Document:

AGN EX 10.40 2012 12 31

EXHIBIT 10.40

NON-QUALIFIED STOCK OPTION GRANT NOTICE 
FOR NON-EMPLOYEE DIRECTORS
Pursuant to the Allergan, Inc. 2011 Incentive Award Plan (the “Plan”), Allergan, Inc. (the “Company”) hereby grants to the individual listed below (“Participant”), an option to purchase the number of shares of the Company’s common stock, par value US$0.01 per share (“Stock”), set forth below (the “Shares”) at the price set forth below (the “Option”).  The Option is subject to all of the terms and conditions set forth in this Non-Qualified Stock Option Grant Notice for Non-Employee Directors (this “Grant Notice”), in the Terms and Conditions for Non-Employee Directors attached hereto as Exhibit A (the “Terms”), in the Country-Specific Terms, if any, for Participant’s country attached hereto as Exhibit B (the “Country-Specific Terms”) and in the Plan attached hereto as Exhibit C, each of which is incorporated herein by reference.  Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Grant Notice.
	
		
	Participant:
	      

	Grant ID:
	      

	Grant Date:
	      

	Exercise Price per Share:
	US$      

	Total Number of Shares Subject to the Option:
	 shares 

	Expiration Date:
	      

Type of Option:         Non-Qualified Stock Option
		
	Vesting Schedule:  
	Subject to the terms and conditions of the Plan, this Grant Notice, the Terms, the Country-Specific Terms and the Sub-Plan, as applicable, the Option shall vest and become exercisable on the earlier of:

		
	(i)
	the first anniversary of the grant date, or

		
	(ii)
	the first stockholder meeting held in ________ at which one or more members of the Board are standing for re-election.

Except as provided in Sections  3.2 or 3.5 of the Terms, in the Country-Specific Terms or in the Sub-Plan, if applicable, as otherwise provided by the Administrator or as set forth in a written agreement between the Company and Participant, in no event shall the Option vest and become exercisable for any additional shares of Stock following Participant’s termination of service as a Director of the Company, except as may otherwise be provided by the Administrator or as set forth in a written agreement between the Company and Participant.

Remainder of page intentionally left blank.

All decisions and interpretations of the Administrator arising under the Plan, this Grant Notice, the Terms or the Country-Specific Terms, if applicable, or relating to the Option shall be binding, conclusive and final.
	
		
	ALLERGAN, INC.

	By:
	 

	Print Name:
	David E.I. Pyott

	Title:
	Chairman of the Board, President and Chief Executive Officer

	Address:
	2525 Dupont Drive

	 
	Irvine, California 92612

Attachments:    Terms and Conditions for Non-Employee Directors (Exhibit A)
Country-Specific Terms (Exhibit B) 
Allergan, Inc. 2011 Incentive Award Plan (Exhibit C)
Allergan, Inc. 2011 Incentive Award Plan Prospectus (Exhibit D)

EXHIBIT A TO THE NON-QUALIFIED STOCK OPTION GRANT NOTICE 
FOR NON-EMPLOYEE DIRECTORS

TERMS AND CONDITIONS

September 2012

Pursuant to the Non-qualified Stock Option Grant Notice (the “Grant Notice”) to which these Terms and Conditions (the “Terms”) are attached, Allergan, Inc. (the “Company”) granted to the participant (“Participant”) specified on the Grant Notice an option under the Allergan, Inc. 2011 Incentive Award Plan (the “Plan”) to purchase the number of shares of the Company’s common stock, par value US$0.01 per share (“Stock”), indicated in the Grant Notice, subject to the terms and conditions of the Grant Notice, the Terms, the Plan attached to the Grant Notice as Exhibit C and the Country-Specific Terms, if any, for Participant’s country attached to the Grant Notice as Exhibit B (the “Country-Specific Terms”).  Any reference herein to the Terms shall include the Country-Specific Terms.

I.GENERAL
1.1.    Defined Terms.  Capitalized terms not specifically defined herein shall have the meanings specified in the Grant Notice or, if not defined therein, the Plan.
1.2.    Incorporation of Terms of Plan.  The Option (as defined in Section 2.1 below) is also subject to the terms and conditions of the Plan, which are incorporated herein by reference.
II.    GRANT OF OPTION
2.1.    Grant of Option.  Effective as of the grant date specified on the Grant Notice (the “Grant Date”), the Company irrevocably grants to Participant an option (the “Option”) to purchase any part or all of the Shares specified on the Grant Notice, subject to the terms and conditions set forth in the Plan and the Terms.
2.2.    Exercise Price.  The exercise price payable for the Shares subject to the Option shall be as set forth in the Grant Notice, without commission or other charge. In addition to the exercise price, Participant shall be responsible for any Tax-Related Items, as defined in Section 4.5(a) of the Terms.
III.    PERIOD OF EXERCISABILITY
3.1.    Commencement of Exercisability.
(a)    Subject to Sections 3.3 and 3.4, the Option shall become vested and exercisable in such amounts and at such times as are set forth in the Grant Notice and Sections 3.2 and 3.5, or at such earlier times as are set forth in a written agreement between the Company and Participant.
(b)    Except as provided in Sections 3.2 and 3.5, in the Country-Specific Terms, as applicable, as otherwise provided by the Administrator or as set forth in a written agreement between the Company and Participant, the unvested and unexercisable portion of the Option shall terminate immediately upon Participant’s termination of service as a Director of the Company.
3.2.    Acceleration of Vesting and Exercisability.  Notwithstanding anything to the contrary in Section 3.1 or the Grant Notice, if Participant’s termination of service as a Director of the Company occurs 

by reason of Participant’s death or permanent and total disability (within the meaning of Section 22(e)(3) of the Code), then the Option shall become fully vested and exercisable immediately prior to Participant’s termination of service as a Director of the Company.
3.3.    Duration of Exercisability.  The Option shall become vested and exercisable for the shares of Stock in one or more installments as specified in Section 3.1, subject to acceleration as provided in Section 3.2 or Section 3.5, the Country-Specific Terms, as applicable, or pursuant to the Plan, or any other written agreement between the Company and Participant.  Each such installment that becomes vested and exercisable shall remain vested and exercisable until it becomes unexercisable under Section 3.4 or Section 3.5, as applicable.
3.4.    Expiration of Option.  Subject to the Country-Specific Terms, as applicable, the Option shall terminate and shall not be exercised after the first to occur of the following events:
(a)    the expiration of ten years from the Grant Date;
(b)    unless Participant served as a Director of the Company for a period of at least six years prior to the Grant Date, the expiration of three months following the date of Participant’s termination of service as a Director of the Company by reason of voluntary resignation or removal for cause; or
(c)    unless Participant served as a Director of the Company for a period of at least six years prior to the Grant Date, the expiration of twelve months following the date of Participant’s termination of service as a Director of the Company by reason of voluntary resignation or removal for cause.
Notwithstanding anything to the contrary in this Section 3.4, if the Company receives an opinion of counsel that there has been a legal judgment and/or legal development that results in the treatment that applies to the Option pursuant to this Section being deemed unlawful and/or discriminatory, the Option will remain outstanding and exercisable for the maximum period permitted by applicable law, but in any event shall terminate and cease to be exercisable after the earlier of (i) the expiration of ten years from the Grant Date or (ii) the expiration of thirty-six months (or such shorter period of not less than three months as may be specified by the Administrator) following the date of Participant’s termination of service as a Director of the Company.
3.5.    Effect of Change in Control.  Notwithstanding anything to the contrary in Sections 3.1 through 3.4 or the Grant Notice, in the event of a Change in Control, the following provisions shall apply:
(a)    If (i) the successor or surviving entity (or any affiliate thereto) assumes the Option (or permits the Option to remain outstanding) or replaces the Option with an option to acquire stock in such successor or surviving entity (or any affiliate thereto) (any such replacement award, a “Substitute Award”) and (ii) any assumption or replacement described in (i) satisfies the requirements set forth in U.S. Treasury Regulation section 1.409A-1(b)(5)(v)(D), the Option or Substitute Award shall remain outstanding and be governed by their respective terms and the provisions set forth in the Plan, subject to Section 3.5(c). 
(b)    If the successor or surviving entity (or any affiliate thereto) does not assume or replace the Option (or permit the Option to remain outstanding) as provided in Section 3.5(a), the Option shall become fully vested and exercisable immediately prior to the occurrence of such Change in Control and shall remain outstanding until the Change in Control, subject to the Administrator’s discretion to take any action with respect to the Option permitted under Section 14.2 of the Plan.
IV.    EXERCISE OF OPTION

4.1.    Person Eligible to Exercise.  Except as provided in Sections 5.2(b), during Participant’s lifetime, only Participant may exercise the Option or any portion thereof.  After Participant’s death, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.4 or Section 3.5 (as applicable), be exercised by Participant’s personal representative or by any person empowered to do so under Participant’s will or under the then applicable laws of descent and distribution.
4.2.    Partial Exercise.  Any exercisable portion of the Option or the entire Option, if then wholly exercisable, may be exercised in whole or in part at any time prior to the time when the Option or portion thereof becomes unexercisable under Section 3.4 or Section 3.5, as applicable.
4.3.    Manner of Exercise.  The Option, or any exercisable portion thereof, may be exercised solely by delivery to the Secretary of the Company (or any third party administrator or other person or entity designated by the Company) of all of the following prior to the time when the Option or such portion thereof becomes unexercisable under Section 3.4 or Section 3.5, as applicable:
(a)    An exercise notice in a form specified by the Administrator, stating that Participant is electing to exercise the Option or a portion thereof, such notice complying with all applicable rules established by the Administrator;
(b)    The receipt by the Company of full payment for the shares of Stock with respect to which the Option or portion thereof is exercised, including full payment of all applicable Tax‐Related Items (as defined in Section 4.5(a)), which may be in one or more of the forms of consideration permitted under Section 4.4; and
(c)    In the event the Option or portion thereof shall be exercised pursuant to Section 4.1 by any person or persons other than Participant, appropriate proof of the right of such person or persons to exercise the Option.
Notwithstanding the foregoing, the Company shall have the right to specify all conditions of the manner of exercise, which conditions may vary by country and which may be subject to change from time to time.
4.4.    Method of Payment.  Payment of the exercise price and any Tax-Related Items shall be by any of the following, or a combination thereof, at Participant’s election:
(a)    cash;
(b)    check;
(c)    to the extent permitted under applicable laws, delivery of a notice that Participant has placed a market sell order with a broker with respect to shares of Stock then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the aggregate exercise price and any Tax-Related Items (as defined in Section 4.5(a)); provided, that payment of such proceeds is then made to the Company upon settlement of such sale;
(d)    if Participant resides in the U.S.: through the delivery of shares of Stock which have been owned by Participant for such period of time as may be necessary to avoid adverse accounting consequences, duly endorsed for transfer to the Company with a Fair Market Value on the date of exercise 

equal to the aggregate exercise price and any Tax-Related Items (as defined in Section 4.5(a)) of the Option or exercised portion thereof;
(e)    to the extent permitted by the Administrator, through the delivery of other lawful consideration; or
(f)    any combination of the foregoing.
4.5.    Taxes. 
(a)    Regardless of any action the Company takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related items related to Participant’s participation in the Plan and legally applicable to Participant (“Tax-Related Items”), Participant acknowledges that the ultimate liability for all Tax-Related Items is and remains Participant’s responsibility and may exceed the amount actually withheld by the Company.  Participant further acknowledges that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Option grant, including, but not limited to, the grant, vesting or exercise of the Option, the subsequent sale of shares of Stock purchased pursuant to such exercise, and the receipt of any dividends; and (ii) does not commit to and is under no obligation to structure the terms of the grant or any aspect of the Option to reduce or eliminate Participant’s liability for Tax-Related Items or achieve any particular tax result.  Further, if Participant becomes subject to tax in more than one jurisdiction between the Grant Date and the date of any relevant taxable or tax withholding event, as applicable, Participant acknowledges that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b)    Prior to any relevant taxable or tax withholding event, as applicable, Participant will pay or make adequate arrangements satisfactory to the Company to satisfy all Tax-Related Items.  In this regard, Participant authorizes the Company or its agents, at their discretion, to satisfy the obligations with regard to all Tax-Related Items by one or a combination of the following:  
(i)    withholding from Participant’s wages or other cash compensation payable to Participant by the Company; or
(ii)    withholding from proceeds of the sale of shares of Stock purchased upon exercise of the Option either through a voluntary sale or through a mandatory sale arranged by the Company (on Participant’s behalf pursuant to this authorization); or
(iii)    withholding in shares of Stock to be issued upon exercise of the Option.
(c)    To avoid negative accounting treatment, the Company may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates.  If the obligation for Tax-Related Items is satisfied by withholding in shares of Stock, for tax purposes, Participant is deemed to have been issued the full number of shares of Stock subject to the exercised Option, notwithstanding that a number of the shares of Stock are held back solely for the purpose of paying the Tax-Related Items due as a result of any aspect of Participant’s participation in the Plan.
(d)    Participant shall pay to the Company any amount of Tax-Related Items that the Company may be required to withhold or account for as a result of Participant’s participation in the Plan that cannot be satisfied by the means previously described.  The Company may refuse to issue or deliver the 

shares or the proceeds of the sale of shares of Stock, if Participant fails to comply with Participant’s obligations in connection with the Tax-Related Items.
4.6.    Conditions to Issuance of Stock Certificates.  The shares of Stock deliverable upon the exercise of the Option, or any portion thereof, may be either previously authorized but unissued shares or issued shares which have then been reacquired by the Company.  Such shares shall be fully paid and nonassessable.  The Company shall not be required to issue or deliver any shares of Stock purchased upon the exercise of the Option or portion thereof prior to fulfillment of all of the following conditions:
(a)    The admission of such shares to listing on all stock exchanges on which such Stock is then listed; 
(b)    The completion of any registration or other qualification of such shares under any state, federal, foreign or local law or under rulings or regulations of the U.S. Securities and Exchange Commission or of any other governmental regulatory body, which the Administrator shall, in its sole and absolute discretion, deem necessary or advisable; 
(c)    The obtaining of any approval or other clearance from any state, federal, foreign or local governmental agency which the Administrator shall, in its sole and absolute discretion, determine to be necessary or advisable; 
(d)    The receipt by the Company of full payment for such shares, which may be in one or more of the forms of consideration permitted under Section 4.4 as well as the payment of any Tax-Related Items pursuant to Section 4.5; and
(e)    The lapse of such reasonable period of time following the exercise of the Option as the Administrator may from time to time establish for reasons of administrative convenience.
4.7.    Rights as Stockholder.  The holder of the Option shall not be, nor have any of the rights or privileges of, a stockholder of the Company in respect of any shares purchasable upon the exercise of any part of the Option unless and until such shares shall have been issued by the Company to such holder (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company).  No adjustment will be made for a dividend or other right for which the record date is prior to the date the shares are issued, except as provided in Section 14.2 of the Plan.
V.    OTHER PROVISIONS
5.1.    Administration.  The Administrator shall have the power to interpret the Plan and the Terms and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules.  All actions taken and all interpretations and determinations made by the Administrator in good faith shall be binding, conclusive and final upon Participant, the Company and all other interested persons.  No member of the Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan, the Terms or the Option.
5.2.    Limited Transferability.
(a)    Subject to Section 5.2(b), the Option may not be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution.  Neither the Option nor any interest or right therein or part thereof shall be liable for Participant’s debts, contracts or engagements 

or the debts, contracts or engagements of Participant’s successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence.
(b)    Notwithstanding any other provision of the Terms, if Participant resides in the U.S. and the Administrator consents, Participant may transfer the Option to one or more “Permitted Transferees” (as defined in the Plan), subject to the following terms and conditions:  
(i)    the Option shall not be assignable or transferable by the Permitted Transferee other than by will or the laws of descent and distribution; 
(ii)    the Option shall continue to be subject to all the terms and conditions of the Plan and the Terms, as amended from time to time, as applicable to Participant (other than the ability to further transfer the Option); and 
(iii)    Participant and the Permitted Transferee execute any and all documents requested by the Company, including, without limitation, documents to (A) confirm the status of the transferee as a Permitted Transferee, (B) satisfy any requirements for an exemption for the transfer under applicable federal and state securities laws, and (C) evidence the transfer.  
Unless transferred to a Permitted Transferee in accordance with Section 5.2(b), during the lifetime of Participant, only Participant may exercise the Option or any portion thereof.  Subject to such conditions and procedures as the Administrator may require, a Permitted Transferee may exercise the Option or any portion thereof during Participant’s lifetime.  After the death of Participant, any exercisable portion of the Option may, prior to the time when the Option becomes unexercisable under Section 3.4 or Section 3.5, as applicable, be exercised by Participant’s personal representative or by any person empowered to do so under the deceased Participant’s will or under the then applicable laws of descent and distribution.
5.3.    Nature of Grant.  In accepting the grant of the Option, Participant acknowledges, understands and agrees that:
(a)    the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time;
(b)    the grant of the Option is voluntary and occasional and does not create any contractual or other right to receive future grants of options, or benefits in lieu of options, even if options have been granted repeatedly in the past;
(c)    all decisions with respect to future option grants, if any, will be at the sole discretion of the Administrator;  
(d)    Participant is voluntarily participating in the Plan;  
(e)    the Option and the shares of Stock subject to the Option are not intended to replace any pension rights;

(f)    nothing in the Plan or the Terms shall confer upon Participant any right to continue in service as a member of the Board of Directors of the Company or any Affiliate or shall interfere with or restrict in any way the rights of the Company or its stockholders to remove Participant from the Board at any time in accordance with the provisions of applicable law;
(g)    if Participant exercises the Option and obtains shares of Stock, the value of those shares purchased upon exercise may increase or decrease in value, even below the exercise price;
(h)    if the underlying shares of Stock do not increase in value, the Option will have no intrinsic value;
(i)    the future value of the underlying shares of Stock is unknown and cannot be predicted;
(j)    no claim or entitlement to compensation or damages shall arise from termination of the Option resulting from Participant’s termination of service as a Director of the Company (for any reason whatsoever), and as a condition to receiving the Option grant, Participant irrevocably agrees (i) never to institute any claim against the Company in the event of any such termination of the Option, (ii) to waive his or her ability, if any, to bring any such claim, and (iii) to release the Company from any such claim; if, notwithstanding the foregoing, any such claim is allowed by a court of competent jurisdiction, then, by participating in the Plan, Participant shall be deemed irrevocably to have agreed not to pursue such claim and to execute any and all documents necessary to request dismissal or withdrawal of such claims; 
(k)    if Participant resides outside of the U.S., the following additional provisions shall apply: 
(i)    the Option and the shares of Stock subject to the Option are an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to the Company, and which is outside the scope of Participant’s employment contract, if any; 
(ii)    except as explicitly provided pursuant to the terms of a written benefit plan maintained by the Company or a Subsidiary, the Option and the shares of Stock subject to the Option are not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement or welfare benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company or any Affiliate; and 
(iii)    Participant acknowledges and agrees that neither the Company nor any Affiliate shall be liable for any foreign exchange rate fluctuation between Participant’s local currency and the U.S. dollar that may affect the value of the Option or of any amounts due to Participant pursuant to the settlement of the Option or the subsequent sale of any shares of Stock acquired upon settlement.
5.4.    Data Privacy.  This Section 5.4 applies to Participant only if Participant resides outside of the U.S. If Participant resides outside the U.S., then Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of Participant’s personal data as described in these Terms and any other Option grant materials by and among the Company and its Affiliates for the purpose of implementing, administering and managing Participant’s participation in the Plan.

Participant understands that the Company may hold certain personal information about Participant, including, but not limited to, Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of stock or directorships held in the Company, details of the Option or any other entitlement to shares of Stock awarded, canceled, exercised, vested, unvested or outstanding in Participant’s favor, for the purpose of implementing, administering and managing the Plan (“Data”).  
Participant understands that Data will be transferred to Charles Schwab & Co., Inc., or such other stock plan service provider as may be selected by the Company in the future, which is assisting the Company with the implementation, administration and management of the Plan.  Participant understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country (e.g., the United States) may have different data privacy laws and protections than Participant’s country.  Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting his or her local human resources representative.  Participant authorizes the Company, Charles Schwab & Co., Inc.,  and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing his or her participation in the Plan.  Participant understands that Data will be held only as long as is necessary to implement, administer and manage Participant’s participation in the Plan.  Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing his or her local human resources representative.  Participant understands, however, that refusing or withdrawing his or her consent may affect Participant’s ability to participate in the Plan.  For more information on the consequences of Participant’s refusal to consent or withdrawal of consent, Participant understands that he or she may contact his or her local human resources representative.
5.5.    Shares to Be Reserved.  The Company shall at all times during the term of the Option reserve and keep available such number of shares of Stock as will be sufficient to satisfy the requirements of the Terms.
5.6.    Notices.  All notices or other communications required or permitted hereunder shall be in writing, and shall be deemed duly given only when delivered in person or when sent by certified mail (return receipt requested) and deposited (with postage prepaid) in a post office or branch post office regularly maintained by the local postal service, addressed as follows:
		
	If to the Company:
	Allergan, Inc. 
Attention:  General Counsel  
2525 Dupont Drive 
Irvine, California 92612

		
	If to Participant:
	To Participant’s most recent address then on file in the Company’s personnel records.

By a notice given pursuant to this Section 5.6, either party may thereafter designate a different address for notices to be given to that party.  Any notice which is required to be given to Participant shall, if Participant is then deceased, be given to the person entitled to exercise the Option pursuant to Section 4.1 by written notice under this Section 5.6.

5.7.    Titles.  Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of the Terms.
5.8.    Governing Law; Venue.  The Terms shall be administered, interpreted and enforced under the laws of the State of Delaware, without regard to conflicts of law principles thereof.  
For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties evidenced by this grant or the Terms, the parties hereby submit to and consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Orange County, California, or the U.S. federal courts for the Central District of California, and no other courts, where this grant is made and/or to be performed.
5.9.    Severability. Should any provision of the Terms be determined by a court of law to be illegal or unenforceable, the other provisions shall nevertheless remain effective and shall remain enforceable.
5.10.    Conformity to Securities Laws.  Participant acknowledges that the Plan is intended to conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and any and all regulations and rules promulgated by the U.S. Securities and Exchange Commission thereunder, and state, foreign or local securities laws and regulations.  Notwithstanding anything herein to the contrary, the Plan shall be administered, and the Option is granted and may be exercised, only in such a manner as to conform to such laws, rules and regulations.  To the extent permitted by applicable law, the Plan and the Terms shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
5.11.    Amendments.  Except as explicitly prohibited by the Plan, the Terms may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Administrator; provided, that, except as may otherwise be provided by the Plan, no termination, amendment or modification of the Terms shall adversely affect the Option in any material way without Participant’s prior written consent.  The Terms may not be modified, suspended or terminated except by an instrument in writing signed by a duly authorized representative of the Company and, if Participant’s consent is required, by Participant or such other person as may be permitted to exercise the Option pursuant to Section 4.1.
5.12.    Successors and Assigns.  The Company may assign any of its rights with respect to the Option to single or multiple assignees, and the Terms shall inure to the benefit of the successors and assigns of the Company.  Subject to the restrictions on transfer set forth in Section 5.2, the Terms shall be binding upon Participant and Participant’s heirs, executors, administrators, successors and assigns.
5.13.    Limitations Applicable to Section 16 Persons.  Notwithstanding any other provision of the Plan or the Terms, the Option and the Terms shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule.  To the extent permitted by applicable law, the Terms shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.
5.14.    No Advice Regarding Grant.  The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding Participant’s participation in the Plan, or Participant’s acquisition or sale of the underlying shares of Stock.  Participant is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding his or her participation in the Plan before taking any action related to the Plan.

5.15.    Language.  If Participant has received these Terms or any other document related to the Plan translated into a language other than English and if the meaning of the translated version is different than the English version, the English version will control.
5.16.    Electronic Delivery.  The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means.  Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
5.17.    Country-Specific Terms. Notwithstanding anything to the contrary herein, the Option grant shall be subject to the Country-Specific Terms.  Moreover, if Participant relocates to one of the countries included in the Country-Specific Terms, the special terms and conditions for such country will apply to Participant to the extent the Company determines that the application of such terms and conditions is necessary or advisable in order to comply with local law or facilitate the administration of the Plan.  The Country-Specific Terms constitute part of these Terms and are incorporated herein by reference.
5.18.    Imposition of Other Requirements.  The Company reserves the right to impose other requirements on Participant’s participation in the Plan, on the Option and on any shares of Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.
5.19.    Currency. All calculations under the Plan shall be prepared based on U.S. dollars. Amounts denominated in any currency other than U.S. dollars shall be converted into U.S. dollars on the basis of the Exchange Rate in effect on the relevant date. The “Exchange Rate” shall be the rate at which the relevant currency is converted into U.S. dollars, as reported on the relevant date in The Wall Street Journal (or such other reliable source as may be selected from time to time by the Administrator in its discretion).
5.20.    Waiver.  Participant acknowledges that a waiver by the Company of a breach of any provision of the Terms shall not operate or be construed as a waiver of any other provision of the Terms, or of any subsequent breach by Participant or any other participant.
5.21.    Entire Agreement.  The Plan and the Terms constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company and Participant with respect to the subject matter hereof.

EXHIBIT B TO THE NON-QUALIFIED STOCK OPTION GRANT NOTICE
FOR NON-EMPLOYEE DIRECTORS

COUNTRY-SPECIFIC TERMS
FOR NON-EMPLOYEE DIRECTOR PARTICIPANTS IN THE U.K.

Terms and Conditions
These Country-Specific Terms include additional terms and conditions that govern the Option granted to Participant under the Allergan, Inc. 2011 Incentive Award Plan (the “Plan”) if Participant resides in the United Kingdom.  Capitalized terms used but not defined in these Country-Specific Terms are defined in the Plan, the Non-Qualified Stock Option Grant Notice, and/or the Terms, and have the meanings set forth therein.
Notifications
These Country-Specific Terms also include information regarding certain issues of which Participant should be aware with respect to Participant's participation in the Plan.  The information is based on the laws in effect in the respective countries as of September 2012, which are often complex and change frequently.  As a result, the Company strongly recommends that Participant not rely on the information noted in these Country-Specific Terms as the only source of information relating to the consequences of Participant’s participation in the Plan because the information may be out of date by the time Participant exercises the Option or sells shares of Stock purchased under the Plan. 
In addition, the information contained herein is general in nature and may not apply to Participant’s particular situation, and the Company is not in a position to assure Participant of a particular result.  Accordingly, Participant is advised to seek appropriate professional advice as to how the relevant laws in Participant’s country may apply to Participant's situation.  
Finally, Participant understands that if he or she is a citizen or resident of a country other than the United Kingdom, transfers to a country other than the United Kingdom after the Grant Date, or is considered a resident of another country for local law purposes, the information contained herein may not apply to Participant, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply.
Terms and Conditions
Taxes.  This provision supplements Section 4.5 of the Terms: 
If payment or withholding of the income tax is not made within ninety (90) days of the event giving rise to the tax or such other period specified in Section 222(1)(c) of the U.K. Income Tax (Earnings and Pensions) Act 2003 (the "Due Date"), the amount of any uncollected income tax will constitute a loan owed by Participant to the Company, effective on the Due Date.  Participant agrees that the loan will bear interest at the then-current Official Rate of Her Majesty’s Revenue and Customs (“HMRC”), it will be immediately due and repayable, and the Company may recover it at any time thereafter by any of the means referred to in Section 4.5 of the Terms.  Notwithstanding the foregoing, if Participant is a director of the Company at such time, he or she will not be eligible for such a loan to cover the uncollected tax.  In the event that Participant is such a director and the taxes due are not collected from or paid by Participant by the Due Date, the amount of any uncollected income tax will constitute a benefit to Participant on which additional income 

tax and national insurance contributions will be payable.  Participant will be responsible for reporting and paying any income tax and national insurance contributions due on this additional benefit directly to HMRC under the self-assessment regime.AGN EX 10.51 2012 12 31

EXHIBIT 10.51

SECOND AMENDMENT OF
THE LICENSE, DEVELOPMENT, SUPPLY AND DISTRIBUTION AGREEMENT
This SECOND AMENDMENT OF THE LICENSE, DEVELOPMENT, SUPPLY AND DISTRIBUTION AGREEMENT (this “Second Amendment”) is made and effective as of January 29, 2013 (the “Second Amendment Effective Date”) by and among Allergan Sales, LLC, a Delaware corporation with its principal place of business at 2525 Dupont Drive, Irvine, California 92612 (“Allergan Sales”), Allergan USA, Inc., a Delaware corporation with its principal place of business at 2525 Dupont Drive, Irvine, California 92612 (“Allergan USA”), Allergan, Inc., a Delaware corporation with its principal place of business at 2525 Dupont Drive, Irvine, California 92612 (“Allergan, Inc.” and, collectively with Allergan Sales and Allergan USA, “Allergan”) and Spectrum Pharmaceuticals, Inc. (“Spectrum”), a Delaware corporation with its principal place of business at 11500 S. Eastern Avenue, Henderson, Nevada 89052.  Allergan and Spectrum are collectively referred to herein as the “Parties” and individually as a “Party”. 
WHEREAS, Allergan Sales, Allergan USA, Allergan, Inc. and Spectrum are parties to that certain License, Development, Supply and Distribution Agreement, dated October 28, 2008 and amended June 13, 2011 (the “License Agreement”), pursuant to which Spectrum granted Allergan the exclusive right to commercialize certain products containing Apaziquone in certain territories, and the Parties otherwise agreed to collaborate in the development and commercialization of such products; 
WHEREAS, Allergan Sales, Allergan USA and Spectrum are also parties to that certain Co-Promotion Agreement, dated October 28, 2008 (the “Co-Promotion Agreement”), pursuant to which the Parties agreed to co-promote Licensed Product (as defined in the License Agreement) in the use for the treatment of bladder cancer, or pre-bladder cancer, conditions (the “Field of Use”); 
WHEREAS, Spectrum now wishes to acquire back all the licensed rights to development and commercial activities for such products under the License Agreement and the Co-Promotion Agreement, and Allergan agrees to return to Spectrum all such rights to develop and commercialize such products, in consideration of which Spectrum has agreed to pay Allergan specified royalties on the future sales of Royalty Product (as defined herein); and 
WHEREAS, the Parties desire to amend the License Agreement, terminate the Co-Promotion Agreement and set forth the terms and conditions under which Allergan will return, and Spectrum will accept, the rights to such products, all as set forth below.
NOW THEREFORE, in consideration of the foregoing premises and the mutual promises, covenants and conditions contained in this Second Amendment, the Parties agree as follows:
1.Unless otherwise indicated, capitalized terms used but not defined herein shall have the meanings set forth in the License Agreement.
2.    In consideration of Spectrum’s acquisition of the licensed rights to development and commercial activities for the Licensed Product back from Allergan, the Parties hereby agree that, notwithstanding anything to the contrary in the License Agreement, Allergan shall have no further 

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

 

liability for any costs or expenses of any kind, including without limitation, any Development Costs incurred after December 31, 2012 and from and after December 31, 2012, Allergan shall have no obligations or liability under the License Agreement or Co-Promotion Agreement including, without limitation, any obligations or liability regarding development, regulatory or other responsibilities or activities of any kind (collectively, the “Purpose”).  
3.    To effectuate the Purpose, as of the Second Amendment Effective Date, the licenses granted to Allergan under Article 2 of the License Agreement are terminated.  Allergan confirms that it did not grant any sublicenses under such licenses while they were in effect. 
4.    Product Royalty.
(a)    Royalty.  In consideration of the Purpose and Allergan’s economic contribution as a party to the License Agreement and the Co-Promotion Agreement, Spectrum shall pay to Allergan a royalty on the Royalty Net Sales (as defined below) of Licensed Product in the Field of Use or for the treatment of upper urinary tract carcinoma (collectively, “Royalty Product”) by Spectrum, its Affiliates or sublicensees of Spectrum or its Affiliates within the Allergan Territory, as set forth in the table below (the “Royalty”):
	
		
	Net Sales of Royalty
Product In The Allergan Territory Each Fiscal Year
	Royalty Rate

	First ***
	***%

	Amounts Greater Than ***
	

***%

“Royalty Net Sales” means, with respect to a given period of time, the gross amounts invoiced in such period, less the following deductions from such gross amounts which are actually incurred, allowed, paid, accrued or specifically allocated:
(1)    credits or allowances actually granted for damaged products, returns or rejections of product, price adjustments and billing errors;
(2)    governmental and other rebates (or equivalents thereof) granted to managed health care organizations, pharmacy benefit managers (or equivalents thereof), federal, state/provincial, local and other governments, their agencies and purchasers and reimbursers or to trade customers;
(3)    normal and customary trade, cash and quantity discounts, allowances and credits actually allowed or paid;
(4)    distribution services agreement fees allowed or paid to Third Party distributors;
(5)    transportation costs, including insurance, for outbound freight related to delivery of the product to the extent included in the gross amount invoiced;

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

(6)    sales taxes, VAT taxes and other taxes directly linked to the sales of the Royalty Product to the extent included in the gross amount invoiced; and
(7)    any other items that reduce gross sales amounts as required by United States Generally Accepted Accounting Principles applied on a consistent basis.
Sales between or among Spectrum or its Affiliates or sublicensees of Spectrum or Spectrum’s Affiliates shall be excluded from the computation of Net Sales, but the subsequent final sales to Third Parties by such Party, Affiliates or sublicensees shall be included in the computation of Net Sales.
For clarity, and without limitation, a Royalty shall be paid on Royalty Products regardless of whether or not closed system packaging is included or utilized.
(b)    Calculations.  Notwithstanding Subsection 4(a) above:
(i)    no royalty payments shall be due for Royalty Product which is sold and returned as defective, unusable, rejected by a purchaser; and
(ii)    no royalty payments shall be due for Royalty Product which is used or provided to others by Spectrum, its Affiliates or its or their sublicensees solely for promotion (without consideration), research, conducting clinical trials, demonstration, evaluation, testing or training purposes.
(c)    No Patent Protection.  If any Royalty Product is sold in a country in the Allergan Territory in which (i) there is no Patent Protection (as defined below), (ii) there is no Regulatory Exclusivity (as defined below), and (iii) a Generic Product (as defined below) exists, then the royalty rates set forth in Subsection 4(a) of this Second Amendment for such Royalty Product shall be ***.  “Generic Product” means, with respect to a Royalty Product in the Field of Use in a particular country in the Allergan Territory, another pharmaceutical product that: (x) contains as an active ingredient Apaziquone; and (y) is approved for use in such country (pursuant to 21 U.S.C. 355(b)(2), an ANDA, a separate NDA, compendia listing, other drug approval application or otherwise, including foreign equivalents of the foregoing, as applicable).  “Patent Protection” means, in the country of sale in the Allergan Territory, that at least one of the claims of an issued and unexpired patent included within the Licensed Intellectual Property, which would be infringed by the sale of such Royalty Product in that country, is in effect and has not been revoked or held unenforceable or invalid by a final decision of a court or other governmental agency of competent jurisdiction having authority over said patent and that final decision is not appealed or unappealable (all claims are considered valid until so adjudicated and during prosecution of a patent application containing such claims) and is sufficient to prevent a Generic Product from being sold in such country.  “Regulatory Exclusivity” means market exclusivity granted by a Governmental Authority designed to prevent the entry of Generic Product(s) onto the market in the Field of Use, including new chemical entity exclusivity, new use or indication exclusivity, new formulation exclusivity, orphan drug exclusivity, pediatric exclusivity and 180-day generic product exclusivity.

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

(d)    Royalty Term.  Spectrum’s royalty obligations shall commence on the first commercial sale of a Royalty Product and expire, on a country-by-country basis, on the later of: (i) the expiration or earlier invalidation of all of the patents in the Licensed Intellectual Property claiming the composition of matter of, the formulation of, or the method of making or using, such Royalty Product in such country; (ii) *** years after the first commercial sale of such Royalty Product in such country; or (iii) the expiration of all Regulatory Exclusivity covering such Royalty Product in such country.  “Royalty Term” means the period of time from the Second Amendment Effective Date to that date upon which Spectrum’s royalty obligation expires in all countries within the Allergan Territory.
(e)    Royalty Payment Schedule.  Within five (5) business days after the end of each Fiscal Quarter during which a Royalty Product is sold by Spectrum, its Affiliates or its or their sublicensees, Spectrum shall provide to Allergan the estimated royalty payment calculation.  Within forty-five (45) days after the end of each Fiscal Quarter during which a Royalty Product is sold by Allergan, its Affiliates or its or their sublicensees, Spectrum shall deliver to Allergan a detailed report, which shall include at least: (i) the net quantity sold, total sales, total to net deductions, and Net Sales of Royalty Product sold in the prior Fiscal Quarter; (ii) the calculation in U.S. dollars of royalty payments due hereunder with respect to such sales; and (iii) the total due hereunder for such Fiscal Quarter.  Simultaneously with the delivery of each such report, Spectrum shall pay to Allergan the total due hereunder for such Fiscal Quarter.
(f)    Currency of Payments.  All payments under this Second Amendment will be made in U.S. dollars by electronic funds transfer to such bank accounts as each Party may designate from time to time, or by check.  When Royalty Product is sold for monies other than U.S. dollars, the exchange rate shall be determined based on the average daily exchange rate calculated by averaging the closing daily rate between the country in which the Royalty Product was sold and the U.S., as obtained from Bloomberg or equivalent successor (absent manifest error therein), on a monthly basis during the Fiscal Quarter that Spectrum records the sale for accounting purposes.  
(g)    Books; Records.  During the Royalty Term and for three (3) years thereafter, Spectrum shall keep and maintain at its regular places of business complete and accurate books, records and accounts in accordance with the U.S. Generally Accepted Accounting Principles, or other accounting standards mandated by the U.S. Securities and Exchange Commission, in sufficient detail to reflect all amounts required to be paid under this Second Amendment, as well as any other books, records or accounts required to be maintained in connection with the Royalty Product under any applicable Law.  Prior to destroying any books, records or accounts which are material to the Allergan’s rights and obligations under this Second Amendment, Spectrum must seek prior written consent from Allergan, which consent may not be unreasonably withheld.
(h)    Audits.  During the Royalty Term and for three (3) years thereafter, Allergan (including a firm of certified public accountants engaged for such purpose) shall have access to and the right to examine such relevant records and accounts that Spectrum is required to maintain pursuant to Subsection 4(g) of this Second Amendment at Spectrum’s premises for the sole purpose of verifying the payments owed to Allergan hereunder; provided, however, that any such examination: (i) shall be at Allergan’s expense; (ii) shall be during normal business hours upon 

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

reasonable prior written notice which shall in no event be less than five (5) business days; and (iii) shall not unreasonably interfere with Spectrum’s operations and activities.  Allergan may not re-audit Spectrum’s records for a given period of time once audited unless a discrepancy has been discovered.  All information reviewed during any such examination shall be treated as Confidential Information of Spectrum except as necessary in connection with the enforcement or interpretation under this Second Amendment.  Spectrum shall promptly pay to Allergan any underpayment discovered in the course of such audit, together with interest at the rate specified in Subsection 4(k) of this Second Amendment accrued from the date due until paid.  Notwithstanding Subsection 4(h)(i) above, if the audit uncovers an underpayment that is more than five percent (5%) of the amount payable for the period subject to such audit, Spectrum shall reimburse Allergan for its out-of-pocket expense of such audit.  
(i)    Withholding Taxes.  Notwithstanding anything to the contrary herein, in the event that withholding taxes apply with respect to any amounts due by Spectrum hereunder, Spectrum shall be entitled to withhold from any payment due to Allergan under this Second Amendment any taxes that Spectrum is required to pay and such withholding shall decrease by an equivalent amount on the payment due to Allergan.  Spectrum shall provide Allergan with notification of any anticipated withholding requirements with as much advance notice as practicable and shall cooperate in good faith with Allergan to legally minimize such withholding taxes.  Spectrum will timely pay to the proper governmental authority the amount of any taxes withheld and will provide Allergan with an official tax certificate or other evidence of tax obligation, together with proof of payment from the relevant governmental authority sufficient to enable Allergan to claim such payment of taxes.
(j)    Spectrum’s Obligations.  Spectrum shall be solely responsible for, and shall pay, any royalties or other payments due under the ***, the *** or any other license to the Licensed Intellectual Property.
(k)    Late Payment.  If Allergan does not receive payment of any sum due to it on or before the due date, simple interest shall thereafter accrue on the sum due to Allergan from the due date until the date of payment at a rate equal to LIBOR, as reported in the Wall Street Journal, plus one percent (1%) or the maximum rate allowable by applicable law, whichever is less.
5.    In consideration of the Purpose and the Royalty, Spectrum shall have the right to continue to use the data and results generated under the License Agreement before the Second Amendment Effective Date for its manufacture, development and/or commercialization of products containing Apaziquone anywhere in the world.  Allergan hereby represents and warrants that to its knowledge, as of the Second Amendment Effective Date, there is no Allergan Intellectual Property Rights in either, any Allergan Solely Developed Know-How or any Joint Intellectual Property that have been incorporated in the Licensed Product in the Field of Use, or the making or using thereof.   
6.    Subject to regulatory approval to the extent applicable, Allergan shall assign to Spectrum all regulatory filings relating to the Licensed Product in the Field of Use in the Allergan Territory that are in the name of Allergan, its Affiliates and its or their sublicensees, if any.  The Parties shall cooperate in good faith toward a goal of completing such assignment within thirty (30) days after the Second Amendment Effective Date or as soon as reasonably practicable thereafter.

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

7.    Allergan hereby agrees to assign to Spectrum all right, title and interest in and to the trademarks specified on Exhibit 1 hereto, including the accompanying goodwill; provided, however, with respect to any abandoned application, Allergan’s obligation to assign shall only apply to the extent such abandoned application is reasonably assignable.  The Parties shall cooperate in good faith toward a goal of completing such assignment within thirty (30) days after the Second Amendment Effective Date or as soon as reasonably practicable thereafter. Allergan consents to Spectrum’s continued ownership of the “eoquin” domain names registered in the name of Spectrum.
8.    Allergan shall, to the extent assignable, assign to Spectrum the contracts listed on Exhibit 2 hereto, which were entered into by Allergan in connection with the development, manufacturing and/or commercialization of the Licensed Product in the Field of Use in the Allergan Territory.  The Parties shall cooperate in good faith toward a goal of completing such assignment within thirty (30) days after the Second Amendment Effective Date or as soon as reasonably practicable thereafter. 
9.    Allergan hereby represents and warrants that as of the Second Amendment Effective Date, it does not possess any inventory of Licensed Product.  
10.    Spectrum hereby agrees to defend, indemnify and hold harmless Allergan Indemnitees from and against any Losses arising out of a Claim by a Third Party (other than an Affiliate of Allergan) arising out of, resulting from or relating to the manufacture, development or commercialization of pharmaceutical products containing Apaziquone by Spectrum, its Affiliates or its or their sublicensees, on or after the Second Amendment Effective Date.  Spectrum’s obligations under this Section 10 shall be subject to the indemnification procedures of Section 12.3 of the License Agreement. 
11.    To effectuate the Purpose, as of the Second Amendment Effective Date: 
		
	(a)
	all rights and obligations of both Parties under the License Agreement are hereby terminated, except for following portions of the License Agreement that will survive the termination:  Article 1 (including Schedule 1) (Definitions; Interpretation); Article 9 (Confidential Information) (but as to Sections 9.1 thru 9.3 only for three (3) years from the Second Amendment Effective Date; for clarity, Section 9.4 (Independent Development; Residuals) shall continue after the three (3) year period); Article 12 (Indemnification; Limitations on Liability; Insurance Requirements) (but only to the extent any Loss arises prior to the Second Amendment Effective Date) and Section 12.3 (but only as applicable to Spectrum under this Second Amendment); Article 14 (Miscellaneous) (other than Sections 14.3, 14.6 and 14.12); Section 6.9 (Books; Records); Section 6.10 (Audits); Section 6.11 (Offset); Section 6.13 (Withholding Taxes); Section 6.15 (Late Payment) (for these Sections in Article 6, only as they relate to payments accrued before the Second Amendment Effective Date); Section 8.1 (Ownership); Section 8.2(a) and (8.2(b) (Prosecution) (as it relates to Joint Intellectual Property only and for clarity these sections shall not create or preserve any payment obligations of Allergan from and after December 31, 2012).  For clarity, the appointment of Allergan as Spectrum’s agent under Section 5.1(a)(ii) is hereby terminated as of the Second Amendment Effective Date and Allergan shall have no obligations or liability under the License Agreement or Co-Promotion 

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

Agreement including, without limitation,  any obligations or liability regarding development, regulatory or other responsibilities or activities of any kind; and
		
	(b)
	the Co-Promotion Agreement is hereby terminated.

12.    After the Second Amendment Effective Date, (i) Allergan shall promptly deliver to Spectrum or destroy (at Allergan’s option) all Confidential Information of Spectrum, subject to Allergan retaining a copy of such Confidential Information solely as may be reasonably necessary for Allergan to perform under this Second Amendment and for legal archival purposes and/or as may be required by Law, and (ii) Spectrum shall promptly deliver to Allergan or destroy (at Spectrum’s option) all Confidential Information of Allergan, subject to Spectrum retaining a copy of such Confidential Information solely as may be reasonably necessary for Spectrum to perform under this Second Amendment and for legal archival purposes and/or as may be required by Law.  For clarity, Confidential Information of Allergan shall exclude the data and results generated under the License Agreement and regulatory filings assigned by Allergan to Spectrum pursuant to Section 6 of this Second Amendment, if any.  
13.    The Parties agree to the press release attached hereto as Exhibit 3 announcing the Second Amendment and the Purpose.  The Parties further agree that such press release shall be issued no later than close of business February 1, 2013.  Further, from and after the Second Amendment Effective Date, each Party shall not mention the other Party or its Affiliates in any press release or other public statements concerning this Amendment, the Purpose, the License Agreement or the Co-Promotion Agreement without first, in each instance: (a) providing such statement to the other Party for review at least two full (2) business days in advance of making such proposed statement, and (b) obtaining the other’s Party’s express written consent to such statement, which shall not be unreasonably withheld; provided, that the other Party’s review and consent shall not be required in connection with a Party making a public statement that conforms in all material respects to the language in Exhibit 3 or that is determined, based on advice of legal counsel, to be required by applicable Law.
14.    Each Party hereby acknowledges and agrees that, as of the Second Amendment Effective Date, to the knowledge of such Party, the other Party has fulfilled its obligations under the License Agreement and Co-Promotion Agreement and neither Party is in breach of the License Agreement or Co-Promotion Agreement.
15.    This Second Amendment amends the terms of the License Agreement as expressly provided above, and the License Agreement, as so amended, along with the Second Amendment, sets forth the complete, final and exclusive agreement and all the covenants, promises, agreements, warranties, representations, conditions and understandings between the Parties hereto with respect to the subject matter of the License Agreement and supersedes, as of the Second Amendment Effective Date, all prior and contemporaneous agreements and understandings between the Parties with respect to the subject matter of the License Agreement.  There are no covenants, promises, agreements, warranties, representations, conditions or understandings, either oral or written, between the Parties other than as set forth in this Second Amendment and the License Agreement (as amended by this Second Amendment).

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

16.    The validity, performance, construction, and effect of this Second Amendment shall be governed by and construed under the laws of the State of New York, without giving effect to any choice of law principles that would require the application of the laws of a different state.  
17.    This Second Amendment may be executed in one (1) or more counterparts, each of which shall be deemed an original, but all of which shall constitute one and the same instrument.  
[ remainder of page intentionally left blank ]

***Certain confidential information contained in this document, marked with 3 asterisks (***), has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended

IN WITNESS WHEREOF, the Parties have caused this Second Amendment of the License, Development, Supply and Distribution Agreement to be executed on the Second Amendment Effective Date.

ALLERGAN SALES, LLC

By: /s/ JEFFREY L. EDWARDS

Name:    Jeffrey L. Edwards            
Title:    Vice President and             
Chief Financial Officer        

ALLERGAN USA, INC.

By:  /s/ JEFFREY L. EDWARDS

Name:    Jeffrey L. Edwards            
Title:    Vice President and             
Chief Financial Officer        

ALLERGAN, INC.

By: /s/ JEFFREY L. EDWARDS

Name:    Jeffrey L. Edwards            
		
	Title:
	Executive Vice President, Finance and  Business Development,                                       Chief Financial Officer        

SPECTRUM PHARMACEUTICALS, INC.

By: /s/ BRETT L. SCOTT

Name:    Brett L. Scott                
Title:    Senior Vice President            
Acting Chief Financial Officer    

 

Exhibit 1
Trademarks 
EOQUIN either (a) as a stand-alone mark or (b) as the mark has been used in combination with any other words, stylizations, logos, or designs so as to create a unitary trademark
Applications
	
					
	Country
	Mark
	Application No.
	Filing Date
	Status

	European Union
	EOQUIN
	5317086
	9/15/06
	Abandoned

Registrations
	
					
	Country
	Mark
	Registration No.
	Registration Date
	Status

	Canada
	EOQUIN
	TMA838454
	12/14/2012
	Issued

	Japan
	EOQUIN
	5041987
	4/20/07
	Issued

	United States
	EOQUIN
	3,171,995
	11/14/06
	Issued

 

Exhibit 2

List of Contracts to be Assigned to Spectrum 

None

 

 

Exhibit 3

Press Release Announcing the Second Amendment and the Purpose 

COMPANY CONTACT:
Shiv Kapoor
Vice President, Strategic Planning & Investor Relations
702-835-6300
InvestorRelations@sppirx.com

Spectrum Pharmaceuticals Acquires Rights for Apaziquone in the U.S., Europe and Other Territories from Allergan; Expects to File New Drug Application

		
	•
	Based on communication with the FDA, Spectrum anticipates an Advisory Committee meeting to review a potential NDA for apaziquone.

		
	•
	The Company expects to file an NDA, which Spectrum will seek to expedite as part of a plan to achieve potential commercialization of apaziquone in key markets.

		
	•
	Apaziquone is in development to treat non-muscle invasive bladder cancer (NIMBC) as a single instillation following transurethral resection of bladder tumor (TURBT).

		
	•
	Approximately 70% of all patients with newly diagnosed bladder cancer have NMIBC, and yet there are no FDA-approved agents for post resection chemotherapy.

HENDERSON, Nev. – January 31, 2013 -- Spectrum Pharmaceuticals (NasdaqGS: SPPI), a biotechnology company with fully integrated commercial and drug development operations with a primary focus in hematology and oncology, today announced the Company has reacquired development and commercialization rights for apaziquone in the United States, Europe and other territories pursuant to an agreed-upon restructuring of Spectrum’s collaboration with Allergan, Inc.  In exchange, Allergan will receive a royalty on future revenue.  Apaziquone is an anticancer agent being developed for the treatment of non-muscle invasive bladder cancer (NIMBC) as a single instillation following transurethral resection of bladder tumor (TURBT).

Spectrum also announced that a scheduled meeting with the U.S. Food & Drug Administration (FDA) was held last month to discuss the results from the Company’s Phase 3 clinical trials.  Based on the discussions with the FDA, Spectrum understands that the FDA can accept the NDA filing with the current Phase III data and will likely convene an Advisory Committee meeting.  Further, based on discussions with the FDA, Spectrum has agreed to conduct one additional Phase III study following consultation with the FDA on its design.

“Regaining apaziquone rights will enable Spectrum  to take the steps we believe are essential to advancing apaziquone toward commercialization in the U.S., Europe and other key territories,” stated Rajesh C. Shrotriya, M.D., Chairman, President and Chief Executive Officer of Spectrum Pharmaceuticals, Inc.  “Spectrum is committed to 

expediting our program for apaziquone, with the goal of accelerating potential registration and integrating apaziquone into our plan to expand our footprint in the U.S. and build our presence in the EU.  Spectrum is grateful to the FDA for its thoughtful feedback on the apaziquone clinical program.  We believe there continues to be a significant unmet need as no drugs have been approved and marketed in the U.S. for more than 20 years for low-grade NMIBC.”

Apaziquone is an anticancer drug that requires activation by bio-reductive enzymes that are over-expressed in bladder cancer cells, to render it a cytotoxic alkylating agent.  Spectrum conducted two multi-center, international Phase 3 trials of a single dose of intravesical instillation of apaziquone into the bladder in the immediate post-operative period after surgical resection of low-grade, non-muscle invasive bladder tumors.  In April 2012, Spectrum announced that the Phase 3 trials did not meet their primary endpoint of a statistically significant difference in the rate of tumor recurrence at 2 years between treatment and placebo arms.  However, analysis of the pooled data from both studies showed a statistically significant treatment effect in favor of apaziquone in the primary endpoint of the rate of tumor recurrence at 2 years (p-value = 0.0174) and in a key secondary endpoint, time to recurrence (p-value = 0.0076).

NMIBC is a form of bladder cancer localized in the surface layers of the bladder that has not spread to the deeper muscle layer.  Approximately 70% of all patients newly diagnosed with bladder cancer have NMIBC.  More than one million patients in the U.S. and Europe are estimated to be affected by the disease, which is treated predominantly by urologists.  Professional urology associations and NCCN Guidelines recommend instillation of a cytotoxic agent following transurethral resection of bladder tumor (TURBT) for NMIBC.  However, in the US, there are no FDA-approved agents for this indication.

About Spectrum Pharmaceuticals, Inc.
Spectrum Pharmaceuticals is a leading biotechnology company focused on acquiring, developing, and commercializing drug products, with a primary focus in oncology and hematology. Spectrum and its affiliates market three oncology drugs ─ FUSILEV® (levoleucovorin) for Injection in the U.S.; FOLOTYN® (pralatrexate injection), also marketed in the U.S.; and ZEVALIN® (ibritumomab tiuxetan) Injection for intravenous use, for which the Company has worldwide marketing rights. Spectrum's strong track record in in-licensing and acquiring differentiated drugs, and expertise in clinical development have generated a robust, diversified, and growing pipeline of product candidates in advanced-stage Phase 2 and Phase 3 studies. More information on Spectrum is available at www.sppirx.com. 

Forward-looking statement — This press release may contain forward-looking statements regarding future events and the future performance of Spectrum Pharmaceuticals that involve risks and uncertainties that could cause actual results to differ materially. These statements are based on management's current beliefs and expectations. These statements include, but are not limited to, statements that relate to 

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

SPECTRUM PHARMACEUTICALS, INC.®, FUSILEV®, FOLOTYN®, and ZEVALIN® are registered trademarks of Spectrum Pharmaceuticals, Inc and its affiliates. REDEFINING CANCER CARETM and the Spectrum Pharmaceuticals logos are trademarks owned by Spectrum Pharmaceuticals, Inc.

© 2013 Spectrum Pharmaceuticals, Inc. All Rights Reserved.

Source: Spectrum Pharmaceuticals, Inc.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00213-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00213-of-00352.parquet"}]]