Document:

Exhibit 10.1
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[Certain identified information has been excluded from the exhibit because it is both not material and is
the type that the registrant treats as private or confidential.]
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DATED    5 May 2022
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(1) INTERCEPT PHARMACEUTICALS, INC
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- and -
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(2) MERCURY PHARMA GROUP LIMITED
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SHARE PURCHASE
AGREEMENT
Relating to certain non-US subsidiaries of
Intercept Pharmaceuticals, Inc.
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CONTENTS
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	1.
	DEFINITIONS AND INTERPRETATION
	1

	2.
	SALE AND PURCHASE OF SHARES
	11

	3.
	CONSIDERATION
	11

	4.
	CONDITION
	12

	5.
	PRE-COMPLETION
	15

	6.
	SIGNING OBLIGATIONS
	19

	7.
	COMPLETION
	19

	8.
	PURCHASER WARRANTIES
	20

	9.
	SELLER WARRANTIES
	21

	10.
	SELLER LIMITATIONS
	23

	11.
	SELLER RESTRICTIVE COVENANTS
	25

	12.
	PRE-SALE MERGER
	26

	13.
	CONFIDENTIALITY AND ANNOUNCEMENTS
	26

	14.
	CEPS MATTER
	28

	15.
	GROUP SEPARATION MATTERS
	29

	16.
	ASSIGNMENT AND SUCCESSORS
	32

	17.
	THIRD PARTY RIGHTS
	33

	18.
	COSTS AND EXPENSES
	33

	19.
	PAYMENTS, ETC
	33

	20.
	FURTHER ASSURANCE
	34

	21.
	ENTIRE AGREEMENT
	34

	22.
	GENERAL
	35

	23.
	NOTICES
	36

	24.
	AGENT FOR SERVICE
	37

	25.
	GOVERNING LAW AND LANGUAGE
	38

	SCHEDULE 1: WARRANTED INFORMATION
	39

	Part 1: The Group Companies
	39

	Part 2: The Shares
	50

	Part 3: Leased Property
	51

	SCHEDULE 2: WARRANTIES
	56

	SCHEDULE 3: MARKETING AUTHORISATIONS
	71

	SCHEDULE 4: COMPLETION OBLIGATIONS
	72

	Part 1: Seller obligations on Completion
	72

	Part 2: Purchaser's obligations on Completion
	76

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	SCHEDULE 5: COMPLETION STATEMENTS
	79

	Part 1: General
	79

	Part 2: Expert determination
	81

	Part 3: Pro formas
	84

	Part 4: Specific bases of preparation
	85

	SCHEDULE 6: TAX COVENANT
	88

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THIS AGREEMENT is made on 5 May 2022
BETWEEN:
	(1) 
	INTERCEPT PHARMACEUTICALS, INC., a company incorporated in Delaware with number 3565213 which has its business address at 305 Madison Avenue, Morristown, New Jersey 07960 (the "Seller"); and

	(2) 
	MERCURY PHARMA GROUP LIMITED, a company incorporated in England with number 02330913 which has its registered office at Capital House, 85 King William Street, London, EC4N 7BL (the "Purchaser").

BACKGROUND:
	A
	The Group Companies are engaged in commercialization activities with respect to the Product.

	B
	The Seller owns either directly, or indirectly, the Shares.  The Seller has agreed to sell or procure the sale of, and the Purchaser has agreed to purchase, the Shares on the terms set out in this agreement.

	C
	The Seller also owns certain intellectual property rights relating to obeticholic acid that it has licensed to Intercept Pharma Europe Ltd. (“IPEL”), a Seller subsidiary, and in connection with this agreement and the BTA, the Seller has agreed to procure that IPEL enters into a licence agreement with the Purchaser in relation to certain of these rights to the Product and the Seller is also entering into the Trademark Assignment with respect to trademarks relating to the same.

IT IS AGREED:
1.DEFINITIONS AND INTERPRETATION
1.1In this agreement:
"Accounts" means (a) the unaudited financial statements of each Group Company as at and for the financial year ended on the Accounts Date as contained at folder 2.1.1 of the Due Diligence Information and (b) the profit and loss statements and balance sheets of the Group Companies as contained at folder 2.1.2.1 and 2.1.3.1, respectively, of the Due Diligence Information;
"Accounts Date" means 31 December 2021;
"Acquisition" means the proposed acquisition of the Shares by the Purchaser on the terms of this agreement;
"Acquisition Documents" means this agreement, the Disclosure Letter, the Licence Agreement, the Supply Agreement, the Transitional Services Agreement, the SDEA, the BTA the Trademark Assignment and the Agreed Form documents (including any attachments or schedules thereto) and other documents to be delivered on Completion;
"Actual Working Capital" means the aggregate Working Capital of the Group Companies as set out in the Completion Statements;
"ADVANZ Group" means ADVANZ Pharma Holdco Limited and its subsidiary undertakings;
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"Affiliate" in relation to a company, means any other company directly or indirectly controlling, controlled by or under common control with such company, and "control" for these purposes means (a) holding the majority of the voting rights or share capital of such company; or (b) otherwise having the power to direct the management and policies of such company;
"Agreed Form", in relation to a document, means the form approved and for identification purposes included in a zip file of agreed form documents titled “Project Echo Agreed Form Documents” and emailed from the Seller’s lawyers to the Purchaser’s Lawyers on the date of this agreement;
"Anti-Bribery Laws" means, in each case to the extent applicable to a Group Company or a member of the Seller Group (as the case may be) at any time prior to the date of this agreement: (i) the UK Bribery Act 2010; (ii) the U.S. Foreign Corrupt Practices Act of 1977 (as amended); (iii) the Italian Legislative Decree no. 231/2001; and (iv) any other applicable anti-bribery and anti-corruption law in any jurisdiction;
"Austrian Shares" means the entire issued share capital of the Austrian Target;
"Austrian Target" means Intercept Pharma Austria GmbH;
"Authority" means any supra-national, national or sub-national authority, commission, department, agency, regulator, regulatory body, court, tribunal or arbitrator;
"Base CEPS Amount" means EUROS 40,600,000 (forty million six hundred thousand euros)
"BTA" means the business transfer agreement dated on or about the date hereof and entered into between (1) IPEL and (2) Advanz Pharma Services (UK) Limited relating to the transfer of certain assets related to the Product;
"Business" means the business of the Group Companies, including the marketing of the Product, as it is carried on at the date of this agreement and as it has been carried on in the 12 months prior to the agreement in the Territory;
"Business Day" means any day other than a Saturday or Sunday on which commercial banks are open for general business in London, Milan and New York;
“Canadian Marketing Authorisation” means the marketed drug product registrations relating to the Product in 5 mg and 10mg form, issued by the Canadian authorities to the Seller with registration number HC e186967;
"Canadian Shares" means the entire issued share capital of the Canadian Target;
"Canadian Target" means Intercept Pharma Canada Inc.;
"Cash" means the aggregate amount of cash (including cash in hand, in transit and credited to any account with any banking, financial, acceptance credit, lending or other similar institution or organisation, together with accrued interest) and cash equivalents (including liquid or easily realisable stocks, shares, bonds, treasury bills and other similar securities) held by or on behalf of any Group Company as at the Effective Time and as shown in the Completion Statements, excluding Restricted Cash;
"CEPS Matter" means the discussions between the Seller’s Group and the Economic Committee for Health Products in France (Comité Economique des Produits de Santé) relating
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to the historic reimbursement price for sales of the Product in France by any Group Company prior to Completion;
"Claim" means any claim against the Seller in relation to this agreement;
"Competing Business" means any business which commercially sells or distributes or provides for commercial sale or distribution a therapeutic product that is indicated for the treatment of primary biliary cholangitis ("PBC") or non-alcoholic steatohepatitis (“NASH”) in the Territory but shall not include clinical development activities for the development of any therapeutic product for the treatment of PBC or NASH in the Territory;
"Completion" means completion of the sale and purchase of the Shares in accordance with this agreement;
"Completion Date" means the date that is 15 Business Days after (and excluding) the day on which the Condition has been satisfied or waived (as the case may be) in accordance with this agreement, or such other date as the Seller and the Purchaser may agree in writing;
"Completion Payment" has the meaning given in clause 3.2;
"Completion Statements" means the statements to be prepared and agreed or determined in accordance with schedule 5;
"Consideration" means the consideration for the Shares calculated as provided in clause 3.1;
"Debt" means the aggregate amount (expressed as a positive number) of all borrowings and indebtedness in the nature of borrowings of all Group Companies (other than between Group Companies) and all accrued and outstanding interest thereon calculated up to and including the Effective Time pursuant to the terms of such debt and as shown in the Completion Statements, including:
		(a)
	loans and bank overdrafts;

		(b)
	liabilities under acceptances of trade bills (other than in respect of purchases in the ordinary course of business) and acceptance credits;

		(c)
	liabilities under any bond, note, loan stock, debenture or other similar instrument or security;

		(d)
	liabilities under factoring arrangements;

		(e)
	amounts raised by any other transactions having the commercial effect of borrowings;

		(f)
	liabilities under any currency or interest swap or other interest or currency protection, hedging or financial futures transaction or arrangement;

		(g)
	liabilities under any guarantee of, or indemnity against financial loss in respect of, any obligation of another person (other than another Group Company);

		(h)
	liabilities in relation to any letter of credit (but not the letter of credit itself), bond or guarantee given by a third party in relation to any obligation and/or liability of any Group Company;

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		(i)
	any amounts relating to costs and expenses, bonuses or other costs payable on or after Completion by any Group Company in connection with the transactions contemplated by this agreement;

		(j)
	any liabilities (including Taxes) of a Group Company in relation to the accelerated vesting of share options;

		(k)
	to the extent that the CEPS Matter has not been finally resolved at Completion and the relevant liability paid a provision of $42,800,000 (forty two million eight hundred thousand dollars) in respect of the CEPS Matter being the dollar equivalent of the Base CEPS Amount.

		(l)
	A provision of $1,000,000 in respect of potential Tax Liabilities which may arise in respect of the matters disclosed at paragraph 34.1 of the Disclosure Letter.

		(m)
	the aggregate cash value of any declared but unpaid dividends and other distributions attributable to the Shares, to the extent that a member of the Seller’s Group is entitled to receive the relevant dividend or other distribution after Completion; and

liability if any, to pay, corporate income tax in respect of the period from the Accounts Date to the Effective Time and any unpaid liability to pay corporate income tax for all periods up to and including the Accounts Date;
but excluding, for the avoidance of doubt, Intra-Group Debt owed by any Group Company and any amount included in the Completion Statements as Working Capital;
“Disclosed” means fairly disclosed to the Purchaser within the Disclosed Information with sufficient detail to enable the Purchaser to identify the nature and scope of the matter disclosed;
"Disclosed Information" means the information in the Disclosure Letter and the Due Diligence Information;
"Disclosure Letter" means the letter of the same date as this agreement from the Seller to the Purchaser relating to the Warranties, together with any documents annexed to it;
"Dispute" means any dispute or claim arising out of or in connection with this agreement, its subject matter or formation (including any non-contractual dispute or claim);
"Due Diligence Information" means the information and documents contained in the electronic data room maintained by Firmex in relation to the Group Companies and their respective businesses and assets as at 30 April 2022 (the “Data Room”) as listed in the index in the Agreed Form (a download of which has, for evidential purposes, been delivered to the Purchaser's Lawyers immediately before the signing of this agreement);
"Effective Time" means the time immediately prior to Completion;
"Encumbrance" means any mortgage, charge, pledge, lien, option, restriction, assignment, right to acquire, right of pre-emption or any other form of right, interest, preference, security or encumbrance of any nature in favour of a third party or any agreement, arrangement or obligation to create any of them;
“French Shares” means the entire issued share capital of the French Target;
“French Target” means Intercept Pharma France SAS;
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"Fund" means any fund, bank, company, unit trust, investment trust, investment company, limited, general or other partnership, industrial provident or friendly society, any collective investment scheme (as defined by the FSMA), any investment professional (as defined in article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion Order) 2005 (the “FPO”)), any high net worth company, unincorporated association or partnership (as defined in article 49(2)(a) and (b) of the FPO) or any high value trust (as defined in article 49(6) of the FPO), any pension fund or insurance company or any person who is an authorised person under the FSMA;
“German Shares” means the entire issued share capital of the German Target;
“German Target” means Intercept Pharma Deutschland GmbH;
“Golden Power Clearance” means (i) the authorisation issued in an express way or by tacit consent (silenzio assenso), to the transactions contemplated hereunder by the Italian Prime Minister’s Office pursuant to the Golden Power Law for the purpose of completing the transactions contemplated by this agreement in relation to the Italian Shares, or, as the case may be, (ii) the order or measure by the Italian Prime Minister’s Office that, in response to the Golden Power Notification, confirms that the Golden Power Law is not applicable to the transactions contemplated by this agreement;
“Golden Power Law” means Law Decree 21/2012 (as subsequently amended and supplemented);
"Group Companies" means the companies listed in schedule 1, and "Group Company" means each such individual company listed in schedule 1:;
"Intra-Group Debt" means:
		(a)
	the aggregate amount owed by the Group Companies to the members of the Seller Group; less

		(b)
	the aggregate amount owed by members of the Seller Group to the Group Companies,

as at the Effective Time as stated in the Completion Statements;
"IP" means:
		(a)
	patents, utility models, inventions, know-how, trade secrets, copyright and related rights and allied rights including moral rights, database rights and other rights in and relating to software, registered designs, unregistered design rights, trademarks and service marks, trade names, business names, company names, brand names, logos, rights in get-up, domain names and URLs, goodwill and rights to sue for passing-off (or for unfair competition) and any other intellectual property rights (in each case, whether or not registered, and including all applications to register and rights to apply to register any of them, and all rights to sue for any past or present infringement of them) and renewals or extensions of such rights; and

		(b)
	rights having equivalent or similar effect to the above items in any jurisdiction in which any Group Company conducts business;

“Irish Shares” means the entire issued share capital of the Irish Target;
“Irish Target” means Intercept Pharma International Limited;
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“Italian Prime Minister’s Office” means the Presidenza del Consiglio dei Ministri of the Republic of Italy;
“Italian Shares” means the entire corporate capital of the Italian Target;
“Italian Target” means Intercept Italia S.r.L;
"Key Customer" means any customer of the Group Companies (taken as a whole) which in the financial year ended on the Accounts Date accounted for revenue in excess of US$[***];
"Key Supplier" means any supplier to the Group Companies (taken as a whole) which in the financial year ended on the Accounts Date accounted for expenditure in excess of US$[***];
"Key Warranties" means the Warranties in paragraphs 1 (The Seller), 2 (The Shares and the Group Companies), 4 (Interests in other companies) and 5 (Insolvency) of schedule 2;
"Key Warranty Claim" means any Warranty Claim in relation to any Key Warranty;
"Latest Financial Information" means the profit and loss statements and balance sheets of the Group Companies as contained at folder 2.1.2.1 and 2.1.3.1, respectively, of the Due Diligence Information;
"Latest Financial Information Date" means 31 December 2021
"Licence Agreement" means the licence agreement to be entered into on or about the date hereof between (1) Intercept Pharma Europe Ltd. and (2) the Purchaser relating to the licensing of certain intellectual property rights;
"Long Stop Date" means the date that falls 90 Business Days immediately following (but excluding) the date of this agreement (as extended pursuant to clause 4.3(a) (as the case may be)), or such other date as the Seller and the Purchaser may agree in writing;
“Marketing Authorisations” means the licenses and approvals held by the Group Companies relating to the marketing, sale and distribution of the Product as listed in schedule 3;
“Marketing Websites” means the following websites used for the marketing of the Product in various territories which are registered in the name of the Seller:
[***]
“Material Contract” means a contract with a Key Customer or a Key Supplier;
“Nordic Capital Sphere” means any Fund whose general partner, operator, manager or investment adviser is a Nordic Capital entity, any company in which such a Fund holds shares (whether directly or indirectly but excluding any portfolio company thereof), or any Affiliate of the same, including each of their general partners, operators, managers and investment advisers and each of their respective employees, directors, officers, finance providers, consultants, advisors and associates;
“Office User Agreement” means the office user agreement amongst United Overseas Investment Ltd., carrying on a business as Zemlar Offices, as centre, and Canadian Target, as user, dated May 21, 2020 with respect to the offices located at Top Level, Suite 300, 4263 Sherwoodtowne Blvd, Mississauga, ON L4Z 1Y5, Canada;
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“Outgoing Directors” means [***] and such other persons as the Purchaser specifies no later than five Business Days prior to Completion;
“Portuguese Shares” means the one quota share of EUR 5,000 in the capital of the Portuguese Target;
“Portuguese Target” means Intercept Pharma Portugal, Unipessoal Lda;
"Product" means Ocaliva® (a monotherapy in which obeticholic acid is the active pharmaceutical ingredient) that is commercially sold for the treatment of PBC;
"Product Files" means all information, processes, technology, and data in the Seller's possession or control and required to (i) enable the manufacture of the Product including that relating to the chemical formula of the Product (including the identity, relative volumes and combination of ingredients and the results of clinical or other trials and investigations or the like) and (ii) obtain and maintain the Marketing Authorisations;
"Property" means the land and buildings leased, licensed or occupied by any Group Company as detailed in part 3 of schedule 1, including without limitation, the Office User Agreement;
"Purchaser Group" means each or any of (a) the Purchaser and any Affiliate of the Purchaser, in each case for the time being; and (b) with effect from Completion, each Group Company (and any reference to "member of the Purchaser Group" or, in the case of any member of the Purchaser Group, to "its group" shall be construed accordingly);
"Purchaser Relevant Persons" means the following employees of the Purchaser Group as at the date of this agreement:  Chief Corporate Development Officer, Director – Strategic Finance, Assistant General Counsel and International Tax Manager.;
"Purchaser's Lawyers" means White & Case LLP of 5 Old Broad Street, London EC2N 1DW;
"Regulatory Authority" means the Austrian Federal Competition Authority (Bundeswettbewerbsbehörde), the Federal Cartel Prosecutor (Bundeskartellanwalt), the Cartel Court (Kartellgericht) and the Supreme Cartel Court (Kartellobergericht), and, if relevant, the Italian Prime Minister’s Office;
"Relevant CEPS Amount" means the aggregate, expressed in Euros of (a) any amounts paid by the Purchaser, the French Target or any Group Company to the French Authorities (including the French Economic Committee for Health Products) in respect of the CEPS Matter which are payable as a result of the French Authority successfully asserting (including by agreement) that the  reimbursement price received by any Group Company in respect of sales of the Product by any Group Company prior to Completion was too high and (b) all costs and expenses reasonably and properly incurred by the Purchaser, the French Target or any Group Company in connection with the CEPS Matter, including amounts paid pursuant to any related litigation and any other third party fees;
"Relief" means any relief, loss, allowance, credit, set-off, deduction or exemption for any Tax purposes, any right to repayment of Tax or to a payment in respect of Tax from a Tax Authority, and:
		(a)
	any reference to the use or set off of a Relief shall be construed accordingly and shall include the use of set-off in part; and

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		(b)
	any reference to the loss of a Relief shall include the failure to obtain, reduction, modification, loss, counteraction, nullification, absence, unavailability, disallowance, withdrawal, clawback, non-existence or cancellation of any such Relief, or to such Relief being available only in a reduced amount;

“Restricted Cash” means all cash and cash equivalents which cannot be:
		(a)
	lawfully spent; or

		(b)
	distributed; or

		(c)
	loaned; or

		(d)
	released

in each case by a Group Company from the jurisdiction in which it is situated within a period of 30 days without deduction, withholding or additional cost (other than general foreign exchange controls applicable in jurisdictions in which the relevant Group Company operates and the de minimis administrative costs of transfer from a bank account incurred in the ordinary course of business); or
		(e)
	used within a period of 90 days as:

		(i)
	it is securing obligations, guarantees or any liabilities of any person in respect of obligations of a Group Company;

		(ii)
	is held by an agent of a Group Company or a regulator or a governmental authority pursuant to a regulatory or contractual requirement;

		(iii)
	it is being held in escrow for the benefit of any person in respect of obligations of a Group Company; or

		(iv)
	amounts are otherwise committed, including but not limited to, in respect of rent deposits, security deposits, customer deposits, to support letters of credit,

and “Restricted Cash” shall include any cash that is held as collateral for any letters of credit issued in respect of any Group Company;
"Seller Group" means each or any of the Seller and any Affiliate of the Seller from time to time, excluding each Group Company (and any reference to "member of the Seller Group" or, in the case of any member of the Seller Group, to "its group" shall be construed accordingly);
"SDEA" means a safety data exchange agreement to be made between the Seller and the Purchaser and entered into on or about the date hereof;
"Seller Group Guarantees Facility" means the facility with HSBC Bank USA pursuant to which HSBC issues standby letters of credit for the benefit of Group Companies from time to time and which are secured by a cash deposit made by the Seller;
"Seller's Lawyers" means DLA Piper UK LLP of 160 Aldersgate Street, London EC1A 4HT;
"Shares" means the issued shares in each Group Company details of which are set out in part 2 of schedule 1;

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"Spanish Shares" means the entire issued share capital of the Spanish Target;
"Spanish Target" means Intercept Pharma Spain, S.L.;
"Supply Agreement" means the agreement entered into on or about the date hereof between Intercept Pharma Europe Ltd. and the Purchaser relating to the supply of the Product;
"Swiss Share" means the one quota share of CHF 20,000 in the capital of the Swiss Target;
"Swiss Target" means Intercept Pharma Switzerland GmbH;
"Tax" or "Taxation" means, save for rates, council tax, municipal taxes and utilities charges, all forms of taxation and statutory and governmental, state, provincial, local governmental or municipal charges, duties, contributions and levies in each case in the nature of tax, and withholdings and deductions required by law in respect of the foregoing, and shall further include social security contributions and payments to a Tax Authority, court or tribunal on account of Tax, in each case, whether chargeable directly or primarily against a Group Company or any other person and wherever and whenever imposed and all related penalties and interest;
"Tax Authority" means any governmental or other authority competent to assess, collect, administer or impose a liability for Taxation and acting in that capacity, whenever and wherever;
"Tax Claim" means a Tax Warranty Claim or Tax Covenant Claim;
"Tax Covenant Claim" means a claim under paragraph 2 of schedule 6 (Tax Covenant);
"Tax Warranties" means the Warranties in paragraph 34 of schedule 2;
"Tax Warranty Claim" means any Claim in relation to any Tax Warranty;
"Territory" means all countries and territories in the world other than the United States and its territories and possessions;
“Trademark Assignment” means the assignment agreement relating to certain trademarks related to the Product to be entered into on or about the date hereof between the Seller (1) and the Purchaser (2);
"Transitional Services Agreement" means the agreement to be entered into on or about the date hereof between the Seller and the Purchaser in relation to certain services to be provided by the Seller to the Purchaser following Completion;
"UK Shares" means the entire issued share capital of each of the UK Targets;
"UK Targets" means Intercept Pharma UK & Ireland Ltd and Intercept Pharma Ltd;
"US GAAP" means the generally accepted accounting principles in the United States of America, including standards and interpretation issued or adopted by the Financial Accounting Standards Board;
"VAT" means value added tax as defined in the Value Added Tax Act 1994 and the EC Sixth Directive on VAT 77/388/EEC, any similar Tax levied by reference to added value or sales and
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all Taxes of a similar nature levied in addition to or in substitution for the foregoing, in each case imposed, collected or assessed by, or payable to a Tax Authority;
"W&I Policy" means the warranty and indemnity policy to be taken out by the Purchaser at its own cost and for its own benefit for the purposes of the Warranties;
"Warranties" means the warranties given by the Seller in clause 9.1 and schedule 2;
"Warranty Claim" means any Claim in relation to any Warranty;
"Working Capital" means the amounts as at the Effective Time of those items stated in the balance sheet in part 3 of Schedule 5 as relating to Working Capital; and
"Working Capital Target" means USD 13,000,000.
	1.2
	In this agreement (unless the context requires otherwise):

		(a)
	"$" and "dollars" means the lawful currency of the United States of America; and

		(b)
	"including", "includes" or "in particular" means including, includes or in particular without limitation.

	1.3
	In this agreement (unless the context requires otherwise), any reference to:

		(a)
	any gender includes all genders, and the singular includes the plural (and vice versa);

		(b)
	a company includes any company, corporation or body corporate, or any other entity having a separate legal personality; and a person includes an individual, company, partnership, unincorporated association or Authority (whether or not having a separate legal personality); and any professional firm or company includes any firm or company effectively succeeding to the whole, or substantially the whole, of its practice or business;

		(c)
	any time of day or date is to that time or date in London;

		(d)
	a day shall be a period of 24 hours running from midnight to midnight, and days shall be to calendar days unless Business Days are specified;

		(e)
	a month or a year shall be to a calendar month or a calendar year respectively;

		(f)
	legislation or a legislative provision includes reference to the legislation or legislative provision as amended or re-enacted, any legislation or legislative provision which it amends or re-enacts and any legislation made under or implementing it, in each case for the time being in force (whether before, on or after the date of this agreement);

		(g)
	any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official or any legal concept or thing shall, in respect of any jurisdiction other than England, be deemed to include the specific term stated in the language of such other jurisdiction immediately after it or, if no such term is stated, what most nearly approximates to such English term in such other jurisdiction; and any reference to any specific English law shall be deemed to include any equivalent or similar law in any other jurisdiction; and

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		(h)
	writing or written includes any method of representing or reproducing words in a legible form.

	1.4
	For the purposes of applying a reference to a monetary sum expressed in dollars in:

		(a)
	any Warranty; or

		(b)
	clause 10 (Seller limitations),

an amount in a different currency shall be deemed to be an amount in dollars converted at the closing mid-point spot rate for a transaction between the relevant currency and dollars as quoted by Barclays Bank plc as at the close of business on the Business Day immediately preceding the date of this agreement.
	1.5
	Unless the context requires otherwise, any reference in this agreement to a clause or schedule, appendix, exhibit or annex is to a clause of or schedule, appendix, exhibit or annex to this agreement, any reference to a part or paragraph is to a part or paragraph of a schedule to this agreement, any reference within a schedule to a part is to a part of that schedule, and any reference within a part of a schedule to a paragraph is to a paragraph of that part of that schedule.

	1.6
	This agreement incorporates the schedules and appendices, exhibits, annexes to it.

	1.7
	The contents list, headings, recitals, background section and any descriptive notes are for ease of reference only and shall not affect the construction or interpretation of this agreement.

	2.
	SALE AND PURCHASE OF SHARES

	2.1
	Subject to the terms of this agreement, the Seller shall sell (or procure the sale of) and the Purchaser shall purchase the Shares on and with effect from Completion.

	2.2
	The Shares shall be sold free from all Encumbrances and together with all rights of any nature attached or accruing to them on or after Completion (including the right to receive all dividends and distributions declared, paid or made by the Company on or after the Completion Date).

	2.3
	Neither the Seller nor the Purchaser shall be obliged to complete the sale and purchase of the Shares unless the sale and purchase of all of the Shares is completed on the Completion Date

	3.
	CONSIDERATION

Consideration
	3.1
	The aggregate consideration for the sale and purchase of the Shares shall be the payment by the Purchaser of an amount (“Consideration”), which is calculated as follows (and shall be apportioned as provided in clause 3.4):

		(a)
	US$ 38,500,000;

		(b)
	plus an amount equal to the Cash;

		(c)
	less an amount equal to the Debt;

		(d)
	plus, if the Actual Working Capital exceeds the Working Capital Target, the amount of the excess or, if the Working Capital Target exceeds the Actual Working Capital, less the amount of such excess; and

​

11

		(e)
	either (as applicable):

		(i)
	plus, where the Intra-Group Debt is a negative number, such amount (expressed as a positive number); or

		(i)
	less, where Intra-Group Debt is a positive number, such amount.

The “Initial Consideration” payable by the Purchaser to the Seller at Completion is nil. The parties acknowledge that the calculation above may result in the Consideration being a negative number which requires a payment from the Seller to the Purchaser.
	3.2
	Payment on account of Consideration

The Purchaser shall pay an amount equal to the Initial Consideration to the Seller on Completion ("Completion Payment") on account of the Consideration in cash in accordance with clause 19.
	3.3
	Adjusting payment

Within 15 Business Days of the agreement, deemed agreement or determination of the Completion Statements in accordance with schedule 5:
		(a)
	if the Consideration exceeds the Completion Payment, the Purchaser shall pay an amount equal to the excess to the Seller; or

		(b)
	if the Consideration is less than the Completion Payment, the Seller shall repay an amount equal to the difference to the Purchaser.

	3.4
	Apportionment

The Consideration shall be apportioned to the Shares of each Group Company, in the proportions as the Parties may agree prior to Completion or failing such agreement based on a calculation by reference to the proportion the net assets of each Group Company represent as a proportion of the aggregate net assets of all the Group Companies.
	4.
	CONDITION

	4.1
	Condition Precedent

The obligations of the Seller and the Purchaser to complete the sale and purchase of the Shares are conditional upon satisfaction (or waiver in accordance with this agreement, to the extent permitted by applicable law) of the following conditions (the “Conditions”):
		(a)
	the Regulatory Authorities in Austria providing approvals or clearances (or deemed approvals or clearances) relating to the proposed sale and purchase of the Shares under applicable laws, regulations or statutes in the jurisdiction of Austria (the “Austrian AT Condition”);

		(b)
	the Golden Power Clearance having been issued (in an express way or by tacit consent (silenzio assenso)) in accordance with applicable laws;

		(c)
	the German Federal Ministry for Economic Affairs and Climate Action (i) in response to the pending jurisdictional consultation having confirmed in writing (email suffices) that the transaction is not subject to a mandatory FDI filing requirement; or otherwise (ii) having cleared the transaction (by way of express clearance or issuing a non-

12

objection certificate) or the transaction being deemed to be cleared by operation of the law; and
		(d)
	the relevant Spanish authority providing either: (i) the approval to the acquisition of the Spanish Target by the Purchaser for the purposes of Article 7.bis of Spanish Law 19/2003 of 4th of July; or, alternatively (ii) a confirmation from such authority confirming that the mentioned approval or clearance shall not be required.

	4.2
	Responsibility for satisfaction

		(a)
	Purchaser Obligations

		(i)
	The Purchaser shall use its reasonable endeavours to ensure satisfaction of each of the Conditions as soon as possible.

		(ii)
	The Purchaser undertakes to:

		(A)
	(i) submit the filing (or where applicable a draft thereof) to each relevant Regulatory Authority and the relevant Spanish authority promptly following the date of this agreement and in any event within five Business Days of the date of this agreement and (ii) notify the Italian Prime Minister’s Office of the transactions contemplated under this agreement on the terms and conditions of this agreement by serving the relevant notice in the agreed form (“Golden Power Notification”) promptly following the date of this agreement and in any event within five Business Days of the date of this agreement, subject only to the Seller complying with its obligations under clause 4.2(b) below;

		(B)
	use its reasonable endeavours to avoid any declaration of incompleteness by any Regulatory Authority or any other suspension for the time periods of clearance;

		(C)
	take all steps necessary to secure the satisfaction of the Austrian AT Condition by the end of any Regulatory Authority’s initial period of review (without the need for a second phase of investigation). In respect of the Austrian AT Condition only, such steps shall include, but are not limited to, proposing, negotiating, offering to commit and agreeing, in each case where necessary to ensure that each the Austrian AT Condition is satisfied prior to the Long Stop Date with the Regulatory Authority to effect (and if such offer is accepted, commit to effect), by agreement, order or otherwise the sale, divestiture, license, or disposition of any necessary assets or businesses by the Purchaser or by any member of the ADVANZ Group;

		(D)
	take all steps reasonably necessary to secure the satisfaction of the Conditions (other than the Austrian AT Condition) by the end of any Regulatory Authority’s initial period of review (without the need for a second phase of investigation);

		(E)
	procure that the Seller is given a reasonable opportunity to review and comment on drafts of any filings or other material documentation prior to their submission to any Regulatory Authority (it being acknowledged that certain such drafts and/or documents may be shared on a confidential outside counsel to counsel basis only) and to consider and take account of any reasonable comments;

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13

		(F)
	respond as soon as reasonably practicable to all inquiries received from any Regulatory Authority for additional information or documentation and to supplement such filings as reasonably requested by the Regulatory Authority. The Purchaser undertakes to keep the Seller informed of contact with the Regulatory Authorities and to the extent permitted by law, provide the Seller with copies of all relevant documentation in relation thereto (to the extent such information relates to the Group Companies); and

		(G)
	promptly notify the Seller after receipt of each such clearance or approval required to satisfy each of the Conditions.

		(iii)
	The Purchaser shall be responsible for all filing fees and other costs incurred in relation to any filing required to be made in connection with each of the Conditions.

		(b)
	Seller Obligations

		(i)
	The Seller undertakes, to the extent permitted by law, to co-operate with the Purchaser and to use its reasonable endeavours to procure that each relevant Group Company co-operates with a view to satisfying each of the Conditions, including, to the extent necessary and on a confidential basis, providing all information and cooperation reasonably required by the Purchaser in relation to the business of the Company and/or relevant Group Company or in relation to the Seller and providing all information required by any Regulatory Authority in relation to the business of the Company and/or relevant Group Company or in relation to the Seller on a timely basis, provided that any information provided in relation to the Seller shall be provided only to the applicable Regulatory Authority and/or, if necessary the Purchaser’s Lawyers on a strictly confidential basis and shall not be provided to the Purchaser.

		(ii)
	Without prejudice to the above, the Seller undertakes to procure that the Italian Target, in compliance with applicable provisions of the Golden Power Law, executes and notifies the Golden Power Notification under clause 4.2 (a)(ii)(A) above jointly with the Purchaser.

		(c)
	Seller and Purchaser Obligations

		(i)
	The Seller undertakes to the Purchaser, to the extent permitted by law, to notify it in writing of anything which it is actually aware will, or which it believes (acting reasonably) is likely to, prevent any of the Conditions from being satisfied on or before the Long Stop Date promptly upon the same coming to the Seller’s attention.

		(ii)
	The Purchaser undertakes to the Seller, to the extent permitted by law, to notify it in writing of anything which it is actually aware will, or which it believes (acting reasonably) is likely to, prevent any of the Conditions from being satisfied on or before the Long Stop Date promptly upon the same coming to the Purchaser’s attention.

	4.3
	Non-Satisfaction

		(a)
	If any of the Conditions is not fulfilled (or waived in accordance with this agreement, to the extent permitted by applicable law) on or before the Long Stop Date, or becomes incapable of satisfaction on or before the Long Stop Date, this agreement shall automatically terminate, provided that each of the Purchaser or the Seller may in its

​

14

sole discretion extend the Long Stop Date on no more than 2 occasions each and on each such occasion by up to 25 calendar days in the event that the relevant Condition(s) has not been satisfied prior to the Long Stop Date due to a breach by the other of its obligations under this agreement.
		(b)
	If this agreement terminates in accordance with clause 4.3(a), and without limiting the right of any Party to claim damages, all obligations of the Parties under this agreement shall end (except for the Continuing Provisions) but all rights and liabilities of the Parties which have accrued before termination shall continue to exist.

	4.4
	The Purchaser shall not be liable for any breach of this clause 4 for failure to take any reasonable step or failing to satisfy any of the Conditions to the extent that such failure arises as a result of the Seller not complying with its obligations under clauses 4.2 (b) or (c).

	5.
	PRE-COMPLETION

	5.1
	The Seller shall, from the date of this agreement until the Effective Time:

		(a)
	procure that each Group Company will conduct its business in the ordinary course of business and that, in the absence of the prior written consent of the Purchaser (such consent not to be unreasonably delayed or withheld), no Group Company will knowingly do or agree to:

		(i)
	enter into, modify any material term of or terminate (other than expiration or termination by a counterparty ) any Material Contract or any other contract involving revenue or expenditure in excess of US$[***];

		(ii)
	dispose of or grant any option in respect of any material part of its assets other than stock in the ordinary course of business;

		(iii)
	acquire or dispose of any fixed asset having a book value in excess of US$[***];

		(iv)
	make any capital commitment in excess of US$[***] individually or which together with all other such capital commitments entered into during such period exceeds US$[***] in aggregate;

		(v)
	make any material change in the nature of its business;

		(vi)
	discontinue or cease to operate all or a material part of its business (except to the extent required to do so by law);

		(vii)
	make any material variation to the terms and conditions of employment of any employee earning US$[***] per annum or more (other than annual salary increases and benefits in the usual course and or which together with all other variations made between the date of this agreement and Completion would increase the total annual  salary or benefits costs of the Group Companies taken as a whole by [***]% or more;

		(viii)
	appoint, employ or offer to appoint or employ any person at a rate of remuneration per annum in excess of US$[***] individually or which together with all other appointments, employments or offers made between the date of this agreement and Completion would increase total annual salary or benefits costs of the Group Companies taken as a whole by [***]% or more;

		(ix)
	other than for cause, dismiss any employee earning US$[***] per annum or

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15

more or, directly or indirectly, induce any such employee to terminate his employment;
		(x)
	borrow money or incur any indebtedness in the nature of borrowing (in each case from or in respect of a person which is not a Group Company and/or a member of the Purchaser Group) otherwise than in the ordinary and usual course of business;

		(xi)
	grant any loan, advance or capital contribution to any other person other than a loan to any employee in an amount not exceeding US$[***] individually or, which together with all other such loans, advances or capital contributions between the date of this agreement and Completion exceeds US$[***];

		(xii)
	reduce its share capital or purchase or redeem its own shares;

		(xiii)
	acquire any share or other interest in any person or acquire any business carried on by any person;

		(xiv)
	create any Encumbrance or redeem or release any Encumbrance or give any guarantees or indemnities other than in the ordinary course of business;

		(xv)
	grant, modify or terminate any material rights or entering into any agreement relating to material IP or doing or omitting to do anything to jeopardise the validity or enforceability of any material IP, including the non-payment of any application, search, maintenance or other official fees;

		(xvi)
	fail to pay any premium in respect of any its insurance policies which are required to be paid to continue such policy of insurance or otherwise reduce the level of cover provided;

		(xvii)
	institute or settle any legal proceedings where the amount claimed exceeds US$[***] (except for debt collection in the normal course of business);

		(xviii)
	fail to renew or, when due, pay the premium in respect of any material insurance policy which relates to a Group Company;

		(xix)
	declare, make or pay any dividend or other distribution;

		(xx)
	create, allot or issue any shares, loan capital or other securities;

		(xxi)
	create, issue, redeem or grant any option or right to subscribe in respect of any share or loan capital or other securities;

		(xxii)
	amend its articles of association, by-laws or equivalent constitutional documents, adopting further articles of association, by-laws or equivalent constitutional documents or passing resolutions which are inconsistent with them except as required by applicable law;

		(i)
	make any change to the material basis, accounting methods, accounting procedures, policies, reference dates or treatment by reference or practice to which its accounts or other financial statements are prepared (or request a Tax Authority to make such changes);

		(ii)
	changing its residence for Tax purposes and/or creating a permanent establishment and/or any taxable presence in any jurisdiction outside its jurisdiction of incorporation;

		(iii)
	amending, retracting or re-submitting any Tax return which has previously

​

16

been submitted to a Tax Authority (other than at the request of a Tax Authority or to correct errors in such return), or amending, disclaiming or revoking any Tax refund or relief or any claim, surrender or election relating to Tax which has previously been received or submitted or notified to any Tax Authority or otherwise given effect pursuant to applicable law (save where such amendment, disclaimer or revocation is at the request of a Tax Authority or in order to correct an error or will not give rise to any Tax liability for a Group Company);
		(iv)
	settle, compromise, agree or materially negotiate any liability, audit, enquiry, assessment, dispute or litigation relating to Tax with any Tax Authority, entering into any closing agreement or similar agreement with any Tax Authority in each case on terms which impose obligations or restrictions on a Group Company after Completion in respect of Tax (other than solely in relation to the the payment of a Tax liability pursuant to such settlement);

		(v)
	consenting to any extension or waiver of a limitation period relating to Tax, outside of the ordinary course on a basis materially inconsistent with past practice; or

		(vi)
	taking any steps or other action (including making any admission to a Tax Authority) which is inconsistent with past practice which could materially increase any liability to Tax and/or could result in any material liability to Tax arising (or being deemed to arise) or any adverse terms or conditions or other material obligations being imposed upon any Group Company after Completion rather before Completion, other than as required to comply with any applicable laws or generally accepted practice;

		(b)
	not, and shall procure that IPEL shall not, do or agree to:

		(i)
	modify or terminate any of the Transaction Documents;

		(ii)
	deal with its interest in the IP (and applications for IP) which are the subject of the Licence Agreement where the same would have an adverse effect on the rights granted to the Purchaser pursuant to the Licence Agreement;

		(iii)
	except as contemplated in and/or to comply with an Acquisition Document, make any variation to the terms and conditions of employment of, or (other than for cause) dismiss or terminate the employment of, any employee who is listed as an employee in the BTA (other than annual salary and benefit increases in the ordinary course of business) ; or

		(iv)
	modify or terminate (other than expiration or termination by a counterparty) any terms of any material contract which is being assigned pursuant the BTA; and

		(c)
	shall procure that Intercept Pharmaceuticals UK & Ireland Ltd shall enforce its rights pursuant to the BTA in the best interests of  Intercept Pharmaceuticals UK & Ireland Ltd.

	5.2
	Clause 5.1 shall not apply in respect of anything done or to be done pursuant to an Acquisition Document, in order to give effect to an Acquisition Document and/or to the extent required in connection with:

		(a)
	electing for patent box treatment and/or capitalising research and development costs for IPEL;

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17

		(b)
	the settlement (on a full and final basis) of  the CEPS Matter for an amount less than or equal to the CEPS Base Amount;

		(c)
	settlement (on a full and final basis) of any claim from any employee in respect of any matter which has been Disclosed;

		(d)
	the transfer of a Canadian marketing agreement and Spanish filings solely to reflect the removal of [***] as a director of the Spanish target;

		(e)
	anything which is required to be done (or not done) in order to comply with any  applicable law or regulation; and

		(f)
	anything which is required to be done (or not done) in order for Seller to comply with any binding obligations under any indenture and security agreements relating to Seller’s bond debt.

	5.3
	Subject to clause 5.4, from the date of this agreement until Completion the Seller shall procure that the Purchaser and its Agents shall be allowed:

		(i)
	reasonable access to, and to take copies of (at the Purchaser’s sole expense), the books, records and documents of or relating in whole or in part to the Group; and

		(ii)
	reasonable access to the directors and employees of the Group (who shall be instructed to assist  Purchaser or any of the Purchaser’s Agents with any such reasonable request ).

	5.4
	Any access granted pursuant to clause 5.3 shall only be permitted:

		(i)
	within normal working hours and on reasonable prior notice having been provided to the Seller;

		(ii)
	to the extent reasonably required by the Purchaser to plan for the integration of the Group into the Purchaser’s Group; and

		(iii)
	provided that access shall not give the Purchaser or its Agents any right to give instructions or otherwise interfere with the management and conduct of any Group Company and is otherwise subject to the legal, regulatory and compliance obligations of the Group Companies.

	5.5
	Any request for consent for any matter pursuant to clause 5.1 shall be sent by email to [***] and [***]. The Purchaser shall respond as soon as is reasonably practicable.  If no response is received within five Business Days of such request, then consent shall be deemed to have been given.

	5.6
	Prior to Completion the Seller shall procure that the employment of each of [***] and [***] are transferred to an entity other than a Group Company with effect from a time on or prior to Completion in such a manner and on terms that the relevant Group Company shall have no liability arising out of such transfer.

	5.7
	Not later than 3 Business Days prior to Completion the Seller shall procure that any amounts which would otherwise constitute Intra Group Debt are settled in cash prior to Completion and to therefore reduce the amount of any Intra Group Debt in existence at Completion and such settlement shall be on terms such that there is no additional liability for any Group Company other than to repay the amount of any Intra Group Debt.  The Seller shall provide to the

​

18

Purchaser details of the proposed steps to be taken to enable such Intra Group Debt to be settled.  To the extent that any steps require the issue of shares by any Group Company then for the avoidance of doubt such shares issued shall constitute “Shares” for the purpose of this agreement.
	6.
	SIGNING OBLIGATIONS

On the date hereof, immediately after signing this agreement:
	6.1
	the Seller shall procure that there are delivered to the Purchaser:

		(a)
	the Transitional Services Agreement executed by the Seller;

		(b)
	the Licence Agreement, duly executed by Intercept Pharmaceuticals Europe Ltd.;

		(c)
	the Supply Agreement duly executed by Intercept Pharmaceuticals Europe Ltd.;

		(d)
	the SDEA, signed by or on behalf of Intercept Pharmaceuticals, Inc.;

		(e)
	the BTA duly executed by Intercept Pharmaceuticals Europe Ltd; and

		(f)
	the Trademark Assignment duly executed by the Seller

	6.2
	the Purchaser shall procure that there are delivered to the Seller duly executed counterparts of each of the agreements referred to in clauses 6.1(a) to 6.1(e) (inclusive).

	7.
	COMPLETION

	7.1
	Completion arrangements

Completion of the sale and purchase of the Shares shall take place on the Completion Date at such place or in such manner as shall be agreed by the parties.
	7.2
	Completion actions

On Completion:
(a)the Seller shall:
		a)
	deliver, or procure the delivery of, the documents set out in part 1 of schedule 4 to the Purchaser; and

		b)
	comply, or procure compliance, with the obligations set out in that part; and

(b)the Purchaser shall:
		a)
	deliver, or procure the delivery of, the documents set out in part 2 of schedule 4 to the Seller; and

		b)
	comply, or procure compliance, with the obligations set out in that part.

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19

	7.3
	Non-compliance

If, on the Completion Date, any party does not comply with its obligations under clause 7.2 in any material respect, then the Seller (in the case of the Purchaser's non-compliance) or the Purchaser (in the case of the Seller's non-compliance) may by notice to the other:
		(a)
	proceed to Completion to the extent reasonably practicable;

		(b)
	postpone Completion to another date not less than two (2) nor more than five (5) Business Days after the Completion Date (so that the provisions of this clause 7 (other than this clause 7.3(b)) shall apply as if that later date is the Completion Date); or

		(c)
	subject to Completion having first been postponed in accordance with clause 7.3(b), terminate this agreement.

	7.4
	Effect of termination

If this agreement is terminated pursuant to clause 7.3(c), then each party's further rights, obligations and liabilities under this agreement shall cease immediately on termination, except for:
		(a)
	each party's accrued rights (including the right to claim any remedy for breach or non-performance), obligations and liabilities as at the date of termination; and

		(b)
	each party's continuing rights, obligations and liabilities under this clause 7.4 and clauses 1 (Definitions and interpretation), 13 (Confidentiality and announcements), 16 (Assignment and successors), 17 (Third party rights), 18 (Costs and expenses), 19 (Payments, etc), 21 (Entire agreement), 22.1 (Severance), 22.2 (Variation), 22.3 (Waiver), 22.4 (Cumulative remedies), 22.5 (Counterparts), 23 (Notices), 24 (Agent for service) and 25 (Governing law and language).

To the extent lawful and except as stated in clause 7.3(c) or in the case of fraud or fraudulent concealment, no party shall have any right to rescind or terminate this agreement or to treat it as having been terminated (whether before or after Completion).
	8.
	PURCHASER WARRANTIES

Purchaser warranties
The Purchaser warrants to the Seller as at the date of this agreement that:
		(a)
	it is validly existing and is a company duly incorporated and registered under the law of its jurisdiction of incorporation;

		(b)
	it has the legal right, full power and authority and all necessary consents and authorisations to enter into and perform its obligations under this agreement and each other Acquisition Document to which it is or will be party;

		(c)
	this agreement and each other Acquisition Document to which it is or will be party constitutes, or will when executed constitute, legal, valid and binding obligations on it and will be enforceable in accordance with their respective terms (assuming that each such Acquisition Document has been properly executed by the other parties to it and that their entry into it has been duly authorised);

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20

		(d)
	the entry into and performance of its obligations under this agreement and each other Acquisition Document will not:

		a)
	conflict with or breach any provision of its constitutional documents;

		b)
	breach any agreement or instrument to which it is a party or by which it is bound and which is material in the context of the Acquisition;

		c)
	conflict with or breach any applicable law or any requirement of any Authority to which it is subject or submits which is material in the context of the Acquisition; or

		d)
	require the consent, approval or authorisation of any Authority;

		(e)
	it is not insolvent under the law of its jurisdiction of incorporation or of any jurisdiction in which it carries on business, and it is not unable to pay its debts as they fall due, nor has it stopped paying its debts as they fall due;

		(f)
	no arrangement or compromise has been made by it with its creditors;

		(g)
	so far as it is aware, no insolvency proceedings have been commenced or applied for, nor has any liquidator, receiver or similar officer been appointed, in relation to it or any of its assets; and

		(h)
	no resolution has been passed, proceedings commenced or order made for its winding-up or any other reorganisation or restructuring.

	9.
	SELLER WARRANTIES

	9.1
	Warranties

The Seller warrants to the Purchaser that, save as Disclosed, each of the statements set out in schedule 2 are true and accurate as at the date of this agreement and, in the case of the Key Warranties only, will be true and accurate at Completion.
	9.2
	Separate and independent

Each of the Warranties is separate and independent.
	9.3
	Knowledge or awareness

Any Warranty qualified by a reference (however expressed) to the knowledge or awareness of the Seller shall be limited to the actual knowledge or awareness of the following persons in column (1) of the table below in relation to the Warranties set out in column (2) of the table below:
	

	

	Warranties
	Persons

	All
	[***] (Assistant Corporate Secretary), [***] (VP, Legal Affairs), [***] (General Counsel), [***] (Chief Financial Officer) and [***] (Corporate Counsel)

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21

	

	

	6 (Accounts), 7 (Period since Accounts Date), 8 (Funding), 9 (Grants and state aid), 10 (Assets), 11 (Debtors), 19 (Guarantees, etc)
	[***] (Chief Accounting Officer & Treasurer) and [***] (Executive Director, Finance)

	12 (Real property)
	[***] (Head/Director, Global Facilities)

	14 (IP)
	[***] (VP, Chief Intellectual Property Counsel)

	15 (Regulatory)
	[***] (SVP, Regulatory Affairs)

	16 (IT Systems)
	[***] (VP, Global Information Technology) and [***] (Director, IT Business Partner, International)

	17 (Data protection), 18 (Confidential information), 23 (Licences), 30 (Compliance with laws), 31 (Anti-Bribery and Improper Payment)
	[***] (Global Chief Compliance and Privacy Officer)

	20 (Key contracts), 21 (Terms of Trade), 22 (Product), 35 (BTA)
	[***] (Director and SVP, Commercial), [***] (Chief Commercial Officer) and [***] (Regional VP Iberia, France and Markets Expansion), [***] (SVP, Medical Affairs, Safety & Pharmacovigilance) and [***] (President of Research & Development; Chief Medical Officer), [***] (Head of Medical Affairs, INTL), [***] (Chief Quality Officer; SVP, Operations), [***] (VP, Product Development), [***] (Director, Global Supply Chain Planning)

	25 (Employees and terms of employment), 26 (Senior Employees), 27 (Trade unions, etc), 28 (Employment disputes), 29 (Pension obligations)
	[***] (Chief Human Resources Officer) and [***] (VP, Head of HR, International Region)

	34 (Tax)
	[***] (VP Tax and Treasury)

​
	9.4
	No rights against the Group Companies, etc

Save in the case of fraud or deliberate misstatement, misconduct or concealment, the Seller undertakes to the Purchaser that each of it and each member of the Seller’s Group (and each of their respective directors, officers and employees) has no rights against (and waive any rights it may have against) and shall not make any claim against:
		(a)
	any of the Group Companies; or

		(b)
	(save in the case of fraud or fraudulent concealment) any current director, officer or employee of any Group Company.

other than any claim which may arise after Completion pursuant to any of the Transaction Documents, any amounts due pursuant to the VAT Group arrangements or any amounts due in respect of any Intra Group Debt which remains outstanding at Completion.
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22

	10.
	SELLER LIMITATIONS

	10.1
	Financial cap

The aggregate liability of the Seller for all Warranty Claims and Tax Covenant Claims except for any Key Warranty Claim , including interest and costs, shall not exceed US$1. The aggregate liability of the Seller and each other member of the Seller Group in respect of all claims pursuant to this agreement and all other Acquisition Documents shall not exceed US$405,000,000.
	10.2
	Time limits

		(a)
	The Seller shall not be liable for any Warranty Claim or Tax Covenant Claim unless the Purchaser has given notice of such Warranty Claim or Tax Covenant Claim to the Seller on or before the date specified against that type of Warranty Claim or Tax Covenant Claim below:

	Claim relating to:
	Time limit:

	Key Warranties
	Two years from Completion

	Tax Warranties and Covenant Claims  
	Seven years from Completion 

	Any other Warranty
	One year from Completion

​
	10.3
	Information and knowledge

The Seller shall not be liable for any Warranty Claim to the extent that the matter giving rise to it:
		(a)
	has been Disclosed; or

		(b)
	was, at the date of this agreement, known by the Purchaser Relevant Persons and which it was reasonable for the Purchaser Relevant Persons to know could give rise to a Warranty Claim.

	10.4
	Completion Statements

The Seller shall not be liable for any Warranty Claim if and to the extent that the matter giving rise to it has been specifically provided for in the Completion Statements.
	10.5
	Insurance

The Seller shall not be liable for any Warranty Claim if and to the extent that the loss, liability or damage to which it relates is recovered by the Purchaser Group under any insurance policy, including, without limitation, the W&I Policy.
	10.6
	Other exclusions

The Seller shall not be liable for any Warranty Claim to the extent that it arises from or is otherwise attributable to, or the amount of such Warranty Claim is increased as a result of any new or amended legislation, law or administrative or regulatory practice, or any change in the
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23

generally accepted interpretation or application of any legislation or law, in each case taking effect after Completion.
	10.7
	Non-application of limitations

Nothing in clauses 10.1 to 10.6 (inclusive) and clause 10.10 shall operate to exclude or limit the liability of the Seller in relation to any Claim that arises as a result of the fraud of the Seller.
	10.8
	No double recovery

Any payment made by the Seller in respect of any Claim shall satisfy and discharge any other Claim which is capable of being made against the Seller in respect of the same loss, but only to the extent of the payment made.
	10.9
	Claim to be reduction of Consideration

Any payment by the Seller in respect of any Claim shall, to the extent legally possible, be deemed to reduce the Consideration received by the Seller.
	10.10
	W&I Policy

Notwithstanding any provision to the contrary in this agreement:
		a)
	the parties acknowledge that the Purchaser has the benefit of the W&I Policy which provides (conditional on Completion) insurance coverage in respect of Warranty Claims and Tax Covenant Claims;

		b)
	the Purchaser shall procure that the W&I Policy contains terms to the effect that the insurer shall be subrogated to (or may require the Purchaser to assign to the insurer) all rights of recovery of the Purchaser or the Group, save that the insurer shall only be entitled to subrogate against the Seller if the loss arose in whole or part out of the Seller’s fraud or fraudulent misrepresentation; and

		c)
	the Purchaser shall:

		i.
	provide a certified copy of the W&I Policy to the Seller within five (5) Business Days of the date of this agreement;

		ii.
	not agree to any amendment, variation, novation, assignment or waiver of the W&I Policy (or do anything which has a similar effect), where such amendment, variation, novation, assignment or waiver would have an adverse effect on the Seller, without the express prior written consent of the Seller; and

		iii.
	without limitation to any right of the Seller to separately enforce such terms, use all reasonable endeavours to enforce any term in the W&I Policy under which the insurer waives its rights to take subrogated action against the Seller upon the terms set out in the W&I Policy;

		d)
	the Purchaser acknowledges that there shall not be any excess or any other amount payable by the Seller under the W&I Policy.

	10.11
	The limitations of liability referred to in this clause 10 shall apply irrespective of whether or not the Purchaser has obtained, or will obtain, a W&I Policy, or any non-payment (including

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24

of premium) under or in respect of a W&I Policy, any expiry or termination of a W&I Policy for any reason whatsoever, insolvency of the insuring parties of a W&I Policy or if the W&I Policy is not otherwise effective or has not come into force or the Purchaser is unable to recover under a W&I Policy and the Purchaser’s sole recourse against the Seller for any Warranty Claims (except for any Key Warranty Claim) and Tax Covenant Claims shall be capped at $1.
	11.
	SELLER RESTRICTIVE COVENANTS

	11.1
	Employees

		(a)
	The Seller shall not, and shall procure that the Seller Group shall not, for a period of three (3) years after the Completion Date, either for itself or jointly with or for any other person, directly or indirectly, solicit, employ or engage any person who was at Completion employed by any Group Company with an annual salary in excess of US$[***].

		(b)
	Nothing in clause (a) shall prohibit the Seller Group from employing any person who responds to a recruitment advertisement which is one directed at suitable candidates generally or whose employment with the Purchaser Group has ceased, provided that such response or cessation was not solicited or induced directly or indirectly by the Seller Group.

	11.2
	Competing businesses; customers and suppliers

The Seller shall not, and shall procure that the Seller Group shall not, for a period of three (3) years after the Completion Date carry on any Competing Business.
	11.3
	Permitted actions

Nothing in clause 11.2 shall prohibit the Seller Group from:
		(a)
	holding up to five (5) per cent of the shares in any company listed or traded on any securities exchange;

		(b)
	performing its obligations as a contractor of the Purchaser Group (including those under the Transitional Services Agreement, the Licence Agreement, the BTA and/or the Supply Agreement);

		(c)
	manufacturing Product in any territory or marketing and/or selling Product outside of the Territory.

	11.4
	Acknowledgement

The Seller agrees and acknowledges that the restrictions contained in this clause 11 are fair and reasonable, and necessary to assure to the Purchaser the full value and benefit of the Shares.
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25

	12.
	PRE-SALE MERGER

	12.1
	The Seller shall procure that ownership of the entire issued share capital of the Italian Target is transferred at Completion to the Purchaser by Intercept Pharmaceuticals LLC.

	13.
	CONFIDENTIALITY AND ANNOUNCEMENTS

	13.1
	Definitions

In this clause 13:
		(a)
	"Announcements" means:

		(i)
	 the announcement to be issued by the Seller and the Purchaser on Completion, the form of which is to be agreed between the parties following singing of this agreement; and

		(ii)
	the announcement in the Agreed Form to be issued by the Seller and the Purchaser following signing of this agreement.

		(b)
	"discloser" means the person making the announcement or disclosing or using the information; and, for the purposes of clause 13.5(a), includes its group; and

		(c)
	"Relevant Party" means (a) when the discloser is a member of the Purchaser Group, the Seller; or (b) when the discloser is a member of the Seller Group, the Purchaser.

	13.2
	Announcements

Other than the Announcement and as permitted under clause 13.4, no party shall, and each party shall procure that its group shall not, at any time issue, or procure the issue of, any press release, circular or other publicity relating to the existence or provisions of this agreement or any other Acquisition Document or the sale and purchase of the Shares except as required by law (including United States securities laws).
	13.3
	Transaction and parties' confidential information

Other than as permitted under clause 13.4, each party shall, and shall procure that its group shall, at all times keep confidential:
		(a)
	the provisions and subject matter of, and the negotiations relating to, this agreement and any other Acquisition Document; and

		(b)
	all confidential information of the other party or its group (in the case of the Purchaser, including the Group from Completion) received by it as a result of negotiating, entering into or performing this agreement,

and shall use the information only for the purposes contemplated by this agreement or any other Acquisition Document.
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26

	13.4
	Permitted announcements and disclosures

Clauses 13.2 and 13.3 shall not restrict the making of any announcement or the disclosure or use of information:
		(a)
	with the prior written consent of the Relevant Party, such consent not to be unreasonably withheld or delayed;

		(b)
	to the extent required by any applicable law or any Authority or securities exchange, including, without limitation, the requirements of the Securities and Exchange Commission and Nasdaq Stock Exchange; or

		(c)
	that is consistent in all material respects with the Announcement, or any other announcement issued in accordance with this clause 13.4.

	13.5
	Other permitted disclosures

Clauses 13.2 and 13.3 shall not restrict the disclosure or use of information if and to the extent:
		(a)
	the information is or becomes publicly available (other than as a result of a breach by the discloser of any provision of this agreement);

		(b)
	the information is independently developed after Completion;

		(c)
	expressly required or permitted by, or required for or in connection with the performance by any party of its obligations under, this agreement or any other Acquisition Document;

		(d)
	required for or in connection with the performance by the Seller Group of its obligations as a contractor of the Purchaser Group (including those under the Transitional Services Agreement, Supply Agreement, Licence Agreement) or otherwise for the benefit of the Purchaser Group; or

		(e)
	disclosure is made on a strictly confidential and need to know basis by the discloser to:

		a)
	its group or any of its or its group's officers, employees, consultants, agents, insurers, pension trustees, professional advisers, debt providers or auditors who are subject to confidentiality obligations; or

		b)
	in the case of the Purchaser:

		i.
	any member of the Purchaser Group;

		ii.
	any entity within the Nordic Capital Sphere;

		iii.
	any Fund which owns any interest in any group undertaking of the Purchaser in respect of which any member of its group is a general partner, manager, operator or investment adviser (in each case, whether solely or jointly with others);

		iv.
	any Fund which has the same general partner, operator, manager or investment adviser as any Fund referred to in (iii) above;

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27

		v.
	any general partner, operator, manager or investment adviser to any Fund referred to in (iii) or ((iv) above;

		vi.
	any group undertaking of any entity referred to in (iii), (iv or (v) above;

		vii.
	any scheme under which certain officers, employees or partners of any group undertaking of any entity referred to in (iii), (iv) or (v) are entitled (as individuals or through a body corporate or any other vehicle) to acquire shares in companies in which any group undertaking of any entity referred to in (iii), (iv or (v) also invests, or any person (excluding natural persons) holding shares or other interests under such a scheme or entitled to the benefits of shares or other interests under such a scheme; and

		viii.
	any director, employee or partner of any of the above.

	14.
	CEPS MATTER

	14.1
	Subject to the finally resolved Relevant CEPS Amount exceeding the Base CEPS Amount, the Seller undertakes to the Purchaser that it shall, within 15 Business Days of a demand by the Purchaser, and subject to the Purchaser providing evidence of it having paid the same, pay to the Purchaser or the French Target or any Group Company designated by the Purchaser (on a Euro for Euro basis)

		(a)
	an amount, equal to the Relevant CEPS Amount less the Base CEPS Amount (the “CEPS Reimbursement”);

		(b)
	less the amount of any actual cash Tax benefit or saving for the Purchaser and/or any Group Company that it reasonably determines, acting in good faith, that part of the Relevant CEPS Amount as corresponds to the CEPS Reimbursement (including all reasonable costs and expenses determined in accordance with paragraph 14.1, (b)) is reasonably expected to give rise to at any time.

	14.2
	Subject to the finally resolved Relevant CEPS Amount being less than the Base CEPS Amount in Euros, the Purchaser undertakes to the Seller that it shall, within 15 Business Days of payment of the Relevant CEPS Amount, pay to the Seller (on a Euro for Euro basis):

		(a)
	an amount equal to the Base CEPS Amount less the Relevant CEPS Amount (the “CEPS Reimbursement”); less

		(b)
	all costs and expenses properly incurred by the Purchaser, the French Target or any Group Company in connection with the CEPS Matter.

	14.3
	The Purchaser shall, and shall procure that the Purchaser Group shall:

		(a)
	consult with the Seller, and, consider in good faith all reasonably commercial actions as the Seller may reasonably request in writing to assess, defend, mitigate, settle or compromise the amount of the CEPS Reimbursement or to defend, mitigate or settle the CEPS Matter or to appeal against any judgment or other adjudication made in relation to the CEPS Matter; and

		(b)
	otherwise, use all commercially reasonable endeavours to take reasonable steps required by the Seller to minimise its liability in relation to the CEPS Reimbursement.

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28

		(c)
	Not settle or agree  the Relevant CEPS Amount with the French Authority, or appeal any determination thereof without the prior written consent of the Seller (not to be unreasonably withheld or delayed)

	14.4
	No member of the Purchaser Group shall be required to take any action or to omit to do anything pursuant to clause 14.3 (a) or (b) which, on a reasonable view, would have a material and adverse effect on the business, goodwill, standing or reputation, or to its relationship with customers, suppliers, employees, or Authorities with oversight of, or be materially onerous or prejudicial to, any Group Company or which might, in the reasonable opinion of the Purchaser, adversely impact the Purchaser Group’s relationship or future dealings with the French Authorities such that the sales or profitability of the Product in France might reasonably be expected to be adversely impacted to an extent which is material in the context of the amount of the CEPS Reimbursement.

	14.5
	Until such time as the CEPS Matter is finally resolved, the Purchaser shall procure that all material information, correspondence and other communication received or transmitted, sent or communicated by it or any Group Company in relation to the CEPS Matter is shared with the Seller as soon as is reasonably practicable and to the extent legally permissible.

	14.6
	For the purposes of this clause 14, “finally resolved” shall mean agreed in writing by the relevant Group Company or determined by a court of competent jurisdiction in respect of which (a) there is no right of appeal or (b) no appeal is launched within 60 days of such court’s determination.

	15.
	GROUP SEPARATION MATTERS

	15.1
	Seller's access to information

The Purchaser shall procure that:
		(a)
	all books of account, records, documents and information of any Group Company (in whatever form) relating to the period before Completion that are held by the Group ("Group Company Information") are preserved for seven (7) years from the Completion Date (or such longer period required by applicable laws); and

		(b)
	(on giving reasonable notice to the Purchaser and subject to the Seller giving such undertakings as to confidentiality as the Purchaser shall reasonably require) the Seller Group and its representatives are permitted, during normal business hours, to have access to, and to take copies (at the Seller's expense) of, such Group Company Information as they reasonably require for Tax, accounting or insurance purposes, or to comply with any applicable law or requirement of any Authority or securities exchange.

	15.2
	Purchaser's access to information

The Seller shall procure that:
		(a)
	all books of account, records, documents and information of any Group Company (in whatever form) relating to the period before Completion that are retained by the Seller Group ("Retained Information") are preserved for seven (7) years from the Completion Date (or such longer period required by applicable laws); and

		(b)
	(on giving reasonable notice to the Seller) each Group Company and its representatives are permitted, during normal business hours, to have access to, and to take copies (at

​

29

such Group Company's expense) of, its Retained Information as they reasonably require for Tax, accounting or insurance purposes, or to comply with any applicable law or requirement of any Authority or securities exchange.
	15.3
	Intra-group guarantees given by Group Companies

		(a)
	The Seller shall use all reasonable endeavours to procure the release of each Group Company from all guarantees, securities, indemnities, agreements or other commitments given by or binding on any Group Company in respect of any obligation or liability of the Seller Group ("Group Company Guarantees") as soon as reasonably practicable after Completion.

		(b)
	The Seller shall indemnify the Purchaser and each Group Company against all liabilities, costs and expenses incurred (whether before or after Completion) under or in relation to the Group Company Guarantees.

	15.4
	Intra-group guarantees given by Seller Group

The Purchaser acknowledges that with effect from Completion the Seller shall cease to provide collateral as security for the Seller Group Guarantees Facility.  The Seller and the Purchaser shall cooperate with the aim that from Completion the letters of credit issued pursuant to the Seller Group Guarantees Facility shall remain in effect but the Seller shall not be under any obligation to provide any security for such facility post Completion.
	15.5
	Insurance

The Purchaser acknowledges and agrees with the Seller that, on and with effect from Completion:
		(a)
	all insurance coverage provided in relation to any Group Company pursuant to policies maintained by the Seller Group (each a "Seller Insurance Policy") shall cease; and

		(b)
	it shall be the sole responsibility of the Purchaser to ensure that adequate insurance policies are put in place for each Group Company.

	15.6
	Canadian Marketing Authorisation

Within 15 Business Days of the date of this Agreement the Seller shall apply for the transfer of the Canadian Marketing Authorisation from the Seller to the Canadian Target.
	15.7
	Websites

The Seller shall procure that on or promptly following Completion it takes the relevant action (including execution of relevant documents) to apply to transfer registration of the Marketing Websites to the Purchaser or such member of the Purchaser Group as it may direct.
	15.8
	VAT Group

		(a)
	The Purchaser acknowledges that prior to Completion the Seller may make an application for the Irish Target to retrospectively join the VAT Group and to the extent such application remains outstanding at Completion shall, subject to the Seller providing reasonable details of the Seller’s and its advisers’ analysis regarding there being no adverse consequences for the Purchaser and any Group Company and reasonably consulting with the Purchaser thereon, provide the Seller with such

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30

reasonable assistance (at the Seller’s cost)  as may be requested (including the signing of relevant documents) in connection with such application.
		(b)
	The Seller and (to the extent relevant) the Purchaser agree to take all reasonable steps to procure that each relevant Group Company is removed from the VAT Group with effect from not later than the Completion Date, and to provide all reasonable co-operation and assistance (including, to the extent relevant and without limitation, the giving of consents and making of elections) to each other in respect of such removal.

		(c)
	The Purchaser shall procure that each relevant Group Company provides such information and assistance to the Representative Member that is reasonably necessary to enable the Representative Member to make the returns and provide the information required for VAT purposes in respect of the period for which such Group Company was a member of the VAT Group.

		(d)
	The Purchaser shall pay, or shall procure that there is paid, to the Representative Member (on behalf of each relevant Group Company) an amount (if any) equal to any VAT for which the Representative Member is accountable that is properly attributable to Supplies made by a Group Company while a member of the VAT Group less the amount of deductible input tax that is properly attributable to those Supplies.

		(e)
	Such payment shall be made in cleared funds no later than the date which is the later of the date ten Business Days after the Purchaser receives a demand for payment from the Seller or the Representative Member and two Business Days before the first date on which the VAT in question is payable to the relevant Tax Authority in order to avoid any related interest or penalty.  No payment shall be required under this clause 14.6(c) to the extent that the relevant Group Company made a payment in respect of such VAT to the Representative Member already on or before Completion.

		(f)
	In relation to any pre-Completion period, the Seller shall pay, or shall procure that there is paid, to the Purchaser (on behalf of each relevant Group Company) an amount (if any) equal to any repayment of VAT received by the Representative Member or any credit obtained by the Representative Member (in either case) by reference to an excess of:

		i.
	any deductible input VAT attributable to Supplies to each such Group Company during the pre-Completion period while a member of such VAT Group; over

		ii.
	output VAT attributable to Supplies made by such relevant Group Company during the pre-Completion period while a member of the relevant VAT Group,

to the extent that such repayment or credit has been taken into account as an asset (or reduction in a liability) in the Actual Working Capital in the Completion Statements, such payment to be made in cleared funds as soon as reasonably practicable following receipt of the relevant repayment by, or set off of the relevant credit against a liability of, the Representative Member. No payment shall be due under this clause 14.6(d) to the extent payment in respect of the relevant repayment or credit has been made already by the Representative Member on or before Completion.  The Purchaser shall provide such information in respect of output VAT and deductible input VAT of any Group Company (which is relevant either to this clause 14.6(d) or clause 14.6(e)), to the extent that such information is in the possession or control of the Purchaser or the relevant Group Company, as may be required for the Representative Member to make the returns and provide the information required to be provided by it for VAT purposes.
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31

		(g)
	In relation to any post-Completion period, the Seller shall pay, or shall procure that there is paid, to the Purchaser (on behalf of each relevant Group Company which is a member of the VAT Group) an amount (if any) equal to any repayment of VAT received by the Representative Member or any credit obtained by the Representative Member by reference to an excess of:

		a)
	any deductible input VAT attributable to Supplies to each such Group Company during the post-Completion period while a member of such VAT Group; over

		b)
	output VAT attributable to Supplies made by such relevant Group Company during the post-Completion period while a member of the relevant VAT Group,

such payment to be made in cleared funds as soon as reasonably practicable following receipt of the relevant repayment by, or set off of the relevant credit against a liability of, the Representative Member.
	15.9
	For the purposes of clause 15.6:

		(a)
	“Representative Member” means Intercept Pharma Europe Ltd.

		(b)
	“Supplies” means any supply, acquisition or importation;

		(c)
	“VAT Group” means the UK VAT group having registration number GB 626 8036 35, the representative member of which is the Representative Member at the date hereof.

	15.10
	Tax Matters

Following signature of this agreement the Seller shall, in conjunction with its third party advisers, prepare for delivery to the Purchaser a file of historic information relating to the tax affairs (including without limitation the tax losses and a breakdown of such losses and reasonable evidence of the same) of the Group Companies and shall liaise with the Purchaser to agree the scope of such information with the intent that such file will include the relevant information in reasonable detail to be provided to any Tax Authority in support of any filings made or to be made in respect of any period prior to Completion.
	16.
	ASSIGNMENT AND SUCCESSORS

	16.1
	No person shall assign, transfer, charge or otherwise deal with all or any of its benefits, rights or obligations under this agreement, or grant, declare, create or dispose of any right or interest in this agreement, without the prior written consent of the Seller and the Purchaser (such consent not to be unreasonably withheld or delayed).

	16.2
	The Purchaser and any permitted assignee under this clause 16.2 may assign all or any of its benefits or rights under this agreement to the Purchaser Group.

	16.3
	If the Purchaser assigns any of its benefits or rights under this agreement as permitted by this clause 16, then the liability of the Seller to the assignee shall not be greater than it would have been had such assignment not taken place, and all the benefits, rights and protections afforded to the Seller shall continue to apply for the benefit of the Seller as against the assignee as they would have applied as against the Purchaser.

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	16.4
	This agreement shall be binding on and continue for the benefit of the successors and permitted assignees of each party.

	17.
	THIRD PARTY RIGHTS

	17.1
	Each member of the Seller Group which is party to an Acquisition Document shall have the right to enforce clause 10.1 as if a party to this agreement. No other person who is not a party to this agreement shall not have any right under the Contracts (Rights of Third Parties) Act 1999 to enforce any of its terms.  This clause does not affect any right or remedy of any person which exists or is available otherwise than pursuant to that Act.

	17.2
	The parties may, without the consent of the Seller Group (other than the Seller) rescind or vary this agreement in such a way as to extinguish or alter the benefits or rights conferred by clause 17.1

	18.
	COSTS AND EXPENSES

	18.1
	The Purchaser shall pay any notarial fees and costs, any registration fees and any stamp duty or other similar transfer tax payable in connection with this agreement or its execution or on or in respect of the transfer of the Shares.

	18.2
	Unless otherwise expressly provided in this agreement, each party shall bear its own costs, charges and expenses incurred in relation to the preparation, negotiation, execution and implementation of this agreement.

	19.
	PAYMENTS, ETC

	19.1
	In this clause 19, "Payment Account" means:

		(a)
	if the relevant payment is to be made to the Seller, the account of the Seller notified to the Purchaser for this purpose not less than three (3) Business Days before the date such payment is due and any payment so made will constitute a good, effective and complete discharge of the Purchaser’s obligation to make that payment, in an amount not exceeding the amount of the payment which is made;

		(b)
	if the relevant payment is to be made to the Purchaser, the account of the Purchaser notified to the Seller for this purpose not less than three (3) Business Days before the date such payment is due.

	19.2
	Any payment to be made to the Seller or the Purchaser under this agreement shall be made in US dollars by transfer of immediately available funds for same day value to the Payment Account.

	19.3
	Each party shall pay, and shall procure that its group pays, all amounts due under this agreement in full, without any set-off, counterclaim, deduction or withholding, except to the extent required by applicable laws. Any such deduction or withholding which is required by law shall not exceed the minimum amount required by law, and (apart from in relation to the Consideration and any interest) the payer shall be obliged to simultaneously pay to the payee such sum as will after such deduction or withholding has been made leave the payee with the same amount as it would have been entitled to receive in the absence of any such requirement to make a deduction or withholding..  If any additional amount is paid under this clause 18.3 by virtue of any deduction or withholding and the payee receives a Tax credit, repayment or other benefit by reason of such deduction or withholding, the payee shall repay to the payer an

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33

amount equal to the lesser of that Tax credit, repayment or other benefit and the additional amount paid under this clause 19.3.
	19.4
	To the extent that any payment (excluding in relation to the Consideration and any interest) pursuant to any indemnity or covenant to pay in this agreement is subject to a charge to Tax in the hands of the payee, the payer shall simultaneously pay to the payee such sum as will ensure that after payment of any Tax charged on such sum in the hands of the payee, the payee shall be left with a sum equal to the sum that it would have received in the absence of such a charge to Tax.

	19.5
	For the purposes of clause 19.4, if a payment would have been charged or subject to Tax in the hands of a payee but for the availability of any Relief (other than an exemption), the payee shall be deemed to have been subject to Tax.

	19.6
	Unless otherwise expressly provided in this agreement, if any amount payable under this agreement is not paid by the due date for payment, then interest shall also be paid on that amount from (and including) the due date for payment to (but excluding) the date it is paid (whether before or after judgment) at the base rate of the Bank of England plus 5% accruing on a daily basis, and compounded monthly.

	20.
	FURTHER ASSURANCE

Each party shall from time to time, so far as it is reasonably able, do (or procure to be done) all such other things and/or execute and deliver (or procure to be executed and delivered) all such other documents as may be reasonably requested of it (at the requesting party's expense) to give effect to this agreement and the Acquisition Documents.
	21.
	ENTIRE AGREEMENT

	21.1
	In this clause 21, "Statement" means representation, warranty, statement or assurance (whether contractual or otherwise).

	21.2
	The Acquisition Documents (as varied in accordance with their terms) constitute the entire agreement and understanding between the parties in connection with the transactions contemplated by the Acquisition Documents.  Accordingly, they supersede and extinguish all previous agreements, arrangements and understandings between, and (except to the extent incorporated in the Acquisition Documents) all Statements given by, the parties in connection with such transactions.

	21.3
	Each party acknowledges that it has not relied on, or been induced to enter into any Acquisition Document by, any Statement given by any person (whether a party to this agreement or not) that is not incorporated in any Acquisition Document.

	21.4
	No party shall be liable in equity, contract or tort, under the Misrepresentation Act 1967 or in any other way for any Statement that is not incorporated in any Acquisition Document.

	21.5
	No party shall be liable in tort or under the Misrepresentation Act 1967 for any Statement that is incorporated in any Acquisition Document.

	21.6
	This clause 21 shall not exclude or limit any liability or remedy arising as a result of any fraud.

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	22.
	GENERAL

	22.1
	Severance

If any provision of this agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any relevant jurisdiction, that shall not affect or impair the legality, validity or enforceability of (a) any other provision of this agreement in that jurisdiction; or (b) that provision or any other provision of this agreement in any other relevant jurisdiction.  If any illegal, invalid or unenforceable provision of this agreement would be legal, valid and enforceable if some part or parts of it were modified, such provision shall apply with whatever modification is necessary so that it is legal, valid and enforceable and gives effect to the commercial intention of the parties.
	22.2
	Variation

No variation of this agreement shall be valid unless it is in writing and signed by or on behalf of the Seller and the Purchaser.
	22.3
	Waiver

Any waiver of any right or remedy under or in respect of this agreement shall only be valid if it is in writing, and shall apply only to the person to whom it is addressed and in the specific circumstances for which it is given.  Unless otherwise expressly provided in this agreement, no right or remedy under or in respect of this agreement shall be precluded, waived or impaired by (a) any failure to exercise or delay in exercising it; (b) any single or partial exercise of it; (c) any earlier waiver of it, whether in whole or in part; or (d) any failure to exercise, delay in exercising, single or partial exercise of or earlier waiver of any other such right or remedy.
	22.4
	Cumulative remedies

Unless otherwise expressly provided in this agreement, the rights and remedies under this agreement are in addition to, and do not exclude, any rights or remedies provided by law.
	22.5
	Counterparts

This agreement may be executed in any number of counterparts, and by the parties on separate counterparts, but shall not be effective until each party has executed at least one counterpart.  Each counterpart shall constitute an original of this agreement, but all the counterparts shall together constitute one and the same agreement. A signed copy of this agreement delivered by e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this agreement.
	22.6
	Effect of Completion

Each provision of this agreement (other than any obligation which is fully performed at Completion) shall remain in full force and effect after Completion.
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	23.
	NOTICES

	23.1
	Interpretation

In this clause 23 any reference to a time is to the local time in the place at or to which the Notice is delivered or sent.
	23.2
	Form and method of giving Notice

Any notice or other communication to be given or made under or in connection with this agreement ("Notice") shall be in writing in English, sent to the relevant party at the postal or email address and for the attention of the person specified in clause 23.3, and may be delivered:
		(a)
	by hand or by courier (using an internationally recognised courier company);

		(b)
	by prepaid recorded delivery post or equivalent if the Notice is to be received in the same country from which it is sent; or

		(c)
	by email, provided that the sender must deliver a copy of such Notice to the recipient otherwise than by email by 5.00 pm on the fifth Business Day after the date on which the original Notice is deemed to have been given in accordance with clause 23.4(b).  Failure by the sender to deliver such copy Notice to the recipient shall not invalidate the original Notice or delay the time such Notice is deemed given under clause 23.4(b).

	23.3
	Contact details for Notices

The postal and email addresses and relevant contacts of the parties for the purposes of clause 23.2 are:
	​

	​

	Seller: Intercept Pharmaceuticals, Inc.
	​

	For the attention of: General Counsel
	​

	Address: 305 Madison Avenue, Morristown, New Jersey 07960
	​

	Email: [***] with a copy by email to [***]
	​

	Purchaser: Mercury Pharma Group Limited
	​

	For the attention of: The General Counsel
	​

	Address: Capital House, 85 King William Street, London, EC4N 7BL
	​

	Email: [***] with a copy by email to [***]
	​

​
or, in each case, such other postal or email address or contact in the UK as a party may notify to the other for this purpose in accordance with this clause 23. Notice of any change shall be
​

36

effective five Business Days after the date on which it is deemed to have been given in accordance with this clause 23, or such later date as may be specified in the Notice.
	23.4
	Time Notice is given

Any Notice which has been delivered in accordance with clause 23.2 shall be deemed to have been given:
		(a)
	if delivered by hand, by courier or by post, at the time of delivery; or

		(b)
	if sent by email, at the time the email is sent, provided that no automated message is received stating that the email has not been delivered.

However if any Notice would be deemed to have been given after 5.00 pm on a Business Day and before 9.00 am on the next Business Day, such Notice shall be deemed to have been given at 9.00 am on the second of such Business Days.
	23.5
	Service of process

clause 23 shall not apply to the service of process in any legal action or proceedings relating to any Dispute.
	24.
	AGENT FOR SERVICE

	24.1
	In this clause 24, "Agent" means Intercept Pharma Europe Ltd. (or any substitute agent appointed pursuant to clause 24.5).

	24.2
	Subject to clause 24.5, the Seller irrevocably appoints the Agent as its agent in England and Wales for service of process in any legal action or proceedings relating to any Dispute. The Seller irrevocably agrees that any such process shall be effectively served on it if served on the Agent in accordance with this clause (whether or not such process is then forwarded to or received by the Seller).

	24.3
	All process to be served on the Agent shall be sent to:

	

	​

	Qauyseco Limited
	​

	For the attention of: The Company Secretary of Intercept 
Pharmaceuticals Europe Limited
	​

	Address: One, Glass 
Wharf, Bristol, United Kingdom, BS2 0ZX
	​

	with a copy, by email 
only to [***] and [***]
	​

​
or such other name, postal or email address or contact as may be notified pursuant to clause 24.4 or 24.5(b).
​

37

	24.4
	The Seller shall notify the Purchaser immediately of any change to the Agent's postal or email address or relevant contact.

	24.5
	If, for any reason, the Agent ceases to be able to act as agent or no longer has a postal address in the UK, the Seller shall immediately:

		(a)
	(subject to this clause 24.5) irrevocably appoint a substitute agent with a postal address in the UK; and

		(b)
	notify the Purchaser of the name, postal and email addresses and relevant contact (when appropriate) of the substitute agent.

Such appointment and notice shall be effective five Business Days after the date on which the notice given pursuant to clause 24.5(b) is deemed to have been given in accordance with clause 23.
	25.
	GOVERNING LAW AND LANGUAGE

	25.1
	This agreement and any Dispute are governed by and shall be construed in accordance with English law.

	25.2
	Each party irrevocably agrees that the courts of England and Wales shall have exclusive jurisdiction to settle any Dispute.

	25.3
	Each party irrevocably agrees that the courts of England and Wales are the most appropriate and convenient courts to settle Disputes and, accordingly, will not argue to the contrary.  Further, each party irrevocably agrees that a judgment in any legal action or proceedings brought in the courts of England and Wales in relation to a Dispute shall be conclusive and binding on it and may be enforced in the courts of any other jurisdiction.

	25.4
	Each party irrevocably agrees that any process in any legal action or proceedings relating to any Dispute may be served on it in accordance with the provisions of clause 23 (Notices).

	25.5
	Nothing in this agreement shall affect the right of any party to serve any process in any legal action or proceedings relating to any Dispute in any other manner permitted by law.

​

38

SCHEDULE 1: WARRANTED INFORMATION
Part 1:  The Group Companies
	1.
	Austria

	Company name:
	Intercept Pharma Austria GmbH

	Registered number:
	FN 433322 p

	Date of incorporation:
	29 April 2015 

	Place of incorporation:
	Vienna, Austria

	Registered office:
	Fleischmarkt 1/6/12, A-1010 Vienna, Austria

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of EUR 35,000
	One

	Directors:
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	One ordinary share of EUR 35,000

​
​

39

	2.
	Canada

	Company name:
	Intercept Pharma Canada Inc.

	Registered number:
	BC1040261

	Date of incorporation:
	18 June 2015

	Place of incorporation:
	British Columbia, Canada

	Registered office:
	Suite 2300, Bentall 5, 550 Burrard Street, Vancouver BC V6C 2B5, Canada

	Issued share capital:
	Class:
	Number of shares:

		Common shares without par value
	1,000

	Director:
	[***]

	Secretary:
	[***]

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	1,000 common shares without par value

​
​

40

	3.
	France

	Company name:
	Intercept Pharma France SAS

	Registered number:
	814 555 173 RCS Paris 

	Date of incorporation:
	18 November 2015 

	Place of incorporation:
	Paris, France

	Registered office:
	19 boulevard Malesherbes, 75008 Paris, France

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of EUR 1.00
	20,000

	Legal Representatives:
	[***]

	Secretary:
	N/A

	Shareholder:
	Name: Intercept Pharmaceuticals Inc.
	Number and class of shares:

		The Seller
	20,000 ordinary shares of EUR 1.00

​
​

41

	4.
	Germany

	Company name:
	Intercept Pharma Deutschland GmbH 

	Registered number:
	HRB 218597

	Date of incorporation:
	19 May 2015

	Place of incorporation:
	Munich, Germany

	Registered office:
	Rosenheimer Straße 52, 81669 Munich, Germany

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of EUR 1.00
	25,000

	Directors (Geschäftsführer):
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	25,000 ordinary shares of EUR 1.00 

​
​

42

	5.
	Ireland

	Company name:
	Intercept Pharma International Limited

	Registered number:
	634539

	Date of incorporation:
	25 September 2018

	Place of incorporation:
	Ireland

	Registered office:
	10 Earlsfort Terrace, Saint Kevin's, Dublin, D02 T380, Ireland

	Issued share capital: 
	Class: 
	Number of shares:

		Ordinary shares of EUR 1.00
	Three

	Director:
	[***]

	Secretary:
	Bradwell Limited

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	Three ordinary shares of EUR 1.00 

​
​

43

	6.
	Italy

	Company name:
	Intercept Italia S.r.l

	Registered number:
	02890650548

	Date of incorporation:
	26 June 2006

	Place of incorporation:
	Milan, Italy

	Registered office:
	Via Giosuè Carducci, 24, 20123 Milan, Italy

	Issued corporate capital:
	 Euro 100.000,00
​
​

	Directors:
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Corporate participation:

		, Intercept Pharmaceuticals, LLC
	1 quota equal to 100% of the corporate capital 

​
​

44

	7.
	Portugal

	Company name:
	Intercept Pharma Portugal, Unipessoal Lda

	Registered number:
	513679073

	Date of incorporation:
	6 October 2015

	Place of incorporation:
	Lisbon, Portugal

	Registered office:
	Avenida Fontes Pereira de Melo, no 6, Lisboa, Freguesia de Santo António, conselho de Lisboa, 1050 121 Lisbon, Portugal

	Issued share capital:
	Class:
	Number of shares:

		Quota shares of EUR 5,000
	One

	Directors:
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	One quota share of EUR 5,000

​
​

45

	8.
	Spain

	Company name:
	Intercept Pharma Spain, S.L.

	Registered number:
	Sheet M-607565, Volume 33756, Page 194.

	Date of incorporation:
	29 July 2015

	Place of incorporation:
	Madrid, Spain

	Registered office:
	Paseo de la Castellana 135, 7a Planta, Madrid, Spain

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of EUR 1.00
	10,000

	Director:
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	10,000 ordinary shares of EUR 1.00

​
​

46

	9.
	Switzerland

	Company name:
	Intercept Pharma Switzerland GmbH

	Registered number:
	CHE-426.015.896

	Date of incorporation:
	30 July 2015

	Place of incorporation:
	Zürich, Switzerland

	Registered office:
	Dreikönigstrasse 31a, 8002 Zürich, Switzerland

	Issued share capital:
	Class:
	Number of shares:

		Quota share of CHF 20,000
	One

	Director:
	[***]

	Secretary:
	None

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	One quota share of CHF 20,000

​
​

47

	10.
	United Kingdom

	Company name:
	Intercept Pharma UK & Ireland Ltd

	Registered number:
	09793586

	Date of incorporation:
	24 September 2015

	Place of incorporation:
	England and Wales

	Registered office:
	One Glass Wharf, Bristol BS2 0ZX

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of £1.00 each
	10

	Directors:
	[***]

	Secretary:
	Quayseco Limited (registration number 02287256)

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	10 ordinary shares of £1.00 each

​
​

48

	Company name:
	Intercept Pharma Ltd

	Registered number:
	10152652

	Date of incorporation:
	28 April 2016

	Place of incorporation:
	England and Wales

	Registered office:
	One Glass Wharf, Bristol BS2 0ZX

	Issued share capital:
	Class:
	Number of shares:

		Ordinary shares of £1.00 each
	Two

	Directors:
	[***]

	Secretary:
	Quayseco Limited (registration number 02287256)

	Shareholder:
	Name:
	Number and class of shares:

		The Seller
	Two ordinary shares of £1.00 each

​
​

49

Part 2:  The Shares
	

	​

	

	​

	

	(1)
	   
	(2)
	   
	(3)

	Company name
	​
	Type and class of Shares in issue
	​
	Registered owner

	Intercept Pharma Austria GmbH
	​
	Ordinary shares of EUR 35,000
	​
	The Seller

	Intercept Pharma Canada Inc.
	​
	Common shares without par value
	​
	The Seller

	Intercept Pharma France SAS
	​
	Ordinary shares of EUR 1.00
	​
	The Seller

	Intercept Pharma Deutschland GmbH 
	​
	Ordinary shares of EUR 1.00
	​
	The Seller

	Intercept Pharma International Limited
	​
	Ordinary shares of EUR 1.00
	​
	The Seller

	Intercept Italia S.r.l
	​
	1 quota equal to 100% of the corporate capital
	​
	Intercept Pharmaceuticals LLC

	Intercept Pharma Portugal, Unipessoal Lda
	​
	Quota share of EUR 5,000.00 
	​
	The Seller

	Intercept Pharma Spain, S.L.
	​
	10,000 ordinary shares of EUR 1.00 each, numbered from 1 to 10,000 
	​
	The Seller

	Intercept Pharma Switzerland GmbH
	​
	Quota shares of CHF 20,000 
	​
	The Seller

	Intercept Pharma UK & Ireland Ltd
	​
	Ordinary shares of £1.00 each
	​
	The Seller

	Intercept Pharma Ltd
	​
	Ordinary shares of £1.00 each
	​
	The Seller

​
​

50

Part 3:  Leased Property
	1.
	Austria

	Description of property:
	Fleischmarkt 1/6/12, A-1010 Vienna, Austria

	Tenant:
	Intercept Pharma Austria GmbH

	Current landlord:
	IWG Management (Austria) GmbH

	Date of lease:
	18 May 2021

	Lease term:
	1 August 2021 for a period of one month, subject to automatic renewal on the last day of each month

	Current use:
	Office space

	Current rent:
	EUR [***] per month

​
	2.
	Canada

	

	

	Description of property:
	Top Level, Suite 300, 4263 Sherwoodtowne Blvd, Mississauga-ON L4Z 1Y5, Canada

	User:
	Intercept Pharma Canada Inc.

	Current Centre:
	United Overseas Investments Ltd. o/a Zemlar Offices

	Date of agreement:
	21 May 2020

	Term:
	Two years commencing on 1 July 2020 and expiring on 30 June 2022, with an option to renew for one further year

	Current use:
	Office space

	Current annual rent:
	CDN $[***], CDN $[***] (rent only) and CDN $[***] (HST only) per month

​
​

51

	3.
	France (Domiciliation contract (contrat de domiciliation))

	Description of property:
	Madeleine, Paris, France 19 boulevard Malesherbes, 75008 Paris, France

	Customer:
	Intercept Pharma France SAS

	Current provider:
	Regus Paris SAS

	Date of contract:
	18 September 2020

	Term:
	1 January 2021 for one month, subject to automatic renewal on the last day of each month

	Current use:
	Office space

	Current fee:
	EUR [***] per month

​
	4.
	Germany

	Description of property:
	Rosenheimer Straße 52, 81669 Munich

	Tenant:
	Intercept Pharma Deutschland GmbH

	Current landlord:
	Stadtsparkasse München

	Date of lease:
	31 August 2020

	Lease term:
	1 September 2020 for an indefinite period

	Current use:
	Office space

	Current rent:
	EUR [***] per month

​
	5.
	Ireland

	

	

	Description of property:
	Ormond, Dublin

	Tenant:
	Intercept Pharma International Limited

	Current landlord:
	Regus CME Ireland Ltd

	Date of lease:
	14 July 2021

	Lease term:
	1 November 2021 to 31 October 2022

	Current use:
	Office space

	Current rent:
	EUR [***] per month

​
​

52

	6.
	Italy

	Description of property:
	Ground Floor, via G. Carducci 24, Milan, Italy

	Tenant:
	Intercept Italia S.r.l.

	Current landlord:
	Vikivi S.r.l. a socio unico 

	Date of lease:
	15 June 2020

	Lease term:
	18 months commencing on 1 November 2020 and expiring on 30 April 2022

	Current use:
	Office space

	Current rent:
	EUR [***] per annum plus VAT

​
	Description of property:
	Ground Floor, via G. Carducci 24, Milan, Italy

	Tenant:
	Intercept Italia S.r.l.

	Current landlord:
	Vikivi S.r.l. a socio unico 

	Date of lease:
	22 January 2022

	Lease term:
	12 months commencing on 1 May 2022 and expiring on 30 April 2023

	Use:
	Office space

	Agreed rent:
	EUR [***] per annum plus VAT

​
	7.
	Portugal

	Description of property:
	Torres de Lisboa, Lisbon, Portugal

	Tenant:
	Intercept Pharma Portugal Unip., Lda.

	Current landlord:
	Regus Business Centre Lda

	Date of lease:
	6 June 2019

	Lease term:
	1 August 2019 for one month, subject to automatic renewal on the last day of each month

	Current use:
	Office space

​
​

53

	

	

	Current rent:
	EUR [***] per month

​
	8.
	Spain

	

	

	Description of property:
	Office numbers 501-502-503-504-539-542 at Paseo de la Castellana 135, Madrid, Spain

	Tenant:
	Intercept Pharma Spain S.L.

	Current landlord:
	Negocenter Business Center, SL

	Date of lease:
	30 October 2015, as amended by:

●
Amendment No 1 dated 15 November 2016;

●
Amendment No 2 dated 24 March 2017;

●
Amendment No 3 dated 12 March 2018;

●
Amendment No 4 dated 3 April 2019;

●
Amendment No 5 dated 23 March 2020; and

●
Amendment No 6 dated 1 March 2021.

	Lease term:
	One year commencing on 1 May 2021 and expiring on 30 April 2022

	Current use:
	Office space

	Current rent:
	EUR [***] per month

​
	9.
	Switzerland

	Description of property:
	City Center Stockerhof, Zurich, Switzerland

	Tenant:
	Intercept Pharma Switzerland GmbH

	Current landlord:
	Regus Business Centers AG

	Date of lease:
	11 April 2019

	Lease term:
	1 June 2019 for one month, subject to automatic renewal on the last day of each month

	Current use:
	Office use

	Current rent:
	CHF [***] per month

​
​

54

	10.
	United Kingdom

	Description of property:
	Sixth floor, 2 Pancras Square, King’s Cross Central, London N1C 4AG

	Title number:
	NGL931387

	Tenant:
	Intercept Pharma Europe Ltd.

	Guarantor:
	Intercept Pharmaceuticals, Inc

	Current landlord:
	Performing Right Society, Limited

	Date of lease:
	22 January 2016

	Lease term:
	From and including 22 January 2016 to and including 31 May 2024

	Current use:
	Office space

	Current rent:
	£[***] per annum

​
​

55

SCHEDULE 2: WARRANTIES
	1.
	Title and capacity

	1.1
	As at the Effective Time, the Seller is the sole legal and beneficial owner of or has the right to exercise all voting and other rights over and is able to procure the sale, free from Encumbrances, of the Shares.

	1.2
	There is no Encumbrance affecting any of the Shares, nor any agreement or commitment to give or to create any such Encumbrance over or affecting the Shares and no claim has been made by any person to be entitled to any such Encumbrance.

	1.3
	The Seller is validly existing and is a company duly incorporated and registered under the law of its jurisdiction of incorporation.

	1.4
	The Seller has the legal right, full power and authority and all necessary consents and authorisations to enter into and to perform its obligations under this agreement and each other Acquisition Document to which it is or will be party.

	1.5
	This agreement and each other Acquisition Document to which the Seller is or will be party constitutes, or will when executed constitute, legal, valid and binding obligations on the Seller in accordance with its terms (assuming that each such Acquisition Document has been properly executed by the other parties to it and that their entry into it has been duly authorised).

	1.6
	The entry into and performance of its obligations under this agreement and each other Acquisition Document by the Seller will not:

		(a)
	conflict with or breach any provision of its certificate of incorporation or by-laws;

		(b)
	breach or constitute a default under any agreement or instrument to which it is party or by which it is bound and which is material in the context of the Acquisition and that would have a material adverse effect on the Group Companies taken as a whole;

		(c)
	conflict with or breach any applicable law or any order, judgment, decree or requirement of any Authority to which it or any Group Company is subject or submits and which is binding on it; or

		(d)
	require the consent, waiver, approval or authorisation of any Authority.

	2.
	Share capital

	2.1
	The Shares constitute the entire allotted and issued share capital of each Group Company and have been properly issued and are fully paid up.

	2.2
	No person has any right (whether contingent or otherwise) to require any Group Company:

		(a)
	to allot, or grant rights to subscribe for, shares in or other securities of any Group Company; or

		(b)
	to convert any existing securities into, or to issue securities that have rights to convert into, shares in any Group Company.

​

56

	3.
	Corporate information

	3.1
	The information set out in part 1 schedule 1 relating to the Group Companies is accurate in all respects.

	3.2
	No Group Company acts or carries on business by way of a legal partnership with any other person or is a party to any joint venture agreement.

	3.3
	No Group Company is a member of any corporate or unincorporated person.

	3.4
	No Group Company has any branch or permanent establishment outside its jurisdiction of incorporation.

	3.5
	Each Group Company has been duly incorporated or formed and is validly existing under the laws of its place of incorporation or formation.

	3.6
	The statutory books of each Group Company have been properly kept, are up-to-date and contain complete and accurate details of all matters required by applicable laws to be entered in them. No notice or indication that any of them is incorrect or should be rectified has been received.

	4.
	Interests in other companies

	4.1
	No Group Company is the legal or beneficial owner of, or has agreed to acquire, any shares, securities or other interests in any company (other than another Group Company).

	5.
	Insolvency

	5.1
	The Seller is not insolvent under the law of its jurisdiction of incorporation and it is not unable to pay its debts as they fall due, nor has it stopped paying its debts as they fall due.

	5.2
	No Group Company is insolvent under the law of its jurisdiction of incorporation.

	5.3
	So far as it is aware, no liquidator, administrator, receiver or similar officer has been appointed by any person in relation to the Seller or any Group Company or the whole or any part of its assets or undertaking and so far as the Seller is aware:

		(a)
	no steps have been taken to initiate any such appointment; and

		(b)
	no voluntary arrangement has been proposed in respect of it.

	5.4
	No resolution has been passed or, so far as the Seller is aware,  order been made for the winding up of the Seller or any Group Company and so far as the Seller is aware, no provisional liquidator has been appointed.  So far as the Seller is aware, no petition has been presented for the winding up of the Seller or any Group Company which has not been withdrawn or dismissed.

	5.5
	No arrangement or compromise in relation to reduced payments or the time for payment has been made by the Seller or any Group Company with its creditors generally.

	5.6
	So far as the Seller is aware:

		(a)
	no application has been made to court for an administration order in respect of the Seller or any Group Company; and

​

57

		(b)
	no notice of intention to appoint an administrator of the Seller or any Group Company has been given or filed.

	6.
	Accounts

	6.1
	The Accounts were prepared in accordance with the accounting principles and practices generally accepted in the United Kingdom at the Accounts Date.

	6.2
	The Accounts are complete and accurate in all material respects and give a true and fair view of the assets, liabilities, financial position and profit or loss of the relevant Group Company and of the Group Companies as a whole as at and for the period to the Accounts Date. For the purposes of this paragraph 6.2 in respect of each Group Company which is not incorporated in the United Kingdom, the words “true and fair” shall be substituted with the equivalent terminology applicable under local auditing or statutory regulations to denote accounts in respect of which an unqualified auditor’s certificate has been given.

	6.3
	No change has been made to the accounting policies or to any other accounting treatment including, for the avoidance of doubt, any estimation techniques, of any Group Company in the three (3) years prior to the Accounts Date.

	6.4
	The Accounts include full provision for all bad and doubtful debts, obsolete or slow moving stock and the Accounts state accurately all liabilities and the value of all assets.

	6.5
	The depreciation and amortisation rates adopted in the Accounts are sufficient to ensure that the assets are written down to nil by the end of their useful economic lives.

	6.6
	The Accounts are not affected by any unusual or non-recurring item or by any other factor that makes the Accounts unusual or misleading in any respect.

	6.7
	At the Accounts Date no Group Company had any other liability (whether actual, contingent, unquantified or disputed) or outstanding capital commitment which is not fully disclosed or fully provided for in the Accounts.

	6.8
	The accounting and other records of each Group Company are up-to-date and have been fully, properly and accurately maintained and are in the possession of the relevant Group Company.

	6.9
	The Latest Financial Information has been prepared with reasonable skill and care, having regard to its nature and purpose, in a manner consistent in all material respects with the Accounts, is free from material error and does not materially misstate the asset and liabilities of each Group Company or profits or losses of each Group Company.

	7.
	Period since Accounts Date

Since the Accounts Date:
	7.1
	no Group Company has declared, paid or made a dividend or other distribution or agreed to do any such things;

	7.2
	no resolution of the shareholders of any Group Company has been passed (other than resolutions relating to routine business at annual general meetings);

	7.3
	no Group Company has changed its accounting reference date;

	7.4
	the business of the Group Companies has been conducted in the ordinary course of business;

​

58

	7.5
	no asset of a value in excess of $[***] has been acquired or disposed of nor has there been any agreement to acquire or dispose of any such asset;

	7.6
	no liability (actual or contingent) has been incurred or has arisen of an amount in excess of $[***] otherwise than trade credit incurred in the ordinary course of business;

	7.7
	no Group Company has materially changed its policies or procedures in relation to the collection of trade debtors or the payment of trade creditors.

	8.
	Funding

	8.1
	The name and address of each bank with which each Group Company maintains a bank account together with full details of each account (including the account name and number, a statement showing the balance as at the day immediately preceding the date of this agreement, all authorities and mandates, standing orders and direct debits) are set out in the Disclosed Information.

	8.2
	The Disclosed Information contains details (including the amounts and terms) of any overdraft, loan or other financial facilities currently available to any Group Company ("Facilities").

	8.3
	No Group Company has received written notice:

		(a)
	that it is in material default under the terms of any of the Facilities (which default remains outstanding at the date of this agreement); or

		(b)
	to repay any of the Facilities in advance of their stated maturity.

	8.4
	No event which is, or which may become or result in, an event of default or a breach of the terms of any borrowing or financial facility of any Group Company has occurred or been alleged and no change in the direct or indirect ownership or control of any Group Company will or may result in such an event of default or breach.

	8.5
	No guarantee, mortgage, charge, pledge, lien or other security agreement or arrangement has been given by or entered into by any Group Company or third party in respect of any obligations of any Group Company (including in respect of borrowings) or in respect of the indebtedness or obligations of any other person.

	8.6
	No Group Company has lent or agreed to lend any money which has not been repaid to it and there are no debts owing to any Group Company other than debts that have arisen in respect of trading and in the ordinary course of business.

	8.7
	No Group Company is a party to any subsisting debt factoring or discounting arrangement or agreement.

	9.
	Grants and state aid

In the last two years, no Group Company has applied for or received grants, subsidies, allowances, loan payments, guarantees or other financial assistance from Authorities in excess of USD $[***].
	10.
	Assets

For the purposes of this paragraph 10 only, a "material asset" means an asset (other than the Property and any IP) with a book value in the Accounts of, or one acquired since then at a purchase price of, more than US$[***]
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59

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	10.1
	All assets, properties and rights used by any Group Company for or in connection with its business, or which are required for the continuation of the Business as it is currently conducted and as conducted for the twelve (12) months prior to the date hereof are legally and beneficially owned by a Group Company, or will be transferred under the BTA and are  free from any Encumbrance and there is no agreement or commitment to create any Encumbrance and no claim has been made by any person to be entitled to any such Encumbrance, other than those:

		(a)
	disposed of in the ordinary course of business;

		(b)
	subject to hire purchase or finance lease agreements;

		(c)
	acquired subject to retention of title clauses; or

		(d)
	subject to liens arising by operation of law.

	10.2
	All material assets are in the possession of or under the control of the Group Companies or are being transferred under the BTA (save where held by a third party in the ordinary course of business).

	10.3
	The trading stock (including work in progress) of each Group Company is in good condition and is capable of being sold by the relevant Group Company in the ordinary course of business at no less than current pricing levels and without discount, rebate or other allowance.

	10.4
	The amounts of trading stock (including work in progress) of each Group Company is appropriate and normal for such Group Company’s current level of business, having regard to current and reasonably anticipated orders, and none is obsolete, slow moving, unusable or unmarketable.

	10.5
	All plant and machinery (including fixed plant and machinery), vehicles and office equipment used by any Group Company in connection with its business are in good repair and condition, are properly maintained and fully serviceable and are capable of being used safely and efficiently in connection with the business of the relevant Group Company.  None is obsolete, surplus to current requirements or in need of renewal or replacement.

	11.
	Debtors

No Group Company is owed any sums other than trade receivables incurred in the ordinary course of business or in respect of any Intra-Group Debt.
	12.
	Real property

	12.1
	The Disclosed Information contains accurate details of the Property.

	12.2
	The Property comprises all the land and premises owned or occupied by any Group Company and no Group Company has interest in any other real estate.

	12.3
	The brief particulars of the Property set out in part 3 of schedule 1 are accurate in all material respects.

	12.4
	In relation to each lease under which any part of the Property is held:

		(a)
	there is no subsisting breach of any covenant, condition or agreement;

		(b)
	such lease is legal, valid, binding, enforceable and in full force and effect, and the relevant Group Company has a valid leasehold interest;

60

		(c)
	the rents and other monies due and payable under it have been paid;

		(d)
	the Group Company named in part 3 schedule 1 as its holder has not received written notice from the landlord that it is in material breach of its obligations under such lease (which breach remains outstanding at the date of this agreement); and

		(e)
	there is no event, fact or circumstance which would allow the lessor to terminate its lease agreement with respect to the Property prior to the expiry of the term of such lease agreement.

	12.5
	In relation to the Office User Agreement under which any part of the Property is occupied:

		(a)
	there is no subsisting breach of any covenant, condition or agreement;

		(b)
	such Office User Agreement is legal, valid, binding, enforceable and in full force and effect, and the Canadian Target occupies such Property;

		(c)
	the fees and other monies due and payable under the Office User Agreement have been paid;

		(d)
	the Canadian Target named in part 3 schedule 1 as its holder has not received written notice from the centre that it is in material breach of its obligations under such Office User Agreement (which breach remains outstanding at the date of this agreement); and

		(e)
	there is no event, fact or circumstance which would allow the centre to terminate its Office User Agreement with respect to the Property prior to the expiry of the term of such Office User Agreement.

	12.6
	No Group Company has leased or otherwise granted to any third party the right to use of occupy any of the Properties or any portion thereof.

	12.7
	There are no easements or other Encumbrances on the Property related to any Group Company’s lease, occupation or use thereof.

	13.
	Insurance

	13.1
	The Disclosed Information contains summary details of the material insurance policies maintained by or on behalf of any Group Company.

	13.2
	Each Group Company has maintained full indemnity insurance cover against all risks normally insured against by companies carrying on a similar business, complete and accurate written particulars of each of which have been provided to the Purchaser.

	13.3
	All of the insurance policies are in full force and effect, none are void or voidable, no claims are outstanding, no event has occurred which might give rise to any claim, and all premiums due and payable have been paid.

	13.4
	During the two (2) years immediately preceding the date of this agreement no individual insurance claim in excess of $[***] has been made by any Group Company.

	13.5
	All known incidents or circumstances that could give rise to (i) a product liability claim, (ii) an employer’s liability claim or (iii) a directors and officers claim against a Group Company or a Seller have been properly disclosed, notified, declared and accepted by the relevant insurer.

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61

	14.
	IP

	14.1
	Each Group Company owns, or has licensed to it or will have licensed to it pursuant to the Licence Agreement, all the IP necessary to carry on its business in all material respects as currently conducted.

	14.2
	The Disclosed Information contains complete and accurate details of the registered IP , or the subject of an application to register IP, in the name of any Group Company or the Seller or any Affiliate of the Seller and the subject of the Licence Agreement or the Trademark Assignment("Seller IP").

	14.3
	The Seller IP is in the sole legal and beneficial ownership of any Group Company or the Seller or any Affiliate of any of them in each case free from any Encumbrance.

	14.4
	The application, registration and renewal fees relating to the Seller IP that have fallen due have been paid.

	14.5
	The Seller IP is in force without restriction and, so far as the Seller is aware, nothing has been done, or not been done, as a result of which any Seller IP may cease to be in force.

	14.6
	In the two years prior to the date of this agreement, neither the Seller nor any Group Company has received any written notice challenging the validity of any Seller IP that would have a material adverse effect on either the Seller or any Group Company.

	14.7
	The Disclosed Information contains complete and accurate details of the terms of all licences of the Seller IP which are material to the business of any Group Company.  So far as the Seller is aware, neither of them nor any Group Company is in material breach of any such licence.

	14.8
	So far as the Seller is aware, in the two years prior to the date of this agreement, no third party has infringed or threatened to infringe any Seller IP.

	14.9
	The Disclosed Information contains details of the licences of IP granted to any Group Company used in, and which is material to, the business of each of the Group Companies ("Material IP Licences").  All Material IP Licences are valid and subsisting.

	14.10
	No Group Company has received written notice from any counterparty to any Material IP Licence that it is in material breach of such licence (which breach remains outstanding at the date of this agreement) and no notice to terminate has been given or threatened.

	14.11
	In the two years prior to the date of this agreement, no activities of any Group Company nor the Seller have been alleged to infringe the IP of any third party.

	14.12
	All rights in and to the Seller IP that was created or developed by an employee or a contractor was either created, developed or conceived pursuant to a valid and enforceable written agreement under which all right, title and interest in and to any IP is assigned to or vests in any Group Company, the Seller or any Affiliate of any of them or so vests by operation of applicable law.

	15.
	Regulatory

	15.1
	The manufacture and sale of the Product in accordance with the formulation set out in the Product Files is in compliance with all applicable laws in all material respects with which the Seller must abide.

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62

	15.2
	In the two years prior to the date of this agreement there have been no enforcement actions against the Seller by any regulatory body or government agency relating to the Product that would have a material adverse effect on the Group Companies taken as a whole.

	15.3
	In the two years prior to the date of this agreement there have been no product recalls affecting the Product that would have a material adverse effect on the Group Companies taken as a whole.

	15.4
	So far as the Seller is aware, the Marketing Authorisations are in full force and effect and the Seller is not aware of any reason why any of them should be withdrawn.

	15.5
	So far as the Seller is aware, the marketing authorisation for the Product in Canada held by the Seller is in full force and effect and the Seller is not aware of any reason why it should be withdrawn.

	16.
	IT Systems

	16.1
	In this paragraph 16, "IT Systems" means the material information technology systems used by any Group Company other than the internet and third party telecommunication networks.

	16.2
	The Disclosed Information contains brief details of the IT Systems.

	16.3
	So far as the Seller is aware, in the last 12 months, there has been no failure, breakdown or security breach of the IT Systems which had a material adverse effect on the Group Companies taken as a whole.

	17.
	Data protection

	17.1
	In the last two years, no Group Company has received any formal written notice from any Authority that would have a material adverse effect on the Group Companies taken as a whole:

		(a)
	alleging non-compliance with the Data Protection Act 1998, the Data Protection Act 2018 or the General Data Protection Regulation (EU 2016/679);

		(b)
	requiring it to change, cease using, block or delete any personal data; or

		(c)
	prohibiting the transfer of personal data to any place.

	18.
	Confidential information

In the last two years, no Group Company has received any written notice alleging any misuse of any third party's confidential information that has had a material adverse effect on the Group Companies taken as a whole.
	19.
	Guarantees, etc

	19.1
	So far as the Seller is aware, no Group Company is a party to or has any liability (actual or contingent) under any subsisting guarantee, security, indemnity or letter of credit, agreement or other commitment in respect of any obligation or liability of any third party (other than another Group Company) in excess of USD $[***].

	19.2
	Except for any guarantee or warranty implied by law, no Group Company has given any indemnity, guarantee, warranty, or made any representation in respect of goods or services supplied or to be supplied.

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63

	20.
	Key contracts

	20.1
	In this paragraph references to “contract” include any arrangement, obligation, understanding or commitment, and references to “material” shall mean material to the business, prospects, profits or assets of any Group Company.

	20.2
	Save as Disclosed, no Group Company is a party to any contract which:

		(a)
	is of a revenue nature in excess of US$[***] per annum or expenditure nature in excess of US$[***]

		(b)
	is of an unusual or exceptional nature or is not in the ordinary course of business; or

		(c)
	cannot readily be performed by it on time except with undue effort or unusual expenditure; or

		(d)
	restricts its freedom to carry on the whole or any part of its business in any part of the world in such manner as it thinks fit,.

	20.3
	The Disclosed Information contains and a copy of each Material Contract (to the extent that the terms of such contract are included within a written agreement).

	20.4
	No Group Company has received written notice from any counterparty to any Material Contract that it is in material breach of such contract (being a breach that would have a material adverse effect on the Group Companies taken as a whole).

	20.5
	Each of the Material Contracts is in full force and effect.  So far as the Seller is aware, no party to any Material Contract is in material breach of it (being a breach that would have a material adverse effect on the Group Companies taken as a whole).

	20.6
	No notice of termination of any Material Contract has been served or received by any Seller or any Group Company and which termination would have a material adverse effect on the Group Companies taken as a whole, there are no grounds for the determination, rescission, avoidance or repudiation of any such contract and there has been no allegation of such a thing.

	20.7
	No Group Company is or, within the past 3  years has been, a party to a contract which is, or was, not entirely of an arm’s length nature and no Group Company has transferred or has agreed to transfer any assets except at market value.

	21.
	Terms of Trade

	21.1
	No substantial customer or supplier of any Group Company (being a customer or supplier which accounts for [***] per cent. ([***]%) or more of such Group Company’s annual custom or supply, as the case may be) has during the twelve (12) months immediately preceding the date of this agreement ceased, reduced or indicated an intention to cease or reduce, changed the terms of or indicated an intention to change the terms of, its trading with or supplying to such Group Company.

	21.2
	No Group Company carries on business under any name other than its own corporate name.

	21.3
	No third party has any option or right of first refusal over the Product or any similar product developed by the Seller Group or any Group Company.

	22.
	Product

	22.1
	So far as the Seller is aware, no Group Company has given any warranty or guarantee in relation to the Product (other than those implied by any applicable law or contained in its standard terms and conditions of sale) that is reasonably likely to give rise to a liability in excess of US$[***].

64

	22.2
	The Disclosed Information contains details of each customer claim in the last 12 months which resulted in a payment or refund to the customer in excess of US$[***].

	22.3
	In the last two years, there has not been any recall of products manufactured or sold by any Group Company where the value of the products recalled exceeded US$[***] in aggregate (either in any calendar year or with respect to any particular product recall or series of product recalls).

	22.4
	No Group Company has manufactured, sold or provided any product or service which did not comply with all laws, regulations, standards and requirements then applicable or with any representation or warranty (express or implied) given in respect of it and in respect of which the relevant time period for bringing a claim has not expired..

	23.
	Licences

	23.1
	The Disclosed Information contains details of the licences, registrations, consents, permits and authorisations by any Group Company from any Authority that are material to the Group Companies taken as a whole, excluding any licences relating to IP ("Licences").

	23.2
	Each Licence is in full force and effect, , is not and in the last two years, no Group Company has received formal written notice from any Authority that it is in material breach of any Licence (which breach remains outstanding at the date of this agreement) that is likely to result in the suspension or revocation of such Licence.

	23.3
	The change of control of the Group Companies pursuant to the sale and purchase of the Shares will not result in the revocation, termination or modification of any Licence.

	24.
	Powers of attorney

No Group Company has given any power of attorney or other authority (express, implied or ostensible) which remains in force to any person to enter into any contract or commitment on its behalf (other than those given to its officers and employees in the ordinary course of business).
	25.
	Employees and terms of employment

	25.1
	The Disclosed Information contains:

		(a)
	an anonymised list of employees of the Group Companies detailing job title, category of employee, start date, annual salary, length of service, function and location of each employee;

		(b)
	a representative sample of standard terms and conditions of employment used for each grade of employee and details of the staff handbooks and employment policies which apply to each Group Company's employees; and

		(c)
	details of the share incentive schemes, share option schemes or profit sharing, bonus or other incentive schemes applicable to any of the Group Companies' employees.

	25.2
	So far as the Seller is aware, no Group Company is under any obligation to make any material change in the basis of remuneration or other benefits paid or provided to any of its employees.

	25.3
	Each contract of employment between a Group Company and its employees can be terminated, in accordance with its terms, by that Group Company giving nine months' notice or less.

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65

	25.4
	No Group Company engages workers or consultants who should properly be categorised as employees for Tax purposes and any independent contractors, workers and consultants of each Group Company have been properly categorised as employed or self-employed for tax and employment purposes.

	25.5
	No Group Company is subject to any claims or liabilities resulting from its employees working from home.

	25.6
	No Group Company has agreed to, or indicated its agreement to, pay any bonus or other incentive or overtime payments to its employees which has not been paid.

	26.
	Senior Employees

	26.1
	No Group Company has given notice of termination or retirement to, or received notice of resignation from, any employee earning in excess of $[***] base annual salary (“Senior Employee”).

	26.2
	No Group Company has made any offer of employment to any person who, if employed, would be a Senior Employee which has either been accepted or remains open for acceptance.

	26.3
	No Group Company has any current disciplinary proceedings or appeals in respect of any Senior Employee.

	26.4
	No Senior Employee will become entitled to any payment or other benefit, or be entitled to give notice to terminate his employment, solely as a result of Completion.

	27.
	Trade unions, etc

The Disclosed Information contains details of any material agreements or arrangements entered into by any Group Company with, or recognising, any trade union, works council, staff association other body representing any of its employees.
	28.
	Employment disputes

	28.1
	No Group Company is involved in any industrial dispute that is of material importance to the Group Companies taken as a whole.

	28.2
	There is no material claim against any Group Company from any of its employees or former employees and, so far as the Seller is aware, none is pending or threatened.

	29.
	Pension obligations

	29.1
	No Group Company has any obligation or liability to provide any pension, allowance, lump sum or other similar benefit on death, disability, retirement or termination of employment (whether voluntary or not) for the benefit of any of the Group Companies' employees, former employees or any of their respective dependants ("Pension Benefits"), or to contribute or provide access to any arrangement which provides Pension Benefits.

	29.2
	Each Group Company has, at all times, complied in all material respects with all applicable pensions legislation in each country and no claims or complaints have been made or are pending or threatened in relation to any pension arrangement of any Group Company.

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66

	30.
	Compliance with laws

	30.1
	Each Group Company has, at all times, conducted its business in compliance with all applicable laws and regulations in each country in which its business is or has been carried on and no Group Company has received written notice from any Authority that it is in breach of any law.

	30.2
	Each Group Company has, at all times, conducted its business in compliance with any applicable sanction laws and regulations (including the international sanction laws and regulations of the European Union, the United States and the United Nations, where applicable).

	30.3
	The Italian Target is not liable pursuant to the Italian Legislative Decree no. 231/2001 for crimes committed by any of its executives, managers or other employees.

	31.
	Anti-Bribery and Improper Payment

	31.1
	No Group Company and no member of the Seller Group nor, so far as the Seller is aware, any of its or their respective directors, officers, employees, agents, representatives or other persons associated with, performing a service for or otherwise acting for or on behalf of it or them (each, an “Associated Person”) has, in connection with the Business, breached or contravened any Anti-Bribery Laws or any applicable anti-money laundering law, rule or regulation or any books and records offences relating directly or indirectly to a bribe.

	31.2
	Each Group Company maintains and regularly keeps under review on an ongoing basis adequate written anti-corruption procedures and internal accounting controls which are designed to ensure compliance by the relevant Group Company and its respective directors, officers and employees with all Anti-Bribery Laws.

	31.3
	Neither the Seller, nor any other member of the Seller Group, nor any Group Company has retained any intermediaries, representatives or other agents to act on their behalf in connection with the Business or any Group Company without first conducting a due diligence review with respect to such proposed intermediary, representative or other agent.

	32.
	Litigation

	32.1
	No Group Company is engaged in or in the six (6) years prior to the date of this agreement has been engaged in any civil, criminal or arbitration proceedings or is proposing to engage in any litigation, arbitration, mediation or other legal proceedings (whether as plaintiff, defendant or otherwise), no litigation, arbitration, mediation or other legal proceedings are pending or threatened and there are no circumstances likely to give rise to any such proceedings.

	32.2
	No Group Company is the subject of any investigation, enquiry or enforcement proceedings by any governmental or other body, no investigations, enquiries, or enforcement proceedings are pending or threatened and there are no circumstances likely to give rise to any such investigation, enquiry or enforcement proceedings.

	32.3
	No director or employee (in each case, past or present) of any Group Company is engaged in or subject to any of the matters referred to in paragraphs 31.1 or 31.2 for which any Group Company may be liable.

	32.4
	No Group Company is affected by any existing or pending judgments or rulings, orders or decrees of any court or governmental authority or any expert determination or arbitration proceedings.

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	33.
	Judgments

So far as the Seller is aware, there is no outstanding judgment, order, ruling or decision by any court, tribunal or arbitrator against any Group Company which is likely to have a material adverse effect on the Group Companies taken as a whole.
	34.
	Tax

Returns and Disputes
	34.1
	In the last six years, each Group Company:

		(a)
	has (to the extent due) made and submitted all material notices, returns (including any land and IP transaction returns) and submitted all reports, accounts, computations, statements, assessments, claims, disclaimers, elections and registrations and any other information to any Tax Authority as reasonably requested by any such Tax Authority or required by applicable law within any requisite period, and all such returns and information and notices made were on a proper basis and within the last three years were true and accurate in all material respects and are not the subject of any material dispute with a Tax Authority and, so far as the Seller is aware, there are no facts or circumstances in existence which are likely to give rise to or be the subject of any such dispute;

		(b)
	has maintained complete and accurate records, invoices and other information in relation to Tax that meet all applicable Tax related legal requirements and enable the tax liabilities of the Group Company to be calculated accurately in all material respects;

		(c)
	has not entered into a concession, agreement or arrangement with a Tax Authority;

		(d)
	has not been, nor so far as the Seller is aware (or ought reasonably to have known) will it become, liable to make to any person (including any Tax Authority) any payment in respect of any liability to Tax which is primarily or directly chargeable against, or attributable to, any other person (not being a Group Company);

		(e)
	has duly paid all amounts of Tax and all amounts in respect of Tax to the relevant Tax Authority to the extent the same were required by law to have been paid by it, has done so within the applicable time limit and is not liable nor has it been liable to pay any material penalty or interest in connection therewith; and

		(f)
	 has not been involved in any dispute with any Tax Authority, nor has it been subject to any non-routine investigation, audit, enquiry, visit, discovery or access order by any Tax Authority, and no Tax Authority has indicated to a Group Company that it intends to make the same.

	34.2
	The Accounts make provision or reserve in accordance with US generally accepted accounting principles for all Tax for which each Group Company is accountable at the Accounts Date. Proper provision has been made and shown in the Accounts for deferred Tax in accordance with US generally accepted accounting principles.

	34.3
	All financing costs, including interest, discounts and premiums payable in the last six years by each Group Company in respect of its loans and amounts payable in the last six years by each Group Company in respect of its derivatives contracts, are deductible by it in computing its

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68

profits, gains or losses for Tax purposes to the extent that they have been treated as so deductible by the Group Company in its applicable Tax returns.
	34.4
	No Group Company:

		(a)
	has any subsisting liability under any agreement relating to the surrender of losses (other than a liability to another Group Company); and

		(b)
	has any subsisting liability under any arrangements for the payment of group Tax liabilities (other than to another Group Company and other than the VAT Group (as defined elsewhere in this agreement)).

	34.5
	All claims made by a Group Company in the last six years for the surrender of losses were valid when made and have been or so far as the Seller is aware will be allowed by way of relief from or allowance or credit against Tax. All arrangements entered into by a Group Company in the last six years in relation to consolidated groups for Tax purposes and fiscal unities were valid when made and (to the extent they remain subsisting) remain valid.  Each Group Company has in the last six years met in all material respects all procedural and other requirements of all applicable Tax statutes in respect of such claims, unities or consolidated groups.

	34.6
	So far as the Seller is aware (or ought reasonably to have known), neither the execution nor completion of this agreement will result in the clawback or any other form of disallowance of any Relief or allowance previously given to the Group Company for Tax purposes.

Deductions and Withholdings
	34.7
	Each Group Company has in the last six years properly made all deductions and withholdings on account of Tax required to be made from any payment made or treated as made by it as are required by applicable law and, to the extent required by applicable law, accounted for all such deductions and withholdings in full to the appropriate Tax Authority.

Residence
	34.8
	Each Group Company was incorporated in, and is and has at all times within the last six years been resident in, its jurisdiction of incorporation for Tax purposes and is not and has not in the last six years been resident for Tax purposes elsewhere.

	34.9
	No Group Company holds, or has held in the last six years, shares in a company that is not resident in its jurisdiction of incorporation or a permanent establishment or taxable presence outside its jurisdiction of incorporation.

Stamp Duty and Transfer Taxes
	34.10
	Any document that is reasonably necessary in proving the title of any Group Company to any asset which is owned by that Group Company is duly stamped or has had the transfer or registration Tax due in respect of it paid.

Sales at Undervalue/Overvalue
	34.11
	All transactions entered into by the Group Companies in the last six years have been entered into on an arm's length basis and the processes by which prices and terms have been arrived at have, in each case, been appropriately documented in accordance with applicable laws. No notice, enquiry or adjustment has been made by any Tax Authority in the last six years in connection with any such transactions or arrangements.

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69

Tax Schemes
	34.12
	No Group Company has entered into or been a party to or otherwise been involved in any marketed scheme, transaction, series of transactions or other form of arrangement designed wholly or mainly for the purposes of avoiding, deferring or reducing a liability to Tax or any transaction that produced a loss for Tax purposes with no corresponding commercial or economic loss.

VAT
	34.13
	Each Group Company is a taxable person and is registered for the purposes of VAT in its jurisdiction of incorporation.

	34.14
	Where required by applicable law, each Group Company has in the last six years complied in all material respects with the requirements and provisions of the applicable VAT legislation and has in the last six years made and maintained materially true, accurate and up to date records, invoices and other documents required by the applicable VAT legislation and each Group Company has in the last six years in all material respects punctually paid and made all payments and returns required thereunder.

	35.
	BTA Warranties

In this paragraph 35 only, terms shall have the meaning given in the BTA.
	35.1
	No consents are required for the completion of the transfer of the Property from the Seller to the Purchaser, save for the Assignment Consent.

	35.2
	Each of the Assets has been and is being used exclusively in the Business.

	35.3
	The Assets comprise all the assets that are necessary for the full and effective continuation of the Business both as it is currently conducted and as it has been conducted in the 12 months prior to the date of this agreement.

	35.4
	Each of the Assets capable of possession is in the possession and control of the Seller.

	36.
	Seller Arrangements

Save as set out in the Disclosed Information and other than trading in the ordinary course of business there is no contract or arrangement outstanding between any Group Company and any member of the Seller Group which  (i) can not be terminated by either party without notice or liability to the other party and (ii) which if terminated would have a material adverse effect on the ability of any Group Company to operate its business as currently carried on.
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SCHEDULE 3:  MARKETING AUTHORISATIONS
​
[***]
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71

SCHEDULE 4:  COMPLETION OBLIGATIONS
Part 1:  Seller obligations on Completion
	1.
	Documents, etc to be delivered

The Seller shall deliver or procure to be delivered to the Purchaser:
Authorities
	1.1
	as evidence of the authority of any person signing any Acquisition Document on behalf of the Seller, a copy of the minutes of a meeting, or written consent resolutions, of its board of directors or shareholders, as applicable, which:

		(a)
	authorises its execution of any Acquisition Document to which it is party; and

		(b)
	appoints the relevant signatory or signatories to sign such Acquisition Document(s) on its behalf,

or, alternatively,
		(c)
	a duly notarized, and, if necessary, apostilled power of attorney with notarial certification of the powers of the signatory, appointing the relevant signatory or signatories to sign such Acquisition Document(s) on its behalf,

	1.2
	if required by any Group Company’s articles of association or other constitutional documents or by applicable law, a copy of the board of directors resolution or shareholder resolution of such Group Company to approve the acquisition of the Shares by the Purchaser;

Transfer of Shares
	1.3
	in respect of the Austrian Shares:

		(a)
	shareholder's resolution executed by the Seller as the sole shareholder of the Austrian Target (i) approving the sale and transfer of the Austrian Shares to the Purchaser and (ii) appointing new managing directors at the effective time of resignation of all prior directors;

		(b)
	a notarial deed of transfer in the Agreed Form in respect of the Austrian Shares executed in the presence of an Austrian civil law notary by and between the Seller and the Purchaser

	1.4
	in respect of the Irish Shares:

		(a)
	a stock transfer form in respect of the Irish Shares duly executed by the registered holders thereof in favour of the Purchaser; and

		(b)
	a share certificate in respect of the Irish Shares in the names of such registered holders or an indemnity in respect of same.

	1.5
	in respect of the German Shares:

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		(a)
	the notarization of a German share transfer and assignment agreement in the Agreed Form by a German notary;

		(b)
	the filing of the new list of shareholder by the notarizing notary, which shows the Purchaser as new owner of the German Shares;

	1.6
	in relation to the Portuguese Company, an executed short-form share purchase agreement in the Agreed Form in respect of the Portuguese Shares;

	1.7
	in respect of the Italian Shares:

		(a)
	notarial sale and purchase agreement in the Agreed Form pursuant to Article 2470 of the Italian Civil Code ("Italian Notarial Deed") to be executed by and between Intercept Pharmaceuticals, LLC and the Purchaser and authenticated by an Italian notary public; and

		(b)
	filing by the notary public of the Italian Notarial Deed with the relevant Companies’ Register (which may also occur after Closing);

it being understood, acknowledged and agreed that the Italian Notarial Deed will not amend or novate this Agreement in any way and that, in case of conflicts between this Agreement and the Italian Notarial Deed, this Agreement shall prevail;
	1.8
	in respect of the Spanish Shares:

		(a)
	the Seller shall appear duly represented (with notarized and apostilled powers of attorney) in order to execute a notarial deed of transfer in respect of the Spanish Shares executed in the presence of a Spanish civil law notary (in Madrid) to be appointed by the Seller who shall bear the notarization costs;

		(b)
	annotation of the share transfer in the registry book of shareholders of the Spanish Target;

		(c)
	sealing (rebaje notarial) of the ownership titles by virtue of which the Seller owns 100% of the shares of the Spanish Target;

		(d)
	the Seller shall confirm in the transfer deed the receipt of the closing payment relating to the Spanish Shares;

		(e)
	execution and filing of the D1B model;

	1.9
	in respect of the Swiss Share:

		(a)
	an executed quota assignment agreement in the Agreed Form executed in wet ink by the Seller in respect of the Swiss Share; and

		(b)
	Commercial Register application, including all required annexes, in respect of the Swiss Share, filing the change of the quotaholder and any board changes of the Swiss Target executed in wet ink by the board members of the Swiss Target incumbent upon Completion;

	1.10
	in respect of the French Shares:

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		(a)
	a duly completed, executed and dated original copy of the shares transfer form (ordre de mouvement de titre) in the Agreed Form in respect of the transfer of the entire share capital of the French Target to the Purchaser;

		(b)
	three duly completed, executed and dated original copies of the tax transfer form (Cerfa n°2759) in the Agreed Form in respect of the transfer of the entire share capital of the French Target to the Purchaser; and

		(c)
	the original versions of the shareholders’ individual accounts (comptes d’actionnaires), the share transfer register (registre des mouvements de titres) and the register of shareholders’ decisions (registre des décisions dés associés) (as well as other registers of corporate decisions, if any) of the French Target;

	1.11
	executed share or stock transfer power forms in the Agreed Form in respect of each of the Canadian and UK Shares in favour of the Purchaser;

Other documents, consents, approvals
	1.12
	share certificates for the UK Shares (or an indemnity in respect of any lost or unavailable share certificates in the agreed terms) relating to such UK Shares;

	1.13
	a power of attorney in the Agreed Form duly executed as a deed in favour of the Purchaser to enable the Purchaser to exercise voting and other rights attaching to the UK Shares with effect from Completion, pending registration of the transfer;

	1.14
	in respect of the Canadian Target and Canadian Shares:

		(a)
	a signed resolution of the directors of the Canadian Target in the Agreed Form consenting to, among other things:

		(i)
	the cancellation of share certificate no. C-2;

		(ii)
	the issuance of uncertificated replacement share C-2R;

(b) delivery of a written notice of uncertificated shares (no. C-2R) to the Seller;
		(c)
	delivery to the Canadian Target of a statutory declaration in the Agreed Form duly signed by the Seller in respect of lost share certificate no. C-2;

		(d)
	a signed resolution of the directors of the Canadian Target in the Agreed Form consenting to, among other things:

		(i)
	the transfer of the Canadian Shares from the Seller to the Purchaser;

		(ii)
	the cancellation of the written notice of uncertificated shares (no. C-2R);

		(iii)
	the issuance of uncertified share C-3; and

		(iv)
	delivery of a written notice of uncertificated shares (no. C-3) to the Purchaser;

		(e)
	delivery of a written notice of uncertificated shares (no. C-3) in the Agreed Form to the Purchaser; and

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		(f)
	delivery of a certified copy of the share register showing the Purchaser as the holder of the Canadian Shares;

	1.15
	a written resolution of the Seller as sole quota holder of the Swiss Target in the Agreed Form approving the quota assignment agreement, to be executed in wet ink by the Seller;

	1.16
	a tax reference number (e-stamping number) of the Seller in respect of the transfer of the Irish Shares for the purpose of relevant stamp duty filings;

	1.17
	a Tax Clearance Certificate pursuant to section 980 of the Tax Consolidation Act, 1997 (the “CGT Clearance Certificate”), or a letter in a form satisfactory to the Purchaser from the auditors of the Irish Target confirming that no such CGT Clearance Certificate is required;

	1.18
	Spanish Target to provide evidence that it has filed missing FY 2020 financial statements with the Spanish registry;

Records
	1.19
	the statutory registers and minute books, corporate books and records of each Group Company; and

	1.20
	the updated quota and beneficial owner register of the Swiss Target, reflecting the Purchaser as its new sole quota holder and the registration of the beneficial owner(s) (if any) as notified by the Purchaser;

Auditors, officers, secretary and employees
	1.21
	the written resignations in the Agreed Form of the Outgoing Directors in their capacity as directors and (where applicable) the secretary, and, if requested by the Purchaser other officers, of each Group Company;

	1.22
	acknowledges the resignation of the Outgoing Directors; and

Other documents
	1.23
	the Disclosure Letter duly executed by the Seller.

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Part 2: Purchaser's obligations on Completion
	1.
	Documents, etc to be delivered

The Purchaser shall deliver to the Seller:
	1.1
	as evidence of the authority of any person signing any Acquisition Document on behalf of the Purchaser:

		(a)
	a copy of the minutes of a meeting of its board of directors (authorising its execution of any Acquisition Document to which it is party, and appointing the relevant signatory or signatories to sign such Acquisition Document(s) on its behalf);

or, alternatively,
		(b)
	a duly notarized, and, if necessary, apostilled power of attorney with notarial certification of the powers of the signatory, appointing the relevant signatory or signatories to sign such Acquisition Document(s) on its behalf,

Other documents
	1.2
	in respect of the Austrian Shares:

		(a)
	a notarial deed of transfer in the Agreed Form executed in the presence of an Austrian civil law notary by and between the Seller and the Purchaser;

		(b)
	application to the Austrian commercial register to register (a) the Purchaser as the new shareholder of the Austrian Target and (b) the deletion of the current directors and the appointment of the incoming (new) directors.

	1.3
	in respect of the German Shares:

		(a)
	the notarization of a German share transfer and assignment agreement in the Agreed Form by a German notary;

		(b)
	the filing of the new list of shareholder by the notarizing notary, which shows the Purchaser as new owner of the German Shares;

	1.4
	in relation to the Portuguese Company:

		(a)
	an executed short-form share purchase agreement in the Agreed Form in respect of the Portuguese Shares;

		(b)
	a shareholder’s resolution of the Portuguese Target aiming to (i) approve the amendment to article 3 of the Portuguese Target’s bylaws (providing identification of shareholder); (ii) accept the resignation of the Outgoing Directors and (iii) approve the appointment of incoming directors;

		(c)
	acceptance letter(s) of the incoming directors;

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		(d)
	Commercial Register application, including all required annexes, in respect of the transfer of Portuguese Shares, amendment of the bylaws and the resignation and appointment of directors;

	1.5
	in relation to the Italian Shares:

		(a)
	the Italian Notarial Deed to be executed by and between the Seller and the Purchaser and authenticated by an Italian notary public; and

		(b)
	filing by the notary public of the Italian Notarial Deed with the relevant Companies’ Register (which may also occur after Closing);

being it understood, acknowledged and agreed that the Italian Notarial Deed will not amend or novate this Agreement in any way and that, in case of conflicts between this Agreement and the Italian Notarial Deed, this Agreement shall prevail;
	1.6
	in respect of the Spanish Shares:

		(a)
	the Purchaser shall appear duly represented (with notarized and apostilled powers of attorney) in order to execute a notarial deed of transfer of the Spanish Shares in the presence of a Spanish civil law notary (in Madrid);

		(b)
	the Purchaser shall grant a public deed in respect of the Spanish Target’s ultimate beneficial owner;

		(c)
	execute a notarial deed in order to acknowledge the change of sole shareholder of the Spanish Target;

		(d)
	a public deed raising into public status the certificate of acknowledging the resignation of the joint directors, the appointment of the new directors of the Spanish Target and the change of the corporate name of the Spanish Target;

	1.7
	in relation to the Swiss Share:

		(a)
	an executed quota assignment agreement in the Agreed Form executed in wet ink by the Purchaser in respect of the Swiss Share;

		(b)
	beneficial owner notification in respect of the Swiss Share in the Agreed Form executed in wet ink by the Purchaser and delivered to the Seller acting on behalf of the Swiss Target;

		(c)
	Commercial Register application, including all required annexes, in respect of the board changes of the Swiss Target, executed in wet ink by the board members of the Swiss Target newly elected at Completion (thus constituting combined, written acceptance declarations, notarized and apostilled signature specimens and a circular resolution on the board constitution and granting of signature rights); and

		(d)
	procure original executed annexes to the Commercial Register application of the Swiss Target as required for (i) the new board members, and (ii) proof of the incorporation and good standing of the Purchaser (i.e., a notarised and apostilled UK Companies House extract of the Purchaser);

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	1.8
	Tax reference numbers (E-stamping number) of the Purchaser in respect of the transfer of the Irish Shares for the purpose of relevant stamp duty filings;

	1.9
	a copy of the W&I Policy;

	1.10
	the Disclosure Letter duly executed by the Purchaser; and

	1.11
	indemnity letters in favour of the Outgoing Directors of the Italian Target in the Agreed Form.

	2.
	Payment on account of the Consideration

	2.1
	The Purchaser shall pay the Completion Payment in cash in accordance with clause 19.

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SCHEDULE 5: COMPLETION STATEMENTS
Part 1:  General
	1.
	Contents

The Completion Statements shall comprise:
	1.1
	a statement of the Cash, Debt and Actual Working Capital in the form and including the items set out in part 3; and

	1.2
	a statement of the Intra-Group Debt detailing, for each amount owing, the payer, payee and a breakdown of the sum due,

in each case as at the Effective Time.
	2.
	Bases of preparation

The Completion Statements shall be prepared:
	2.1
	as at the Effective Time; and

	2.2
	in accordance with the following:

		(a)
	the specific accounting policies, principles, estimation techniques, measurement bases, practices, procedures and rules set out in part 4;

		(b)
	to the extent not covered by paragraph 2.2(a) the accounting policies, principles, estimation techniques, measurement bases, practices and procedures used by the Group Companies in the preparation of the Latest Financial Information on a consistent basis, to the extent not inconsistent with accounting standards detailed in paragraph 2.2(c); and

		(c)
	to the extent not covered by paragraphs 2.2 (a) or 2.2 (b), US GAAP  at the Accounts Date and applying to the relevant Group Company.

	3.
	Submission of Draft Completion Statements

The Seller shall procure the preparation and submission to the Purchaser of a draft of the Completion Statements in accordance with the provisions of this schedule 4 ("Draft Completion Statements") within 60 Business Days of Completion.
	4.
	Agreement or determination of Draft Completion Statements

	4.1
	Within 45 Business Days of receipt of the Draft Completion Statements ("Response Period"), the Purchaser may give notice to the Seller either:

		(a)
	disputing the Draft Completion Statements (a "Dispute Notice"), stating:

		(i)
	the item or items in dispute;

		(ii)
	the reasons for such dispute; and

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		(iii)
	(to the extent then reasonably practicable) details of its proposed adjustments to the Draft Completion Statements; or

		(b)
	confirming to the Seller in writing its acceptance of the Draft Completion Statements.

	4.2
	If the Purchaser does not give a Dispute Notice within the Response Period, then the Draft Completion Statements shall constitute the agreed Completion Statements.

	4.3
	If a Dispute Notice is given within the Response Period:

		(a)
	the Purchaser and the Seller shall endeavour to agree the Draft Completion Statements in good faith and, failing such agreement in writing within fifteen (15) Business Days of receipt of the Dispute Notice (or such later date as may be agreed in writing between the Purchaser and the Seller), any item or items which then remain in dispute shall be referred for determination by an Expert in accordance with the provisions of part 2 on the written request of either the Purchaser or the Seller; and

		(b)
	the Draft Completion Statements adjusted, where applicable, to reflect any modifications agreed in writing between the Purchaser and the Seller and the Expert's determination pursuant to part 2, shall constitute the Completion Statements.

	4.4
	The Completion Statements as constituted pursuant to paragraph 4.2 or 4.3(b) shall be final and binding on the parties for the purposes of this agreement.

	5.
	Records, etc

The Purchaser shall procure that each Group Company provides the Seller and its representatives with reasonable access during normal business hours to its accounting records and personnel to facilitate the review and agreement or other determination of the Completion Statements.
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Part 2: Expert determination
	1.
	Appointment of Expert

	1.1
	An "Expert" is an individual at a firm of chartered accountants in England (who and which are independent of the parties):

		(a)
	agreed by the Purchaser and the Seller in writing; or

		(b)
	in default of agreement within five (5) Business Days of the date of either the Purchaser or the Seller serving on the other details of its suggested Expert or Experts, nominated by the President of the Institute of Chartered Accountants in England and Wales on the application at any time of either the Purchaser or the Seller.

	1.2
	Any firm proposed or nominated to provide an Expert shall be required to declare in writing any current and past associations of such firm and its proposed Expert with any party or its group before appointment to establish their independence.

	1.3
	The Expert shall be jointly appointed by the Purchaser and the Seller and shall act as an expert and not as an arbitrator.

	1.4
	Each of the Purchaser and the Seller agrees to:

		(a)
	use its reasonable endeavours to appoint the Expert expeditiously following a written request to do so from the other and to agree the terms of engagement for the Expert within ten (10) Business Days of the Expert's selection or nomination;

		(b)
	not unreasonably (having regard to the provisions of this part 2) refuse its agreement to any terms of engagement proposed by the Expert (which may include a limitation on his liability at a level consistent with market practice at the relevant time) or each other; and

		(c)
	instruct the Expert to deliver his determination within twenty (20) Business Days of his appointment.

	2.
	Procedure

	2.1
	Within 10 Business Days of his appointment, the Purchaser and the Seller shall each provide the Expert with a written statement detailing the remaining disputed item or items, its submission in relation to each item and the adjustments (if any) it proposes to the Draft Completion Statements, together with copies of any supporting documents.  The Expert shall afford the Seller and the Purchaser the opportunity within reasonable time limits to make written representations to him on the written statement and representations of the other and each of the Purchaser and the Seller shall receive a copy of the other’s written statement at the same time.

	2.2
	The Purchaser and the Seller shall each provide (or, to the extent it is reasonably able, procure that others provide) the Expert with such other documents, information and assistance (including the right to inspect such documents, records and materials held by it or under its control) as the Expert reasonably requires for the purpose of making his determination.  For the avoidance of doubt, neither the Purchaser nor the Seller shall be obliged to provide the Expert with auditors' working papers or any information or documents prepared by it or its advisers with a view to assessing the merits of any argument on any item in dispute.

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	2.3
	Following submission of the written statements pursuant to paragraph 2.1 above, the Purchaser and the Seller shall supply each other with a copy of anything provided by it or on its behalf to the Expert pursuant to this part 2 at the same time as it is provided to the Expert.

	2.4
	All matters relating to the Expert's determination shall be kept confidential by the parties and the Expert.

	3.
	Determination of Expert

	3.1
	The Expert shall:

		(a)
	conduct and deliver his determination in the English language;

		(b)
	be entitled to obtain such independent legal or other professional advice as he may reasonably require in making his determination;

		(c)
	to the extent not provided for in or inconsistent with this part 2, determine the procedure to be followed but shall otherwise be directed to apply the provisions of this schedule 5 in making his determination, unless otherwise agreed by each of the Seller and the Purchaser in writing;

		(d)
	make his determination on the remaining disputed items within in the range between the amounts proposed by the Seller and the Purchaser;

		(e)
	determine on the basis of all information, documents and materials before him what adjustments (if any) are in his opinion necessary to the amounts shown by the Draft Completion Statements in respect of each of the disputed items referred to him in order to comply with the provisions of this agreement; and

		(f)
	notify the Purchaser and the Seller of his determination in writing (without reasons) as soon as practicable.

	3.2
	The Expert's determination shall be final and binding on the parties except when there is fraud or manifest error. On the Expert's determination, the Draft Completion Statements shall be adjusted (if required) to reflect the disputed items as so determined.

	3.3
	The Expert's fees and expenses (including the costs of his nomination and any fees and expenses of any professional advisers appointed by him) shall be borne as determined by the Expert (having regard to the merits of the parties' submissions), failing which, borne equally by the Purchaser and the Seller.

	4.
	Substitute or replacement Expert

If the Expert dies or becomes unwilling to act or incapable of acting, then the Purchaser and the Seller shall:
	4.1
	accept any substitute Expert reasonably nominated by the firm engaged by them following a written request to such firm to do so from either the Purchaser or the Seller; or

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	4.2
	if no substitute is nominated within five Business Days of such request, promptly discharge the original Expert and appoint a replacement expeditiously, and this part 2 shall apply to the replacement Expert as if he were the first Expert appointed.

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Part 3: Pro formas
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Part 4: Specific bases of preparation
	1.
	Calculation of Cash

All amounts held in the form of cash (if any) which comprise the proceeds of any insurance claim in respect of the destruction of, or damage to, assets of any Group Company, to the extent that such entity would need to apply it towards the replacement or repair of the insured asset in order to be able to continue to use or earn income from the asset or its replacement in the manner in which it did so during its period of ownership shall be excluded when calculating Cash.
Fifty per cent of any cash amount which, as at the date of this Agreement, is held by or on behalf of any member of the Seller’s Group (or which is replaced on or around Completion by cash from a member of the Purchaser Group)  as collateral for any letters of credit provided pursuant to the Seller Guarantees Facility prior to the Effective Time, will be included as a current liability in the calculation of Working Capital in the Completion Statements.
Any Restricted Cash which is held in any account of a Group Company as collateral for any letter of credit shall be allocated to Working Capital as a net current asset in the Completion Statements.
	2.
	Deferred taxes shall be excluded from the Completion Statements.

	3.
	CEPS

To the extent that the CEPS Matter has not been finally resolved at the date of the Completion Statements a provision of $42,800,000 (forty two million eight hundred thousand US dollars) shall be included within Debt in respect of the CEPS Matter and no further provision will be included in the Completion Statements in respect of the CEPS Matter.
	4.
	Inventory valuation

Inventory will be valued at external cost, excluding any internal pricing mark-up applied by the Seller Group for transfer pricing purposes. For the avoidance of doubt, the inventory balances of the Canadian Target and the Swiss Target as at Effective Time, will be allocated to ‘Other’ in the Completion Statements. Inventory shall include the Stock transferred under the BTA.
	5.
	Vesting of share options

The Completion Statements will include a liability within Debt, for any expected future outflow arising in any Group Company as a result of the accelerated vesting of RSU’s or stock option or other equity awards pursuant to any plan operated by the Seller, including any Taxes and social security costs payable thereon save to the extent that the terms of such options, RSU’s or equity awards provide for such Taxes and social security costs to be borne by the relevant employee.
	6.
	Provisions against trade receivables

A provision of 1 per cent of all gross trade receivables shall be included in the Completion Statements.  In addition, a further provision shall be included in respect of any trade receivable where evidence exists that such trade receivable is not expected to be received.
	7.
	Transfer Pricing tax liabilities

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A liability of $1 million shall be included in the Completion Statements, as Debt, in respect of potential Tax Liabilities which may arise in respect of the matters disclosed at paragraph 34.1 of the Disclosure Letter.
	8.
	General

The balance sheets in relation to each of the Group Company balance sheets reflected in the Completion Statements shall be prepared with the same degree of care and attention, using those procedures that would customarily be adopted for statutory accounts prepared at a financial year end.
The provisions of this Schedule 5, Part 4 shall be interpreted so as to avoid double counting (whether positive or negative) of any item to be included in the Completion Statements and no minimum materiality limits and thresholds shall be applied in calculating any amounts included in the Completion Statements.
The Completion Statements will include within Working Capital Advance Receipts and Advance Payments (as defined in the BTA) as a relevant net current asset or net current liability as appropriate.
The Completion Statements will include within Working Capital accounts payable which are transferred pursuant to the BTA as a relevant net current liability.
A corporate income tax provision shall be included in the Completion Statements in respect of the period between Accounts Date and the Effective Time as if this were a normal financial accounting period. Any corporate tax provisions outstanding for any prior periods shall also be included in the Completion Statements.
The Completion Statements shall reflect events occurring after the Effective Time but before the date on which the Draft Completion Statements are delivered to the Purchaser to the extent that these provide additional evidence of conditions that existed at the Effective Time.
For the avoidance of doubt the Completion Statements shall not include any amount in respect of deferred tax (whether as a liability or an asset).
The Completion Statements shall be expressed in US$. Any amounts which are to be included in any such calculation which are expressed in a currency other than dollars shall be converted into dollars at the closing midpoint spot rate for a transaction between the relevant currency and dollars as quoted by Barclays Bank Plc as at the close of business Completion Date.
Fixed Assets will be allocated to column “Other” in the Completion Statements.
Prepayments and Advance Payments shall only be included in the Completion Statements, within Actual Working Capital, to the extent goods and services in respect of such prepayments are receivable and will provide a benefit to any Group Company after Effective Time.
For the avoidance of doubt, the Completion Statements shall include, within Actual Working Capital, any unpaid outstanding amounts in respect of audit and accountancy fees, together with an accrual for all audit and accountancy fees relating to the period prior to Completion by pro rating the forecast cost for the year ended on 31 December 2022 (which shall be assumed equal to the total cost incurred in respect of the year ended 31 December 2021).
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The Completion Statements shall not release accruals or provisions included in the Latest Financial Information unless they have been utilised (but not released) before the Effective Time.
The Completion Statements shall include, within Debt, a full provision for any redundancies  announced prior to the Effective Time but which are not yet effective.
A provision for any unsettled employee claims as at Effective Time, will be included in the  Completion Statements, within Debt. For the avoidance of doubt, the value of any such provision will not take into account any insurance claim proceeds which may or may not be receivable as at the Effective Time.
A liability will be included in the Completion Statements, within Debt, for any unsettled transaction costs, and transaction bonuses (including any irrecoverable Tax thereon) associated with the  transaction contemplated by this agreement, and payable by any Group Company.
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SCHEDULE 6:  TAX COVENANT
	1.
	Definitions

	1.1
	"Accounts Relief" means a Relief which has been:

		(a)
	treated as an asset in the Completion Statements; and/or

		(b)
	taken into account in computing (and reducing) any provision for Tax (including deferred Tax) which appears in the Completion Statements or which has resulted in no provision for Tax (including deferred Tax) being made in the Completion Statements;

"Actual Tax Liability" means any liability of a Group Company to make an actual payment of or in respect of, or on account of, Tax, whether or not the same is primarily payable by a Group Company and whether or not the Group Company has or may have any right of reimbursement against any other person, in which case the amount of the Actual Tax Liability will be the amount of the actual payment;
"Purchaser’s Relief" means:
		(a)
	an Accounts Relief;

		(b)
	any Relief arising to a Group Company:

		(i)
	as a consequence of, in relation to or in connection with any Event occurring, or

		(ii)
	from, in relation to or in connection with income, profits or gains earned, accrued or received,

after Completion; and/or
		(c)
	any Relief arising to any member of the Purchaser Group (other than a Group Company);

"Deemed Tax Liability" means:
		(a)
	the Loss of an Accounts Relief, and the amount of the Tax Liability will be:

		(i)
	where the Relief was a right to repayment of Tax or to a payment in respect of Tax, the amount of the repayment or payment;

		(ii)
	in any other case, the amount of Tax which would have been saved on the basis of the Tax rates current at Completion (assuming for this purpose that relevant Group Company had sufficient profits or was otherwise in a position to use the Relief); and/or

		(b)
	the use or setting-off of any Purchaser’s Relief where, but for that set-off or use, the Seller would have had a liability to make a payment to the Purchaser under this Schedule and/or the agreement (ignoring any financial limitations or restrictions), and the amount of the Tax Liability will be the amount of Tax for which the Seller would have been liable but for such use or set-off;

"Event" means any transaction, act, failure to act, event or omission whatsoever, whether or not a Group Company is a party to the transaction, act, failure to act, event or omission, and any reference to an Event occurring on or before a particular date shall include an Event which for Tax purposes is deemed to have, or is treated or regarded as having, occurred on or before that date;
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"Loss" includes absence, failure to obtain, non-existence, non-availability, reduction, modification, loss, counteraction, nullification, utilisation, disallowance, withdrawal or clawback for whatever reason; and
"Tax Liability" means an Actual Tax Liability or a Deemed Tax Liability.
	1.2
	In this Schedule, a reference to a statutory provision includes a reference to the statutory provision as modified or re-enacted or both from time to time whether before or after the date of this Schedule and any subordinate legislation made under the statutory provision whether before or after the date of this Schedule.

	1.3
	Each of the covenants contained in paragraph 2 shall be construed as a separate and independent covenant and shall not be limited or restricted by reference to or inference from any other covenant contained in paragraph 2.

	1.4
	References to a repayment of Tax shall include any repayment supplement or interest in respect of it.

	1.5
	Any stamp duty charged on any document (or in the case of a document that is outside the UK, any stamp duty that would be charged on the document if it were brought into the UK) that is necessary to establish the title of any Group Company to any asset or which a Group Company may wish to rely upon for the purposes of any litigation in which a Group Company is or is reasonably likely to be involved or in connection with any Tax matter, and any interest, fine or penalty relating to the stamp duty, shall be deemed to be a liability of such Group Company to make an actual payment of Tax because of an Event arising on the last day on which it would have been necessary to pay the stamp duty to avoid any liability to interest or penalties arising on it.

	1.6
	Any reference to gross receipts, income, profits or gains earned, accrued or received on or before a particular date or in respect of a particular period shall include gross receipts, income, profits or gains deemed, treated or regarded to have been earned, accrued or received on or before that date or in respect of that period for the purposes of any Taxation.

	1.7
	Any word or expression defined in the agreement shall, save as otherwise defined or as the context may otherwise require in this Schedule, have the same meaning in this Schedule.

	2.
	Covenant

	2.1
	The Seller covenants to pay to the Purchaser (as far as possible, as an adjustment to the Consideration) an amount equal to:

		(a)
	any Actual Tax Liability arising in respect of, by reference to or in consequence of: (i) an Event which occurred, or was deemed to occur, on or before Completion; or (ii) any income, profits or gains which were earned, accrued or received on or before Completion;

		(b)
	any Deemed Tax Liability;

		(c)
	any Tax Liability that arises to a Group Company, or any member of the Purchaser  Group due to the relationship for Tax purposes before Completion of a Group Company with any person (other than another Group Company or any other member of the Purchaser Group), whether arising before or after Completion;

		(d)
	any liability of a Group Company arising from an obligation to repay the whole or any part of any payment received for any surrender or transfer of any Relief pursuant to an arrangement entered into by a Group Company on or before Completion;

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89

		(e)
	any amount paid (or payable to the extent it is not yet actually paid) by a Group Company for a surrender or transfer to it of any Relief in respect of any period ended on or prior to Completion to the extent that such Relief is lost, cancelled or disallowed or otherwise proves to be unavailable to set off against income, profits or gains or Tax for the period in respect of which the surrender is made;

		(f)
	any liability of a Group Company to pay or account for income Tax under any withholding regime or payroll system or national insurance/social security contributions (in each case together with any related interest and/or penalties) which arises at any time as a result of, in consequence of or in connection with the remuneration paid, or otherwise referable to any period, prior to Completion of any person engaged by a Group Company, whether engaged by a Group Company as an employee or office-holder or otherwise (including through a personal services company and/or agency);

		(g)
	any Tax Liability of a Group Company relating to employment taxes or social security contributions in respect of the grant, exercise, surrender, exchange or other disposal of an option or other right to acquire securities, or in respect of any acquisition, holding, variation or disposal of securities, where the acquisition of the security or the grant of the option, or other right to acquire the security occurred on or before Completion;

		(h)
	any Tax Liability relating to, in connection with, or arising (in respect of a period or part-period ending on or before Completion) as a result of any Group Company entering into any transaction or arrangement prior to Completion otherwise than on arm's length terms and/or the lack of documentation relating to the processes by which prices and terms have been arrived at for any transaction or arrangement entered into by a Group Company;

		(i)
	any Tax Liability relating to, in connection with, or arising as a result of any Group Company entering into any transaction or arrangement relating to IP with IPEL prior to Completion, but only to the extent such Tax Liability arises as a result of an Event occurring or income, profits or gains earned, accrued or received by a Group Company on or before Completion;

		(j)
	any Tax Liability relating to, in connection with or arising as a result of the offset in 2011 and 2012 of the R&D tax credit related to activities carried out by Intercept Italia S.r.l; and

		(k)
	any reasonable liabilities, losses and costs incurred by the Purchaser, any member of the Purchaser Group and/or a Group Company in connection with any claim or in connection with any action taken in taking defending or settling any action in respect of a claim under this Schedule.

	3.
	Exclusions

	3.1
	The covenant at paragraph ‎2 does not apply in respect of any Tax Liability of a Group Company if and to the extent that:

		(a)
	a specific provision, accrual, allowance or reserve for the Tax Liability has been made in the Completion Statements;

		(b)
	the Tax Liability or other liability arises or is increased as a result of:

		(i)
	a change in Tax rates or in law; or

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		(ii)
	a change or withdrawal of any published practice, concession or interpretation of any Tax Authority;

in each case both announced and with effect after Completion;
		(c)
	such Tax Liability has been discharged, or the relevant Group Company has been compensated for such Tax Liability (by any person other than the Purchaser and/or any member of the Purchaser Group), in each case without cost to the relevant Group Company, the Purchaser and/or any member of the Purchaser Group.

	4.
	Payment of Claims

	4.1
	Any sums required to be paid by the Seller under this schedule shall be paid (in cleared funds):

		(a)
	in respect of an Actual Tax Liability, on the later of:

		(i)
	the date five Business Days after the date on which the Seller receives written notice of the amount of the Tax Liability from the Purchaser; and

		(ii)
	the date five Business Days before the date on which the relevant Group Company will finally be liable to pay the Tax without incurring a liability to interest and/or penalties (or would have been liable to pay the Tax but for the availability of some other Relief);

		(b)
	in respect of a Deemed Tax Liability, on the later of:

		(i)
	the date five Business Days after the date on which the Seller  receives written notice of the amount of the Tax Liability from the Purchaser;

		(ii)
	five Business Days before the date on which the relevant Group Company is due to pay any Tax without incurring a liability to interest and/or penalties which it would not have had to pay but for the loss or settling off of an Accounts Relief or, where the loss of an Accounts Relief is the loss of a repayment of Tax, the date on which such repayment would otherwise have been due; or

		(iii)
	five Business Days before the date on which the relevant Group Company would have had to pay the Tax without incurring a liability to interest and/or penalties but for the setting off of a Purchaser’s Relief; and

		(c)
	for anything else, on the date five Business Days following the date on which written notice of the amount due is received by the Seller from the Purchaser.

	5.
	Miscellaneous

	5.1
	Any sum payable under or pursuant to this Schedule is (unless expressly stated otherwise) exclusive of any applicable VAT. If any supply is treated as made for VAT purposes by one party (the "Supplier") to the other party (the "Recipient") under or pursuant to this Schedule and the Supplier (or the representative member of any VAT group of which it is a member) is required to account for VAT in respect of that supply then, unless expressly stated otherwise, the Recipient shall, subject to the receipt of a valid VAT invoice, pay to the Supplier (in addition to, and at the same time as, any other consideration for that supply) an amount equal to such VAT.

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91

	5.2
	Where under the terms of this schedule one party is liable to indemnify or reimburse another party (the "Payee") in respect of costs, charges or expenses, the payment shall include an amount equal to any VAT thereon.

	5.3
	The Seller shall (and shall procure that any other member of the Seller Group) provide (at the cost of the Purchaser) to the Purchaser, any Group Company and/or any relevant professional advisers such information, documentation and/or assistance as the Purchaser might reasonably require to assist the Purchaser and/or any Group Company in dealing with the pre-Completion Tax affairs of any Group Company.

	5.4
	The Purchaser shall (and shall procure that the Group Companies shall) provide (at the cost of the Seller) to the Seller and/or any relevant professional advisers such information, documentation and/or assistance as the Seller might reasonably require to assist the Seller and/or any member of the Seller Group in dealing with their Tax affair

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	Signed for and on behalf of MERCURY
	)
		​

	PHARMA GROUP LIMITED by:
	)
	Signature
	  /s/ Andreas Stickler

	​
	​
	​
	​

	​
	​
	Name (block capitals)
	  ANDREAS STICKLER

	​
	​
	​
	  Authorised signatory

​
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​
	

	

	

	

	Signed for and on behalf of INTERCEPT 
	)
		
	PHARMACEUTICALS, INC. by:
	)
	Signature
	  /s/ Andrew Saik

	​
	​
	​
	​

	​
	​
	Name (block capitals)
	  ANDREW SAIK 

	​
	​
	​
	  Authorised signatory

​

[ Signature Page to SPA ]Exhibit 10.2

​
[Certain identified information has been excluded from the exhibit because it is both not material and is the
type that the registrant treats as private or confidential.]
​
SUBLICENSE AGREEMENT
BY AND BETWEEN
INTERCEPT PHARMA EUROPE LTD.
AND
MERCURY PHARMA GROUP LIMITED
EXECUTED AS OF MAY 5, 2022
​
​

​

​
	​

	​

	​

	​

	ARTICLE 1

	DEFINITIONS

	1

	ARTICLE 2

	LICENSES AND OTHER RIGHTS

	13

	2.1
	Grant of License to Licensee
	13

	2.2
	Grant of Sublicense by Licensee
	13

	2.3
	Retained Rights
	14

	2.4
	Grant of License to Licensor
	15

	2.5
	Data Transfer
	16

	2.6
	No Implied License
	16

	ARTICLE 3

	JOINT STEERING COMMITTEE

	16

	3.1
	Formation
	16

	3.2
	JSC Functions and Powers
	17

	3.3
	JSC Decision Making
	18

	3.4
	Disputed JSC Matter
	19

	3.5
	Termination of JSC
	20

	ARTICLE 4

	DEVELOPMENT AND REGULATORY AFFAIRS

	20

	4.1
	Licensee Development
	20

	4.2
	Licensor Development
	21

	4.3
	Regulatory
	23

	ARTICLE 5

	COMMERCIALIZATION

	24

	5.1
	Commercialization Generally
	24

	5.2
	Licensed Product Statements and Promotional Materials
	24

	ARTICLE 6

	MANUFACTURING

	25

	6.1
	Supply of the Licensed Products
	25

	6.2
	Manufacture by Licensee
	25

	6.3
	Finished Product Packaging and Labeling
	25

	ARTICLE 7

	FINANCIALS

	25

	7.1
	Upfront Payment
	25

	7.2
	Royalty
	25

	7.3
	Sublicensee Income
	25

	7.4
	Exclusivity Extension
	26

	7.5
	Mode of Payment and Currency
	27

	7.6
	Royalty and Sublicensee Income Reports
	27

	7.7
	Late Payments
	27

	7.8
	Default Payment
	27

	7.9
	Accounting
	27

	7.10
	Books and Records
	27

	7.11
	Audits
	27

	7.12
	Taxes
	28

	ARTICLE 8

	INTELLECTUAL PROPERTY

	29

	8.1
	Ownership of Intellectual Property
	29

	8.2
	Patent Filing Prosecution and Maintenance
	31

	8.3
	Actions Regarding Licensed IP and Joint IP
	32

	8.4
	Enforcement of Licensee Technology
	33

	8.5
	Patent Marking
	33

​

​

​

​
	​

	​

	​

	​

	8.6

	Patent Term Extensions

	33

	ARTICLE 9

	CONFIDENTIALITY AND PUBLICATIONS

	34

	9.1
	Confidentiality
	34

	9.2
	Publicity
	35

	9.3
	Publications
	35

	ARTICLE 10

	REPRESENTATIONS, WARRANTIES AND COVENANTS

	35

	10.1
	Mutual Representations and Warranties
	35

	10.2
	Representations and Warranties of Licensor
	36

	10.3
	Representations and Warranties of Licensee
	36

	10.4
	Disclaimer of Representations and Warranties
	36

	10.5
	Covenants
	37

	ARTICLE 11

	INDEMNIFICATION; INSURANCE AND LIMITATION OF LIABILITY

	38

	11.1
	Indemnification by Licensor
	38

	11.2
	Indemnification by Licensee
	38

	11.3
	Indemnification Procedure
	39

	11.4
	Indemnification Settlement
	39

	11.5
	Insurance
	39

	11.6
	Limitation of Liability
	40

	ARTICLE 12

	TERM AND SURVIVAL

	40

	12.1
	Term
	40

	12.2
	Licensor Rights of Termination for the NASH Product
	41

	12.3
	Licensee Rights of Termination for the NASH Product
	41

	12.4
	Effects of Termination
	41

	12.5
	Survival
	42

	12.6
	Rights in Bankruptcy
	42

	ARTICLE 13

	DISPUTE RESOLUTION; GOVERNING LAW

	43

	13.1
	Executive Officers
	43

	13.2
	Governing Law and Venue
	43

	13.3
	Injunctive Relief
	43

	ARTICLE 14

	MISCELLANEOUS

	43

	14.1
	Force Majeure
	43

	14.2
	Notices
	44

	14.3
	Independent Status
	44

	14.4
	Entire Agreement; Amendment and Waiver
	44

	14.5
	Headings; Construction; Certain Conventions
	44

	14.6
	Assignment
	45

	14.7
	Third Party Beneficiaries
	45

	14.8
	Severability
	45

	14.9
	Further Assurances
	45

	14.10
	Translation
	45

	14.11
	Other Obligations
	46

	14.12
	Counterparts
	46

​
​

​

​

​
SCHEDULES
Schedule 1.39 – Licensed Patents
Schedule 4.2.1(a) – Post-Marketing Work
Schedule 4.2.1(b) - Budget
​
​

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​
SUBLICENSE AGREEMENT
THIS SUBLICENSE AGREEMENT (this “Agreement”), executed as of the 5th day of May, 2022 (the “Execution Date”) and effective as of the Completion Date (as defined below) (the “Effective Date”), is made by and between Intercept Pharma Europe Ltd., a UK limited corporation (“Licensor”), and Mercury Pharma Group Limited, a company incorporated in England with number 02330913 which has its registered office at Capital House, 85 King William Street, London, EC4N 7BL (“Licensee”).  Licensor and Licensee may be referred to herein as a “Party” or, collectively, as “Parties”.
RECITALS
WHEREAS, Intercept Pharmaceuticals, Inc. (“Intercept”) is a clinical stage biopharmaceutical company engaged in the development of therapeutic products for the treatment of progressive non-viral liver diseases, and Intercept Controls (as defined below) certain intellectual property rights in the active pharmaceutical ingredient obeticoholic acid (“OCA”) for therapeutic use in connection with primary biliary cholangitis (“PBC”) and nonalcoholic steatohepatitis (“NASH”);
WHEREAS, Intercept granted a license to such intellectual property rights to Licensor, Intercept’s subsidiary, pursuant to the terms of that certain License Agreement dated and effective as of May 22, 2015 (the “License Agreement”);
WHEREAS, Intercept and Licensee are entering into that certain Share Purchase Agreement as of the Execution Date whereby, upon the Completion Date, Licensee shall acquire the business of certain non-US subsidiaries of Intercept (the “Share Purchase Agreement”);
WHEREAS, pursuant to the Share Purchase Agreement, Intercept has agreed to Licensor entering into this Agreement to grant a sublicense to Licensee of certain rights to Intercept’s product Ocaliva®, a therapeutic product with OCA as its sole Active Pharmaceutical Ingredient (as defined below) that is commercially sold for the treatment of PBC (“Ocaliva”), and rights to Licensor’s OCA product being developed for the treatment of NASH; and
WHEREAS, Licensee desires to obtain, and Licensor is willing to grant, such rights pursuant to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the various promises and undertakings set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby agree as follows:
ARTICLE 1
DEFINITIONS
Unless otherwise specifically provided herein, the following terms shall have the following meanings:
1.1“Active Pharmaceutical Ingredient” means any substance that is used in a pharmaceutical product that when used becomes an active pharmaceutical ingredient of that product and exerts a pharmacological, immunological or metabolic action with a view to restoring, correcting or modifying physiological functions and such substance has an effect on the price of such pharmaceutical product (excluding formulation components such as coatings, stabilizers, excipients, solvents or adjuvants).
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1.2“Adverse Risk” means any risk of a material adverse effect on the Development, procurement or maintenance of Regulatory Approval, Manufacture or Commercialization of the applicable Licensed Product(s), including, without limitation, safety-related matters with respect to the applicable Licensed Product(s).
1.3“Affiliate” means a Person that controls, is controlled by or is under common control with a Party, but only for so long as such control exists.  For the purposes of this Section 1.3, the word “control” (including, with correlative meaning, the terms “controlled by” or “under common control with”) means the actual power, either directly or indirectly through one or more intermediaries, to direct the management and policies of such Person, whether by the ownership of more than fifty percent (50%) of the voting stock of such Person, or by contract or otherwise.
1.4“Anti-Corruption Laws” means laws, regulations, or orders prohibiting the provision of a financial or other advantage for a corrupt purpose or otherwise in connection with the improper performance of a relevant function, including without limitation, the Corruption of Foreign Public Officials Act (CFPOA), the US Foreign Corrupt Practices Act (FCPA), the UK Bribery Act 2010, and similar laws governing corruption and bribery, whether public, commercial or both, to the extent applicable.
1.5“Applicable Laws” means all applicable common law, statutes, ordinances, rules, regulations, guidances and orders of any Governmental Body.
1.6“Authorized Or Other Generic Entry” means, with respect to a country, the first commercial sale in such country of any product that has regulatory approval for use in such country pursuant to a regulatory process governing the approval of generic products where such regulatory approval relied on or incorporated data submitted to any Regulatory Authority generated by or on behalf of Licensor or its Affiliates or licensees, or was obtained using an abbreviated, expedited, or other similar regulatory process, including that is the subject of a license grant by Licensor, its Affiliates or licensees granting the right to sell such product in the jurisdiction.
1.7“BTA” means the business transfer agreement of even date entered into between the Licensor and Advanz Pharma Services (UK) Limited relating to the transfer of the business and related assets of the Licensor relating to the importing, offering for sale, commercializing, registering, holding or keeping exporting, transporting, distributing, promoting, packaging, labelling marketing and sale of the Licensed Product outside of the US.
1.8“Business Day” means any Monday, Tuesday, Wednesday, Thursday or Friday that is not a day on which banking institutions in the State of New York are explicitly authorized or required by, in either case, law, regulation or executive order to close.
1.9“Calendar Quarter” means the respective periods of three (3) consecutive calendar months ending on March 31, June 30, September 30 and December 31 of each Calendar Year.
1.10“Calendar Year” means each successive period of twelve (12) months commencing on January 1 and ending on December 31.
1.11“Challenge” will be interpreted as follows:  Licensee, its Affiliate or a Sublicensee (including sub-Sublicensees) will be deemed to have made a “Challenge” of the Licensed Patents if Licensee, such Affiliate or such Sublicensee (including sub-Sublicensees), respectively:  (a) institutes, voluntarily joins as a party to, causes its counsel to institute on Licensee’s or such Affiliate or Sublicensee’s (including sub-Sublicensees) behalf, or otherwise provides material support to, any
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​
interference, opposition, re-examination, post-grant review or similar proceeding with respect to any Licensed Patents with the US Patent and Trademark Office (“USPTO”) or similar foreign equivalent filing or request in any foreign patent office; or (b) makes any filing, institutes, voluntarily joins as a party or otherwise provides material support to any legal proceeding, or causes its counsel to make any filing or institute or voluntarily join as a party to any legal proceeding on Licensee’s or such Sublicensee’s (including sub-Sublicensees) behalf, with a court or other Governmental Body (including, without limitation, the USPTO or any foreign patent office) having authority to determine the validity, enforceability or scope of the Licensed Patents, in which one or more claims or allegations challenges the validity or enforceability of any Licensed Patents.
1.12“Clinical Trial” means a human clinical study, in which a Licensed Product is administered to human subjects, that is designed to (a) establish that a pharmaceutical product is reasonably safe for continued testing; (b) investigate the safety and efficacy of the pharmaceutical product for its intended use, and to define warnings, precautions and adverse reactions that may be associated with the pharmaceutical product in the dosage range to be prescribed; (c) support Regulatory Approval of such pharmaceutical product or label expansion of such pharmaceutical product; or (d) obtain or maintain marketing approval and for a purpose other than to obtain, support or maintain Regulatory Approval, including any and all post-marketing commitments.
1.13“Commercialization” means any and all activities of marketing, promoting, importing, exporting, distributing, offering for sale or selling the Licensed Products in the Field and in the Territory, including, for example, marketing, branding, pricing, distribution, Sales, obtaining health insurance reimbursement and formulary coverage, market research, business analytics, pharmacovigilance and medical affairs activities, pre-commercial launch market development activities conducted in anticipation of Regulatory Approval to sell or market the Licensed Products, product livery, labelling/summary of product characteristics, patient information leaflet, preparing advertising and promotional materials, sales force training, and all interactions and correspondence with a Regulatory Authority regarding Clinical Trials commenced following Regulatory Approval.  When used as a verb, “Commercialize” means to engage in Commercialization. “Commercialized” and “Commercializing” shall be construed accordingly.
1.14“Commercially Reasonable Efforts” means with respect to a Party, the use of reasonable, diligent, good faith efforts and resources consistent with the general practices followed by such Party for its own internally discovered technology of similar commercial potential and similar stage of development, taking into account efficacy, safety, patent and regulatory exclusivity, profitability, pricing and reimbursement, probability of Regulatory Approval and all other relevant factors reasonably determined by such Party to be relevant.  Without limiting the foregoing, Commercially Reasonable Efforts requires, with respect to such obligations, that the applicable Party applies resources and personnel to complete tasks or activities in connection with the Development or Commercialization, as applicable, of Licensed Products in a timely manner, including (a) promptly assigning responsibility for such obligation to specific employee(s) with appropriate experience and expertise, and reasonably monitoring the performance of such task or activity on an on-going basis, (b) setting and reasonably seeking to achieve the intended endpoints or outcomes of such task or activity, and (c) allocating resources designed to advance progress with respect to such objectives.
1.15“Confidential Information” means all secret, confidential or proprietary information or data, whether in written, oral, graphic, video, computer or other form, provided by one Party (the “Disclosing Party”) to the other Party (the “Receiving Party”) pursuant to this Agreement or generated pursuant to this Agreement, including information relating to the Disclosing Party’s existing or proposed research, development efforts, activities to commercialize, Patent applications, business or products and any other materials that have not been made available by the Disclosing Party to the general public.
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3

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Notwithstanding the foregoing sentences, Confidential Information shall not include any information or material that:
(a)was already known to the Receiving Party (other than under an obligation of confidentiality owed to the Disclosing Party), at the time of disclosure by the Disclosing Party;
(b)was generally available to the public or otherwise part of the public domain at the time of its disclosure to the Receiving Party;
(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;
(d)was subsequently disclosed to the Receiving Party by a Third Party who had no legal obligation to the Disclosing Party not to disclose such information to others;
(e)is independently discovered or developed by or on behalf of the Receiving Party without the use of the Confidential Information belonging to the other Party; or
(f)is approved for release by the Disclosing Party in writing.
1.16“Controlled” means, when used in reference to Technology, trademark rights or Patents, the ownership thereof, or the possession of the ability to grant licenses or sublicenses thereto, without violating the terms of any agreement or other arrangement with, or the rights of, any Third Party existing as of the date on which such license or sublicense is granted. “Control” shall be interpreted accordingly.
1.17“Damages” means all claims, threatened claims, damages, losses, suits, proceedings, liabilities, costs (including reasonable legal expenses, costs of litigation and reasonable attorney’s fees), or judgments, whether for money or equitable relief, of any kind and is not limited to matters asserted by Third Parties against a Party, but includes claims, threatened claims, damages, losses, suits, proceedings, liabilities, costs (including reasonable legal expenses, costs of litigation and reasonable attorney’s fees) or judgments incurred or sustained by a Party in the absence of Third Party claims; provided, however, that no party shall be liable to hold harmless or indemnify the applicable indemnified party, as applicable, for any claims, threatened claims, damages, losses, suits, proceedings, liabilities, costs or judgments for punitive or exemplary damages, except to the extent the Party seeking indemnification is actually liable to a Third Party for such punitive or exemplary damages in connection with a claim by such Third Party.
1.18“Data” shall mean all data and information generated, collected or filed, in connection with the conduct of research and development activities relating to a Licensed Product in the Field in the Territory, including toxicology data, pharmacological data, biomarker data, bioanalytical data, non-clinical reports, clinical reports, single patient clinical report forms, data points and the databases, and stability data, chemical data, quality control data (excluding the closed portion of any drug mater file), marketing data, pharmaco-economic data, branding and naming research reports, assays, study designs, protocols, specifications, and all CMC data (including CMC (chemistry, manufacturing and control) development reports).
1.19“Development” means all activities related to research, preclinical development efforts, test method development and stability testing, assay development, toxicology, formulation, process development, formulation development, delivery system development, quality assurance and quality control development, statistical analysis, clinical pharmacology, clinical studies (including Clinical Trials) and clinical study regulatory activities, seeking Regulatory Approval and otherwise handling regulatory
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4

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​
affairs, statistical analysis and reporting writing with respect to the Licensed Products.  Development shall not include Manufacturing or Commercialization.  When used as a verb, “Develop” means to engage in Development. “Developing” shall be construed accordingly.
1.20“EMA” means the European Medicines Agency and any successor entity thereto.
1.21“EU Sales Territory” means any member state of the European Union.
1.22“Executive Officers” means each Party’s respective Chief Medical Officer.
1.23“FD&C Act” means the United States Federal Food, Drug and Cosmetic Act, as amended.
1.24“FDA” means the United States Food and Drug Administration and any successor entity thereto.
1.25“Field” means any and all uses in humans and animals.
1.26“First Commercial Sale” means the date of the first Sale of the NASH Product.
1.27“Force Majeure” means any occurrence beyond the reasonable control of a Party that prevents or substantially interferes with the performance by the Party of any of its obligations hereunder, if such occurs by reason of any act of God, flood, fire, explosion, earthquake, strike, lockout, labor dispute, casualty or accident; or war, revolution, civil commotion, acts of public enemies, terrorist attack, blockage or embargo; or any injunction, law, order, proclamation, regulation, ordinance, demand or requirement of any government (to the extent such government has ruling authority over such Party) or of any subdivision, authority or representative of any such government; or other similar event, beyond the reasonable control of such Party, if and only if the Party affected shall have used reasonable efforts to avoid such occurrence.
1.28“Governmental Body” means any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) federal, provincial, state, local, municipal, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or entity and any court or other tribunal); (d) multi-national or supranational organization or body; or (e) individual, entity, or body exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature.
1.29“HMRC” means HM Revenue & Customs.
1.30“IFRS” means the International Financial Reporting Standards issued by the International Accounting Standards Board, as in effect from time to time.
1.31“IND” means (a) an Investigational New Drug Application as defined in the FD&C Act and the regulations promulgated thereunder, or (b) the equivalent application to the equivalent Regulatory Authority in any other regulatory jurisdiction, the filing of which is necessary to initiate or conduct clinical testing of a pharmaceutical product in humans in such jurisdiction.
1.32“Intellectual Property” means all rights in Patents and Know-How.
1.33“Inventions” means any idea, process, method, composition of matter, article of manufacture, discovery, improvement or finding that is discovered, generated or invented (whether
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patentable or not) in the course of activities performed under this Agreement and all Intellectual Property therein.
1.34“Joint Steering Committee” or “JSC” means the committee formed by the Parties pursuant to Section 3.1.
1.35“Know-How” means Confidential Information relating to the research and development of the Licensed Products and other scientific and technical activities contemplated under this Agreement, including unpatented technical and other information, including inventions, discoveries, methods, data, processes and procedures, ideas, concepts, formulae, scientific notebooks, specifications, procedures for experiments and tests and results of experimentation and testing; together with all common law or statutory rights protecting the same and any similar or analogous rights to any of the foregoing whether arising or granted under any Applicable Laws.  Know-How shall also include all information for the Field for the Licensed Indications necessary to conduct research relative to OCA for therapeutic uses in the NASH Indication and/or the PBC Indication.
1.36“Licensed Indication” means, individually, the NASH Indication or the PBC Indication, and “Licensed Indications” means, collectively, the NASH Indication and the PBC Indication.
1.37“Licensed IP” means the Licensed Patents, Licensed Technology and Licensed NASH Trademarks.
1.38“Licensed NASH Trademarks” means the trademarks Controlled by Licensor and approved by applicable Regulatory Authorities for the Commercialization of the NASH Products in the Territory.
1.39“Licensed Patents” means Patents that are Controlled by Licensor in the Territory as of the Effective Date or throughout the Term and are necessary to make, have made, use, sell, offer for sale or import Licensed Products, including those Patents existing as of the Execution Date as set forth on Schedule 1.39.
1.40“Licensed Product” means, individually, the NASH Product or the PBC Product, and “Licensed Products” means, collectively, the NASH Product and the PBC Product.
1.41“Licensed Technology” means any and all Technology Controlled by Licensor as of the Effective Date or during the Term that is necessary for exploitation of the Licensed Products.
1.42“Licensee Insolvency Event” means that Licensee has (a) commenced a voluntary proceeding under any insolvency law, (b) had an involuntary proceeding commenced against it under any insolvency law which has continued undismissed or unstayed for sixty (60) consecutive days, (c) had a receiver, trustee or similar official appointed for it or for any substantial part of its property, (d) made a general assignment for the benefit of creditors, or (e) had an order for relief entered with respect to it by a court of competent jurisdiction under any insolvency law.  For purposes hereof, the term “insolvency law” means any applicable bankruptcy, insolvency or other similar law now or hereafter in effect.
1.43“Licensee Product Data” means all Data and Regulatory Documentation (including all Regulatory Approvals) Controlled by Licensee, its Affiliates or their respective Sublicensees during the Term that relates to the Development or Commercialization of the Licensed Products.
1.44“Manufacture” or “Manufacturing” means all operations necessary or appropriate to make, test, release, store, supply and ship the Licensed Products, including bulk tablet packaging and
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labeling, in accordance with good manufacturing practices (where applicable), Applicable Laws and the Licensed Products’ specifications.  For the avoidance of doubt, “Manufacture” and “Manufacturing” shall not include Packaging and Labeling requirements for the Licensed Products for Licensee to Develop or Commercialize the Licensed Products in the Territory.  “Manufactured” shall be construed accordingly.
1.45“MHRA” means the Medicines and Healthcare products Regulatory Agency and any successor entity thereto.
1.46“NASH Indication” means utilizing the NASH Product for therapeutic use to treat NASH.
1.47“NASH Product” means any product composition or formulation that contains OCA as the sole Active Pharmaceutical Ingredient for the treatment of NASH, or an authorized generic thereof in any jurisdiction in the Territory.
1.48“NDA” means a “New Drug Application”, as defined in the United States Federal Food, Drug, and Cosmetic Act, as amended, and applicable regulations promulgated thereunder by the FDA and all amendments and supplements thereto filed with the FDA, or the equivalent application filed with any Regulatory Authority, including all documents, data, and other information concerning Licensed Products, which are necessary for gaining Regulatory Approval to market and sell Licensed Product in the relevant jurisdiction, including an application for an import drug license in Mainland China.
1.49“Net Sales” means the gross amounts billed or invoiced by Licensee or any of its Affiliates or Sublicensees (including all sub-Sublicensees) for Sales of the NASH Product, in a bona fide arm’s length transaction, less the following deductions (to the extent included in and not already deducted from the gross amounts invoiced or otherwise charged) to the extent reasonable and customary and related to the Sales of the NASH Product:
1.49.1trade discounts, including trade, cash and quantity discounts or rebates, credits or refunds (including inventory management fees, discounts or credits which shall not include warehousing or distribution costs);
1.49.2price reductions or rebates, retroactive or otherwise, imposed by, negotiated with or otherwise paid to Regulatory Authorities or other payees;
1.49.3amounts repaid or credited by reason of rejections, defects, return goods allowance, recalls or returns, or because of retroactive price reductions, including rebates or wholesaler charge backs;
1.49.4allowances or credits actually granted upon claims, returns or rejections of the NASH Product;
1.49.5charges included in the gross sales price for freight, insurance, transportation, postage, handling and any other charges relating to the Sale, transportation, delivery or return of such Licensed Products;
1.49.6customs duties, sales, excise and use taxes and any other government charges (including value added tax) actually paid in connection with the transportation, delivery or return of the NASH Product (but excluding what is commonly known as income taxes); and
1.49.7any other items actually deducted from gross invoiced sales amounts as reported by a Party in its financial statements in accordance with IFRS, as applied on a consistent basis.
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Even if there is overlap between any of the deductions described above, each individual item shall only be deducted once in the overall Net Sales calculation.  Each of the above deductions to Net Sales shall be calculated in accordance with IFRS.  Deductions exceeding gross amounts billed or invoiced in a period shall be carried forward and applied to future periods until fully taken.  Net Sales shall not include transfers or dispositions for charitable, promotional, pre-clinical, clinical, regulatory, or governmental purposes, provided that such transfer or disposition is at or less than cost of manufacturing of such NASH Product. Net Sales shall not include sales between or among the Licensor or its Affiliates.  In the event that any components of Net Sales are denominated in a currency other than US Dollars, such amounts shall be converted into US Dollars in accordance the average rate of exchange, as specified on Oanda in respect of the period during which the relevant Net Sales were recorded.
1.50“Packaging and Labeling” means finished product packaging and labeling and holding (including storage) of a Licensed Product in the Territory.  When used as a verb, “Package and Label” means to engage in Packaging and Labeling.
1.51“Patent” means any and all (a) patent applications filed under Applicable Laws in any jurisdiction, including all provisional applications, substitutions, continuations, continuations-in-part, divisionals, renewals, and all patents granted thereon; and (b) all patents, reissues, reexaminations and extensions or restorations by existing or future extension or restoration mechanisms, including Patent Term Extension, supplementary protection certificates or the equivalent thereof.
1.52“Patent Term Extension” means any term extensions, supplementary protection certificates, regulatory exclusivity and equivalents thereof offering patent protection beyond the initial term with respect to any issued Patents.
1.53“PBC Indication” means utilizing the PBC Product for the treatment of PBC.
1.54“PBC Product” means Ocaliva® or an authorized generic thereof in any jurisdiction in the Territory.
1.55“Person” means any natural person, corporation, firm, business trust, joint venture, association, organization, company, partnership or other business entity, or any Governmental Body or agency or political subdivision thereof.
1.56“Promotional Materials” means all written, printed, electronic or graphic materials, provided or approved by Licensor for use by Licensee in promotion of the Licensed Products in the Territory.
1.57“Regulatory Approval” means, with respect to a Licensed Product in any regulatory jurisdiction, approval from the applicable Regulatory Authority sufficient for the manufacture, distribution, use, marketing and sale of such pharmaceutical product in such jurisdiction in accordance with Applicable Laws.  For countries where governmental approval is required for pricing or reimbursement for a Licensed Product, “Regulatory Approval” shall not be deemed to occur in such country in the Territory until such pricing or reimbursement approval is obtained in such country.
1.58“Regulatory Authority” means any Governmental Body, including the FDA or any successor agencies thereto and its foreign equivalents, that has responsibility for granting any licenses or approvals or granting pricing or reimbursement approvals necessary for the marketing and sale of a pharmaceutical product in any country.
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1.59“Regulatory Documentation” shall mean all applications, registrations, licenses, authorizations, approvals (including all Regulatory Approvals), and correspondence (registration and licenses, pricing and reimbursement correspondence, regulatory drug lists, advertising and promotion documents) submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents in connection therewith, and all non-clinical, preclinical trials and Clinical Trials, tests and biostudies, relating to the use of Licensed Product in the Field, or as required for regulatory purposes (including all Regulatory Approvals) and all Data contained in any of the foregoing, including all INDs, NDAs and Regulatory Approvals, regulatory drug lists, advertising and promotion documents, manufacturing data and records, drug master files, inspection reports, Data from Clinical Trials, adverse event files and complaint files, in each case related to Licensed Products in the Field, or as required for regulatory purposes.
1.60“Right of Reference or Use” means a “Right of Reference or Use” as that term is defined in 21 C.F.R. § 314.3(b), and any non-United States equivalents.
1.61“Royalty Term” means, with respect to the NASH Product in a country or region in the Territory, the period commencing upon the First Commercial Sale of the NASH Product in such country or region and expiring upon the latest of (a) the tenth (10th) anniversary of the First Commercial Sale of the NASH Product in such country or region, (b) the expiration of the last-to-expire Valid Claim of the Licensed Patents, and (c) the expiration of regulatory exclusivity for the NASH Product in such country or region.
1.62“Sale” means any transaction, transfer or disposition of value for which consideration is received by Licensee, its Affiliates or Sublicensees for sale, use, lease, transfer or other disposition of the NASH Product to or for the benefit of a Third Party.  A Sale shall not include any NASH Product sold for use in Clinical Trials, for research or for other non-commercial uses, or that is supplied as part of a compassionate use or similar program; provided, however, that Licensee, its Affiliates or their respective Sublicensees do not make a profit from such sale.
1.63“Selected Supply Events” means the occurrence of any of the following events (a) Licensee Affiliate that is party to the Manufacturing Agreement gives notice of termination under the Manufacturing Agreement exercising its rights to terminate the Manufacturing Agreement under Section 21.2.2 (subject to the applicable cure period) or under Section 24.5 of the Manufacturing Agreement (in the case of Section 24.5, solely due to a Force Majeure Event (as defined in the Share Purchase Agreement)) that results in no supply of Licensed Product for a period of six (6) months or under Section 21.5; (b) Licensor gives notice of termination under the Manufacturing Agreement exercising its rights to terminate the Manufacturing Agreement under Section 21.1 or 21.4.2 of the Manufacturing Agreement; or (c) the Manufacturing Agreement is terminated or rejected in any proceeding in relation to a bankruptcy or insolvency of Licensor solely to the extent that this Agreement remains in effect pursuant to Section 12.6.
1.64“Sublicense Documents” means any and all agreements, amendments or written understandings entered into with a Sublicensee (including any of its Affiliates) that are related to the grant of a Sublicense, Licensed Patents or Licensed Product.  For clarity, in addition to the primary sublicense agreement, any other agreement with the Sublicensee that grants rights to Develop or Commercialize a Licensed Product other than for or on behalf of Licensee is a Sublicense Document.  By way of example, a co-promotion or co-marketing agreement with such Sublicensee would be a Sublicense Document, but an agreement with such Sublicensee for the oversight of a Clinical Trial for Licensee (i.e., a master services agreement with a contract research organization) would not be a Sublicense Document.  For clarity, the
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foregoing exclusion is limited to such contract research organization master service agreements, and does not encompass all agreements with such Sublicensee.
1.65“Sublicensee” means a Person (including any Affiliate) to which a Sublicense is granted pursuant to this Agreement.
1.66“Sublicensee Income” means any and all financial consideration (including equity), upfront payments, license fees, and milestone payments, in cash payments or any other form of financial (or equity) consideration (as determined using the fair market value of such other form of financial (or equity) consideration), in each case other than all gross amounts included in Net Sales, received by Licensee or its Affiliates for the grant by Licensee or its Affiliates of a sublicense under this Agreement to a Third Party, including any right granted to a Third Party to Develop or Commercialize the NASH Product, including, but not limited to, a right to market or distribute the NASH Product (excluding rights granted by Licensee or its Affiliates to a Third Party to market or distribute the NASH Product for or on behalf of Licensee, where Licensee or its Affiliates are booking the sales of the NASH Product).
1.67“Technology” means any and all compounds, materials, equipment, specifications, Confidential Information, proprietary ideas and information, designs, formulae, methods, techniques, processes, procedures, inventions, Know-How, data and information, Clinical Trial data and all other scientific data, documentation and other technology, whether or not patentable or protectable as a trade secret.
1.68“Territory” means all countries and territories in the world other than the United States.
1.69“Third Party” means any Person other than the Parties and their respective Affiliates.
1.70“Transitional Services Agreement” means that certain Transitional Services Agreement entered into by Intercept Pharmaceuticals, Inc. and Mercury Pharma Group Limited as of even date.
1.71“TOGC” means the transfer of a business or part of a business as a going concern for the purposes of section 49 of the VAT Act and article 5 of the Value Added Tax (Special Provisions) Order 1995.
1.72“United States” or “US” means the United States of America, its territories and possessions.
1.73“Valid Claim” means a claim of any Patent that covers the make, use or sale of the Licensed Product, whose validity, enforceability, or patentability has not been affected by any of the following:  (a) irretrievable lapse, abandonment, revocation, dedication to the public, or disclaimer; or (b) a holding, finding, or decision of invalidity, unenforceability, or non-patentability by a court, governmental agency, national or regional patent office, or other appropriate body that has competent jurisdiction, such holding, finding, or decision being final and unappealable or un-appealed within the time allowed for appeal.
1.74“VAT” means: (a) value added tax; (b) any tax imposed in compliance with the council directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); (c) any other sales tax, use tax, consumption tax and goods and services tax; and (d) any other tax of a similar nature to such tax referred to in any of (a) to (c).
1.75Other Terms.  The definition of each of the following terms is set forth in the Section of this Agreement indicated below:
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	Defined Term
	Section

	Additional Studies
	4.2.1(c)

	Agreement
	Introductory Clause

	Adjusted Budget
	4.2.1(a)

	Budget
	4.2.1(a)

	Completion Date
	12.1.1

	Costs
	4.2.1(a)

	Development Plan
	4.1.2(b)

	Disclosing Party 
	1.15

	Effective Date
	Introductory Clause

	EMA Second Payment Amount
	7.4

	EU First Payment Amount
	7.4

	Execution Date
	Introductory Clause

	Financial Report
	7.6

	Infringement 
	8.3.1

	Intercept
	Recitals

	Joint Inventions
	8.1.4

	Joint IP
	8.1.4

	Joint Patents
	8.1.4

	License
	2.1

	License Agreement
	Recitals

	Licensee
	Introductory Clause

	Licensee Know-How
	8.1.3

	Licensee Necessary IP
	2.4.1

	Licensee Patents
	8.1.3

	Licensee Technology
	8.1.3

	Licensor
	Introductory Clause

	Licensor Inventions 
	8.1.2

	Manufacturing Agreement
	6.1

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	Defined Term
	Section

	MHRA First Payment Amount
	7.4

	MHRA Second Payment Amount
	7.4

	NASH
	Recitals

	Non-Objecting Party
	3.4

	Objecting Party
	3.4

	OCA
	Recitals

	Ocaliva
	Recitals

	Parties
	Introductory Clause

	Party
	Introductory Clause

	Patent Costs
	8.2.1

	PBC
	Recitals

	PIP Studies
	3.2(b)

	Post-Marketing Work
	4.2.1(a)

	Progress Report
	4.1.2(c)

	Prosecution and Maintenance
	8.2.1

	Quality Agreement
	6.1

	Recall Notice
	4.3.4(a)

	Receiving Party
	1.15

	Review Period
	9.3

	SDEA
	4.3.3

	Share Purchase Agreement
	Recitals

	Sublicense
	2.2

	Term
	12.1.2

	Termination
	12.1.1

	Third Party Claim
	11.1

	USPTO 
	1.11

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ARTICLE 2
LICENSES AND OTHER RIGHTS
2.1Grant of License to Licensee.  In consideration of the payments due from Licensee under Article 7,
2.1.1Licensor hereby grants to Licensee an exclusive (even as to Licensor, but subject to Licensor’s retained rights set forth in Sections 2.3 and 4.2.1), fully paid-up, perpetual, irrevocable right and license, with the right to grant sublicenses in accordance with Section 2.2, under the Licensed IP to Develop, Commercialize, Package and Label, use and import, in each case of the foregoing the PBC Product for the Field for the PBC Indication in the Territory.
2.1.2During the Term, subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee an exclusive (even as to Licensor, but subject to Licensor’s retained rights set forth in Sections 2.3 and 4.2.2), royalty-bearing right and license, with the right to grant sublicenses in accordance with Section 2.2, under the Licensed IP to Develop, Commercialize, Package and Label, use and import the NASH Product for the Field for the NASH Indication in the Territory.
2.1.3Licensor hereby grants to Licensee a non-exclusive, fully paid-up, perpetual, irrevocable right and license under the Licensed IP to have Third Parties Manufacture the PBC Product for the Field for the PBC Indication in the Territory solely for use by or behalf of Licensee to the extent licensed to Licensee under Section 2.1.1; provided, however Licensee hereby agrees to not exercise its rights under this license grant unless and until the occurrence of any of the Selected Supply Events.
2.1.4During the Term, subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee a non-exclusive, fully paid-up right and license under the Licensed IP to have Third Parties Manufacture the NASH Product for the Field for the NASH Indication in the Territory solely for use by or behalf of Licensee to the extent licensed to Licensee under Section 2.1.2; provided, however Licensee hereby agrees to not exercise its rights under this license grant unless and until the occurrence of any of the Selected Supply Events.
Sections 2.1.1, 2.1.2, 2.1.3, and 2.1.4, collectively, are herein referred to as the “License”.
For clarity, the Parties intend for Licensee to primarily be supplied PBC Products and NASH Products by Licensor and the foregoing license grants provided in Sections 2.1.3 and 2.1.4 are part of the Parties’ plans to provide assurances and continuity of the supply of these products to Licensee, as further detailed in the Selected Supply Events.
2.2Grant of Sublicense by Licensee.  Licensor grants to Licensee the right to grant sublicenses, in whole or in part, under the License (each, a “Sublicense”) subject to the terms and conditions of this Agreement and specifically this Section 2.2.
2.2.1All Sublicenses may be granted through multiple tiers, and are subject to the prior written consent of Licensor, which shall not be unreasonably conditioned, withheld or delayed, and to the agreement of the Sublicensee to comply with the applicable terms of this Agreement; provided, however, no such consent shall be required in connection with a Sublicense to a Third Party solely for distribution and/or Packaging and Labeling activities performed by such Third Party on behalf of Licensee.
2.2.2All Sublicenses will be issued in writing, and all Sublicenses shall include all of the rights of Licensor and require the performance of obligations due to Licensor contained in this Agreement and include no less than the following terms and conditions:
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(a)Reasonable record keeping, audit and reporting obligations sufficient to enable Licensee to reasonably verify the payments due to Licensee and royalties due to Licensor under such Sublicense and to reasonably monitor such Sublicensee’s progress in Developing and/or Commercializing any Licensed Products, provided that such obligations shall be no less stringent than those provided in this Agreement for Licensee;
(b)Infringement and enforcement provisions that do not conflict with the restrictions and procedural requirements imposed on Licensee and do not provide greater rights to Sublicensee than as provided in Article 8;
(c)Confidentiality provisions with respect to Confidential Information of Licensor and publication requirements consistent with the restrictions on Licensee and rights of Licensor in Article 9;
(d)Covenants by Sublicensee that are equivalent to those made by Licensee in Section 10.5;
(e)A requirement of indemnification of Licensor by Sublicensee that is equivalent to the indemnification of Licensor by Licensee under Section 11.2;
(f)A requirement of obtaining and maintaining insurance by Sublicensee that is equivalent to the insurance requirements of Licensee under Section 11.5; and
(g)A requirement that Licensor is a third party beneficiary of such Sublicense.
2.2.3A fully executed copy of any Sublicense granted by Licensee pursuant to this Section 2.2 and any and all related Sublicense Documents must be provided to Licensor within fifteen (15) days following execution.
2.2.4If any Sublicense does not include all of the terms and conditions set forth in Section 2.2.2 or is not issued in accordance with the terms and conditions set forth in this Section 2.2, Licensee shall be liable to Licensor for any harm to Licensor that actually results from such deficiency.
2.2.5Licensee may only grant sublicenses under the licenses granted in Section 2.1.2 to the extent granted in connection with (and of the same scope as) a sublicense granted under the License granted to Licensee under Section 2.1, in each case solely to Develop or Commercialize Licensed Products for the Field in the Territory (i.e., no naked sublicensing permitted).
2.2.6Licensee shall be responsible for each Sublicensee complying with the applicable terms and conditions of this Agreement as if such Sublicensee were a party to this Agreement with respect to such terms and conditions, and Licensee hereby waives any requirement that Licensor exhaust any right, power or remedy, or proceed against any such Sublicensee directly.
2.3Retained Rights.  Notwithstanding the rights granted in Section 2.1, but subject to the restrictive covenants binding upon the Licensor as set forth in the Share Purchase Agreement, Licensor retains:
2.3.1the right to practice the Licensed IP in order to perform, or have performed by a Third Party, Licensor’s rights or obligations under this Agreement (including, without limitation, the right and obligation to perform the Post-Marketing Work and the right to perform Additional Studies, Additional PIP Studies, and a global study for the NASH Product) and obligations under the Transitional Services
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Agreement, including providing the assistance to Licensee in the preparation of applications for Regulatory Approvals in the Territory that will be filed in the name of Licensee as contemplated under this Agreement and the Transitional Services Agreement;
2.3.2the right to Develop and use the Licensed Products inside the Territory, including as part of global studies, solely for support of applications for Regulatory Approvals outside of the Territory;
2.3.3the right to Develop and use the Licensed Products for Regulatory Approvals and Commercialization outside of the Territory, irrespective of where such activities occur in the world (including the Territory), including, without limitation, in connection with activities performed by Licensor pursuant to Section 4.2;
2.3.4all rights to practice the Licensed IP with respect to compounds and products other than the Licensed Products;
2.3.5all rights to practice the Licensed IP for a product containing OCA for indications other than the Licensed Indications;
2.3.6the right to Manufacture and have Manufactured the Licensed Products and OCA in the Territory (but for clarity, Licensee also has certain rights to have Manufactured the Licensed Products under Section 2.1.3 or Section 2.1.4); and
2.3.7all rights to practice the Licensed IP with respect to countries outside of the Territory.
2.4Grant of License to Licensor.  Subject to the terms and conditions of this Agreement, Licensee hereby grants to Licensor the following:
2.4.1a (a) royalty-free, transferable, perpetual, sublicensable (subject to the provisions of this Section 2.4.1), irrevocable, exclusive right and license under the Licensee Technology that are necessary or reasonably useful for the Development, Manufacture or Commercialization by Licensor, its Affiliates or their respective sublicensees of a Licensed Product outside of the Territory, (b) subject to the restrictive covenants binding upon the Licensor as set forth in Clause 11 of the Share Purchase Agreement, a worldwide, royalty-free, transferable, perpetual, sublicensable (subject to the provisions of this Section 2.4.1), irrevocable, non-exclusive right and license under the Licensee Technology that is necessary or reasonably useful for the Development, Manufacture or Commercialization by Licensor, its Affiliates or their respective sublicensees of a product containing OCA (other than the Licensed Products), (c) a royalty-free, transferable, sublicensable (subject to the provisions of this Section 2.4.1), irrevocable, non-exclusive right and license under any Inventions that are first reduced to practice or discovered, developed, invented, created or obtained solely by Licensee, its Affiliates or Third Parties acting on its or its Affiliates’ behalf while conducting Manufacturing activities of the Licensed Products that are necessary or reasonably useful for the Manufacture by Licensor, its Affiliates or their respective sublicensees of a Licensed Product inside the Territory for Commercialization outside the Territory (subsections (a), (b) and (c) collectively, “Licensee Necessary IP”). The foregoing licenses shall include the right for Licensor to grant sublicenses under the Licensee Necessary IP to its Affiliates and to Third Parties, through multiple tiers, solely in connection with (and of substantially equivalent scope to) a grant of rights to such Affiliates and Third Parties under the Licensed IP (inside of the Territory) or a Licensed Product outside of the Territory (i.e., no naked sublicensing of the Licensee Necessary IP is permitted); and
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2.4.2a Right of Reference or Use to all Licensee Product Data solely to the extent necessary or reasonably required in connection with the Development, Manufacturing and Commercialization of the Licensed Products by Licensor, its Affiliates or their respective sublicensees.
2.5Data Transfer.  To enable Licensee to benefit from the License, Licensor will conduct (a) an initial or agreed later time point, one-time transfer of all Data that is necessary for Licensee to Develop and Commercialize the Licensed Products for the Field for the Licensed Indications in the Territory (including relating to regulatory matters), (b) a transfer of the Data arising from Licensor’s performance of the Post-Marketing Work and other Data to be transferred on an agreed frequency, which Data is necessary for Licensee to Develop and Commercialize the Licensed Products for the Field for the Licensed Indications in the Territory (including relating to regulatory matters), which transfer shall be at mutually agreed milestones relating to such Post-Marketing Work or directly related activities, as applicable, and (c) upon Licensee’s reasonable written requests from time to time after the Effective Date to which Licensor does not reasonably object, Licensor will conduct data transfers to Licensee of such other requested Data that is reasonably necessary, for Licensee to Develop and Commercialize the Licensed Products for the Field for the Licensed Indications in the Territory (including relating to regulatory matters), to the extent such Data has not been previously transferred under subsection (a) or (b).  Prior to Completion, the Parties’ applicable subject matter experts will discuss and reach mutual agreement on their shared expectation for what Data would be transferred under the foregoing subsections (a) and (b).  All such transfers of Data shall be undertaken by both Parties efficiently with a goal of minimizing both cost as well as disruption to the other activities of Licensor.  If fulfillment of any such transfer of Data would cause Licensor to incur any out-of-pocket costs, Licensee will be responsible for Licensor’s reasonable out-of-pocket costs incurred in any transfer of such Data to Licensee.  Without limiting the generality of the foregoing, or being limited thereby, from and after the Effective Date, during the Term the Licensor shall make available to Licensee access to global patient outcome Data relating to the use of the PBC Product in the PBC Indication for use by Licensee in support of its activities for the PBC Product in the PBC Indication in the Territory, subject to such access and use at all times being in compliance with applicable privacy and data protection laws as forth in a data use agreement entered into by the Parties within fifteen (15) days following the Effective Date.
2.6No Implied License.  Each Party acknowledges that the rights and licenses granted in this Agreement are limited to the scope expressly granted herein.  Accordingly, except for the rights expressly granted under this Agreement, no right, title, or interest of any nature whatsoever is granted whether by implication, estoppel, reliance, or otherwise, by either Party to the other Party.  All rights with respect to any Know-How, Patent or other intellectual property that are not specifically granted herein are reserved to the owner thereof.
ARTICLE 3
JOINT STEERING COMMITTEE
3.1Formation.  Within thirty (30) calendar days following the Effective Date, the Parties will form a JSC comprised of three (3) non-legal subject matter expert representatives of each of the Parties.  One representative at the JSC will be selected to act as the chairperson of the JSC.  The JSC will meet on a regular basis but in no event less than two (2) times per year.  Each Party may also schedule a meeting of the JSC on an ad hoc basis at any time upon two (2) weeks’ notice to the other Party, subject to the reasonable availability of the JSC members.  Meetings of the JSC may be conducted by videoconference, teleconference or in person, as agreed by the Parties.  The JSC will agree upon the time and location of the meetings.  The chairperson, or his or her designee, will circulate an agenda for each meeting approximately one week before the date scheduled for the meeting, and will include all matters requested to be included on such agenda by either Party.  The chairperson, or his or her designee, will take complete and accurate minutes of all discussions occurring at the JSC meetings and all matters decided upon at the
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meetings, except that matters reflecting legal advice of counsel will not be included in such minutes.  A copy of the draft minutes of each meeting will be provided to each Party by the chairperson, or his or her designee, after each meeting, and such minutes will be reviewed by the JSC members, any needed changes discussed and final minutes agreed to and provided to each Party within fifteen (15) Business Days after each meeting unless otherwise agreed.  A reasonable number of additional non-legal subject matter expert representatives of a Party may attend meetings of the JSC in a non-voting capacity.  Each Party is responsible for their travel costs and expenses associated with attending meetings.
3.2JSC Functions and Powers.  The responsibilities of the JSC will be limited to the following matters:
(a)encouraging and facilitating communication between the Parties with respect to the Development of the Licensed Products;
(b)providing a forum for the Parties to discuss the pediatric investigation plan studies, as defined in Schedule 4.1.2(a) as, “PIP Studies”, conducted by Licensor for the PBC Product;
(c)providing a forum for the Parties to discuss and mutually agree on the overall strategy and priorities for Development of the NASH Product for the Field for the Licensed Indications in the Territory and to assist Licensor in coordinating Development activities for the NASH Product outside of the Territory;
(d)reviewing and approving the Budget and any deviations from the Budget of the Costs;
(e)reviewing and approving the initial Development Plan and each updated Development Plan thereafter, including any amendments thereto, for the NASH Product, and reviewing and approving the material aspects of any other Development of the PBC Product by or on behalf of Licensor;
(f)monitoring the progress of the Development of the NASH Product against the Development Plan and Licensee’s diligence in carrying out its responsibilities thereunder;
(g)providing a forum for the Parties to discuss whether Licensee should file for Regulatory Approval for the NASH Product in the Territory pursuant to Section 4.1.2;
(h)reviewing and commenting on proposed regulatory filings and submissions from Licensee to Regulatory Authorities to obtain, support and maintain Regulatory Approval of the Licensed Products for the Field for the Licensed Indications in the Territory;
(i)providing a forum for the Parties to discuss the status of Regulatory Approvals for the Licensed Products;
(j)providing a forum for the Parties to discuss the status of Commercialization efforts by Licensee for the NASH Product;
(k)providing a forum for the Parties to discuss the Commercialization of an authorized generic of a Licensed Product in the Territory; and
(l)providing a forum for the Parties to discuss inventorship disputes of Inventions.
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3.3JSC Decision Making.  The JSC is intended to serve primarily as an advisory body and to serve as a forum for the Parties to discuss matters relating to this Agreement and to provide a convenient mechanism for implementation of any review and/or approval rights granted to a Party under this Agreement.  However, to the extent that the JSC is required to make a decision on a matter (including, without limitation, drafting, accepting and amending the Development Plan), all such decisions of the JSC will be made by unanimous vote, with each Party having one vote, irrespective of the number of members it has on the JSC.  In the event that, after reasonable discussion and good faith consideration of each Party’s view on a particular matter before the JSC, the JSC cannot reach an agreement as to such matter (to the extent that such matter requires the agreement of the JSC hereunder), then:
(a) so long as the Licensor is the lead Party conducting the PIP Studies for the PBC Product, Licensor shall have the final decision-making authority with respect to the PIP Studies for the PBC Product which may be exercised by Licensor only in a manner that is consistent with seeking to complete the Post-Marketing Work as agreed by the Parties in the development plans and the Budget (or Adjusted Budget) therefor and other requirements provided therefor in Section 4.2.1, and if and when Licensee becomes the lead Party conducting the PIP Studies for the PBC Product, Licensee shall have the final decision-making authority with respect to the PIP Studies for the PBC Product;
(b) Licensor shall have the final decision-making authority with respect to all matters related to Development and Commercialization of the NASH Product (including, without limitation, any Clinical Trial) outside the Territory, and Licensor shall also have the right to object to, and have final decision-making authority with respect to, (i) any Development of the NASH Product (including, without limitation, any Clinical Trial) in the Territory or submission for a label change to the extent relating to safety for the NASH Product to either the MHRA or EMA, in each case proposed by Licensee that Licensor has a good faith objection that it (individually or in the aggregate) presents an Adverse Risk to the NASH Product outside the Territory, and (ii) the Commercialization of an authorized generic for the NASH Product inside the Territory at any time prior to Authorized Or Other Generic Entry for the NASH Product in the U.S.;
(c) except as set forth in Section 3.3(b) and Licensee’s obligation to use Commercially Reasonable Efforts to Commercialize the NASH Product in each country in the Territory where Licensee has obtained Regulatory Approval for the NASH Product pursuant to Section 5.1, Licensee shall have the final decision-making authority with respect to Development or Commercialization of the NASH Product in the Territory;
(d) any deviations from the Budget (or an Adjusted Budget) of the Costs, the status quo shall prevail;
(e) Licensee shall have the final decision-making authority with respect to all matters related to its Development and Commercialization of the PBC Product in the Territory, including Commercialization of an authorized generic of the PBC Product in the Territory, provided that Licensor shall have the right to object to (i) any such Development of the PBC Product, (ii) any submission for a label change to the extent relating to safety for the PBC Product to either the MHRA or EMA, or (iii) the Commercialization of an authorized generic of the PBC Product in the Territory at any time prior to Authorized Or Other Generic Entry for the PBC Product in the U.S., in each case proposed by Licensee with respect to which Licensor has a good faith objection that such Development (individually or in the aggregate), submission for a label change or the Commercialization of an authorized generic of the PBC Product in the Territory presents an Adverse Risk to the PBC Product outside the Territory, and in such event such objected to Development, submission for a label change or Commercialization of an authorized generic of the PBC Product in the Territory shall be subject to the provisions of Section 3.4; and
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(f) Licensor shall have the final decision-making authority with respect to all matters related to its Development and Commercialization of the PBC Product outside the Territory, including Commercialization of an authorized generic of the PBC Product outside the Territory, provided that Licensee shall have the right to object to (i) any such Development of the PBC Product, (ii) any submission for a label change to the extent relating to safety for the PBC Product to the FDA, or (iii) Commercialization of an authorized generic of the PBC Product outside the Territory at any time prior to Authorized Or Other Generic Entry for the PBC Product in the Territory, in each case proposed by Licensor with respect to which Licensee has a good faith objection that such Development (individually or in the aggregate), submission for a label change or Commercialization of an authorized generic of the PBC Product outside the Territory presents an Adverse Risk to the PBC Product inside the Territory, and in such event such objected to Development or Commercialization of an authorized generic of the PBC Product outside the Territory, shall be subject to the provisions of Section 3.4.
The JSC shall not have any authority other than for those matters expressly set forth in Section 3.2 and, specifically, shall have no authority (1) to amend or interpret this Agreement (2) to determine whether or not Licensee has met its diligence or other obligations under this Agreement, or (3) to determine whether or not a breach of this Agreement has occurred.  For clarity, the JSC decision-making authority shall not supersede any right, obligation or reservation of rights of a Party that is otherwise set forth in this Agreement.
3.4Disputed JSC Matter.  In the event Licensor objects to Development of the PBC Product, submission for a label change to the extent relating to safety for the PBC Product to either the MHRA or EMA, or Commercialization of an authorized generic for the PBC Product in the Territory pursuant to Section 3.3(e) or Licensee objects to the Development for a PBC Product outside the Territory, submission for a label change to the extent relating to safety for a PBC Product to the FDA, or Commercialization of an authorized generic for the PBC Product pursuant to Section 3.3(f), (in each case, an “Objecting Party”), the Parties shall meet and confer in good faith on such objected matter within thirty (30) days from written request from an Objecting Party to the other Party (“Non-Objecting Party”) to meet pursuant to the provisions of this Section 3.4; provided, to the extent the timely resolution of the objected matter is critical to meeting any deadline set by a Regulatory Authority, then the foregoing thirty (30) day period will be shortened as much as needed in order to meet the applicable deadline (and the Non-Objecting Party shall promptly inform the Objecting Party of this reduced time period).  The Non-Objecting Party shall take into good faith consideration the Adverse Risk raised by the Objecting Party in connection with such proposed activities and the Non-Objecting Party shall present to the Objecting Party, for further consideration by the Objecting Party, alternatives to eliminate the Adverse Risk raised by the Objecting Party.  In the event that after the proposal of such alternatives during such thirty (30) day (or shorter) time period, the activities remain disputed by the Objecting Party, the Executive Officers shall meet and confer on such disputed activities.  The Executive Officers shall work in good faith to mutually agree on alternative activities to address the Objecting Party’s concerns regarding such Adverse Risk in an additional time period of no longer than ten (10) Business Days.  In the event that the Parties cannot reach agreement after such escalation to the Executive Officers, then the Non-Objecting Party shall have final decision-making authority for such disputed matters other than (a) Commercialization of an authorized generic of the PBC Product in the Territory at any time prior to Authorized Or Other Generic Entry of the PBC Product in the U.S., and (b) a submission for a label change to the extent relating to safety of the PBC Product in the Territory, in which case under subsection (a) and (b), Licensor shall have final decision-making authority.  The Parties agree and acknowledge that in the event that Licensor exercises its final decision-making authority under this Section 3.4(b) relating to a submission for a label change to the extent relating to safety, such submission shall be in compliance with any requests from the Regulatory Authorities relating to such label and Applicable Laws.  For clarity, if the Parties utilize this dispute escalation provision for any other disputed matters outside Sections 3.3(e) or 3.3(f), the provisions of Section 3.3 with respect to final decision-making authority shall remain.
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3.5Termination of JSC.  The JSC shall continue to exist until the Parties mutually agreeing to disband the JSC.  Thereafter, the JSC shall have no further obligations under this Agreement.
ARTICLE 4
DEVELOPMENT AND REGULATORY AFFAIRS
4.1Licensee Development.
4.1.1PBC Product.  Subject to Sections 4.2.1 and 4.3, Licensee shall have responsibility for, and control over, the Development of the PBC Product in the Territory, including supporting and maintaining Regulatory Approval of the PBC Product in the Territory.  Notwithstanding the foregoing and anything in Section 4.3 to the contrary, prior to conducting any Clinical Trial for the PBC Product, Licensee shall submit the proposed design, protocol and endpoints for such Clinical Trial to Licensor for Licensor’s review and prior written approval, such approval not to be unreasonably withheld, conditioned or delayed.  Licensee shall be solely responsible for all costs and expenses incurred by Licensee for the Development of the PBC Product.  In addition to the Post-Marketing Work, Licensee may request that Licensor perform on behalf of Licensee, and at Licensee’s sole cost and expense, Development activities for the PBC Product in the Territory.  Any agreement by Licensor to perform any Development activities for the PBC Product in the Territory (other than the Post-Marketing Work) shall be in Licensor’s sole discretion.
4.1.2NASH Product.
(a)General.  Subject to Sections 4.2.2 and 4.3, Licensee shall have responsibility for, and control over, the Development of the NASH Product in the Territory, including supporting and maintaining Regulatory Approval of the NASH Product in the Territory, and may initiate such activities as and when it determines to do so during the Term, subject in each case to the provisions of Article 3 (including Section 3.3(a)).  In the event that Licensee determines that it no longer wishes to seek or maintain Regulatory Approval from the EMA for the NASH Product, or to pursue the Commercialization of the NASH Product in the Territory, Licensee shall terminate this Agreement solely with respect to the NASH Product effective upon written notice to the Licensor as provided in Section 12.3 and with effects of termination provided in Section 12.4.  Licensee shall be solely responsible for all costs and expenses incurred by Licensee for the Development of the NASH Product for the Territory.
(b)Development Plan.  Prior to commencing any NASH Product Development activities Licensee shall submit a proposed development plan for the NASH Product for the Field for the NASH Indication in the Territory to the JSC for review and approval by the JSC (the “Development Plan”).  Any Development conducted by Licensee under this Agreement relating to the NASH Product for the Field for the NASH Indication in the Territory shall be conducted pursuant to the Development Plan.  The Development Plan shall be focused on efficiently obtaining Regulatory Approvals for the NASH Product in the Territory (subject to the obligations set forth in Section 4.1.2(a)), while taking into consideration the potential Development, Regulatory Approval or Commercialization impact on the NASH Product outside of the Territory.  On no less than an annual basis following adoption of the initial Development Plan, Licensee shall submit any updates and amendments, as appropriate, to the then-current Development Plan to the JSC for review and approval by the JSC.  Notwithstanding the foregoing and anything in Section 4.3 to the contrary, prior to conducting any Clinical Trial for the NASH Product, Licensee shall submit the proposed design, protocol and endpoints for such Clinical Trial to Licensor for Licensor’s review and prior written approval, such approval not to be unreasonably withheld, conditioned or delayed.
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(c)Progress Reports.  Following adoption of the initial Development Plan for the NASH Product pursuant to Section 4.1.2(b) and continuing until the First Commercial Sale of the NASH Product, Licensee, on an annual basis or more frequently as reasonably requested by Licensor, shall submit to Licensor a progress report (each, a “Progress Report”) covering Licensee’s (and any Affiliates’ and Sublicensees’) achievements and activities under the Development Plan for the NASH Product.  Each Progress Report must include at least the following:  (i) a summary of achievements and activities under the Development Plan for the NASH Product; (ii) a summary of pre-launch activities prior to Commercialization of the NASH Product; (iii) an identification of filings for Regulatory Approval (and status of such filings) and other material correspondence and meetings with Regulatory Authorities for the NASH Product; and (iv) a listing of any and all Sublicenses granted by Licensee regarding the NASH Product.
4.2Licensor Development.
4.2.1PBC Product Post-Marketing Work.  All Development activities provided for under this Section 4.2.1 shall be efficiently undertaken by the Parties with the goal of limiting cost and expenditure to both Parties to what is reasonably necessary to achieve the objective of such Development activities.
(a)Licensee acknowledges that Licensor is performing, and shall have the right and obligation to continue to perform (subject to Section 4.2.1(d)), Development activities for the PBC Product that have been planned by Licensor as of the Effective Date and are detailed in Schedule 4.2.1(a) attached hereto (with an associated budget on Schedule 4.2.1(b)) (“Budget”), and shall also perform the PIP Studies as they are modified and perform further data analysis of, and other non-clinical work with respect to, the PIP Studies, in each case that are required by Regulatory Authorities as a result of meetings with, and submissions to, Regulatory Authorities regarding the PIP Studies through December 31, 2029, which modifications, data analysis and other non-clinical work shall be implemented efficiently to meet the requirements of the Regulatory Authorities, (collectively, the “Post-Marketing Work”).  To the extent any Post-Marketing Work regarding the PIP Studies in respect of the Territory extends past December 31, 2029, unless otherwise mutually agreed by the Parties, Licensor shall transition to Licensee the conduct of the remaining Post-Marketing Work in respect of the Territory for Licensee to undertake as the lead party for such Development activities, and Licensee shall bear [***] percent ([***]%) of all costs for such Development, and Licensor shall bear [***] percent ([***]%) of all costs for such Development.  The Budget (and any Adjusted Budget) shall include all associated out-of-pocket costs and expenses expected to be incurred by the Party leading the applicable Post-Marketing Work after the Effective Date, including necessary regulatory costs and expenses and costs and expenses payable to contract research organizations, pharmacovigilance costs (solely related to the performance of such Post-Marketing Work), Clinical Trial sites, Development, including in the foregoing categories personnel fairly allocated to this Post-Marketing Work, and regulatory service providers and external consultants, through December 31, 2029 (collectively, the “Costs”); provided, that such Budget shall be subject to adjustment (proposed by the Party leading such Post-Marketing Work and discussed with the other Party, and finally decided by the Party leading such Post-Marketing Work taking into good faith consideration the comments of the other Party) based on (i) any modifications to the PIP Studies resulting from meetings with, and submissions to, Regulatory Authorities, (ii) any Additional PIP Studies, (iii) any data analysis and other non-clinical work included in the Post-Marketing Work, or (iv) Additional Studies (solely to the extent such Additional Studies are performed by Licensor) (“Adjusted Budget”) and Licensee shall bear [***] percent ([***]%) of all such Costs in such Adjusted Budget and Licensor shall bear [***] percent ([***]%) of all such Costs in such Adjusted Budget.  In the event any new pediatric investigation plan studies not included in the PIP Studies are required by Regulatory Authorities in the Territory as a result of meetings with, and submissions to, MHRA or EMA in support of the same pediatric investigation plan objectives in the Territory of the PIP Studies through December 31, 2029, Licensor shall have the first right to conduct such additional studies
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and shall implement these efficiently to meet the requirements of such Regulatory Authorities (the “Additional PIP Studies”), and if Licensor conducts such Additional PIP Studies, Licensor shall provide Licensee an Adjusted Budget for such Costs associated with such Additional PIP Studies, and Licensee shall bear [***] percent ([***]%) of all such Costs in such Adjusted Budget and Licensor shall bear [***] percent ([***]%) of all such Costs.  In the event that Licensor elects not to conduct such Additional PIP Studies, Licensee may conduct such Additional PIP Studies, and Licensor shall bear [***] percent ([***]%) of all such costs for such Additional PIP Studies, and Licensee shall bear [***] percent ([***]%) of all such costs for such Additional PIP Studies, and Licensee shall provide Licensor with an Adjusted Budget.
(b)In the event there is a positive deviation between the Costs and the Budget (or Adjusted Budget) greater than [***] percent ([***]%), Licensor shall provide Licensee with all reasonable documentation supporting any increase in the Costs from the Budget (or Adjusted Budget), and the Parties will meet and agree upon an adjustment of Licensee’s share above such [***] percent ([***]%) deviation, and any such amendment shall be done in writing by mutual agreement and with formal amendment to this Agreement; provided further, that to the extent any such increase to the Budget (or Adjusted Budget) which is caused by and commensurate with a material market event (not caused by or related to any fault, action or omission by the Licensee), material new or increased requirements by a Regulatory Authority or material changes in Applicable Laws, Licensee shall bear [***] percent ([***]%) of such Adjusted Budget to account for such material market event or material new or increased requirements by a Regulatory Authority, or material changes in Applicable Law.  Licensor shall invoice Licensee for its share of the Costs, and Licensee shall make payment to Licensor for such Costs within thirty (30) days following the invoice date.  Except as expressly provided herein, any PBC Product Development undertaken by Licensee in the Territory shall be undertaken at Licensee’s cost and expense.  Upon Licensor’s request, Licensee shall submit to Regulatory Authorities, in a form and manner directed by Licensor, any Regulatory Documentation prepared by Licensor in connection with such Post-Marketing Work.
(c)In the event the FDA and/or one or more Regulatory Authority(ies) in the Territory requires additional clinical studies not included in the PIP Studies or Additional PIP Studies for the PBC Product and such requirement arises from the 2022 annual renewal procedures set forth by the EMA or MHRA relating to the COBALT (302) Study (described on Schedule 4.2.1(a)) (“Additional Studies”), (i) if the FDA requires such Additional Studies (whether or not any other Regulatory Authorities in the Territory also require such Additional Studies), then Licensor shall perform such Additional Studies; and (ii) otherwise Licensor shall have the first right to perform such Additional Studies, and if the Licensor elects not to, then the Licensee may conduct such Additional Studies.  In the event that Licensor performs such Additional Studies which are required by the FDA but no Regulatory Authorities in the Territory also require such Additional Studies, such Additional Studies shall not be considered part of the Post-Marketing Work and Licensor shall perform such Additional Studies at its cost and expense.  In the event that Licensor exercises its first right to perform such Additional Studies which are required by one or more Regulatory Authorities in the Territory (whether or not also required by the FDA) , such Additional Studies shall be considered part of the Post-Marketing Work and addressed in an Adjusted Budget provided by Licensor to Licensee, and Licensee shall bear [***] percent ([***]%) of all such Costs in such Adjusted Budget and Licensor shall bear [***] percent ([***]%) of all such Costs.  In the event that Licensee performs such Additional Studies which are not required by the FDA, such Additional Studies shall not be considered part of the Post-Marketing Work and Licensee shall perform such Additional Studies at its cost and expense.
(d)In the event that there is a termination, suspension or wind-down of the PIP Studies or Additional PIP Studies, or any portion thereof, that is agreed to by the Regulatory Authorities prior to December 31, 2029, the Licensor’s obligation to perform such Post-Marketing Work (including PIP Studies or Additional PIP Studies) shall be modified based on such approved action by the Regulatory Authority.  In such event, Licensor shall submit an Adjusted Budget to Licensee to reflect the reduction in
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scope to such Post-Marketing Work (including PIP Studies or Additional PIP Studies), and such Adjusted Budget shall be subject to the provisions of Section 4.2.1(a).
4.2.2NASH Product Development.  Notwithstanding anything in this Agreement to the contrary, Licensor shall have the sole and exclusive right to conduct all Development work, including Clinical Trials necessary for the Development of the NASH Product up until receipt of Regulatory Approval by the FDA of the NASH Product for the NASH Indication.  Any NASH Product Development undertaken by Licensee in the Territory shall be undertaken at Licensee’s cost and expense.
4.2.3Cooperation.  Licensor shall provide such technical assistance and cooperation to Licensee as Licensee may reasonably request in writing as necessary for Licensee to Develop the Licensed Products for the Field for the Licensed Indications in the Territory, subject to Licensees’ reimbursement of Licensor’s out-of-pocket costs and expenses related thereto.  Licensor shall invoice Licensee for any such costs and expenses, and Licensee shall make payment to Licensor for such costs and expenses within thirty (30) days following the invoice date.
4.3Regulatory.
4.3.1Subject to the provisions of Article 2 and this Article 4, Licensee shall have authority and responsibility for regulatory activities for the Licensed Products for the Field for the Licensed Indications in the Territory.  Licensee will have the right to conduct all communications with Regulatory Authorities, including all meetings, conferences and discussions (including advisory committee meetings), with regard to the Licensed Products for the Field for the Licensed Indications in the Territory; provided, however, that Licensee shall notify Licensor of all such communications, and Licensor shall have the right to attend and reasonably participate in any such meetings, conferences and discussions.  Licensee will lead and have control over preparing and submitting all regulatory filings related to the Licensed Products for the Field for the Licensed Indications in the Territory, including all applications for Regulatory Approval; provided, however, that all such filings and submissions shall be submitted in advance to Licensor for review and comment with such comments to be incorporated in good faith and require Licensor’s prior written approval, such approval not to be unreasonably withheld, conditioned or delayed.  Licensee will own any and all Regulatory Approvals and applications therefor (including INDs) and other regulatory filings related to the Licensed Products for the Field for the Licensed Indications in the Territory, which will be held in the name of Licensee or its designees.  For clarity, Licensor retains the right to file, and owns, any and all Regulatory Approvals and applications therefor (including INDs), and other regulatory filings related to the Licensed Products outside of the Territory.  Licensee agrees to grant to Licensor any rights to such Regulatory Approvals and applications therefor (including INDs) in the Territory necessary for Licensor to perform the activities set forth in Section 4.2, including in the Territory.
4.3.2Safety Reporting.  The Parties agree to comply with any and all Applicable Laws that are applicable as of the Effective Date and thereafter during the Term in connection with Licensed Product safety data collection and reporting.  If either Party has or receives any safety information which may be related to the use of Licensed Product, then such Party shall provide the other Party with all such information in accordance with the obligations set forth in the SDEA.
4.3.3Safety Data Exchange Agreement.  Without limiting Section 4.3.2, the Parties have executed as of the Effective Date that certain Safety Data Exchange Agreement, which sets forth standard operating procedures governing the collection, investigation, reporting, and exchange of safety information sufficient to permit each Party to comply with its regulatory and other legal obligations within applicable timeframes (the “SDEA”).  Each Party shall comply with its obligations under the SDEA.
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(a)If either Party is subject of a request, court order or other directive of a Governmental Body or Regulatory Authority to withdrawal or recall any Licensed Product from the market in the Territory, or otherwise becomes aware of any product safety concern or other circumstances which may reasonably result in a withdrawal or recall being undertaken voluntarily it shall notify immediately the other Party in writing (a “Recall Notice”) enclosing a copy of all relevant information.
(b)Following receipt of a Recall Notice, both Parties shall:
(i)Discuss the Recall Notice in good faith with a view to agreeing to the course of action to be taken (subject to Section 4.3.4(c) either Party shall be free to undertake a withdrawal or recall in respect of any Licensed Product which it has placed on the market in the Territory (with respect to Licensee) or outside the Territory (with respect to Licensor)); and
(ii)Comply with their respective obligations set forth in the Quality Agreement.
(c)Unless required by Applicable Law, neither Party may (i) refer to the other Party in any public statement or announcement; or (ii) make any admission of liability on the other Party’s behalf, whether in connection with a withdrawal, recall or otherwise, without the other Party’s prior written consent.
4.3.5Adverse Risk. The Parties agree to actively cooperate in the event that there is an Adverse Risk to a Licensed Product, subject to the final decision-making set forth in Section 3.3.
ARTICLE 5
COMMERCIALIZATION
5.1Commercialization Generally.  Subject to Section 5.2, Licensee shall have sole responsibility for, and control over, the Commercialization of the Licensed Products for the Field for the Licensed Indications in the Territory.  The Parties shall reasonably coordinate to create alignment on nonpromotional materials and medical information used in the Commercialization of the Licensed Products in their respective territories. Subject to the terms and conditions of this Agreement, Licensee shall bear one hundred percent (100%) of all costs and expenses associated with the Commercialization of the Licensed Products in the Territory.  Following receipt of Regulatory Approval for the NASH Product in a country or region in the Territory, Licensee, its Affiliates and/or their respective Sublicensees shall use Commercially Reasonable Efforts to Commercialize the NASH Product that receives Regulatory Approval in such country or region, which efforts shall include using Commercially Reasonable Efforts to (a) Commercialize the NASH Product in the Territory to maximize the commercial return, (b) undertake marketing, promoting and selling the NASH Product in a diligent sustained manner consistent with the best practices of the pharmaceutical industry, and (c) establish and consistently seek to achieve specific and meaningful sales goals and allocate sufficient resources designed to meet such objectives, including, but not limited to, fielding, training (including any reasonably necessary medical education) and supervising a sales force (including an appropriate management structure) reasonably necessary for Licensee to perform its Commercialization obligations hereunder.
5.2Licensed Product Statements and Promotional Materials.  The Licensee shall only make statements and claims regarding the Licensed Products, including as to efficacy and safety, that are consistent with the product labels of the Licensed Products and the Promotional Materials, and Licensee shall not make any false or misleading statements or comments about the Licensed Products.  The Parties shall reasonably cooperate to create alignment in the marketing and Promotional Materials used for the Licensed Products for the Field for the Licensed Indications inside and outside of the Territory, including
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Licensor providing to Licensee after the Effective Date a one-time transfer of copies of Promotional Materials used by Licensor outside the Territory together with high resolution artwork and layout files used therein.  Licensee shall have a fully paid-up, perpetual, irrevocable non-exclusive right to use such Promotional Materials in the Territory in connection with the Commercialization of the PBC Product in the Territory.
ARTICLE 6
MANUFACTURING
6.1Supply of the Licensed Products.  The Parties have executed as of the Execution Date that certain Agreement for the Supply of Manufactured Products, effective as of the Effective Date, pursuant to which Licensee shall exclusively purchase from Licensor, and Licensor shall supply to Licensee, bulk tablets of the Licensed Products for Development and Commercialization by Licensee in accordance with this Agreement (the “Manufacturing Agreement”).  In connection with the Manufacturing Agreement, the Parties will also execute a certain Quality Agreement, governing the agreed upon specifications and other technical aspects of supply of the Licensed Products under the Manufacturing Agreement (the “Quality Agreement”).  The Parties shall comply with the obligations of the Manufacturing Agreement and Quality Agreement.
6.2Manufacture by Licensee.  Except as expressly permitted pursuant to Section 2.1 following the occurrence of a Selected Supply Event, Licensee shall not be permitted to Manufacture (or have Manufactured) the Licensed Products, inside or outside of the Territory, without the prior written consent of Licensor, and nothing herein shall be construed as granting any license or right to Licensee to Manufacture the Licensed Products.
6.3Finished Product Packaging and Labeling.  Licensee shall have the right and the sole obligation to perform all Packaging and Labeling for the Licensed Products in accordance with Applicable Laws and all applicable Regulatory Approvals for Licensee’s Development, Commercialization and use of the Licensed Products in connection with this Agreement.  In no event shall Licensor have any responsibility or liability for the Packaging and Labeling of the Licensed Products in the Territory.
ARTICLE 7
FINANCIALS
7.1Upfront Payment.  As consideration for the rights and licenses granted to Licensee under this Agreement (including the License) with respect to the Licensed Products, Licensee shall make a one-time, non-refundable, non-creditable amount to Licensor of US$364,500,000 in cash and cleared funds on the Completion Date in accordance with Section 7.5.
7.2Royalty.  As further consideration for the rights and licenses granted to Licensee under this Agreement (including the License) with respect to the NASH Product, during the Royalty Term, Licensee shall pay Licensor a royalty of [***] percent ([***]%) of Net Sales of the NASH Product.  Licensee shall pay such royalties owed to Licensor on a Calendar Quarter basis.  Royalties for Sales that take place in a Calendar Quarter shall be paid within thirty (30) days following the end of such Calendar Quarter, at the same time as delivery of the Financial Reports for such Calendar Quarter under Section 7.6.
7.3Sublicensee Income.  As further consideration for the rights and licenses granted to Licensee under this Agreement (including the License), Licensee shall pay Licensor [***] percent ([***]%) of all Sublicensee Income paid to Licensee or its Affiliates by a Sublicensee in consideration for any Sublicense granted to such Sublicensee to Develop or Commercialize the NASH Product pursuant to
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Section 2.2.  Licensee will make such payment to Licensor within thirty (30) days after the receipt by Licensee of any Sublicensee Income from such Sublicensee.
7.4Exclusivity Extension.  In the event an extension of orphan exclusivity of two (2) years for the PBC Product is received from the EMA prior to the receiving an extension from the MHRA, then:
Upon receipt of an extension of orphan exclusivity of two (2) years for the PBC Product by the EMA, Licensor shall provide Licensee notice that such extension has been granted and for the twelve (12) month period preceding the date of such receipt from the EMA extension grant Licensee shall calculate the aggregate Net Sales of the PBC Product in the EU Sales Territory divided by the aggregate Net Sales of the PBC Product in the United Kingdom and the EU Sales Territory, and multiply this by US$45,000,000 (the “EU First Payment Amount”).  The twelve (12) month calculation period shall be based on the first full month immediately preceding receipt of such notice of extension and the full twelve (12) month period preceding the end of such first full month.  Licensee shall pay the EU First Payment Amount to Licensor in cash and cleared funds as set forth in Section 7.5 no later than thirty (30) days of the Licensee being provided notice by Licensor that such EMA extension has been granted (which notice shall act as an invoice for this payment).  Thereafter, if and when an extension of orphan exclusivity of two (2) years for the PBC Product is received from the MHRA, Licensor shall provide Licensee notice that such extension has been granted and Licensee shall calculate US$45,000,000 less the EU First Payment Amount (the “MHRA Second Payment Amount”).  Licensee shall pay the MHRA Second Payment Amount to Licensor in cash and cleared funds as set forth in Section 7.5 no later than thirty (30) days of the Licensee being provided notice by Licensor that such extension by the MHRA has been granted (which notice shall act as an invoice for this payment).
Alternatively, in the event an extension of orphan exclusivity of two (2) years for the PBC Product is received from the MHRA prior to the receiving an extension from the EMA, then:
Upon receipt of an extension of orphan exclusivity of two (2) years for the PBC Product by the MHRA, Licensor shall provide Licensee notice that such extension has been granted and for the twelve (12) month period preceding the date of such receipt from the MHRA extension grant Licensee shall calculate the aggregate Net Sales of the PBC Product in the United Kingdom divided by the aggregate Net Sales of the PBC Product in the United Kingdom and the EU Sales Territory, and multiply this by US$45,000,000 (the “MHRA First Payment Amount”).  The twelve (12) month calculation period shall be based on the first full month immediately preceding receipt of such notice of extension and the full twelve (12) month period preceding the end of such first full month.  Licensee shall pay the MHRA First Payment Amount to Licensor in cash and cleared funds as set forth in Section 7.5 no later than thirty (30) days of the Licensee being provided notice by Licensor that such MHRA extension has been granted (which notice shall act as an invoice for this payment).  Thereafter, if and when an extension of orphan exclusivity of two (2) years for the PBC Product is received from the EMA, Licensor shall provide Licensee notice that such extension has been granted and Licensee shall calculate US$45,000,000 less the MHRA First Payment Amount (the “EMA Second Payment Amount”).  Licensee shall pay the EMA Second Payment Amount to Licensor in cash and cleared funds as set forth in Section 7.5 no later than thirty (30) days of the Licensee being provided notice by Licensor that such extension by the EMA has been granted (which notice shall act as an invoice for this payment).
For clarity: (i) the maximum aggregate payments that can become due and payable under this Section 7.4 is US$45,000,000, which would only occur in the event an extension of orphan exclusivity of two (2) years for the PBC Product is received from each of the MHRA and the EMA (regardless of which such extension is received first); and (ii) if only one such extension is received and the second extension is no longer
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achievable due to the deadline for approval expiring, then only one payment will become due and payable under this Section 7.4 (either the EMA First Payment Amount or the MHRA First Payment Amount, as applicable).
7.5Mode of Payment and Currency.  Unless otherwise directed by Licensor in writing, all payments to Licensor hereunder shall be made by deposit of US Dollars in the requisite amount to “Intercept Pharma Europe Ltd.” and will be made by delivery by ACH/WIRE to the account of Licensor notified to Licensee for this purpose.  Payments under this Agreement shall be made in US Dollars.  All royalties payable shall be calculated first in the currency of the jurisdiction in which payment was made, then converted into US Dollars at the average rate of exchange, as specified in Oanda, in respect of the period during which the Net Sales occurred.
7.6Royalty and Sublicensee Income Reports.  Within thirty (30) days after the end of each Calendar Quarter, Licensee shall deliver to Licensor a report (“Financial Report”), in a reasonable form requested by Licensor, setting out all details necessary to calculate the royalty and Sublicensee Income due under this Article 7 for such Calendar Quarter, including:  (a) the number of NASH Product sold by Licensee, its Affiliates and their respective Sublicensees in each country; (b) gross sales and Net Sales of the NASH Product made by Licensee, its Affiliates and Sublicensees; (c) royalties; (d) names and addresses of all Sublicensees; (e) Sublicensee Income payable to Licensor in such Calendar Quarter, if applicable; (f) a specification of all deductions and their dollar value taken under each of Section 1.49; and (g) the date of First Commercial Sale in each country or region in the Territory for the NASH Product (this need only be reported in the first Financial Report following such First Commercial Sale of in the respective country).
7.7Late Payments.  In addition to any other remedies available to Licensor, any failure by Licensee to make a payment within thirty (30) days after the date when due shall obligate Licensee to pay computed interest, the interest period commencing on the due date and ending on the actual payment date, to Licensor at a rate per annum (but with interest accruing on a monthly basis) four (4) percentage points above the then-applicable prime rate published by the Wall Street Journal (or, if not available therein, as quoted in a reputable source reasonably acceptable to both Parties), calculated daily on the basis of a 365-day year, or the highest rate allowed by Applicable Laws, whichever is lower.
7.8Default Payment.  In the event of default in payment of any payment owing to Licensor under the terms of this Agreement, and if it becomes necessary for Licensor to undertake legal action to collect said payment, Licensee shall pay reasonable, documented out-of-pocket attorneys’ fees and costs incurred in connection therewith.
7.9Accounting.  Each Party shall calculate all amounts, and perform other accounting procedures required, under this Agreement and applicable to it in accordance IFRS.
7.10Books and Records.  Licensee will keep accurate books and records of the Licensed Products and all Sublicenses and any agreements entered into by Licensee that involved Licensed IP.  Licensee will preserve these books and records for at least five (5) years from the date of the Financial Report to which they pertain.
7.11Audits.  Upon reasonable written notice, Licensor, at its own cost, through an independent auditor reasonably acceptable to Licensee, may inspect and audit the relevant financial books and records of Licensee pertaining to the calculation of any royalties and Sublicensee Income due to Licensor under this Agreement.  Licensee shall provide such auditors with access to necessary key personnel, and necessary financial books and records during reasonable business hours.  Such access need not be given to any such set of records more often than once each year unless for cause, or to any set of records for any
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period that has already been the subject of an audit under this Section 7.11.  Licensor shall provide Licensee with written notice of its election to inspect and audit the records related to the royalties and Sublicensee Income due hereunder not less than thirty (30) days prior to the proposed date of review of Licensee’s records by Licensor’s auditors.  Should the auditor find any discrepancy relating to the non-payment and/or underpayment of royalties or Sublicensee Income by Licensee, Licensee shall (a) promptly pay Licensor the amount of such non-payment and/or underpayment; and (b) shall reimburse Licensor for the cost of the audit, if non-payment of Sublicensee Income due is discovered or if such non-payment or underpayment of such Sublicensee Income or royalties equals or exceeds five percent (5%) of the Sublicensee Income or royalties, as applicable and as calculated separately, due during the time period audited.  If the auditor finds overpayment by Licensee, then Licensee shall have the right to deduct the overpayment from any future royalties or Sublicensee Income due to Licensor by Licensee.
7.12Taxes.
7.12.1Generally.  Each Party shall be solely responsible for the payment of all taxes imposed on its share of income arising from the activities of such Party under this Agreement.  Except for VAT which shall be subject to the provisions of Section 7.12.2, Licensee may withhold from payment made to Licensor under this Agreement any income tax required to be withheld by Licensee under Applicable Laws.  If any tax is withheld by Licensee, Licensee shall provide Licensor receipts or other evidence of such withholding and payment to the appropriate tax authorities on a timely basis following that tax payment.  Each Party agrees to cooperate with the other Party in claiming refunds or exemptions from such deductions or withholdings under any relevant agreement or treaty which is in effect.  The Parties shall discuss applicable mechanisms for minimizing such taxes to the extent possible in compliance with Applicable Laws.  In addition, the Parties shall cooperate in accordance with Applicable Laws to minimize indirect taxes (such as value added tax, sales tax, consumption tax and other similar taxes) in connection with this Agreement.
7.12.2VAT.
(a)The consideration for any License or other supply by Licensor for VAT purposes made or deemed to be made under this Agreement, including any non-monetary consideration, shall be deemed to be expressed as exclusive of any applicable VAT.  Licensee shall make all payments due hereunder (in addition to the consideration) and shall pay to Licensor all VAT that Licensor is required to account for in relation to amounts paid or consideration given under this Agreement.
(b)The Parties consider that, as the License is granted in connection with the sale of the Business (as defined in the BTA) under (and is required to be entered into under the terms of) the BTA and will be used for the purposes of the Business, the grant of the License will form part of a TOGC, and they shall use their reasonable endeavours to procure that such grant is so treated by HMRC.  This obligation shall not require the Licensor to make any appeal against any determination of HMRC that the grant does not amount to a TOGC.
(c)If it is determined that the grant of the License under this Agreement does not constitute a TOGC, or part of a TOGC, then the VAT chargeable by the Licensor to the Licensee shall be paid within ten (10) Business Days of the receipt by the Licensor of a valid VAT invoice and a copy of the confirmation from HMRC (such documentation to be delivered by the Licensor as soon as possible after receipt from HMRC).
(d)The Licensee warrants and undertakes to the Licensor that: (i) it is and will at Completion (as defined in the Share Purchase Agreement) be registered for UK VAT purposes as a member of a VAT group with Advanz Pharma Services Limited; (ii) the Licensed IP that is the subject of
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the License will be used by Advanz Pharma Services Limited for the purposes of the Business; and (iii) it is not taking the grant of the License as a nominee of any other Person.
ARTICLE 8
INTELLECTUAL PROPERTY
8.1Ownership of Intellectual Property.
8.1.1Inventorship.  Inventorship of Inventions shall be determined in accordance with US patent laws.  Ownership of Inventions shall follow inventorship.  Any dispute between the Parties on inventorship of Inventions may be referred to the JSC for discussion.
8.1.2Licensor Inventions.  Licensor shall be the sole owner of any Inventions and Know-How, and all intellectual property rights therein, that are first reduced to practice or discovered, developed, invented, created or obtained solely by Licensor, its Affiliates or Third Parties acting on its or its Affiliates’ behalf (“Licensor Inventions”), and will retain all of its rights, title and interests thereto; provided, however, that, for the avoidance of doubt, Licensor Inventions shall be included in Licensed Technology and subject to the License.
8.1.3Licensee Technology.  As between the Parties, Licensee will be the sole owner of any Inventions and Know-How, and all intellectual property rights therein, that are first reduced to practice or discovered, developed, invented, created or obtained solely by Licensee, its Affiliates or Third Parties acting on its or its Affiliates’ behalf while conducting activities under this Agreement or arising from or related to the exploitation of the Licensed Products, in each case without the use of Licensed IP or Licensor’s Confidential Information (such Inventions, Know-How and intellectual property rights, “Licensee Know-How”), and any Patents that claim such Licensee Know-How (“Licensee Patents” and, together with the Licensee Know-How, the “Licensee Technology”), and will retain all of its rights, title and interests thereto, subject to the license grant set forth in Section 2.4.1.
8.1.4Joint Inventions.  Licensor and Licensee will be the joint owners, each with an undivided one-half interest, of any Inventions and Know-How, and all intellectual property rights therein, that are first reduced to practice or discovered, developed, invented, created or obtained (a) jointly by Licensor, its Affiliates or Third Parties acting on its or its Affiliates’ behalf on the one hand and by Licensee, its Affiliates or Third Parties acting on its or its Affiliates’ behalf while conducting activities under this Agreement on the other hand or (b) by Licensee, its Affiliates or Third Parties acting on its or its Affiliates’ behalf through the use of the Licensed IP or Licensor’s Confidential Information (each (a) and (b), “Joint Inventions”), including any Patents that claim such Joint Inventions (“Joint Patents” and, together with the Joint Inventions, the “Joint IP”), and will retain all of its rights, title and interests thereto.
8.1.5Trademarks, Trade Dress and Copyrights.
(a)Goodwill.  Licensee acknowledges that all goodwill generated by Licensee’s, its Affiliates’ or any Sublicensee’s use of the Licensed NASH Trademarks will inure to the benefit of Licensor.
(b)Quality.  Licensee shall adhere to the level of quality for the Packaging and Labeling of the Licensed Products (and where Licensor has NASH Products made for it by Third Parties exercising its license rights to do so after a Selected Supply Event, the level of quality of the NASH Products) bearing the Licensed NASH Trademarks at least as high as that maintained by Intercept and Licensor prior to and during the Term, and adhere to such other quality control standards for the Packaging
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and Labeling (and in the event of a Selected Supply Event, any other quality control standards of Licensed Products) as Licensor may from time to time communicate to Licensee.
(c)Samples.  Licensee will submit samples of all the Packaging and Labeling of Licensed Products bearing the Licensed NASH Trademarks (and where Licensor has NASH Products made for it by Third Parties exercising its license rights to do so after a Selected Supply Event, samples of the NASH Products) to Licensor for approval prior to the first use of a Licensed NASH Trademark thereon, provided, however, that Licensee may continue to sell any Licensed Product bearing a Licensed NASH Trademark in the form that is substantially similar to that sold by Licensor, its Affiliates and their respective sublicensees prior to the Effective Date, without prior approval.
(d)Inspection.  Licensor will have the right to inspect, upon reasonable notice and during normal business hours, Licensee’s, its Affiliates’ and Sublicensees’ premises, records, operations and samples in connection with the use of the Licensed IP for the Packaging and Labeling of Licensed Products bearing the Licensed NASH Trademarks (and where Licensor has NASH Products made for it by Third Parties exercising its license rights to do so after a Selected Supply Event, the NASH Products), provided, however, that such inspections shall not be conducted in a manner that unduly interferes with Licensee’s operations.
(e)Licensee Selected Trademarks.  Licensee shall Commercialize, promote and otherwise exploit the PBC Product under the Licensed Trademark Ocaliva® in the Territory.  Licensor shall select, in coordination with Licensee, a Licensed NASH Trademark.
(f)Limited Use Outside the Territory.
(i)Licensor hereby grants to Licensee a non-exclusive, royalty-bearing, right and license under the Licensed NASH Trademark during the Term to (A) arrange, attend and present at investment bank or other financing/investment focused industry conferences, (B) arrange, attend and present at non-investment bank/financing/investment focused other industry conferences or seminars and/or trade shows (or anything similar) without using marketing materials incorporating use of a Licensed NASH Trademark that have not been pre-approved by the Licensor and without using any marketing booth presence that has not been pre-approved by the Licensor (which approvals shall not be unreasonably withheld, delayed or conditioned), and (C) subject to the provisions of Section 9.3(a), draft, review, edit, publish and/or submit (or anything similar) publications and/or articles, in each case of the foregoing (A), (B) and (C) outside the Territory only in connection with and in support of Licensee’s Development and Commercialization of the NASH Product in the Territory.
(ii)Licensor hereby grants to Licensee a non-exclusive, fully-paid, perpetual, irrevocable right and license under the Licensed Trademark Ocaliva® to (A) arrange, attend and present at investment bank or other financing/investment focused industry conferences, (B) arrange, attend and present at non-investment bank/financing/investment focused other industry conferences or seminars and/or trade shows (or anything similar) without using marketing materials incorporating use of a Licensed NASH Trademark that have not been pre-approved by the Licensor and without using any marketing booth presence that has not been pre-approved by the Licensor (which approvals shall not be unreasonably withheld, delayed or conditioned), and (C) subject to the provisions of Section 9.3(a), draft, review, edit, publish and/or submit (or anything similar) publications and/or articles, in each case of the foregoing (A), (B) and (C), outside the Territory only in connection with and in support of Licensee’s Development and Commercialization of the PBC Product in the Territory.
(g)Domain Name.  As of the Effective Date and until mutually agreed by the Parties otherwise, (i) the Licensor shall promptly reprogram any domain name associated with
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Development and Commercialization of the PBC Product or Nash Product held by the Licensor such that a person located in the Territory accessing such domain name is immediately, and without any user intervention or action, redirected to a relevant web page address of the marketing websites designated by the Licensee from time to time; and (ii) Licensee shall promptly reprogram the marketing websites such that a person located outside the Territory accessing such domain name is immediately, and without any user intervention or action, redirected to relevant webpages held by the Licensor designated by the Licensor from time to time.
8.2Patent Filing Prosecution and Maintenance.
8.2.1Licensed Patents and Joint Patents.  Licensed Patents will be held in the name of Licensor and obtained and maintained with counsel selected solely by Licensor.  Licensor shall have the first right to control the prosecution and maintenance (including, without limitation, all proceedings before the European Patent Office, and all foreign equivalent agencies, such as, interference proceedings, post grant reviews, oppositions, reexaminations, nullity actions and inter partes proceedings) (“Prosecution and Maintenance”) of all relevant Licensed Patents and any Joint Patents.  When used as a verb, “Prosecute and Maintain” means to engage in Prosecuting and Maintaining.  Licensor shall provide Licensee with a reasonable opportunity to review and comment on such filing and Prosecution and Maintenance efforts regarding such Licensed Patents and Joint Patents in the Territory, to the extent relevant to the Licensed Products, reasonably prior to any submissions with applicable patent authorities.  Licensor shall reasonably consider any such comments and the commercial strategy of Licensee in the Territory in its Prosecution and Maintenance of the Licensed Patents and Joint Patents.  Licensor shall be responsible for all out-of-pocket costs, all accrued attorney fees, expenses, official and filing fees (“Patent Costs”) for the Prosecution and Maintenance of the Licensed Patents and Joint Patents in the Territory.  If Licensor determines in its sole discretion to abandon, cease Prosecution and Maintenance any Licensed Patent or Joint Patent anywhere in the Territory, then Licensor shall provide Licensee written notice of such determination at least sixty (60) days before any deadline for taking action to avoid abandonment (or other loss of rights) and, except in the case of a strategic abandonment by Licensor, Licensee shall have the right (but not the obligation) to Prosecute and Maintain such Licensed Patent or Joint Patent in the Territory on behalf of Licensor and in Licensor’s name.  Licensee’s rights under this Section 8.2.1 with respect to any Licensed Patent licensed to Licensor by a Third Party shall be subject to the rights of such Third Party to Prosecute and/or Maintain such Licensed Patent.  If Licensee assumes responsibility for any Licensed Patent or Joint Patent pursuant to this Section 8.2.1, then Licensee shall afford Licensor the same review and comment rights afforded to Licensee in the circumstance where Licensor controls Prosecution and Maintenance, and all costs incurred by Licensee in the course of Prosecuting and Maintaining such Licensed Patent or Joint Patent (including Patent Costs) shall be borne by Licensee, without reimbursement by Licensor.
8.2.2Licensee Patents.  Licensee Patents will be held in the name of Licensee and obtained and maintained with counsel selected solely by Licensee.  Licensee shall retain sole responsibility and control over the Prosecution and Maintenance of all relevant Licensee Patents at Licensee’s cost and expense.  Licensee shall provide Licensor with a reasonable opportunity to review and comment on such filing and Prosecution and Maintenance efforts regarding such Licensee Patents reasonably prior to any submissions with applicable patent authorities.  Licensee shall reasonably consider any such comments and the commercial strategy of Licensor outside of the Territory in its Prosecution and Maintenance of the Licensee Patents.
8.2.3Cooperation.  Each Party shall provide the other Party all reasonable assistance and cooperation in the Patent prosecution efforts provided above in this Section 8.2, including providing any necessary powers of attorney and executing any other required documents or instruments for such prosecution.
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8.3Actions Regarding Licensed IP and Joint IP.
8.3.1If either Party, including, in the case of Licensee, Licensee’s Affiliates or their respective Sublicensees, learn of any infringement or violation by a Third Party (an “Infringement”) of any Licensed IP or Joint IP in the Territory, whether or not within the Field, it shall notify the other Party as soon as practicable.
8.3.2As between the Parties, Licensor shall have the first right, but not the obligation, to prosecute any Infringement with respect to Licensed IP and Joint IP against a competing product for the Field for the Licensed Indications in the Territory.  Notwithstanding the foregoing, if Licensor does not take commercially reasonable steps to prosecute or take other measures to address such an Infringement (a) within ninety (90) days following the first notice provided above with respect to such Infringement or (b) if such date occurs after the first such notice of such Infringement is provided, thirty (30) Business Days before the time limit, if any, set forth in appropriate laws and regulations for filing of such actions, whichever comes first, then Licensor shall so notify Licensee and Licensee shall have the right (but not the obligation) to prosecute such Infringement at its sole cost and expense.  For the avoidance of doubt, Licensor shall have the sole and exclusive right (but not the obligation) to prosecute any Infringement with respect to the Licensed IP or the Joint IP to the extent such Infringement is (i) outside of the Licensed Indications, whether or not in the Territory, or (ii) outside the Territory, whether or not for the Licensed Indications.
8.3.3If a Party is entitled to, and pursues an action against an Infringement in accordance with this Section 8.3, (a) the other Party shall, and shall cause its Affiliates and sublicensees (including Sublicensees) to, cooperate fully, including being joined as a necessary party to such action upon the pursuing Party’s request (in the case of Licensee’s request, at Licensee’s cost and expense), providing access to relevant documents and other evidence and making its employees available at reasonable business hours, (b) the Party pursuing any action against an Infringement shall consult with the other Party as to the strategy for such action and (c) such Party shall consider in good faith any comments from the other Party and shall keep the other Party reasonably informed of any steps taken with respect to such action; provided, however, clauses (b) and (c) shall not apply to any Infringement action prosecuted by Licensor pursuant to the last sentence of Section 8.3.2.
8.3.4The Party that is entitled to and pursues an action against an Infringement in accordance with this Section 8.3 shall have the right to control any settlement of such claim; provided that, except for any Infringement action pursued by Licensor pursuant to the last sentence of Section 8.3.2, no settlement shall be entered into without the prior consent of the other Party (which consent shall not be unreasonably withheld, conditioned or delayed) if such settlement would reasonably be expected to have a material adverse effect on the rights or interest of the other Party or any of its Affiliates or impose any costs or liability on, or involve any admission by, the other Party or any of its Affiliates.
8.3.5In the event that an action alleging nullity, invalidity or non-infringement of any Licensed IP shall be brought against Licensor or Licensee in the Territory that is related to a Licensed Product, Licensor shall have the right to take and control the action, in accordance with the provisions of this Section 8.3.
8.3.6Each Party shall bear its own costs and expenses relating to any action commenced pursuant to this Section 8.3; provided that the pursuing Party (or in the case of Section 8.3.5, the defending Party) shall reimburse the other Party for the costs and expenses incurred by the other Party for any assistance requested by the pursuing Party (or in the case of Section 8.3.5, the defending Party) for such action.  Except as otherwise agreed by the Parties in connection with a cost sharing arrangement, any recovery realized as a result of such litigation described above in this Section 8.3 (whether by way of
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settlement or otherwise) shall be first allocated to reimburse the Parties for their costs and expenses in connection with such action (which amounts shall be allocated pro rata if insufficient to cover the totality of such expenses). Except for any Infringement action prosecuted by Licensor pursuant to the last sentence of Section 8.3.2, (a) to the extent the action related to PBC Products in the Territory, then the remainder after such reimbursement shall be paid to Licensee, and (b) otherwise, [***] percent ([***]%) of the remainder after such reimbursement shall be paid to Licensee and [***] percent ([***]%) of the remainder after such reimbursement shall be paid to Licensor.
8.4Enforcement of Licensee Technology.
8.4.1If either Party learns of any Infringement by a Third Party of any Licensee Technology for the Licensed Products outside of the Territory, it shall notify the other Party as soon as practicable.
8.4.2Licensee shall have the first right (but not the obligation) at its own cost and expense to enforce all Licensee Technology related to the Licensed Products against Third Parties outside of the Territory.  If Licensee does not take steps to enforce the Licensee Technology within thirty (30) days of actual notice of any Infringement by a Third Party of any Licensee Technology outside of the Territory, Licensor may take enforcement actions and prosecute the suit, action or proceeding of the Licensee Technology against such Third Party at its own cost and expense.  In the event Licensor elects to prosecute a suit, action or proceeding under this Section 8.4.2, Licensor shall keep Licensee updated as to the steps it intends to take to prosecute such suit, action or proceeding, and shall otherwise provide Licensee with any information reasonably requested by Licensee.  Licensee agrees to be joined as party plaintiff if necessary to prosecute the suit, action or proceeding and to give Licensor reasonable authority to file and prosecute the suit, action or proceeding.  Licensee shall provide reasonable assistance to Licensor.
8.4.3The Party that is entitled to and pursues an action against an Infringement in accordance with this Section 8.4 shall have the right to control any settlement of such claim; provided that no settlement shall be entered into without the prior consent of the other Party (which consent shall not be unreasonably withheld, conditioned or delayed) if such settlement would reasonably be expected to have a material adverse effect on the rights or interest of the other Party or any of its Affiliates or impose any costs or liability on, or involve any admission by, the other Party or any of its Affiliates.
8.4.4Each Party shall bear its own costs and expenses relating to any action commenced pursuant to this Section 8.4; provided that the pursuing Party shall reimburse the other Party for the costs and expenses incurred by the other Party for any assistance requested by the pursuing Party for such action.  Except as otherwise agreed by the Parties in connection with a cost sharing arrangement, any recovery realized as a result of such litigation described above in this Section 8.4 (whether by way of settlement or otherwise) shall be first allocated to reimburse the Parties for their costs and expenses in connection with such action (which amounts shall be allocated pro rata if insufficient to cover the totality of such expenses), and the remainder after such reimbursement shall be paid to Licensor.
8.5Patent Marking.  Licensee shall place in a conspicuous location on any Licensed Product (or its packaging where appropriate and practicable) made or sold under this Agreement a patent notice in accordance with the Applicable Laws concerning the marking of patented articles where such Licensed Products are made or sold, as applicable.
8.6Patent Term Extensions.  The Parties shall reasonably cooperate with each other in obtaining Patent Term Extension in any country in the Territory under any statute or regulation equivalent or similar to 35 U.S.C. §156.  Licensor shall make such election (including by filing supplementary protection certificates and any other extensions that are now or in the future become available).  Licensee
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shall abide by such election and cooperate as reasonably requested by Licensor in connection with the foregoing (including by providing appropriate information and executing appropriate documentation).
ARTICLE 9
CONFIDENTIALITY AND PUBLICATIONS
9.1Confidentiality.  In the course of their activities pursuant to this Agreement, the Parties anticipate that they may disclose Confidential Information.  The Parties wish to protect such Confidential Information in accordance with this Section 9.1.  The provisions of this Section 9.1 shall apply to disclosures furnished to or received by a Party and its agents and representatives (which may include agents and representatives of its Affiliates).  Each Party shall advise its agents and representatives of the requirements of this Section 9.1 and shall be responsible to ensure their compliance with such provisions.
9.1.1Treatment of Confidential Information.  The Receiving Party shall (a) use such Confidential Information solely and exclusively in connection with the exercise of its rights and discharge of its obligations under this Agreement and (b) not disclose such Confidential Information without the prior written consent of the Disclosing Party to any Person other than its Affiliates and those of its and/or its Affiliates’ agents and representatives who need to know such Confidential Information in order to perform activities under or in connection with this Agreement and are subject to confidentiality obligations at least as stringent as those set forth herein.
9.1.2Permitted Disclosures.  Notwithstanding Section 9.1.1, a Party may disclose Confidential Information (a) to Regulatory Authorities as reasonably needed to Develop and/or obtain or maintain Regulatory Approvals of the Licensed Products, (b) to its Sublicensees as reasonably needed to Develop and/or Commercialize the Licensed Products, under terms of confidentiality that are no less restrictive than those set forth in this Agreement (including, in the case of Licensor, to its agents, sublicensees, or partners for Commercialization of the Licensed Products outside the Territory), (c) to prospective Sublicensees, strategic partners, merger partners or acquirers, existing and potential investors and in each case, their respective professional advisors, in connection with evaluation and/or negotiation of possible sublicense, corporate partnering, merger, asset purchase or other similar transactions; provided, however, that any such disclosure shall be subject to a written confidentiality agreement with terms of non-disclosure no less restrictive than those set forth in this Agreement, or (d) as reasonably needed to conduct or defend any litigation relating to this Agreement, the Licensed Products or such Party’s rights hereunder.  Furthermore, if the Receiving Party becomes legally compelled to disclose any Confidential Information in order to comply with Applicable Laws or with an order issued by a court or regulatory body with competent jurisdiction, the Receiving Party shall (i) provide prompt written notice to the Disclosing Party so that the Disclosing Party may seek a protective order or other appropriate remedy or waive its rights under this Section 9.1.2; and (ii) disclose only that portion of Confidential Information that is legally required to furnish; provided, however, that, in connection with such disclosure, the Receiving Party shall use Commercially Reasonable Efforts to obtain assurance that confidential treatment will be given with respect to such Confidential Information.
9.1.3Return and Destruction.  Upon the termination or expiration of this Agreement, upon the request of the Disclosing Party, the Receiving Party shall promptly re-deliver to the Disclosing Party all Confidential Information provided to the Receiving Party in tangible form or destroy the same and certify in writing that such destruction has occurred; provided, however, that nothing in this Agreement shall require the alteration, modification, deletion or destruction of computer backup tapes made in the ordinary course of business.  All notes or other work product prepared by the Receiving Party based upon or incorporating Confidential Information of the Disclosing Party shall be destroyed, and such destruction shall be certified in writing to the Disclosing Party by the Receiving Party.  Notwithstanding the foregoing, legal counsel to the Receiving Party shall be permitted to retain in its files one copy of all Confidential
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Information to evidence the scope of and to enforce the Party’s obligation of confidentiality under this Section 9.1.
9.1.4Term of Obligation.  The obligations and prohibitions contained in this Section 9.1 shall survive expiration or termination of this Agreement for a period of ten (10) years, which may be shortened or extended as mutually agreed by both Parties in writing.
9.2Publicity.  The Parties acknowledge that, in connection with the execution of the Share Purchase Agreement, the Parties shall issue the announcement (as defined in the Share Purchase Agreement).  The Parties agree that any public announcement regarding the transactions contemplated hereby, if any, by the Parties or any other publication, news release or other public announcement relating to this Agreement or to the performance hereunder, shall first be reviewed and approved by both Parties in writing, such approval not to be unreasonably withheld; provided, however, that any disclosure which a Party is required to make under Applicable Law, including, without limitation, the requirements of the Securities and Exchange Commission and Nasdaq Stock Exchange, may be made without the prior consent of the other Party.
9.3Publications; Review of Use of Trademarks for the Licensed Products in Publications.
(a)Licensee shall submit to Licensor for review and approval any proposed academic, scientific and medical publication or public presentation which contains any Licensed IP, Data, Licensor’s Confidential Information, makes use of the Licensed NASH Trademark or Licensed Trademark Ocaliva® outside the Territory or otherwise relates to the Licensed Products.  Such review and approval will be conducted for the purposes of preserving the value of the Licensed IP and the rights granted to Licensee hereunder as well as the optimal use of the Licensed NASH Trademark and Licensed Trademark Ocaliva® outside the Territory and determining whether any portion of the proposed publication or public presentation containing the Licensor’s Confidential Information or using any such trademark should be modified or deleted. Written copies of such proposed publication or public presentation required to be submitted hereunder shall be submitted to Licensor no later than thirty (30) days before submission for an abstract and forty-five (45) days before submission for a publication or public presentation (the “Licensor Review Period”).  The Licensor shall provide its comments with respect to such publications and presentations within thirty (30) days for an abstract and forty-five (45) days for a publication or public presentation, from Licensor’s receipt of such written copy.  Licensee shall fully address and remedy any reasonable objections of Licensor with respect to the use of such trademarks outside the Territory in such proposed publication or public presentation. The Licensor Review Period may be extended for an additional sixty (60) days in the event the Licensor can demonstrate reasonable need for such extension including for the preparation and filing of patent applications.
(b)Licensor agrees to use good faith efforts to provide notice to Licensee of academic, scientific and medical publications relating to the Licensed Products in the Territory.
(c)Licensor and Licensee will each comply with standard academic practice regarding authorship of scientific publications and recognition of contribution of other parties in any publication governed by this Section 9.3, including International Committee of Medical Journal Editors standards regarding authorship and contributions.
ARTICLE 10 
REPRESENTATIONS, WARRANTIES AND COVENANTS
10.1Mutual Representations and Warranties.  Each Party represents and warrants to the other Party that, as of the Execution Date:
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10.1.1such Party is duly organized and validly existing under the Applicable Law of the jurisdiction of its incorporation or organization;
10.1.2such Party has taken all action necessary to authorize the execution and delivery of this Agreement and the performance of its obligations under this Agreement;
10.1.3this Agreement is a legal and valid obligation of such Party, binding upon such Party and enforceable against such Party in accordance with the terms of this Agreement, except as enforcement may be limited by applicable bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other Applicable Laws relating to or affecting creditors’ rights generally and by general equitable principles; and
10.1.4such Party has all right, power and authority to enter into this Agreement, to perform its obligations under this Agreement.
10.2Representations and Warranties of Licensor.  Licensor hereby represents and warrants to Licensee that, as of the Execution Date:
10.2.1no party to the License Agreement has breached any of its obligations under the License Agreement; and
10.2.2Licensor has the right to grant the rights and licenses Licensor grants to Licensee under this Agreement.
10.3Representations and Warranties of Licensee.  Licensee hereby represents and warrants to Licensor that:
10.3.1Licensee has maintained and will maintain appropriate skilled personnel and facilities to carry out its obligations under this Agreement;
10.3.2No Licensee employees or other Persons performing services on behalf of Licensee under this Agreement have been debarred or excluded, or are the subject of debarment or exclusion proceedings, under Section 306 of the FD&C Act, and, if Licensee becomes aware that a Person performing on its behalf under this Agreement has been debarred or has become the subject of debarment or exclusion proceedings under Section 306 of the FD&C Act, Licensee shall promptly notify Licensor and shall prohibit such Person from performing on its behalf under this Agreement;
10.3.3There is no action, claim, demand, suit, proceeding, arbitration, grievance, citation, summons, subpoena, inquiry or investigation of any nature, civil, criminal, regulatory or otherwise, in law or in equity, pending or, to the best of Licensee’s knowledge, threatened against Licensee in connection with or relating to the transactions and/or activities contemplated by this Agreement; and
10.3.4Licensee is not aware of any Licensee Patents which are necessary for the Development or Commercialization of the Licensed Products for the Field for the Licensed Indications in the Territory.
10.4Disclaimer of Representations and Warranties.
10.4.1EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES SET FORTH IN SECTIONS 10.1, 10.2 AND 10.3, NEITHER PARTY MAKES ANY REPRESENTATIONS AND WARRANTIES, WHETHER EXPRESS OR IMPLIED, AND
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EXPLICITLY DISCLAIMS ANY REPRESENTATION AND WARRANTY, INCLUDING WITH RESPECT TO ANY ACCURACY, COMPLETENESS, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, COMMERCIAL UTILITY, NON-INFRINGEMENT, VALIDITY, PATENTABILITY OR TITLE FOR THE LICENSED INTELLECTUAL PROPERTY, LICENSED PATENTS, LICENSE AND ANY PRODUCT, OR THE LIKELIHOOD OF SUCCESSFUL DEVELOPMENT OR COMMERCIALIZATION OF THE LICENSED PRODUCTS.
10.4.2Furthermore, nothing in this Agreement will be construed as:  (a) a representation or warranty by Licensor as to the scope of any Licensed Patent; (b) a representation or warranty that anything made, used, sold or otherwise disposed of under this Agreement is or will be free from infringement of Patents, copyrights, trademarks or any other forms of intellectual property rights or tangible property rights of Third Parties; (c) obligating Licensor to bring or prosecute actions or suits against Third Parties for Patent, copyright or trademark infringement; and (d) conferring by implication, estoppel or otherwise any license or rights under any Patent of Licensor other than Licensed Patents as defined herein, regardless of whether such Patent(s) are dominant or subordinate to the Licensed Patents.
10.5Covenants.
10.5.1Each Party shall, and shall ensure that its Affiliates and their respective Sublicensees will, comply in all respects with Anti-Corruption Laws and all Applicable Laws in the performance of its obligations under this Agreement and any Regulatory Authority and Governmental Body health care programs having jurisdiction in such Party’s respective territory, each as may be amended from time to time.  Each Party shall immediately notify the other Party if it has any information or suspicion that there may be a violation of any Applicable Laws (including Anti-Corruption Laws) in connection with its performance under this Agreement or the Development or Commercialization of any Licensed Product hereunder.  In the event that either Party has violated or been suspected of violating any of its obligations, representations, warranties or covenants in this Section 10.5.1, such Party will take reasonable actions to remedy such breach and to prevent further such breaches from occurring.  Notwithstanding the foregoing, each Party will have the right, upon reasonable prior written notice and during the other Party’s regular business hours, to audit the other Party’s books and records in the event that a suspected violation of any Anti-Corruption Law needs to be investigated (in such Party’s reasonable, good-faith discretion).  Such audit shall be conducted by such Party’s audit team comprised of qualified auditors who have received anti-corruption training.  For clarity, a credible finding, after a reasonable investigation, of any breach of this Section 10.5.1 with respect to any Anti-Corruption Law, shall be deemed a material breach of this Agreement.
10.5.2Licensee shall require that work done by Licensee and its Affiliates pursuant to this Agreement shall be done by representatives of Licensee, including, but not limited to its employees or agents, that are required to assign all Intellectual Property developed in the performance of any obligation under this Agreement to Licensee, such assignments having terms materially consistent with those governing the ownership of Intellectual Property in this Agreement.
10.5.3Licensee shall not Develop or Commercialize the Licensed Products outside of the Territory or outside of the Licensed Indications.
10.5.4Licensee shall not, and shall cause its Affiliates and Sublicensees (including sub-Sublicensees) not to, engage in a Challenge to any Licensed Patent.  In the event that Licensee, its Affiliate or any Sublicensee (including any sub-Sublicensee) engages in a Challenge to any Licensed Patent, Licensor has the right to adjust the amounts payable under this Agreement as further set forth in this Section 10.5.4.  If Licensee does not, within fifteen (15) days following notice from Licensor, cease, or cause its Affiliate or Sublicensee (including any sub-Sublicensee) to cease, its participation in such
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Challenge or terminate the Sublicense with such Sublicensee, as applicable, then (a) during the pendency of such Challenge, the amounts payable by Licensee to Licensor under Section 7.2 shall increase to two (2) times the amount otherwise payable under Section 7.2, effective as of the first date of Licensee’s or its Affiliate’s or Sublicensee’s (including any sub-Sublicensee’s) first filing, joining, participation in, causing of the filing or provision of material support to the Challenge, (b) following the Challenge in the event that the Licensed Patent or claim of the Licensed Patent subject to the Challenge is not adjudged to be invalid by a court or Governmental Body of competent jurisdiction, the amounts payable by Licensee to Licensor under Section 7.2 shall increase to two and one-half (2.5) times the amount otherwise payable under Section 7.2, effective as of the date of such judgment, and (c) Licensee shall reimburse all otherwise unreimbursed reasonable costs and expenses of Licensor in defending such Challenge, including reasonable attorneys’ fees.  For clarity, to the fullest extent permitted by Applicable Law, Licensee agrees that no payment previously made to Licensor is refundable or may be offset as the result of any Challenge by Licensee, its Affiliate or its Sublicensee (including any sub-Sublicensee) even if the Challenge is successful or it is otherwise determined that the Licensed Patent does not include Valid Claims.  Notwithstanding the foregoing, if any Licensed Patent is asserted against Licensee, or its Affiliate or its Sublicensee (including any sub-Sublicensee), then Licensee or its Affiliate or Sublicensee (including any sub-Sublicensee) is entitled to all and any defenses available to it including challenging the validity or enforceability of such Licensed Patent and Licensor shall have no right to adjustment amounts payable by Licensor to Licensee as set forth herein.
10.5.5Licensor covenants that the License Agreement shall not be amended in any manner that materially adversely effects the rights of Licensee under this Agreement; provided, however, that termination of the License Agreement with survival of Licensee’s rights and licenses under this Agreement as provided for in clause (ii) of the signature page of this Agreement shall not be deemed a breach of this Section 10.5.5.
ARTICLE 11
INDEMNIFICATION; INSURANCE AND LIMITATION OF LIABILITY
11.1Indemnification by Licensor.  Licensor shall indemnify and hold harmless Licensee and its Affiliates and their respective directors, officers, employees and agents from and against any and all Damages, arising out of or resulting from any claim, demand, action, suit or proceeding by a Third Party (collectively, a “Third Party Claim”) to the extent arising from:  (a) any breach by Licensor of any of its representations, warranties or material obligations under this Agreement; (b) any gross negligence or willful misconduct of Licensor or any of their respective employees or agents in connection with this Agreement; (c) any Development, Commercialization, storage, handing or use of the Licensed Products by Licensor, its Affiliates and/or their respective Sublicensees, distributors, agents and/or customers outside the Territory; or (d) in the event of termination of this Agreement with respect to the NASH Product pursuant to Section 12.2 or Section 12.3, any Development, Commercialization, storage, handing or use of the NASH Products by Licensor, its Affiliates and/or their respective Sublicensees, distributors, agents and/or customers in the Territory; provided further that Licensor shall not have any obligations under this Section 11.1 to the extent such Damages arise out of the gross negligence, recklessness, or wrongful acts or omissions of Licensee.  Licensor’s indemnification obligations shall be limited to the extent covered by Licensee’s indemnification obligation under Section 11.2.
11.2Indemnification by Licensee.  Licensee shall indemnify and hold harmless Licensor and its Affiliates and their respective directors, officers, employees and agents from and against any and all Damages in connection with any Third Party Claim to the extent arising from:  (a) any breach by Licensee, any of its Affiliates and/or any of their respective Sublicensees of any of Licensee’s representations, warranties, covenants or material obligations under this Agreement; (b) the Development, Commercialization, storage, handling or use of the Licensed Products by Licensee, its Affiliates and/or
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their respective Sublicensees, distributors, agents and/or customers in the Territory; (c) any gross negligence or willful misconduct of Licensee, its Affiliates, their respective Sublicensees or any of their respective employees or agents in connection with this Agreement; or (d) any exploitation by Licensee, its Affiliates and/or their respective Sublicensees of the Licensed Products in the Territory, including, but not limited to, product liability claims, provided that Licensee shall not have any obligations under this Section 11.2 to the extent such Damages arise out of the gross negligence, recklessness, or wrongful acts or omissions of Licensor.  Licensee’s indemnification obligations shall be limited to the extent covered by Licensor’s indemnification obligation under Section 11.1 or to the extent covered by Licensor’s indemnification obligation under the Manufacturing Agreement.
11.3Indemnification Procedure.  The indemnified Party shall give the indemnifying Party prompt written notice of any Third Party Claim with respect to which the indemnifying Party’s indemnification obligations apply, but any delay or failure of such notice shall not excuse such indemnification obligations except to the extent that the indemnifying Party’s legal position is actually and materially prejudiced thereby.  The indemnifying Party shall have the right to assume and control the defense and settlement of any Third Party Claim; provided, however, that the following conditions must be satisfied:  (a) the indemnifying Party must provide to the indemnified Party written acknowledgement of the indemnifying Party’s obligation to indemnify the indemnified Party hereunder against Damages that may result from the Third Party Claim, (b) the indemnified Party shall not have given the indemnifying Party written notice that it has determined, in the exercise of its reasonable discretion based on the advice of counsel, that a conflict of interest makes separate representation by the indemnified Party’s own counsel advisable, (c) the Third Party Claim does not include damages other than monetary damages for which indemnity hereunder is available, (d) the Third Party Claim does not relate to or arise in connection with any criminal proceeding, action, indictment, criminal allegation or investigation, and (e) if requested by the indemnified Party, the indemnifying Party has reasonably demonstrated its financial ability to pay for the defense of such Third Party Claim and to satisfy the full amount of any Damages that may result from such Third Party Claim.  The indemnified Party shall have the right to participate in the defense of the Third Party Claim at its own expense, but in any event shall cooperate with the indemnifying Party in the investigation and defense of the Third Party Claim.
11.4Indemnification Settlement.  If the indemnifying Party is entitled to, and does, assume and control the defense and settlement of any Third Party Claim with respect to which its indemnification obligations apply, then the indemnifying Party shall not settle such Third Party Claim without the indemnified Party’s prior written consent (which consent shall not be unreasonably withheld, conditioned or delayed), unless (a) the sole relief provided in such settlement is monetary in nature and shall be paid in full by the indemnifying Party and (b) such settlement does not include any finding or admission of a violation by the indemnified Party, its Affiliates or their respective Sublicensees of any Applicable Laws or Third Party’s rights.
11.5Insurance.  Licensee acknowledges and agrees that during the Term and for a period of three (3) years thereafter it shall maintain, at its own expense, Commercial General Liability Insurance in commercially reasonable amounts to cover Licensee’s indemnification and other obligations under this Agreement and as required under Applicable Laws; provided such insurance shall cover product and related contractual liabilities in amounts no less than (a) prior to the commencement of Clinical Trials of any Licensed Product by or on behalf of Licensee, its Affiliates or its Sublicensees, [***] United States dollars ($[***]) per occurrence for personal injury, bodily injury and injury or destruction of property, and [***] United States dollars ($[***]) in the aggregate, and (b) following the commencement of Clinical Trials for the first Licensed Product by or on behalf of Licensee, its Affiliates or its Sublicensees, [***] United States dollars ($[***]) per occurrence for personal injury, bodily injury and injury or destruction of property, and [***] United States dollars ($[***]) in the aggregate, in each case of (a) and (b), with an internationally recognized, reliable and financially sound insurance carrier, to cover Licensee’s obligations
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under this Agreement, including personal injury, bodily injury, including death resulting therefrom, and injury or destruction of property caused by or arising from activities conducted under this Agreement.  Minimum limits of insurance may be satisfied through a combination of primary and excess liability insurance policies.  Licensee shall name Licensor and its subsidiaries, Affiliates, employees, directors, officers, and agents as an additional insured on each such policy and an endorsement stating same must be endorsed to the policy(ies) providing such required coverage.  Licensee shall waive rights of subrogation against Licensor and its subsidiaries, Affiliates, employees and agents.  Licensee’s policies of insurance are primary and non-contributory with any other coverage maintained by any insured.  Licensee will furnish to Licensor, no later than the Effective Date, a properly executed Certificate of Insurance in English evidencing such coverages and endorsements set forth above, and shall, within ten (10) Business Days of any request by Licensor at any time during the Term, provide copies of the policies, with all endorsements evidencing the coverage required by this Agreement.  In the event of any notice of cancellation or non-renewal of the required minimum insurance, Licensee will take all necessary steps to ensure continuity of coverage and shall provide to Licensor written disclosure thirty (30) days in advance of such cancellation or non-renewal, along with evidence of its intention to enter into a replacement policy for the required insurance.
11.6Limitation of Liability.  EXCEPT FOR DAMAGES ARISING FROM A BREACH OF ARTICLE 8 OR ARTICLE 9, DAMAGES PAYABLE TO A THIRD PARTY IN CONNECTION WITH INDEMNIFICATION OBLIGATIONS PURSUANT TO ARTICLE 11, OR THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF A PARTY, IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY OF ITS AFFILIATES FOR SPECIAL, INDIRECT, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING LOSS OF PROFITS, WHETHER IN CONTRACT, WARRANTY, TORT, NEGLIGENCE, STRICT LIABILITY OR OTHERWISE ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREIN OR ANY BREACH HEREOF.  NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT, THE PARTIES ACKNOWLEDGE THAT THE PROVISIONS OF CLAUSE 10.1 OF THE SHARE PURCHASE AGREEMENT SHALL OPERATE TO LIMIT THE LIABILITY OF LICENSOR PURSUANT TO THIS AGREEMENT.
ARTICLE 12
TERM AND SURVIVAL
12.1Term.
12.1.1Effective Date. The Parties acknowledge that, as of the Execution Date, the Parties have entered into the Share Purchase Agreement, the Completion (as defined in the Share Purchase Agreement) of which shall not occur until the satisfaction or waiver of the Condition (as defined in the Share Purchase Agreement).  Accordingly, this Agreement is conditional in all respects on Completion taking place. Notwithstanding any other provision in it, this Agreement shall not take effect (and no term in it shall have effect) until Completion takes place (the “Completion Date”).  On and with effect from Completion, this Agreement shall have full effect in accordance with its terms. In the event that: (a) prior to Completion, the Share Purchase Agreement is terminated or otherwise ceases to have effect (whether pursuant to its terms, by agreement of the parties to it or otherwise) (each a “Termination”) or (b) Completion has not taken place on or prior to the Longstop Date (as defined in the Share Purchase Agreement); on and with effect from the first to occur of (i) the Longstop Date; and (ii) the date of such Termination, this Agreement shall automatically terminate and it shall have no effect (as if void when first entered into).  On and after automatic termination of this Agreement, no Party to it shall have any liability to any other Party to it pursuant to its terms and/or in respect of a breach of it, whether actual or contingent and whether in relation to the actual time of termination or the period prior to or following termination.
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12.1.2Term.  This Agreement shall become effective as of the Effective Date and shall continue in full force and effect until the final sale of all Licensed Products by Licensee, its Affiliates and its Sublicensees in the Territory (the “Term”).
12.2Licensor Rights of Termination for the NASH Product.  Licensor shall have the right to terminate this Agreement as expressly set forth in this Section 12.2.
12.2.1Termination for Material Breach.  In the event that Licensee commits a material breach of its obligations under this Agreement and such breach is not cured within ninety (90) days (or such other time period as mutually agreed by the Parties), or a material breach of its payment obligations under this Agreement that is not cured within thirty (30) days, after Licensee receives written notice from Licensor, which notice shall specify the nature of the breach and demand its cure, Licensor may terminate this Agreement, solely with respect to the NASH Product, upon written notice to Licensee.
12.2.2Insolvency Event.  In the event of a Licensee Insolvency Event, Licensor may terminate this Agreement, solely with respect to the NASH Product, upon written notice to Licensee.
12.2.3Adverse Risk Termination.  In the event that Licensee takes any action, or omits to take any action, that the JSC, through its final decision-making process pursuant to Section 3.3, has determined may have an Adverse Risk with respect to the NASH Product, Licensor may terminate this Agreement, solely with respect to the NASH Product, upon written notice to Licensee.
12.3Licensee Rights of Termination for the NASH Product.  Licensee may terminate this Agreement, solely with respect to the NASH Product, at any time effective upon at least ninety (90) days’ prior written notice to Licensor.
12.4Effects of Termination.  In the event of termination of this Agreement with respect to the NASH Product pursuant to Section 12.2 or Section 12.3, then this Agreement shall remain in full force and effect with respect to the PBC Product and the following terms shall apply solely with respect to the NASH Product:
12.4.1The rights and licenses in respect of the NASH Product granted by Licensor, including under Sections 2.1.2, 2.1.4, and 5.2 shall immediately terminate;
12.4.2Licensee shall, upon written request of Licensor, assign to Licensor all of its rights, title, and interests in and to all Regulatory Documentation (including any Regulatory Approvals) applicable to the NASH Product that are Controlled by Licensee or any of its Affiliates;
12.4.3If applicable, Licensee shall upon written request and approval of Licensor, notify the applicable Regulatory Authorities and take any other action reasonably necessary to effect the transfer set forth in Section 12.4.2;
12.4.4Licensee shall, in addition to the rights and licenses granted by Licensee to Licensor pursuant to Section 2.4, grant, and hereby grants, effective as of the effective date of termination, to Licensor (a) a non-exclusive, perpetual, irrevocable, royalty-free worldwide license, with the right to grant multiple tiers of sublicenses, under the Licensee Technology to the extent necessary or reasonably useful for Licensor to exploit the NASH Product in the Territory, and (b) a non-exclusive, perpetual, irrevocable, royalty-free worldwide license and Right of Reference or Use, with the right to grant multiple tiers of sublicenses and further rights of reference, under all Regulatory Documentation (including any Regulatory Approvals) then Controlled by Licensee or any of its Affiliates that are necessary or reasonably useful for Licensor or any of its Affiliates or sublicensees to exploit the NASH Product in the Territory;
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12.4.5Licensee shall, unless expressly prohibited by any Regulatory Authority, at Licensor’s written request, transfer Control to Licensor of all Clinical Trials for the NASH Product in the NASH Indication being conducted by Licensee or its Affiliates as of the effective date of termination and subject to reasonable time periods and conditions of transfer to ensure the safety and quality of such Clinical Trial; provided, however, that (a) Licensor shall not have any obligation to continue any Clinical Trial unless required by Applicable Laws, and (b) with respect to each Clinical Trial for which (i) such transfer is expressly prohibited by the applicable Regulatory Authority, (ii) Licensor does not accept assignment or (iii) wind-down is reasonably expected to take more than six (6) months, if any, solely in the case of termination pursuant to Sections 12.2.1 and 12.2.3, Licensee shall continue to conduct such Clinical Trial to completion, at Licensee’s cost;
12.4.6Licensee, at its sole cost and expense, to the extent applicable, shall within thirty (30) days of Licensor’s written request (a) conduct a technology transfer to Licensor, including all relevant Licensee Technology, included in the license set forth in 12.4.4, and (b) during a period of ninety (90) days following such technology transfer, provide other reasonable assistance necessary to permit Licensor to assume responsibility for the Development or Commercialization of the NASH Product; and
12.4.7Licensee shall duly execute and deliver, or cause to be duly executed and delivered, such instruments and shall do and cause to be done such acts and things, including the filing of such assignments, agreements, documents, and instruments, as may be necessary under, or as Licensor may reasonably request in connection with, or to carry out more effectively the purpose of, or to better assure and confirm unto Licensor its rights under this Section 12.4.
12.5Survival.  Expiration or termination of this Agreement shall not relieve any Party of any obligations that are expressly indicated to survive expiration or termination.  The provisions of Articles 1, 3 (with respect to the PBC Product), 5 (with respect to the PBC Product), 6 (with respect to the PBC Product), 8 (with respect to the PBC Product), 9, 10 (with respect to the PBC Product), 11, 13, and 14 and Sections 2.1.1, 2.1.3, 2.2, 2.3, 2.4, 2.5 (with respect to the PBC Product), 2.6, 4.1.1, 4.2, 4.3 (with respect to the PBC Product), 7.1, 7.2 (for royalties due prior to termination), 7.3 (for Sublicensee Income amounts due prior to termination), 7.4, 7.5, 7.7, 7.8, 7.9, 7.10, 7.11 (for a period of two (2) years after termination), 7.12, 10.4, 12.4, and this 12.5 shall survive expiration or termination.  Except as otherwise expressly provided, expiration or termination of this Agreement for any reason shall be without prejudice to any rights that shall have accrued to the benefit of any Party prior to such expiration or termination.
12.6Rights in Bankruptcy.  The Parties intend to take advantage of the protections of Section 365(n) (or any successor provision) of the US Bankruptcy Code or any analogous provisions in any other country or jurisdiction to the maximum extent permitted by Applicable Law.  All rights and licenses granted under or pursuant to this Agreement, but only to the extent they constitute licenses of a right to “intellectual property” as defined in Section 101 of the US Bankruptcy Code, shall be deemed to be “intellectual property” for the purposes of Section 365(n) or any analogous provisions in any other country or jurisdiction.  The non-bankrupt Party shall retain and may fully exercise all of its rights and elections under the US Bankruptcy Code or any analogous provisions in any other country or jurisdiction, including the right to obtain such intellectual property from another entity.  In the event of the commencement of a bankruptcy proceeding by or against a Party under the US Bankruptcy Code or any analogous provisions in any other country or jurisdiction, the non-bankrupt Party shall be entitled to a complete duplicate of (or complete access to, as appropriate) all such intellectual property (including all embodiments of such intellectual property), which, if not already in the non-bankrupt Party’s possession, shall be promptly delivered to it upon its’s written request (a) upon commencement of a bankruptcy proceeding, unless the bankrupt Party continues to perform all of its obligations under this Agreement, or (b) if not delivered pursuant to clause (a) because the bankrupt continues to perform, upon the rejection of this Agreement by or on behalf of the bankrupt Party.  Unless and until the bankrupt Party rejects this Agreement, the bankrupt
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Party shall perform this Agreement or provide such intellectual property (including all embodiments of such intellectual property) to the non-bankrupt Party, and shall not interfere with the rights of the non-bankrupt Party to such intellectual property, including the right to obtain the intellectual property from another entity.  In the case of an insolvency that is governed by non-US bankruptcy law, the Parties agree that, to the extent not prohibited by the applicable insolvency law, the non-bankrupt Party will be entitled to at least the same rights and protections afforded by the US Bankruptcy Code, including survival of the licenses granted hereunder even if the bankrupt Party revokes or terminates this Agreement and a copy of the embodiments of such intellectual property, without conditions other than any legally required payment of royalties.
ARTICLE 13
DISPUTE RESOLUTION; GOVERNING LAW
13.1Executive Officers.  If a dispute arises between the Parties concerning this Agreement, then such dispute shall be escalated to the Executive Officers of each Party.  The Executive Officers will meet and confer, as soon as practicable, in an attempt to resolve the dispute.  If the Parties are unable to resolve such dispute amicably within thirty (30) days from the date of escalation to the Executive Officers of each Party, then each Party may submit such dispute to the exclusive jurisdiction of, and venue in, the state and federal courts located in the State of New York pursuant to Section 13.2.
13.2Governing Law and Venue.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without giving effect to any choice of law provisions thereof that would result in the application of the law of any jurisdiction other than the State of New York.  Each Party hereby submits itself for the purpose of this Agreement and any controversy arising hereunder to the exclusive jurisdiction of the state and federal courts located within the Borough of Manhattan in the City of New York, and any courts of appeal therefrom, and waives any objection on the grounds of lack of jurisdiction (including, without limitation, venue) to the exercise of such jurisdiction over it by any such courts.  To the extent a payment alleged to be due under this Agreement is the subject of a bona fide good faith dispute asserted by the Licensee, the Licensor shall continue to provide all services as required by this Agreement during the pendency of the dispute so long as Licensee timely pays (including the allowance of 7 days cure period) all undisputed amounts due under this Agreement and can only withhold payment of disputed amounts where there is a bona fide good faith dispute.
13.3Injunctive Relief.  Notwithstanding anything to the contrary in this Agreement, either Party will have the right to seek temporary injunctive or preliminary equitable relief pending final resolution of any dispute, in any court of competent jurisdiction as may be available to such Party under the Applicable Laws in such jurisdiction with respect to any matters arising out of the other Party’s performance or breach of its obligations under this Agreement.
ARTICLE 14
MISCELLANEOUS
14.1Force Majeure.  Neither Party shall be held liable or responsible to the other Party or be deemed to have defaulted under or breached this Agreement for failure or delay in fulfilling or performing any term of this Agreement when such failure or delay is caused by or results from a Force Majeure event.  The non-performing Party shall notify the other Party of such Force Majeure within thirty (30) days after such occurrence by giving written notice to the other Party stating the nature of the event, its anticipated duration and any action being taken to avoid or minimize its effect.  The suspension of performance shall be of no greater scope and no longer duration than is necessary and the non-performing Party shall use Commercially Reasonable Efforts to remedy its inability to perform.
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14.2Notices.  All notices, documentation and other communications that are required or permitted under this Agreement shall be in writing in the English language, and delivered personally, sent by email or sent by internationally-recognized overnight courier to the addresses below.  Any such communication will be deemed to have been given (a) when delivered, if personally delivered or sent by email with confirmation of receipt (including read-receipt in the case of email), and (b) on the second Business Day after dispatch, if sent by internationally-recognized overnight courier.  Unless otherwise specified in writing, the mailing addresses of the Parties shall be as described below.
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85 King William Street, London, EC4N 7BL
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	For Licensor:
Intercept Pharma Europe Ltd.
Attn: Intercept Pharmaceuticals
305 Madison Avenue
Morristown, NJ 07960
Attention:  General Counsel
Email: [***]
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	For Licensee:
Mercury Pharma Group Limited
Capital House, 85 King William Street, 
London, EC4N 7BL
Attention:  The General Counsel
Email:
[***]
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	with a copy to:
DLA Piper LLP (USA)
51 John F. Kennedy Parkway
Suite 120
Short Hills, NJ 07078
United States of America
Attention:  [***]
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	with a copy to:
White & Case LLP
5 Old Broad Street
London
EC2N 1DW
United Kingdom
Attention:  [***]
Email: [***]
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14.3Independent Status.  Neither Party is an agent, employee or representative of the other Party.  Neither Party shall have the authority to make any statements, representations or commitments of any kind, nor to take any action, which shall be binding on the other Party, except as may be explicitly authorized by the other Party in writing.  This Agreement shall not constitute, create or in any way be interpreted as a joint venture, partnership or formal business organization of any kind.
14.4Entire Agreement; Amendment and Waiver.  This Agreement, including the Exhibits attached hereto (each of which is hereby and thereby incorporated herein and therein by reference) shall constitute the entire agreement and understanding of the Parties relating to the subject matter of this Agreement and supersedes all prior oral or written agreements, representations, understandings or arrangements between the Parties relating to the subject matter of this Agreement.  No amendment, supplement or other modification to any provision of this Agreement shall be binding unless in writing and signed by both Parties.  No waiver of any rights under this Agreement shall be effective unless in writing signed by the Party to be charged.  A waiver of a breach or violation of any provision of this Agreement will not constitute or be construed as a waiver of any subsequent breach or violation of that provision or as a waiver of any breach or violation of any other provision of this Agreement.
14.5Headings; Construction; Certain Conventions.  The headings used in this Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof.  The

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Exhibits to this Agreement are incorporated herein by reference and will be deemed a part of this Agreement.  Unless otherwise expressly provided herein or the context of this Agreement otherwise requires, (a) words of any gender include each other gender, (b) words such as “herein”, “hereof”, and “hereunder” refer to this Agreement as a whole and not merely to the particular provision in which such words appear, (c) words using the singular will include the plural, and vice versa, (d) the words “include,” “includes” and “including” will be deemed to be followed by the phrase “but not limited to”, “without limitation”, “inter alia” or words of similar import, (e) the word “or” will be deemed to include the word “and” (e.g., “and/or”) and (f) references to “Article,” “Section,” “subsection”, “clause” or other subdivision, or to an Exhibit or Schedule, without reference to a document are to the specified provision or Exhibit or Schedule of this Agreement.  Licensor and Licensee have each consulted counsel of their choice regarding this Agreement, and each acknowledges that this Agreement will be construed as if it were drafted jointly by the Parties and shall not be strictly construed against either Party.
14.6Assignment.  Subject to this Section 14.6, a Party shall not have the right to assign, by operation of law or otherwise, any of its rights or obligations under this Agreement without the prior written consent of the other Party, which shall not be unreasonably withheld, conditioned or delayed.  Any assignment not in accordance with this Section 14.6 shall be void.  Notwithstanding the limitations in this Section 14.6, either Party may assign this Agreement, or any rights or obligations hereunder in whole or in part, without the consent of the other Party, to (a) its Affiliates or (b) its successor in interest pursuant to a merger, acquisition, reorganization, consolidation or sale of all or substantially all of the assets of the business pertaining to the subject matter of this Agreement.
14.7Third Party Beneficiaries.  All rights, benefits and remedies under this Agreement are solely intended for the benefit of Licensor and Licensee, and no Third Party shall have any rights whatsoever to (a) enforce any obligation contained in this Agreement; (b) seek a benefit or remedy for any breach of this Agreement; or (c) take any other action relating to this Agreement under any legal theory, including but not limited to, actions in contract, tort (including but not limited to negligence, gross negligence and strict liability), or as a defense, setoff or counterclaim to any action or claim brought or made by the Parties.
14.8Severability.  If any provision of this Agreement or application thereof to anyone is adjudicated to be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect any provision or application of this Agreement which can be given effect without the invalid or unenforceable provision or application and shall not invalidate or render unenforceable such provision or application in any other jurisdiction.  Further, the judicial or other competent authority making such determination shall have the power to limit, construe or reduce the duration, scope, activity and/or area of such provision, and/or delete specific words or phrases as necessary to render, such provision enforceable in such jurisdiction.
14.9Further Assurances.  Each Party shall, as and when requested by the other Party, do all acts and execute all documents as may be reasonably necessary to give effect to the provisions of this Agreement.
14.10Translation.  This Agreement is in English language only, which language shall be controlling in all respects, and all versions hereof in any other language shall be for accommodation only and shall not be binding upon the Parties.  All communications and notices to be made or given pursuant to this Agreement, and any dispute proceeding related to or arising hereunder, shall be in the English language.  If there is a discrepancy between any translation of this Agreement and this Agreement, this Agreement shall prevail.
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14.11Other Obligations.  Except as expressly provided in this Agreement or as separately agreed upon in writing between Licensor and Licensee, each Party shall bear its own costs incurred in connection with the implementation of the obligations under this Agreement.
14.12Counterparts.  This Agreement may be executed simultaneously in any number of counterparts, any one of which need not contain the signature of more than one Party but all such counterparts taken together shall constitute one and the same agreement.  Copies of original signature pages sent by facsimile and/or PDF shall have the same effect as signature pages containing original signatures.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, duly authorized representatives of the Parties have executed this Agreement as of the Execution Date.
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	INTERCEPT PHARMA EUROPE LTD.

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	MERCURY PHARMA GROUP LIMITED

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	By:

	/s/ Rocco Venezia

	    

	By:

	/s/ Andreas Stickler

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	Name: Rocco Venezia

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	Name: Andreas Stickler

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	Title: Director

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	Title: Director

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Intercept Pharmaceuticals, Inc. hereby acknowledges and agrees, and represents and covenants to each of the Parties, that: (i) it has reviewed and consents to the terms and provisions of this Agreement; and (ii) if the License Agreement is terminated for any reason (other than due to breach of this Agreement by Licensee), then Licensee’s rights and licenses under this Agreement shall not terminate or otherwise be materially adversely effected, and all of Licensee’s rights and licenses under this Agreement, including all of the license grants provided in this Agreement, shall survive and continue pursuant to their terms notwithstanding the purported termination of the License Agreement as if Intercept Pharmaceuticals, Inc. were the Licensor under this Agreement.
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	INTERCEPT PHARMACEUTICALS, INC.

	    

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	By:

	/s/ Andrew Saik

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	Name: Andrew Saik

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	Title: Authorised Signatory

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Schedule 1.39.
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Licensed Patents
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[***]
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Schedule 4.2.1(a) – Post-Marketing Work
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[***]
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Schedule 4.2.1(b) – Budget
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[***]

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