including equitable relief, which may include termination of this Agreement in whole or in part, as the arbitrators shall determine appropriate, except that termination of this Agreement in whole shall only be the remedy of last resort.

18.7.5 License Upon Termination. In the event of a termination of this Agreement, FG shall have an irrevocable, exclusive, license, with the right to grant and authorize sublicenses, to any trademarks used by Astellas in association with the Lead Compounds hereunder to make, use, sell, import and otherwise exploit products within the Field in the Astellas Territory. Such license shall be royalty-free, provided, however, if such trademark is not a global trademark (i.e. materially different from the trademark used in the FG Territory) and either (i) if Astellas terminates this Agreement under Section 18.2.1 or 18.2.4, or (ii) if this Agreement is terminated in accordance with the procedure as provided for in Section 18.2.5 as a result of FG's Material Non-Performance, in which event FG and Astellas shall negotiate in good faith a reasonable fee for such license.

ARTICLE 19 DISPUTE RESOLUTION

19.1 Disputes. If the parties are unable to resolve any dispute between them regarding the breach, interpretation or enforcement of this Agreement, either party may, by written notice to the other, have such dispute referred to their Authorized Designees, provided that such individuals are not directly involved in the dispute (i.e., the dispute occurs at the JDC, such individuals shall not be members of the JDC), for good faith negotiations. If after [ * ] such executives are unable to resolve the issue, each of Astellas and FG shall have the right to refer the matter to mediation upon notice to the other party, and the parties shall choose a mediator within [ * ] of the receipt of such notice, and shall negotiate in good faith to resolve such matter through the mediator within [ * ] thereafter.

19.2 Full Arbitration. Any dispute, controversy or claim arising out of or relating to the breach, interpretation or enforcement of this Agreement, including disputes relating to termination of this Agreement, shall be settled by binding arbitration in the manner   -40-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   described in this Section 19.2. The arbitration shall be conducted pursuant to the rules of Arbitration of the International Chamber of Commerce then in effect. Notwithstanding those rules, the following provisions shall apply to the arbitration hereunder:

19.2.1 Arbitrators. The arbitration shall be conducted by a panel of three (3) arbitrators, with one (1) arbitrator chosen by each of FG and Astellas and the third appointed by the other two (2) arbitrators. If the parties are unable to agree upon a single arbitrator, or the third arbitrator in case of a panel of three (3), such third arbitrator (as the case may be) shall be appointed in accordance with the rules of the Arbitration of the International Chamber of Commerce.

19.2.2 Proceedings. Except as otherwise provided herein, the parties shall use their best efforts to complete the arbitration within [ * ] after the appointment of the Panel under Section 19.2.1 above, unless a party can demonstrate to the Panel that the complexity of the issues or other reasons warrant the extension of one or more of the time tables. In such case, the Panel may extend such time table as reasonably required. The Panel shall, in rendering its decision, apply the substantive law of the State of California, without regard to its conflicts of laws provisions, except that the interpretation of and enforcement of this Article 19 shall be governed by the U.S. Federal Arbitration Act. The proceeding shall be conducted in English and shall take place in the city of Vancouver, British Columbia, Canada. The judgment of the Panel shall be binding upon the parties and enforceable in any court of competent jurisdiction.

19.2.3 Interim Relief. Notwithstanding anything in this Article 19 to the contrary, FG and Astellas shall each have the right to apply to any court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other similar interim or conservatory relief, as necessary, pending resolution under the above described arbitration procedures. Nothing in the preceding sentence shall be interpreted as limiting the powers of the arbitrators with respect to any dispute subject to arbitration under this Agreement.

ARTICLE 20 MISCELLANEOUS

20.1 Confidential Terms. Except as expressly provided herein, each party agrees not to disclose any terms of this Agreement to any third party without the consent of the other party, except (i) as required by securities or other applicable laws or (ii) to prospective and other investors and such party's accountants, attorneys and other professional advisors, or (iii) to others under reasonable conditions of confidentiality.

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

20.3 Force Majeure. Nonperformance of any party (except for payment of amounts due hereunder) shall be excused to the extent that performance is rendered impossible by strike, fire, earthquake, flood, governmental acts or orders or restrictions, failure of suppliers, or any other reason where failure to perform is beyond the reasonable control of the non-   -41-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   performing party. In such event FG or Astellas, as the case may be, shall promptly notify the other party of such inability and of the period for which such inability is anticipated to continue. Without limiting the foregoing, the party subject to such inability shall use reasonable efforts to minimize the duration of any force majeure event.

20.4 No Implied Waivers; Rights Cumulative. No failure on the part of FG or Astellas to exercise and no delay in exercising any right under this Agreement, or provided by statute or at law or in equity or otherwise, shall impair, prejudice or constitute a waiver of any such right, nor shall any partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right.

20.5 Independent Contractors. Nothing contained in this Agreement is intended implicitly, or is to be construed, to constitute FG or Astellas as partners in the legal sense. No party hereto shall have any express or implied right or authority to assume or create any obligations on behalf of or in the name of any other party or to bind any other party to any contract, agreement or undertaking with any third party.

20.6 Notices. All notices, requests and other communications hereunder shall be in writing and shall be personally delivered or sent by registered or certified mail, return receipt requested, postage prepaid; facsimile transmission (receipt verified); or express courier service (signature required), in each case to the respective address specified below, or such other address or fax number as may be specified in writing to the other party hereto:   Astellas:   Astellas Pharma Inc.   Attn: Director of Legal Department   [ * ]

with copy to:   Astellas Pharma Inc.   Attn: Licensing, Corporate Strategy   [ * ]

FG:   FibroGen, Inc.   Attn: Chief Executive Officer   225 Gateway Boulevard   San Francisco, California 94080   Fax: 1-650-866-7202

with a copy to:   FibroGen, Inc.

  Attn: Legal Department   225 Gateway Boulevard   San Francisco, California 94080   Fax: 1-650-866-7343   -42-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   20.7 Assignment. This Agreement shall not be assignable by either party to any third party without the written consent of the other party hereto; except that either party may assign this Agreement without the other party's consent to an entity that acquires substantially all of the business or assets of the assigning party within the Field, in each case whether by merger, transfer of assets, or otherwise. Upon a permitted assignment of this Agreement, all references herein to the assigning party shall be deemed references to the party to whom the Agreement is so assigned.

20.8 Modification. No amendment or modification of any provision of this Agreement shall be effective unless in writing signed by all parties hereto. 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 all parties.

20.9 Severability. If any provision hereof should be held invalid, illegal or unenforceable in any jurisdiction, the parties shall negotiate in good faith a valid, legal and enforceable substitute provision that most nearly reflects the original intent of the parties and all other provisions hereof shall remain in full force and effect in such jurisdiction and shall be liberally construed in order to carry out the intentions of the parties hereto as nearly as may be possible. Such invalidity, illegality or unenforceability shall not affect the validity, legality or enforceability of such provision in any other jurisdiction.

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

20.11 Headings. Headings used herein are for convenience only and shall not in any way affect the construction of or be taken into consideration in interpreting this Agreement.

20.12 Export Laws. Notwithstanding anything to the contrary contained herein, all obligations of FG and Astellas are subject to prior compliance with United States and foreign export regulations and such other United States and foreign laws and regulations as may be applicable, and to obtaining all necessary approvals required by the applicable agencies of the governments of the United States and foreign jurisdictions. FG and Astellas shall cooperate with each other and shall provide assistance to the other as reasonably necessary to obtain any required approvals.

20.13 Language. This Agreement is in the English language only, which language shall be controlling in all respects, and all versions hereof in any other language shall not be binding on the parties hereto. All communications and notices to be made or given pursuant to this Agreement shall be in the English language.

20.14 Entire Agreement. This Agreement (including the Exhibits hereto) constitutes the entire agreement, both written or oral, with respect to the subject matter hereof, and supersedes all prior or contemporaneous understandings or agreements, including the Binding Term Sheet, dated as of February 9, 2004 by and between FG and Astellas, as amended   -43-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   on January 25, 2005, whether written or oral, between FG and Astellas with respect to such subject matter.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered in duplicate originals as of the date first above written.   ASTELLAS PHARMA INC.   FIBROGEN, INC.

By:   /s/ Toichi Takenaka   By:   /s/ Thomas B. Neff

  Toichi Takenaka President and Chief Executive Officer     Thomas Neff President and Chief Executive Officer

Date:   1.September.05   Date:   23 August 05   -44-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   EXHIBIT A  LIST OF PATENTS

[ * ]   -45-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   EXHIBIT B  INDICATIONS

Included indications:

  •   Treatment of anemia in patients with chronic kidney disease undergoing dialysis

  •   Treatment of anemia in patients with chronic kidney disease not undergoing dialysis

  •   [ * ]    -46-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended.





CONFIDENTIAL   EXECUTION COPY   EXHIBIT C  INITIAL DEVELOPMENT PLAN

[ * ]    -47-

[ * ] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended. 
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:
Each party shall secure and maintain in effect during the term of this Agreement and for a period of five (5) years thereafter insurance policy(ies) underwritten by a reputable insurance company and in a form and having limits standard and customary for entities in the biopharmaceutical industry for exposures related to the Lead Compounds. Such insurance shall include general liability, clinical trial liability and products liability coverage with respect to such party's performance of the Development Program and commercialization of Lead Compounds hereunder. Upon request by the other party hereto, certificates of insurance evidencing the coverage required above shall be provided to the other party.
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