Document:

Exhibit 10.25

 

PONIARD PHARMACEUTICALS, INC.

AMENDED AND RESTATED

CHANGE OF CONTROL AGREEMENT

(SENIOR EXECUTIVE)

 

This Amended and Restated Change of Control
Agreement (Senior Executive) (this “Agreement”), dated as of March 3,
2008, is entered into by and between PONIARD PHARMACEUTICALS, INC., a
Washington corporation (formerly known as NeoRx Corporation and as supplemented
by Section 13, the “Company”),
and CAROLINE LOEWY (the “Executive”).

 

The Board of Directors of the Company (the “Board”) has determined that it is in the best interests
of the Company and its shareholders to ensure that the Company will have the
continued dedication of the Executive, notwithstanding the possibility, threat
or occurrence of a Change of Control (as defined in Section 1 hereof) of
the Company.  The Board believes it is
imperative to diminish the inevitable distraction of the Executive arising from
the personal uncertainties and risks created by a pending or threatened Change
of Control, to encourage the Executive’s full attention and dedication to the
Company currently and in the event of any threatened or pending Change of
Control, and to provide the Executive with reasonable compensation and benefit
arrangements upon a Change of Control.

 

In order to accomplish these objectives, the Board
has caused the Company to enter into this Agreement.

 

1.                                      Definitions

 

1.1                                 “Change
of Control” shall have the definition set forth in Appendix A
hereto, which is hereby incorporated by reference.

 

1.2                                 “Change
of Control Date” shall mean the first date on which a Change of
Control occurs.

 

1.3                                 “Employment
Period” shall mean the two (2) year period commencing on
the Change of Control Date and ending on the second anniversary of such date.

 

1.4                                 “Original
Agreement” shall mean the Change of Control Agreement, dated as
of June 23, 2006, between the parties.

 

1.5                                 “Severance
Agreement” shall mean the Amended and Restated Key Executive
Severance Agreement, dated as of the date hereof, between the parties, as it
may be amended from time to time, that provides for certain benefits related to
termination of the Executive’s employment that are unrelated to a Change of
Control.

 

 

2.                                      Term

 

The initial term of this Agreement (“Initial Term”)
shall be for a period of one (1) year from the date this Agreement as
first appearing above; provided, however, that this Agreement shall
automatically renew for successive additional one (1) year periods (“Renewal Terms”) unless notice of
nonrenewal is given by either party to the other at least ninety (90) days
prior to the end of the Initial Term or any Renewal Term, and provided further
that if a Change in Control occurs during the Term, the Term shall
automatically extend for the duration of the Employment Period.  The “Term” of
this Agreement shall be the Initial Term plus all Renewal Terms and, if
applicable, the duration of the Employment Period.  At the end of the Term, this Agreement shall
terminate without further action by either the Company or the Executive.

 

3.                                      Employment

 

3.1                               Employment
Period

 

During the Employment Period, the Company hereby
agrees to continue the Executive in its employ or in the employ of its
affiliated companies, and the Executive hereby agrees to remain in the employ
of the Company or its affiliated companies, in accordance with the terms and
provisions of this Agreement; provided, however, that either the Company or the
Executive may terminate the employment relationship subject to the terms of
this Agreement.

 

3.2                               Position and
Duties

 

During the Employment Period, the Executive’s position,
authority, duties and responsibilities shall be at least commensurate in all
material respects with the most significant of those held, exercised and
assigned at any time during the ninety (90) day period immediately preceding
the Change of Control Date.

 

3.3                               Location

 

During the Employment Period, the Executive’s
services shall be performed at the Company’s offices on the Change of Control
Date at which the Executive was employed or any office that is subsequently
designated by the Company and is less than thirty (30) miles from such
location.

 

3.4                               Employment at
Will

 

The Executive and the Company acknowledge that,
except as may otherwise be provided under any other written agreement between
the Executive and the Company, the employment of the Executive by the Company
or its affiliated companies is “at will” and may be terminated by either the
Executive or the Company or its affiliated companies at any time with or
without cause.  Moreover, if prior to the
Change of Control Date, the Executive’s 

 

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employment
with the Company or its affiliated companies terminates for any reason, then
the Executive shall have no further rights under this Agreement; provided,
however, that the Company may not avoid liability for any termination payments
that would have been required during the Employment Period pursuant to Section 8
hereof by terminating the Executive prior to the Employment Period where such
termination is carried out in anticipation of a Change of Control and the
principal motivating purpose is to avoid liability for such termination
payments.

 

4.                                      Attention and Effort

 

During the Employment Period, and excluding any
periods of vacation and sick leave to which the Executive is entitled, the
Executive will devote all of the Executive’s productive time, ability,
attention and effort to the business and affairs of the Company and the
discharge of the responsibilities assigned to the Executive hereunder, and will
use the Executive’s reasonable best efforts to perform faithfully and
efficiently such responsibilities.  It
shall not be a violation of this Agreement for the Executive to (a) serve
on corporate, civic or charitable boards or committees, (b) deliver
lectures, fulfill speaking engagements or teach at educational institutions, (c) manage
personal investments, or (d) engage in activities permitted by the
policies of the Company or as specifically permitted by the Company, so long as
such activities do not significantly interfere with the performance of the
Executive’s responsibilities in accordance with this Agreement.  It is expressly understood and agreed that to
the extent any such activities have been conducted by the Executive prior to
the Employment Period, the continued conduct of such activities (or the conduct
of activities similar in nature and scope thereto) during the Employment Period
shall not thereafter be deemed to interfere with the performance of the
Executive’s responsibilities to the Company.

 

5.                                      Compensation

 

As long as the Executive remains employed by the
Company during the Employment Period, the Company agrees to pay or cause to be
paid to the Executive, and the Executive agrees to accept in exchange for the
services rendered hereunder by the Executive, the following compensation:

 

5.1                               Salary

 

The Executive shall receive an annual base salary
(the “Annual Base Salary”), at
least equal to the annual salary established by the Board or the Compensation
Committee of the Board (the “Compensation Committee”)
or the Chief Executive Officer for the fiscal year in which the Change of
Control Date occurs.  The Annual Base
Salary shall be paid in substantially equal installments and at the same
intervals as the salaries of other executives of the Company are paid.  The Board or the Compensation Committee or
the Chief Executive Officer shall review the Annual Base Salary at least
annually and shall determine in good faith and consistent with any generally
applicable Company policy any increases for future years.

 

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5.2                               Bonus

 

In addition to the Annual Base Salary, the Executive
shall be awarded, for each fiscal year ending during the Employment Period, an
annual performance bonus (the “Annual Performance Bonus”)
in cash at least equal to the average annualized (for any fiscal year
consisting of less than twelve (12) full months) bonus paid or payable to the
Executive by the Company and its affiliated companies in respect of the
Executive’s performance during the three fiscal years (or such shorter period
of employment) immediately preceding the fiscal year in which the Change of
Control Date occurs.  Each Annual
Performance Bonus shall be paid in the fiscal year following the fiscal year
for which the Annual Performance Bonus is awarded, but no later than the
fifteenth day of the third month of such subsequent fiscal year, unless the
Executive shall elect to defer the receipt of the Annual Performance Bonus in
accordance with the terms of the Company’s deferred compensation program.

 

6.                                      Benefits

 

6.1                               Incentive,
Retirement and Welfare Benefit Plans; Vacation

 

As long as the Executive remains employed by the Company
during the Employment Period, the Executive shall be entitled to participate,
subject to and in accordance with applicable eligibility requirements, in such
fringe benefit programs as shall be generally made available to other
executives of the Company and its affiliated companies from time to time during
the Employment Period by action of the Board (or any person or committee
appointed by the Board to determine fringe benefit programs and other
emoluments), including, without limitation, paid vacations; any stock purchase,
savings or retirement plan, practice, policy or program; and all welfare
benefit plans, practices, policies or programs (including, without limitation,
medical, prescription, dental, disability, salary continuance, employee life,
group life, accidental death and travel accident insurance plans or programs).

 

6.2                               Expenses

 

As long as the Executive remains employed by the Company
during the Employment Period, the Executive shall be entitled to receive prompt
reimbursement for all reasonable employment expenses incurred by the Executive in
accordance with the policies, practices and procedures of the Company and its
affiliated companies in effect for the executives of the Company and its
affiliated companies during the Employment Period.  Without limitation on the foregoing,
reimbursement shall be made no later than the end of the fourth month of the
year following the year in which the expense was incurred.

 

7.                                      Termination

 

During the Employment Period, employment of the
Executive may be terminated as follows, but, in any case, the nondisclosure
provisions set forth in Section 10 hereof shall survive the termination of
this Agreement and the termination of the Executive’s employment with the
Company:

 

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7.1                               By the Company
or the Executive

 

At any time during the Employment Period, the
Company may terminate the employment of the Executive with or without Cause (as
defined below), and the Executive may terminate the Executive’s employment for
Good Reason (as defined below) or for any reason, upon giving the Notice of
Termination (as defined below).

 

7.2                               Automatic
Termination

 

This Agreement and the Executive’s employment during
the Employment Period shall terminate automatically upon the death or Total
Disability of the Executive.  The term “Total Disability” as used herein shall mean the
Executive’s inability (with such accommodation as may be required by law and
which places no undue burden on the Company), as determined by a physician
selected by the Company and acceptable to the Executive, to perform the duties
set forth in Section 3.2 hereof for a period or periods aggregating twelve
(12) weeks in any three hundred sixty-five (365) day period as a result of
physical or mental illness, loss of legal capacity or any other cause beyond
the Executive’s control, unless the Executive is granted a leave of absence by
the Board.  The Executive and the Company
hereby acknowledge that the duties specified in Section 3.2 hereof are
essential to the Executive’s position and that Executive’s ability to perform
those duties is the essence of this Agreement.

 

7.3                               Notice of
Termination

 

Any termination by the Company or by the Executive
during the Employment Period shall be communicated by the Notice of Termination
to the other party given in accordance with Section 12 hereof.  The term “Notice of Termination”
shall mean a written notice that (a) indicates the specific termination
provision in this Agreement relied upon and (b) to the extent applicable,
sets forth in reasonable detail the facts and circumstances claimed to provide
a basis for termination of the Executive’s employment under the provision so
indicated.  The failure by the Executive
or the Company to set forth in the Notice of Termination any fact or
circumstance that contributes to a showing of Good Reason or Cause shall not
waive any right of the Executive or the Company hereunder or preclude the
Executive or the Company from asserting such fact or circumstance in enforcing
the Executive’s or the Company’s rights hereunder.

 

7.4                               Date of
Termination

 

During the Employment Period, “Date
of Termination” means (a) if the Executive’s employment is
terminated by reason of death, at the end of the calendar month in which the
Executive’s death occurs, (b) if the Executive’s employment is terminated
by reason of Total Disability, immediately upon a determination by the
Company of the Executive’s Total Disability, and (c) in all other cases,
ten (10) days after the date of personal delivery or mailing of the Notice
of Termination.  The Executive’s
employment and performance of services will continue during such ten (10) day
period; provided, however, that the Company 

 

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may,
upon notice to the Executive and without reducing the Executive’s compensation
during such period, excuse the Executive from any or all of the Executive’s duties
during such period.

 

8.                                      Termination Payments

 

In the event of termination of the Executive’s
employment during the Employment Period, all compensation and benefits set
forth in this Agreement shall terminate except as specifically provided in this
Section 8.

 

8.1                               Termination by
the Company Other Than for Cause or by the Executive for Good Reason

 

If during the Employment Period the Company
terminates the Executive’s employment other than for Cause or the Executive
terminates the Executive’s employment for Good Reason, the Executive shall be
entitled to:

 

(a)                                  receive payment of the
following accrued obligations (the “Accrued Obligations”):

 

(i)                                     the Annual Base
Salary through the Date of Termination to the extent not theretofore paid;

 

(ii)                                  the product of (x) the
Annual Performance Bonus payable with respect to the fiscal year in which the
Date of Termination occurs and (y) a fraction the numerator of which is
the number of days in the current fiscal year through the Date of Termination,
and the denominator of which is three hundred sixty-five (365);

 

(iii)                               any
compensation previously deferred by the Executive (together with accrued
interest or earnings thereon, if any); and

 

(iv)                              any accrued
vacation pay that would be payable under the Company’s standard policy, in each
case to the extent not theretofore paid;

 

(b)                                 for one year after the Date
of Termination or until the Executive qualifies for comparable medical and
dental insurance benefits from another employer, whichever occurs first, the
Company shall pay the Executive’s premiums for health insurance benefit
continuation for the Executive and the Executive’s family members, if
applicable, which the Company provides to the Executive under the provisions of
the federal Consolidated Omnibus Budget Reconciliation Act of 1985, as amended
(“COBRA”), to the extent that the Company would have paid
such premiums had the Executive remained employed by the Company (such
continued payment is hereinafter referred to as “COBRA
Continuation”);

 

(c)                                  an amount as severance pay equal
to one (1) times the Annual Performance Bonus payable with respect to the
fiscal year in which the Date of Termination occurs;

 

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(d)                                 an amount as severance pay
equal to one (1) times the Annual Base Salary for the fiscal year in which
the Date of Termination occurs; and

 

(e)                                  immediate vesting of all
outstanding stock options previously granted to the Executive by the Company.

 

8.2                               Termination for
Cause or Other Than for Good Reason

 

If during the Employment Period the Executive’s
employment shall be terminated by the Company for Cause or by the Executive for
other than Good Reason, this Agreement shall terminate without further
obligation on the part of the Company to the Executive, other than the Company’s
obligation to pay the Executive (a) the Annual Base Salary through the
Date of Termination, (b)  the amount of any compensation previously
deferred by the Executive in accordance with the terms of the Company’s
deferred compensation program, and (c) any accrued vacation pay that would
be payable under the Company’s standard policy, in each case to the extent
theretofore unpaid.

 

8.3                               Expiration of
Term

 

In the event the Executive’s employment is not
terminated prior to expiration of the Term, this Agreement shall terminate without
further obligation on the part of the Company to the Executive, other than the
Company’s obligation to pay the Executive the product of (a) the Annual
Performance Bonus payable with respect to the fiscal year in which the Term
expired and (b) a fraction the numerator of which is the number of days in
the current fiscal year through the end of the Term and the denominator of
which is three hundred sixty-five (365). 
Such payment will be made in the fiscal year following the fiscal year
in which the Term expired no later than the fifteenth day of the third month of
such subsequent fiscal year.

 

8.4                               Termination
Because of Death or Total Disability

 

If during the Employment Period the Executive’s
employment is terminated by reason of the Executive’s death or Total
Disability, this Agreement shall terminate automatically without further
obligation on the part of the Company to the Executive or the Executive’s legal
representatives under this Agreement, other than the Company’s obligation to
pay the Executive the Accrued Obligations (which shall be paid to the Executive’s
estate or beneficiary, as applicable in the case of the Executive’s death), and
to provide COBRA Continuation.

 

8.5                               Payment
Schedule

 

All payments of Accrued Obligations, or any portion
thereof payable pursuant to this Section 8, other than deferred
compensation pursuant to Section 8.1(a)(iii), shall be made to the
Executive within ten (10) working days of the Date of Termination.  Deferred compensation pursuant to Section 8.1(a)(iii) shall
be payable pursuant to the terms of the deferred compensation program.  Any payments payable to the Executive
pursuant to 

 

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Section 8.1(c) and
(d) hereof shall be made to the Executive in a lump sum within ten (10) working
days of the Date of Termination.  For
purposes of determining the payment schedule, other than for deferred
compensation pursuant to Section 8.1(a)(iii), to the extent that the
payment schedule in this Section 8.5 would subject payments to the
distribution requirements set forth in Section 409A(a)(2) of the
Internal Revenue Code of 1986, as amended (“Code”), because the Date of
Termination is different than the date that a person would be deemed to have
had a separation from service within the meaning of Code Section 409A(a)(2)(i),
the Date of Termination shall be treated as the latest date so as to not
subject such payments to the distribution requirements set forth in Code Section 409A(a)(2).  Notwithstanding the preceding provisions of this
Section 8, if necessary to meet the requirements of subparagraphs (A)(i) and
(B)(i) of Code Section 409A(a)(2), the amounts that would normally be
paid during the first six months after the Executive’s separation from service
within the meaning of Code Section 409A(a)(2) shall not be paid to an
Executive who is a specified employee (as defined in Code Section 409A(a)(2)(B)(i) in
accordance with the procedures established by the Compensation Committee) until
the six-month anniversary of the Executive’s separation from service.

 

8.6                               Cause

 

For purposes of this Agreement, “Cause”
means cause given by the Executive to the Company and shall include, without
limitation, the occurrence of one (1) or more of the following events:

 

(a)                                  a clear refusal
to carry out any material lawful duties of the Executive or any directions of
the Board or senior management of the Company, all reasonably consistent with
the duties described in Section 3.2 hereof;

 

(b)                                 persistent
failure to carry out any lawful duties of the Executive described in Section 3.2
hereof or any directions of the Board or senior management reasonably
consistent with the duties herein set forth to be performed by the Executive,
provided, however, that the Executive has been given reasonable notice and opportunity
to correct any such failure;

 

(c)                                  violation by
the Executive of a state or federal criminal law involving the commission of a
crime against the Company or any other criminal act involving moral turpitude;

 

(d)                                 current abuse
by the Executive of alcohol or controlled substances; deception, fraud,
misrepresentation or dishonesty by the Executive; or any incident materially
compromising the Executive’s reputation or ability to represent the Company
with investors, customers or the public; or

 

(e)                                  any other
material violation of any provision of this Agreement by the Executive, subject
to the notice and opportunity-to-cure requirements of Section 11 hereof.

 

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8.7                               Good Reason

 

For purposes of this Agreement, “Good
Reason” means

 

(a)                                  the assignment to the
Executive of any duties materially inconsistent with the Executive’s position,
authority, duties or responsibilities as contemplated by Section 3.2
hereof or any other action by the Company that results in a material diminution
in such position, authority, duties or responsibilities, excluding for this
purpose an isolated and inadvertent action not taken in bad faith and that is
remedied by the Company promptly after receipt of notice thereof given by the Executive;

 

(b)                                 any failure by the Company
to comply with any of the provisions of Section 5 or Section 6
hereof, other than an isolated and inadvertent failure not taken in bad faith
and that is remedied by the Company promptly after receipt of notice thereof
given by the Executive;

 

(c)                                  the Company’s requiring the
Executive to be based at any office or location other than that described in Section 3.3
hereof;

 

(d)                                 any failure by the Company
to comply with and satisfy Section 13 hereof; provided, however, that the
Company’s successor has received at least ten (10) days’ prior written
notice from the Company or the Executive of the requirements of Section 13
hereof; or

 

(e)                                  any other material violation
of any provision of this Agreement by the Company;

 

provided, however, that the Executive has notified
the Company of such assignment, failure, situation or violation within ninety
(90) days of its occurrence and there has been compliance with the notice and
opportunity-to-cure requirements of Section 11 hereof.

 

8.8                               Excess
Parachute Limitation

 

If any portion of the payments or benefits for the
Executive under this Agreement, the Severance Agreement, or any other agreement
or benefit plan of the Company (including stock option plan) would be
characterized as an “excess parachute payment” to the Executive under Section 280G
of the Internal Revenue Code of 1986, as amended (the “Code”),
the Executive shall be paid any excise tax that the Executive owes under Section 4999
of the Code as a result of such characterization, such excise tax to be paid to
the Executive at least ten (10) days prior to the date that the Executive
is obligated to make the excise tax payment. 
The determination of whether and to what extent any payments or benefits
would be “excess parachute payments” and the date by which any excise tax shall
be due, shall be determined in writing by recognized tax counsel selected by
the Company and reasonably acceptable to the Executive.  Without limitation on the foregoing, the
payments made pursuant to this 

 

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Section 8.8
shall be made no later than the end of the year following the year in which the
Executive remits such excise tax to the IRS.

 

8.9                               Release

 

As a condition to receiving the payments and benefits
under this Section 8, the Executive shall execute a general release and
waiver of all claims against the Company, which release and waiver shall be in
a form acceptable to the Company, in its reasonable discretion, and delivered
to the Company no later than the fifteenth day of the third month of the fiscal
year following the year in which the Date of Termination occurs.

 

9.                                      Representations, Warranties
and Other Conditions

 

In order to induce the Company to enter into this
Agreement, the Executive represents and warrants to the Company as follows:

 

9.1                               Health

 

The Executive is in good health and knows of no
physical or mental disability that, with any accommodation that may be required
by law and that places no undue burden on the Company, would prevent the
Executive from fulfilling the Executive’s obligations hereunder.  The Executive agrees, if the Company
requests, to submit to reasonable periodic medical examinations by a physician
or physicians designated by, paid for and arranged by the Company.  The Executive agrees that the examination’s
medical report shall be provided to the Company.

 

9.2                               No Violation of
Other Agreements

 

The Executive represents that neither the execution
nor the performance of this Agreement by the Executive will violate or conflict
in any way with any other agreement or obligations by which the Executive may
be bound.

 

10.                               Nondisclosure; Return of
Materials

 

10.1                        Nondisclosure

 

Except as required by the Executive’s employment
with the Company, the Executive will not, at any time during the term of
employment by the Company, or at any time thereafter, directly, indirectly or
otherwise, use, communicate, disclose, disseminate, lecture upon or publish
articles relating to any confidential, proprietary or trade secret information without
the prior written consent of the Company. 
The Executive understands that the Company will be relying on this
Agreement in continuing the Executive’s employment, paying the Executive compensation,
granting the Executive any promotions or raises, or entrusting the Executive with
any information that helps the Company compete with others.

 

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10.2                        Return of
Materials

 

All documents, records, notebooks, notes, memoranda,
drawings or other documents made or compiled by the Executive at any time, or
in the Executive’s possession, including any and all copies thereof, shall be
the property of the Company and shall be held by the Executive in trust and
solely for the benefit of the Company, and shall be delivered to the Company by
the Executive upon termination of employment or at any other time upon request
by the Company.

 

11.                               Notice and Cure of Breach

 

Whenever a breach of this Agreement by either party
is relied upon as justification for any action taken by the other party
pursuant to any provision of this Agreement, other than clause (a), (b), (c) or
(d) of Section 8.6 hereof, before such action is taken, the party
asserting the breach of this Agreement shall give the other party at least
twenty (20) days’ prior written notice of the existence and the nature of such
breach before taking further action hereunder and shall give the party
purportedly in breach of this Agreement the opportunity to correct such breach
during the twenty (20) day period.

 

12.                               Form of Notice

 

Every notice required by the terms of this Agreement
shall be given in writing by serving the same upon the party to whom it was
addressed personally or by registered or certified mail, return receipt
requested, at the address set forth below or at such other address as may
hereafter be designated by notice given in compliance with the terms hereof:

 

	
  If to the Executive:

  	
   

  	
  Caroline Loewy

  
	
   

  	
   

  	
  [Address]

  
	
   

  	
   

  	
   

  
	
  If to the Company:

  	
   

  	
  Poniard
  Pharmaceuticals, Inc.

  
	
   

  	
   

  	
  300 Elliott Avenue West,
  Suite 500

  
	
   

  	
   

  	
  Seattle, Washington 98119

  
	
   

  	
   

  	
  Attn: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  Perkins Coie LLP

  
	
   

  	
   

  	
  1201 Third Avenue, 48th
  Floor

  
	
   

  	
   

  	
  Seattle, Washington
  98101-3099

  
	
   

  	
   

  	
  Attn: James R. Lisbakken

  

 

Except as set forth in Section 7.4 hereof, if notice is mailed, such
notice shall be effective upon mailing.

 

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13.                               Assignment

 

This Agreement is personal to the Executive and
shall not be assignable by the Executive.

 

The Company shall assign to and require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise)
to all or substantially all the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the
same extent that the Company would be required to perform it if no such
succession had taken place.  As used in
this Agreement, “Company” shall mean Poniard Pharmaceuticals, Inc.
and any successor to its business and/or assets as aforesaid that assumes and
agrees to perform this Agreement by operation of law, or otherwise.  All the terms and provisions of this
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors and permitted assigns.

 

14.                               Waivers

 

No delay or failure by any party hereto in
exercising, protecting or enforcing any of its rights, titles, interests or
remedies hereunder, and no course of dealing or performance with respect
thereto, shall constitute a waiver thereof. 
The express waiver by a party hereto of any right, title, interest or
remedy in a particular instance or circumstance shall not constitute a waiver
thereof in any other instance or circumstance. 
All rights and remedies shall be cumulative and not exclusive of any
other rights or remedies.

 

15.                               Amendments in Writing

 

No amendment, modification, waiver, termination or
discharge of any provision of this Agreement, or consent to any departure
therefrom by either party hereto, shall in any event be effective unless the
same shall be in writing, specifically identifying this Agreement and the
provision intended to be amended, modified, waived, terminated or discharged
and signed by the Company and the Executive, and each such amendment,
modification, waiver, termination or discharge shall be effective only in the
specific instance and for the specific purpose for which given.  No provision of this Agreement shall be
varied, contradicted or explained by any oral agreement, course of dealing or
performance or any other matter not set forth in an agreement in writing and
signed by the Company and the Executive.

 

16.                               Applicable Law

 

This Agreement shall in all respects, including all
matters of construction, validity and performance, be governed by, and
construed and enforced in accordance with, the laws of the State of Washington,
without regard to any rules governing conflicts of laws.

 

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17.                               Arbitration; Attorneys’ Fees

 

Except in connection with enforcing Section 10
hereof, for which legal and equitable remedies may be sought in a court of law,
any dispute arising under this Agreement shall be subject to arbitration.  The arbitration proceeding shall be conducted
in accordance with the Commercial Arbitration Rules of the American Arbitration
Association (the “AAA Rules”) then in effect,
conducted by one arbitrator either mutually agreed upon or selected in
accordance with the AAA Rules.  The
arbitration shall be conducted in King County, Washington, under the
jurisdiction of the Seattle office of the American Arbitration
Association.  The arbitrator shall have
authority only to interpret and apply the provisions of this Agreement, and
shall have no authority to add to, subtract from or otherwise modify the terms
of this Agreement.  Any demand for
arbitration must be made within sixty (60) days of the event(s) giving
rise to the claim that this Agreement has been breached.  The arbitrator’s decision shall be final and
binding, and each party agrees to be bound to by the arbitrator’s award,
subject only to an appeal therefrom in accordance with the laws of the State of
Washington.  Either party may obtain
judgment upon the arbitrator’s award in the Superior Court of King, County,
Washington.

 

If it becomes necessary to pursue or defend any legal
proceeding, whether in arbitration or court, in order to resolve a dispute
arising under this Agreement, the prevailing party in any such proceeding shall
be entitled to recover its reasonable costs and attorneys’ fees.  To the extent necessary to prevent Executive
from being subject to any additional tax pursuant to Code Section 409A(a)(1)(B),
any amounts payable to the Executive pursuant to this paragraph shall be paid
in no event later than the year following the year during which such costs and
fees were incurred.

 

18.                               Severability

 

If any provision of this Agreement shall be held
invalid, illegal or unenforceable in any jurisdiction, for any reason,
including, without limitation, the duration of such provision, its geographical
scope or the extent of the activities prohibited or required by it, then, to
the full extent permitted by law, (a) all other provisions hereof shall
remain in full force and effect in such jurisdiction and shall be liberally
construed in order to carry out the intent of the parties hereto as nearly as
may be possible, (b) such invalidity, illegality or unenforceability shall
not affect the validity, legality or enforceability of any other provision
hereof, and (c) any court or arbitrator having jurisdiction thereover
shall have the power to reform such provision to the extent necessary for such
provision to be enforceable under applicable law.

 

19.                               Entire Agreement

 

This Agreement supersedes and replaces the Original
Agreement, and except as described in Section 23 hereof, this Agreement
constitutes the entire agreement between the Company and the Executive with
respect to the subject matter hereof, and all prior or contemporaneous oral or
written communications, understandings or agreements between the 

 

13

 

Company
and the Executive with respect to such subject matter, are hereby superseded
and nullified in their entireties, except that the Proprietary Information and
Invention Agreement between the Company and the Executive shall continue in
full force and effect to the extent not superseded by Section 10 hereof.

 

20.                               Withholding

 

The Company may withhold from any amounts payable
under this Agreement such federal, state or local taxes as shall be required to
be withheld pursuant to any applicable law or regulation.

 

21.                               409A Interpretation
Provision

 

The
Company intends that this Agreement fully comply with the payout and other
limitations and restrictions imposed under Code Section 409A if and to the
extent such Code Section 409A is otherwise applicable to payments under
this Agreement and such compliance is necessary to avoid the penalties
otherwise imposed under Code Section 409A. 
In this connection, the Company and Executive agree that the payout
timing provisions and any other terms of this Agreement shall be interpreted
and deemed modified, if and to the extent necessary, to comply with the payout
and other limitations and restrictions imposed under Code Section 409A if
and to the extent such Code Section 409A is otherwise applicable to this
Agreement and such compliance is necessary to avoid the penalties otherwise
imposed under Code Section 409A.

 

22.                               Counterparts

 

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

 

23.                               Coordination with Severance
Agreement

 

The Severance Agreement that the parties entered
into provides for certain forms of severance and benefit payments in the event
of termination of the Executive’s employment. 
This Agreement is in addition to the Severance Agreement and in no way
supersedes or nullifies the Severance Agreement.  Nevertheless, it is possible that termination
of employment by the Company or by the Executive may fall within the scope of
both agreements.  In such event, payments
made to the Executive under Section 8.1 hereof shall be coordinated with
payments made to the Executive under Section 5.1 of the Severance
Agreement as follows:

 

(a)                                  Accrued Obligations under
this Agreement shall be paid first, in which case Accrued Obligations need not
be paid under the Severance Agreement;

 

(b)                                 COBRA Continuation under
this Agreement shall be provided first, in which case COBRA Continuation need
not be provided under the Severance Agreement; and

 

14

 

(c)                                  the severance payment
required under Section 8.1(d) hereof shall be paid first, in which
case only that portion of any severance payment required under Section 5.1(c) of
the Severance Agreement that is in excess of the severance payment required
under Section 8.1(d) hereof shall be paid in accordance with the
provisions of the Severance Agreement.

 

IN WITNESS WHEREOF, the parties have executed and
entered into this Agreement effective on the date first set forth above.

 

	
   

  	
  PONIARD PHARMACEUTICALS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald McMahon

  
	
   

  	
   

  	
  Name: Gerald McMahon

  
	
   

  	
   

  	
  Its: Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Caroline Loewy

  
	
   

  	
   

  	
  Name: Caroline Loewy

  

 

15

 

APPENDIX A

 

For purposes of this Agreement, a “Change
of Control” shall mean:

 

(a)                                  A “Board
Change” that, for purposes of this Agreement, shall have
occurred if a majority (excluding vacant seats) of the seats on the Board are
occupied by individuals who were neither (i) nominated by a majority of
the Incumbent Directors nor (ii) appointed by directors so nominated.  An “Incumbent Director”
is a member of the Board who has been either (i) nominated by a majority
of the directors of the Company then in office or (ii) appointed by
directors so nominated, but excluding, for this purpose, any such individual
whose initial assumption of office occurs as a result of either an actual or
threatened election contest (as such terms are used in former Rule 14a-11
of Regulation 14A promulgated under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”)) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person (as hereinafter defined) other than the Board; or

 

(b)                                 The acquisition by any
individual, entity or group (within the meaning of Section 13(d)(3) or
14(d)(2) of the Exchange Act) (a “Person”) of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under
the Exchange Act) of (i) twenty percent (20%) or more of either (A) the
then outstanding shares of Common Stock of the Company (the “Outstanding
Company Common Stock”) or (B) the combined voting power of
the then outstanding voting securities of the Company entitled to vote generally
in the election of directors (the “Outstanding Company Voting
Securities”), in the case of either (A) or (B) of this
clause (i), which acquisition is not approved in advance by a majority of the
Incumbent Directors, or (ii) thirty-three percent (33%) or more of either (A) the
Outstanding Company Common Stock or (B) the Outstanding Company Voting
Securities, in the case of either (A) or (B) of this clause
(ii), which acquisition is approved in advance by a majority of the Incumbent
Directors; provided, however, that the following acquisitions shall not
constitute a Change of Control:  (x) any
acquisition by the Company, (y) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company, or (z) any acquisition by any
corporation pursuant to a reorganization, merger or consolidation, if,
following such reorganization, merger or consolidation, the conditions
described in clauses (i), (ii) and (iii) of subsection (c) of
this Appendix A are satisfied; or

 

(c)                                  Approval by the shareholders
of the Company of a reorganization, merger or consolidation, in each case,
unless, immediately following such reorganization, merger or consolidation, (i) more
than sixty percent (60%) of, respectively, the then outstanding shares of
common stock of the corporation resulting from such reorganization, merger or
consolidation and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or
substantially all the individuals and entities who were 

 

 

the
beneficial owners, respectively, of the Outstanding Company Common Stock and
the Outstanding Company Voting Securities immediately prior to such
reorganization, merger or consolidation in substantially the same proportion as
their ownership immediately prior to such reorganization, merger or
consolidation of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities, as the case may be, (ii) no Person (excluding
the Company, any employee benefit plan (or related trust) of the Company or
such corporation resulting from such reorganization, merger or consolidation
and any Person beneficially owning, immediately prior to such reorganization,
merger or consolidation, directly or indirectly, thirty-three percent (33%) or
more of the Outstanding Company Common Stock or the Outstanding Company Voting
Securities, as the case may be) beneficially owns, directly or indirectly,
thirty-three percent (33%) or more of, respectively, the then outstanding
shares of common stock of the corporation resulting from such reorganization,
merger or consolidation or the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally in the
election of directors, and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such reorganization,
merger or consolidation were the Incumbent Directors at the time of the
execution of the initial agreement providing for such reorganization, merger or
consolidation; or

 

(d)                                 Approval by the shareholders
of the Company of (i) a complete liquidation or dissolution of the Company
or (ii) the sale or other disposition of all or substantially all the
assets of the Company, other than to a corporation with respect to which
immediately following such sale or other disposition, (A) more than sixty
percent (60%) of, respectively, the then outstanding shares of common stock of
such corporation and the combined voting power of the then outstanding voting
securities of such corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or
substantially all the individuals and entities who were the beneficial owners,
respectively, of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities immediately prior to such sale or other disposition
in substantially the same proportion as their ownership, immediately prior to
such sale or other disposition, of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities, as the case may be, (B) no Person
(excluding the Company, any employee benefit plan (or related trust) of the
Company or such corporation and any Person beneficially owning, immediately
prior to such sale or other disposition, directly or indirectly, thirty-three
percent (33%) or more of the Outstanding Company Common Stock or the Outstanding
Company Voting Securities, as the case may be) beneficially owns, directly or
indirectly, thirty-three percent (33%) or more of, respectively, the then
outstanding shares of common stock of such corporation and the combined voting
power of the then outstanding voting securities of such corporation entitled to
vote generally in the election of directors, and (C) at least a majority
of the members of the board of directors of such corporation were approved by a
majority of the Incumbent Directors at the time of the execution of the initial
agreement or action of the Board providing for such sale or other disposition
of the Company’s assets.

 

2Exhibit 10.36

 

*** Indicates confidential material that has
been omitted pursuant to a Confidential Treatment Request filed with the
Securities and Exchange Commission.  A
complete copy of this agreement has been separately filed with the Securities
and Exchange Commission.

 

 

COMMERCIAL
PICOPLATIN ACTIVE PHARMACEUTICAL INGREDIENT

MANUFACTURING AGREEMENT

 

BETWEEN

 

 

PONIARD
PHARMACEUTICALS, INC.

 

AND

 

W. C.
HERAEUS GMBH

 

 

COMMERCIAL
PICOPLATIN ACTIVE PHARMACEUTICAL INGREDIENT MANUFACTURING AGREEMENT

 

TABLE OF
CONTENTS

 

	
  Article 1
  Interpretation

  	
  2

  
	
   

  	
   

  
	
  1.1

  	
  Definitions

  	
  2

  
	
  1.2

  	
  Currency

  	
  5

  
	
  1.3

  	
  Headings

  	
  5

  
	
  1.4

  	
  Entire Agreement

  	
  5

  
	
  1.5

  	
  Exhibits

  	
  6

  
	
  1.6

  	
  Applicable Law and Venue

  	
  6

  
	
   

  	
   

  	
   

  
	
  Article 2 Scope of
  Performance

  	
  6

  
	
   

  	
   

  	
   

  
	
  2.1

  	
  Heraeus Services

  	
  6

  
	
  2.2

  	
  Heraeus Investment and Equipment Installation

  	
  6

  
	
  2.3

  	
  Quality Agreement

  	
  6

  
	
  2.4

  	
  Manufacturing Report

  	
  7

  
	
  2.5

  	
  CM&C Documentation

  	
  7

  
	
  2.6

  	
  Processing Changes by PONIARD

  	
  7

  
	
  2.7

  	
  Processing Changes by Heraeus

  	
  7

  
	
  2.8

  	
  Notification of Deviations

  	
  7

  
	
  2.9

  	
  Monitoring of Facilities

  	
  7

  
	
  2.10

  	
  No Subcontracting

  	
  7

  
	
   

  	
   

  	
   

  
	
  Article 3 Supply
  of Starting Materials

  	
  8

  
	
   

  	
   

  	
   

  
	
  3.1

  	
  Supply of Materials

  	
  8

  
	
  3.2

  	
  Waste Disposal

  	
  8

  
	
   

  	
   

  	
   

  
	
  Article 4 Testing
  and Samples

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.1

  	
  Retention Samples

  	
  8

  
	
  4.2

  	
  Batch Documentation

  	
  8

  
	
  4.3

  	
  Release Testing

  	
  8

  
	
  4.4

  	
  Release of Picoplatin API

  	
  8

  
	
  4.5

  	
  Shipment and Release of Picoplatin API

  	
  9

  
	
   

  	
   

  	
   

  
	
  Article 5
  Forecast, Purchase Order, Price, Delivery and Payment

  	
  9

  
	
   

  	
   

  	
   

  
	
  5.1

  	
  Forecasts

  	
  9

  
	
  5.2

  	
  Product Orders.

  	
  9

  
	
  5.3

  	
  Purchase Obligation.

  	
  9

  
	
  5.4

  	
  Purchase Orders.

  	
  10

  
	
  5.5

  	
  Picoplatin API Pricing

  	
  10

  
	
  5.6

  	
  Shipping

  	
  10

  
	
  5.7

  	
  Invoices

  	
  10

  
	
  5.8

  	
  Payment of Invoices

  	
  10

  
	
  5.9

  	
  Inspection of Picoplatin API

  	
  11

  
	
   

  	
   

  	
   

  
	
  Article 6 Rejected
  Picoplatin API

  	
  11

  
	
   

  	
   

  	
   

  
	
  6.1

  	
  Rejection of Nonconforming Picoplatin API

  	
  11

  

 

 

	
  6.2

  	
  Dispute of Rejected Products

  	
  11

  
	
  6.3

  	
  Replacement of Nonconforming Picoplatin API

  	
  12

  
	
  6.4

  	
  Destruction of Rejected Products

  	
  12

  
	
   

  	
   

  	
   

  
	
  Article 7
  Intellectual Property Rights

  	
  12

  
	
   

  	
   

  	
   

  
	
  7.1

  	
  Title

  	
  12

  
	
  7.2

  	
  No Grant of Rights

  	
  12

  
	
  7.3

  	
  Grant of License

  	
  13

  
	
  7.4

  	
  Ownership of Process Improvements

  	
  13

  
	
  7.5

  	
  Patents

  	
  13

  
	
  7.6

  	
  Use of Trademarks

  	
  13

  
	
   

  	
   

  	
   

  
	
  Article 8
  Confidential Information

  	
  13

  
	
   

  	
   

  	
   

  
	
  8.1

  	
  Obligation of Confidentiality

  	
  13

  
	
  8.2

  	
  Disclosure with Consent

  	
  14

  
	
  8.3

  	
  Publicity

  	
  14

  
	
  8.4

  	
  Disclosure Required by Law

  	
  14

  
	
  8.5

  	
  Duration of Obligation

  	
  14

  
	
   

  	
   

  	
   

  
	
  Article 9
  Representations and Warranties

  	
  14

  
	
   

  	
   

  	
   

  
	
  9.1

  	
  Heraeus’s Representations and Warranties

  	
  14

  
	
  9.2

  	
  PONIARD’s Representations and Warranties

  	
  15

  
	
  9.3

  	
  NO OTHER WARRANTIES

  	
  16

  
	
   

  	
   

  	
   

  
	
  Article 10
  Indemnification

  	
  16

  
	
   

  	
   

  	
   

  
	
  10.1

  	
  Scope of Indemnification

  	
  16

  
	
  10.2

  	
  Indemnification Procedure

  	
  17

  
	
   

  	
   

  	
   

  
	
  Article 11
  Insurance

  	
  17

  
	
   

  	
   

  	
   

  
	
  Article 12 Recalls

  	
  17

  
	
   

  	
   

  	
   

  
	
  12.1

  	
  Implementation of Recalls

  	
  17

  
	
  12.2

  	
  Heraeus’s Liability for Recall

  	
  18

  
	
  12.3

  	
  PONIARD’s Liability for Recall

  	
  18

  
	
   

  	
   

  	
   

  
	
  Article 13 Term
  and Termination

  	
  18

  
	
   

  	
   

  	
   

  
	
  13.1

  	
  Term

  	
  18

  
	
  13.2

  	
  Termination

  	
  18

  
	
  13.3

  	
  Transfer of Technology

  	
  18

  
	
  13.4

  	
  Return of Starting Materials and
  Equipment

  	
  19

  
	
  13.5

  	
  Return of Confidential Information

  	
  19

  
	
  13.6

  	
  Survival of Obligations

  	
  19

  
	
   

  	
   

  	
   

  
	
  Article 14 General
  Provisions

  	
  20

  
	
   

  	
   

  	
   

  
	
  14.1

  	
  Assignment

  	
  20

  
	
  14.2

  	
  Force Majeure

  	
  20

  
	
  14.3

  	
  Injunction

  	
  20

  
	
  14.4

  	
  Notice

  	
  20

  
	
  14.5

  	
  Relationship of Parties

  	
  21

  
	
  14.6

  	
  Severability

  	
  21

  
	
  14.7

  	
  Waiver

  	
  21

  

 

2

 

	
  EXHIBITS:

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A: PICOPLATIN
  SPECIFICATIONS AND PACKAGING

  	
  23

  
	
   

  	
   

  	
   

  
	
  EXHIBIT B: OUTLINE OF
  PICOPLATIN MANUFACTURING PROCESS

  	
  27

  
	
   

  	
   

  	
   

  
	
  EXHIBIT C: HERAEUS
  INVESTMENT AND DEDICATED EQUIPMENT FOR PICOPLATIN MANUFACTURE

  	
  28

  
	
   

  	
   

  	
   

  
	
  EXHIBIT D: FORECASTING
  SYSTEM FOR PICOPLATIN

  	
  31

  
	
   

  	
   

  	
   

  
	
  EXHIBIT E: COMMERCIAL
  PRICING PICOPLATIN / CALCULATION OF PAYBACK FOR DEDICATED EQUIPMENT COSTS /
  PAYBACK FOR DEDICATED EQUIPMENT COSTS

  	
  32

  

 

3

 

COMMERCIAL PICOPLATIN ACTIVE PHARMACEUTICAL INGREDIENT MANUFACTURING
AGREEMENT

 

THIS COMMERCIAL PICOPLATIN ACTIVE
PHARMACEUTICAL INGREDIENT MANUFACTURING AGREEMENT
(this “Agreement”) is made and entered into as
of the 24 day of March, 2008 (the “Effective Date”)

 

BETWEEN:

 

PONIARD PHARMACEUTICALS,
INC., a US company having an address at 300 Elliott Avenue, Suite 500,
Seattle, Washington  98119, USA

 

(hereinafter referred to as “PONIARD”)

 

AND:

 

W. C. HERAEUS GMBH,
a German company having an address at
Heraeusstr. 12 – 14, 63450 Hanau, Germany

 

(hereinafter referred to as “Heraeus”)

 

WHEREAS:

 

	
  A.

  	
   

  	
  PONIARD is the owner of or controls certain
  technology and patent rights regarding the active pharmaceutical agent
  Picoplatin (also known by the codename “NX473”) which
  is being developed for use as a human pharmaceutical for oncology therapy;

  
	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  Heraeus has expertise, personnel, the
  facility for, and experience in manufacturing active pharmaceutical
  ingredients and is willing to conduct development and manufacturing
  activities for PONIARD for the manufacture and supply of the Picoplatin
  Active Pharmaceutical Ingredient (Picoplatin API, as defined below);

  
	
   

  	
   

  	
   

  
	
  C.

  	
   

  	
  PONIARD and Heraeus have entered into a
  Mutual Confidential Disclosure Agreement dated October 29, 2004 (the “Confidentiality Agreement”);

  
	
   

  	
   

  	
   

  
	
  D.

  	
   

  	
  Heraeus and PONIARD entered into a
  Picoplatin Active Pharmaceutical Ingredient Manufacturing Agreement on
  July 27, 2006. The subject matter of this agreement is the development
  and manufacture of the active pharmaceutical ingredient (API) Picoplatin by
  Heraeus for the purpose of clinical trials and development activities.

  
	
   

  	
   

  	
   

  
	
  E.

  	
   

  	
  PONIARD is now interested in Heraeus
  manufacturing the active pharmaceutical ingredient Picoplatin and delivering
  it to PONIARD for manufacture of final dosage pharmaceutical products which
  are intended to be used for commercial purposes by PONIARD and may be used
  for additional clinical trials and development activities.

  
	
   

  	
   

  	
   

  
	
  F.

  	
   

  	
  Already at the beginning of 2008 Heraeus
  has to make an investment in production equipment for a commercial delivery
  of Picoplatin API starting 2009.

  

 

 

NOW THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

Article 1
Interpretation

 

	
  1.1

  	
   

  	
  Definitions

  

 

In this Agreement, the following terms shall have the meanings set
forth below:

 

	
  (a)

  	
   

  	
  “Act”
  means the U.S. Food, Drug and Cosmetic Act of 1934
  and the Public Health Service Act of 1944 and
  the regulations and guidelines promulgated thereunder, as the same may be
  amended from time to time;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
   

  	
  “Affiliate”
  means any corporation or non-corporate business entity, which directly or
  indirectly controls, is controlled by, or is under common control with a
  party. A corporation or non-corporate business entity shall be regarded as in
  control of another corporation if it owns or directly or indirectly controls
  at least fifty percent (50%) of the voting stock of the other corporation or

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  in the absence of the
  ownership of at least fifty percent (50%) of the voting stock of a
  corporation, or

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  in the case of a
  non-corporate entity, the power to direct or cause the direction of the
  management and policies of such corporation or non-corporate entity, as
  applicable;

  
	
   

  	
   

  	
   

  
	
  (c)

  	
   

  	
  “Batch”
  or “Lot” means, with respect to the
  Picoplatin API, each separate and distinct quantity of Picoplatin API
  processed under continuous conditions and designated by a batch or lot
  number;

  
	
   

  	
   

  	
   

  
	
  (d)

  	
   

  	
  “Batch
  Record” means the complete detailed manufacturing and control
  instructions and specifications for the each Batch or Lot of Picoplatin API,
  written and signed by Heraeus;

  
	
   

  	
   

  	
   

  
	
  (e)

  	
   

  	
  “Business
  Days” means a day that is not a Saturday or a Sunday or a national
  holiday in the United States or Germany;

  
	
   

  	
   

  	
   

  
	
  (f)

  	
   

  	
  “Certificate
  of Analysis” means a document certifying a Batch or Lot of
  Picoplatin API meets the Specifications, signed and dated by a duly
  authorized representative of the Quality Control or Quality Assurance
  Department of Heraeus;

  
	
   

  	
   

  	
   

  
	
  (g)

  	
   

  	
  “Certificate
  of Compliance” means a document certifying that the Batch or Lot
  of Picoplatin API was Processed according to cGMP Requirements and the
  Specifications, signed and dated by a duly authorized representative of
  Heraeus;

  
	
   

  	
   

  	
   

  
	
  (h)

  	
   

  	
  “cGMP
  Requirements” means

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  the current Good Manufacturing
  Practices established by the FDA, TPD and EMEA and the applicable FDA, TPD
  and EMEA regulations, policies or guidelines in effect for the manufacture,
  processing, packing and holding of API products, and

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  the corresponding
  requirements of each other applicable jurisdiction for which PONIARD informs
  Heraeus from time to time in writing that the Picoplatin API is to be used in
  such jurisdiction and to which Heraeus agrees it can meet such requirements;

  
	
   

  	
   

  	
   

  
	
  (i)

  	
   

  	
  “Confidential
  Information” means any and all know-how, information and/or
  techniques disclosed by PONIARD or Heraeus to the other, as the case may be,
  relating to their respective technologies, products, research, processes and
  other activities and information, including, without limiting the generality
  of the foregoing, all research results, formulae, manufacturing methods and
  processes, data, specifications, plans, drawings, prototypes, models,
  documents,

  

 

2

 

	
   

  	
   

  	
  recordings, instructions,
  manuals, papers, reports, studies, findings, business methods, operating
  procedures, production capacities, prices, market share and other market
  data, customer information or other materials of any nature whatsoever,
  whether written or otherwise, relating to same, provided that such
  disclosures shall not be considered “Confidential Information” for the
  purpose of this Agreement if and when it:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  is made subject to an
  order by judicial or administrative process requiring PONIARD or Heraeus, as
  the case may be, to disclose any Confidential Information of the other,
  provided however, that either party shall promptly notify the other and allow
  the other reasonable time to oppose such process before disclosing any of the
  Confidential Information of the other;

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  is or becomes generally
  available to the general public other than through a breach of this
  Agreement;

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  is obtained by PONIARD
  or Heraeus from a Third Party with a valid right to disclose it, provided
  that such Third Party is not under a confidentiality obligation to PONIARD or
  Heraeus, as the case may be;

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  is independently
  developed without reference to the other’s Confidential Information as
  evidenced by PONIARD’s or Heraeus’s (as the case may be) business records; or

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (v)

  	
  was possessed by either
  party prior to receipt from the other, other than through prior disclosure by
  PONIARD or Heraeus, as the case may be, as evidenced by their business
  records;

  
	
   

  	
   

  	
   

  
	
  (j)

  	
   

  	
  “Confidentiality
  Agreement” has the meaning ascribed thereto in Recital C;

  
	
   

  	
   

  	
   

  
	
  (k)

  	
   

  	
  “Delivery
  Date” means the date that Picoplatin API is to be delivered to a
  PONIARD designated carrier at Heraeus’s facilities;

  
	
   

  	
   

  	
   

  
	
  (l)

  	
   

  	
  “Dedicated
  Equipment Cost” means the cost of equipment dedicated to the manufacture
  of Picoplatin API as described in Exhibit C;

  
	
   

  	
   

  	
   

  
	
  (m)

  	
   

  	
  “EMEA”
  means the European Medicines Evaluation Agency and any successor thereto;

  
	
   

  	
   

  	
   

  
	
  (n)

  	
   

  	
  “Environmental
  Laws” means all applicable requirements under applicable statutes,
  regulations, rules, ordinances, codes, licenses, permits, orders, approvals,
  plans or other authorizations, as amended from time to time, of all
  applicable national, state and local governments and regulatory authorities
  thereof and all applicable judicial, administrative or regulatory judgments
  or orders, relating to the protection of human health or the environment,
  including, without limitation, any and all occupational health and safety
  requirements and procedures for the safe handling of the Picoplatin API and
  any Waste;

  
	
   

  	
   

  	
   

  
	
  (o)

  	
   

  	
  “Facility”
  means Heraeus’s manufacturing facility located at Heraeusstr. 12 – 14, 63450 Hanau, Germany;

  
	
   

  	
   

  	
   

  
	
  (p)

  	
   

  	
  “FDA”
  means the United States Food and Drug Administration and any successor
  thereto;

  
	
   

  	
   

  	
   

  
	
  (q)

  	
   

  	
  “Improvements”
  means, in relation to any Intellectual Property, any and all adaptations,
  improvements, enhancements, revisions and derivative works (whether complete
  or incomplete) thereof;

  
	
   

  	
   

  	
   

  
	
  (r)

  	
   

  	
  “Installation
  Qualification” means the documented verification required to
  comply with cGMP Requirements that all key aspects of the installation of the
  equipment and ancillary systems used or to be used in the Manufacturing
  Process adhere to the approved designs and the recommendations of the
  manufacturer;

  

 

3

 

	
  (s)

  	
   

  	
  “Intellectual
  Property” means anything that is protected by any patents,
  trademarks, copyrights, trade secrets or any other intellectual or industrial
  property rights whatsoever and worldwide (whether registered or unregistered
  and including rights in any application for any of the foregoing);

  
	
   

  	
   

  	
   

  
	
  (t)

  	
   

  	
  “Manufacturing
  Process” means the activities set out in
  Exhibit B,  the Master
  Batch Record and Heraeus’s standard operating procedures for the Processing
  and packaging of the Picoplatin API;

  
	
   

  	
   

  	
   

  
	
  (u)

  	
   

  	
  “Manufacturing
  Report” means a report prepared by Heraeus summarizing the
  manufacturing Batches and stability study data relating to Picoplatin API;

  
	
   

  	
   

  	
   

  
	
  (v)

  	
   

  	
  “Master
  Batch Record” means the complete detailed manufacturing and
  control instructions and specifications for the Manufacturing Process for
  Picoplatin API written and signed by Heraeus, as defined by the cGMP
  Requirements, and agreed to by both parties, and as may be revised by both
  parties from time to time;

  
	
   

  	
   

  	
   

  
	
  (w)

  	
   

  	
  “Materials”
  means raw materials, solvents and packaging used in the Processing to produce
  the Picoplatin API;

  
	
   

  	
   

  	
   

  
	
  (x)

  	
   

  	
  “NDA”
  means a New Drug Application, as defined in the Act and applicable
  regulations promulgated thereunder, as amended from time to time, and any
  foreign equivalent;

  
	
   

  	
   

  	
   

  
	
  (y)

  	
   

  	
  “Operational
  Qualification” means the documented verification required to
  comply with cGMP Requirements that the equipment and ancillary systems used
  in the Manufacturing Process perform as intended throughout anticipated
  operating ranges;

  
	
   

  	
   

  	
   

  
	
  (z)

  	
   

  	
  “Picoplatin
  Active Pharmaceutical Ingredient” (“Picoplatin
  API”) means
  (SP-4-3)-(cis)-Amminedichloro-[2-methylpyridine]platinum(II);

  
	
   

  	
   

  	
   

  
	
  (aa)

  	
   

  	
  “Picoplatin
  Drug Product” means the product produced from Picoplatin API for
  human use by PONIARD or its designee;

  
	
   

  	
   

  	
   

  
	
  (bb)

  	
   

  	
  “Picoplatin
  NDA Approval” means approval of an NDA necessary for commercial
  sale in a jurisdiction;

  
	
   

  	
   

  	
   

  
	
  (cc)

  	
   

  	
  “PONIARD
  Know How” means all inventions, ideas, manufacturing methods,
  processes, technical data, documentation, technology and other know how now
  or hereafter owned by or licensed to PONIARD, in, to or covering
  (i) Picoplatin API, (ii) Picoplatin Drug Product, or (iii) the
  manufacture, use or sale of Picoplatin API or Picoplatin Drug Product, including,
  without limitation, Improvements to any of the foregoing;

  
	
   

  	
   

  	
   

  
	
  (dd)

  	
   

  	
  “PONIARD
  Patent Rights” means United States and foreign patents and patent
  applications now or hereafter owned or controlled by PONIARD and under which
  Heraeus would need a license or sublicense to lawfully produce Picoplatin API
  for PONIARD under this Agreement;

  
	
   

  	
   

  	
   

  
	
  (ee)

  	
   

  	
  “Process
  Improvements” means any Improvements to the Manufacturing Process
  of Picoplatin API developed by Heraeus or PONIARD in connection with this
  Agreement that relate to or are useful or necessary for the Processing of
  Picoplatin API;

  
	
   

  	
   

  	
   

  
	
  (ff)

  	
   

  	
  “Processing”
  means the performance of the Manufacturing Process or a portion thereof and
  “Process,” “Processing” and “Processed” shall have comparable meanings;

  
	
   

  	
   

  	
   

  
	
  (gg)

  	
   

  	
  “Purchase
  Order” means written orders from PONIARD to Heraeus which shall
  specify (a) the quantity of Picoplatin API ordered, (b) shipping
  instructions (e.g. choice of container, temperature requirements),
  (c) delivery dates, and (d) delivery destinations;

  
	
   

  	
   

  	
   

  
	
  (hh)

  	
   

  	
  “Quality
  Agreement” means the addendum to this Agreement under which the
  parties allocate pharmaceutical quality responsibilities as set forth in
  Section 2.3;

  

 

4

 

	
  (ii)

  	
   

  	
  “Recall”
  means:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  any action by PONIARD,
  Heraeus or any of their respective Affiliates, to recover possession of
  Picoplatin API shipped to Third Parties; or

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  any action by the FDA
  or any other applicable Regulatory Authority in any jurisdiction, to detain
  or destroy the Picoplatin API or prevent release of the Picoplatin API;

  
	
   

  	
   

  	
   

  
	
  (jj)

  	
   

  	
  “Regulatory
  Authority” means any federal, state, local or international
  regulatory agency, department, bureau, or other governmental agency having
  jurisdiction over the manufacture, use, sale, or distribution of the
  Picoplatin API, including, but not limited to, the FDA, TPD, and EMEA;

  
	
   

  	
   

  	
   

  
	
  (kk)

  	
   

  	
  “Released
  Batch Records” means the completed Batch Record and associated
  deviation reports, investigation reports and Certificates of Analysis created
  for each Batch or Lot of Picoplatin API as described in Section 4.2;

  
	
   

  	
   

  	
   

  
	
  (ll)

  	
   

  	
  “Specifications”
  means the specifications attached hereto in Exhibit A
  for which the Picoplatin API and packaging must comply to be considered
  acceptable, as may be revised from time to time by both parties as part of
  the regulatory process with the approval of applicable Regulatory
  Authorities;

  
	
   

  	
   

  	
   

  
	
  (mm)

  	
   

  	
  “Testing
  Documentation” means the documentation describing the results from
  testing to determine whether a Batch or Lot of Picoplatin API meets the
  requirements set out in the Specification as described in Section 4.3;

  
	
   

  	
   

  	
   

  
	
  (nn)

  	
   

  	
  “Third
  Party” shall mean any person or entity other than PONIARD or
  Heraeus and their respective Affiliates;

  
	
   

  	
   

  	
   

  
	
  (oo)

  	
   

  	
  “TPD”
  means the Health Canada Therapeutic Products Directorate and any successor
  thereto;

  
	
   

  	
   

  	
   

  
	
  (pp)

  	
   

  	
  “Validation
  Protocol” means the protocols developed by PONIARD and Heraeus
  setting out predetermined specifications and quality attributes to be met and
  the procedures to be adopted for any validation activities hereunder;

  
	
   

  	
   

  	
   

  
	
  (qq)

  	
   

  	
  “Validation
  Report” means the reports prepared by PONIARD and/or Heraeus
  describing the findings of any validation activities and comparing them
  against the applicable Validation Protocol; and

  
	
   

  	
   

  	
   

  
	
  (rr)

  	
   

  	
  “Waste”
  shall mean all rejects or waste relating to the manufacture or packaging of
  the Picoplatin API, including but not limited to rejected, or unusable
  Picoplatin API or Materials.

  

 

	
  1.2

  	
   

  	
  Currency

  

 

In this Agreement, all references to money or payments shall mean the
lawful currency of the European Union and all payments made hereunder shall be
made in that currency (Euro).

 

	
  1.3

  	
   

  	
  Headings

  

 

The headings in this Agreement are solely for convenience of reference
and shall not be used for purposes of interpreting or construing the provisions
hereof.

 

	
  1.4

  	
   

  	
  Entire Agreement

  

 

This Agreement constitutes the entire agreement between the parties
concerning the subject matter hereof, and supersedes all prior written or oral
agreements or understandings with respect thereto.  No party shall claim any amendment,
modification, or release from any provision hereof by acknowledgement or

 

5

 

acceptance or purchase order forms or otherwise, unless in writing
signed by an authorized representative of each party.

 

1.5                               Exhibits

 

The Exhibits listed below and attached hereto shall be deemed to form
an integral part of this Agreement:

 

	
   

  	
  Exhibit A

  	
  Picoplatin Specifications and Packaging

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit B

  	
  Outline of Picoplatin Manufacturing Process

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit C

  	
  Heraeus Investment and Dedicated Equipment
  for Picoplatin Manufacture

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit D

  	
  Forecasting System for Picoplatin

  
	
   

  	
   

  	
   

  
	
   

  	
  Exhibit E

  	
  Commercial Pricing Picoplatin

  
	
   

  	
   

  	
  Calculation of Payback for Dedicated
  Equipment Costs

  
	
   

  	
   

  	
  Payback for Dedicated Equipment Costs

  

 

In the event of a conflict between the terms and conditions set out in
this Agreement and the terms and conditions set out in any Exhibit hereto,
the terms and conditions set out in this Agreement shall govern.

 

1.6                               Applicable Law and Venue

 

This Agreement shall be construed, interpreted and governed by the
substantive laws of Switzerland, without regard to conflict of law principles
to the contrary.  All disputes arising
out of or in connection with the present Agreement shall be finally settled
under the Rules of Arbitration of the International Chamber of Commerce in
Paris, France, by one or more arbitrators appointed in accordance with the said
Rules. The place of arbitration shall be Paris, France. The language of
arbitration shall be English.

 

Article 2
Scope of Performance

 

2.1                               Heraeus Services

 

Heraeus shall manufacture Picoplatin API according to cGMP
Requirements, the Specifications and the Manufacturing Process and shall
deliver Picoplatin API to PONIARD according to the form and package as
described in Exhibit A.  Heraeus shall furnish all Materials, labor,
equipment and facilities necessary for the manufacturing of the Picoplatin API
and all other activities set out in this Agreement, including, without limitation,
in-process and finished product quality control analyses, storage and packaging
of the Picoplatin API, and shipping of the Picoplatin API in accordance with
PONIARD’s instructions.

 

2.2                               Heraeus Investment and Equipment
Installation

 

Heraeus shall undertake to finance and install the equipment listed in Exhibit C – hereinafter referred to as “Investment” - within the time frame defined in Exhibit C. 
PONIARD shall undertake to repay Heraeus for the Investment in the
amount mentioned in Exhibit C
based on manufacture and delivery of Picoplatin API by Heraeus as defined in Section 5.3,
Purchase Obligation.  Heraeus will own
the equipment and will undertake any necessary on-going maintenance and
qualification of the equipment to ensure it continues to meet cGMP Requirements
during its use for the manufacture of Picoplatin API.

 

2.3                               Quality Agreement

 

For the manufacturing of Picoplatin API by Heraeus, the parties shall
conclude a Quality Agreement to allocate and coordinate the pharmaceutical
quality responsibilities.  In case of any
inconsistencies between this Agreement and the Quality Agreement, the Quality
Agreement will prevail for matters of

 

6

 

quality and regulatory compliance and this Agreement shall prevail for
all business, legal, or financial issues, unless otherwise explicitly agreed to
in writing by the parties.

 

2.4                               Manufacturing Report

 

Within 30 days following the annual anniversary of the first Picoplatin
NDA Approval, Heraeus shall provide to PONIARD a Manufacturing Report
concerning the Picoplatin API data from the 12 months preceding the NDA
approval anniversary.

 

2.5                               CMC Documentation

 

Heraeus shall supply all information required by PONIARD in support of
the Chemistry, Manufacturing & Control (“CMC”)
section of PONIARD’s regulatory filings for Picoplatin API.  Heraeus shall cooperate with, and provide
timely support and assistance to, any consultant that PONIARD selects to write
the documentation described in this Section 2.5.

 

2.6                               Processing Changes by PONIARD

 

PONIARD and Heraeus shall agree in writing to any changes to the
Specifications, any applicable Validation Protocols, any other specified
analytical procedure or process specified by PONIARD or any starting materials
used in the Processing of Picoplatin API, and the relevant documents and
related exhibits to this Agreement shall be revised accordingly.  Any such changes made by PONIARD that
significantly impact the cost of Processing, including any such changes to
accommodate the cGMP Requirements of countries other than the United States,
Canada or members of the European Union, and which Heraeus is capable of
implementing, shall be reflected in a corresponding equitable increase or
decrease in the fees paid by PONIARD under this Agreement, which increase or
decrease shall be set forth in an amendment to this Agreement signed by both
parties.

 

2.7                               Processing Changes by Heraeus

 

Heraeus shall make no changes to:

 

(a)                                  The
Manufacturing Process, Specifications, development protocols, any applicable
Validation Protocols or any other specified analytical procedure or process
specified by both parties; or

 

(b)                                 any
starting materials used in the Processing to produce the Picoplatin API;

 

without the prior written consent of PONIARD.

 

2.8                               Notification of Deviations

 

During the Processing to produce each Batch, Heraeus shall provide
notice to PONIARD of any deviations and nonconformities from the approved
Manufacturing Process. The promptness of notification shall be commensurate
with the potential impact of the deviation or nonconformance.

 

2.9                               Monitoring of Facilities

 

PONIARD shall have the right to have representatives of its (or its
designee’s) quality assurance or manufacturing personnel present in Heraeus’s
facilities to observe the manufacturing activities.  Heraeus shall use its best efforts to prevent
Third Parties from observing Picoplatin API Batch Processing at the Facility.

 

2.10                        No Subcontracting

 

Heraeus shall not subcontract to any Third Party any of the development
or Processing activities to be performed by Heraeus under this Article 2
without the prior written consent of PONIARD.

 

7

 

Article 3
Supply of Starting Materials

 

3.1                               Supply of Materials

 

Heraeus shall be responsible for the planning and supply of all
Materials required for the Processing to produce each Batch of Picoplatin API
purchased by PONIARD in accordance with Section 5.2 and shall order all
Materials from vendors mutually agreed to by the parties.  Heraeus shall not change the vendor of any
Materials without the prior written consent of PONIARD.  Before release for use, Heraeus shall conduct
testing of all such Materials following Heraeus’s standard operating
procedures, or as otherwise approved by PONIARD.

 

3.2                               Waste Disposal

 

Heraeus shall hire, direct, and pay for waste contractors to remove all
Waste from the Facility in accordance with all applicable material safety data
sheets.  Heraeus shall ensure that all
Waste disposal at the Facility shall be performed by or for Heraeus in
accordance with all applicable Environmental Laws of Germany.

 

Article 4
Testing and Samples

 

4.1                               Retention Samples

 

For each Lot, Heraeus shall maintain retention samples and store such
samples in accordance with cGMP Requirements and Heraeus’s internal quality
assurance standard operating procedures, and shall notify PONIARD in writing
before disposing of any such samples. 
Upon written request from PONIARD and at PONIARD’s expense, Heraeus
shall grant to PONIARD the right to examine any such retention samples.

 

4.2                               Batch Documentation

 

For each Batch Processed under this Agreement, Heraeus shall deliver
the following to PONIARD no later than *** (***) Business Days following the
completion of product packaging for each Batch:

 

(a)                                  a
copy of Heraeus’s quality assurance reviewed Released Batch Record for the
Batch;

 

(b)                                 a
copy of Heraeus’s quality assurance reviewed analytical testing data for the
Batch;

 

(c)                                  a
copy of all deviation and investigation reports concerning the Batch;

 

(d)                                 a
Certificate of Compliance; and

 

(e)                                  a
Certificate of Analysis for the Batch.

 

4.3                               Release Testing

 

(a)                                  Heraeus
shall perform testing, in accordance with the specifications set out the Exhibits, of each Batch Processed to determine whether such
Batch meets the requirements set out in the Specifications.

 

4.4                               Release of Picoplatin API

 

(a)                                  PONIARD
shall release each Batch of Picoplatin API manufactured by Heraeus under this
Agreement after receipt and approval by PONIARD of the documentation described
in Section 4.2.

 

(b)                                 PONIARD
may reject, by written notice to Heraeus, any Batch of Picoplatin API on the
grounds that:

 

8

 

(i)                                     the
Picoplatin API does not comply with the Specifications; or

 

(ii)                                  the
Picoplatin API or its Processing does not comply with cGMP Requirements.

 

PONIARD shall include in each notice of rejection hereunder, a
description of the deficiency and copies of any test reports and testing
methodology conducted on any samples tested.

 

(c)                                  Heraeus
shall not ship or transfer any rejected Batch without the prior written consent
of PONIARD, and PONIARD and Heraeus shall comply with the requirements set out
in Article 6.

 

4.5                               Shipment and Release of Picoplatin API

 

Except as otherwise agreed on by PONIARD and Heraeus, Heraeus shall
ship each Batch in accordance with Section 5.6 as soon as reasonably
possible after release of the Batch by PONIARD. 
Heraeus shall store the Picoplatin API *** prior to shipment.

 

Article 5 Forecast, Purchase Order,
Price, Delivery and Payment

 

5.1                               Forecasts

 

Commencing on the Effective Date and prior to *** of each ***
thereafter, PONIARD shall provide Heraeus in writing *** forecast, for each ***
during the remainder of the Term, of PONIARD’s estimated contract requirements
for Picoplatin API (the “Long Range Forecast”).
Commencing on the Effective Date and prior to the *** (***) *** of ***
thereafter, PONIARD shall provide Heraeus in writing a *** (***) *** rolling
forecast of PONIARD’s estimated requirements for the Picoplatin API (the “Rolling Forecast”). Heraeus and PONIARD specifically agree
that ***.

 

5.2                               Product Orders.

 

During ***, Heraeus shall supply PONIARD with the quantity of
Picoplatin API ordered by PONIARD, unless the quantity for *** exceeds ***
(***%) of the Rolling Forecast for ***, in which event Heraeus shall use good
faith efforts to supply quantities in excess of *** percent (***%) of the
Rolling Forecast for ***.  In no event
shall Heraeus be required to supply quantities in excess of its manufacturing
capacity of *** kg per ***.  PONIARD
shall order from Heraeus not less than ***% of PONIARD’s *** commercial
requirements of Picoplatin API, subject to market demands and Heraeus’s
capacity to manufacture product.

 

5.3                               Purchase Obligation.

 

In the event
PONIARD does not purchase from Heraeus a minimum of *** kg during the period
from the Effective Date until Dec 31, 2013, PONIARD shall pay the residual
amortization of the Dedicated Equipment Cost based on the formula in Exhibit E.  In
the event  PONIARD decides not to pursue the
development of Picoplatin prior to purchasing such *** kg, PONIARD shall pay
the residual amortization of the Dedicated Equipment Cost based on the formula
in Exhibit E.  In the event this Agreement is terminated by
Poniard pursuant to Section 13.2 or 14.2, Poniard shall not be responsible
for paying the residual amortization of Dedicated Equipment Cost based on the
formula in Exhibit E.

 

9

 

5.4                               Purchase Orders.

 

PONIARD shall submit Purchase Orders to Heraeus covering PONIARD’s
purchases of Picoplatin API pursuant to this Agreement.  PONIARD shall not, without the written
consent of Heraeus, designate a Delivery Date in a Purchase Order earlier than
*** (***) months from the date PONIARD submits the Purchase Order.

 

Heraeus shall provide a confirmation of receipt of each Purchase Order
confirming the Delivery Date that Heraeus will meet and setting forth Heraeus’s
filling date for such order.  Upon
sending of the confirmation, such Purchase Order shall become a “Firm Purchase Order.”

 

If Heraeus is unable to meet the Delivery Date specified by PONIARD,
Heraeus shall so notify PONIARD within *** business days of receiving PONIARD’s
Purchase Order and provide to PONIARD an alternative Delivery Date, which shall
not be more than *** (***) calendar days later than the initial Delivery Date
designated by PONIARD in its Purchase Order.

 

To the extent of any conflict between Purchase Orders submitted by
PONIARD, Heraeus’s confirmation and this Agreement, this Agreement shall
control.

 

5.5                               Picoplatin API Pricing

 

PONIARD shall pay Heraeus the fees specified in Exhibit E
and in accordance with the terms of this Agreement.  Except as otherwise provided in this
Agreement, PONIARD shall not be responsible for any changes in the fees unless
expressly agreed by PONIARD in writing. 
PONIARD shall make all requests for additional work to be performed
under this Agreement in writing under Section 2.6, and Heraeus shall
provide PONIARD a cost estimate for such work.

 

5.6                               Shipping

 

All Batches ordered by PONIARD under Section 5.4 and documentation
therefor shall be properly packed, marked and shipped to the PONIARD-designated
facilities in accordance with the Specifications, the terms of this Agreement,
and PONIARD’s reasonable written instructions for shipping and packaging.  For purposes of this Agreement, delivery of
the Picoplatin API by Heraeus to PONIARD shall be deemed to have taken place
upon delivery of the shipment to a PONIARD-designated carrier at Heraeus’s
facilities.  PONIARD shall pay all
shipping charges (including freight insurance) actually incurred by Heraeus to
ship the Picoplatin API to PONIARD in accordance with PONIARD’s shipping
instructions.  If Heraeus pays on behalf
of PONIARD any shipping or other charges required to be paid by PONIARD under
this Section, Heraeus shall include such charges on its invoice to PONIARD
under Section 5.7.

 

5.7                               Invoices

 

Heraeus shall issue invoices to PONIARD for each purchase order placed
under Section 5.4 per the payment terms stated on the purchase order or
after the release under Section 4.4 of the Batch corresponding to the
purchase order.  All such invoices shall
include any applicable sales tax and shipping costs as separate line items and
shall not be issued prior to acceptance of the Picoplatin API by PONIARD (Section 5.9).

 

5.8                               Payment of Invoices

 

Each invoice provided by Heraeus to PONIARD hereunder shall be paid by
PONIARD to Heraeus by check or wire transfer of funds within thirty (30)
calendar days after the receipt of the invoice. 
The payment of any invoice hereunder shall not in any way be deemed to
be an acceptance of any Batch, or a waiver of the requirements for release
thereof.

 

10

 

5.9                               Inspection of Picoplatin API

 

Within *** (***) working days after receipt of the Released Batch
Record, the Testing Documentation Certificate of Analysis and Certificate of
Compliance at Poniard, Poniard shall determine whether material conforms to the
Product Specifications and was manufactured according to cGMP Requirements and
is therefore deemed accepted.

 

Poniard is obligated to inspect each batch of Picoplatin API manufactured
and delivered by Heraeus for conformance with the Specifications within ***
(***) working days of receipt of the Picoplatin API and if the product meets
the Specifications, is therefore deemed accepted.  However, PONIARD shall have the right to revoke
acceptance if, within *** (***) months of receipt of the Batch, PONIARD
discovers latent defects not reasonably discoverable during a proper chemical
incoming goods inspection at time of acceptance.  If nonconformance with the Specifications of
the delivered Picoplatin API is of such kind that it could not be detected
during a proper chemical incoming goods inspection, PONIARD shall be obligated
to send a written notice of defects to Heraeus regarding any nonconformance
with the Specifications within *** (***) working days as of the date of getting
knowledge of such nonconformance with the Specifications.  If PONIARD fails to notify Heraeus in writing
within the applicable time periods set forth in this Section 5.9 that any
shipment of Picoplatin API does not conform to the Specifications, then PONIARD
shall be deemed to have accepted the Product and waived its right to revoke
acceptance.

 

PONIARD may reject the shipment of Picoplatin API following release of
the Batch pursuant to this Section 5.9 if Heraeus shipped the Picoplatin
API in a manner that does not comply with PONIARD’s transportation and storage
requirements or if PONIARD has grounds for rejection under Section 4.4(b).  All notices rejecting a shipment hereunder
shall include a description of the grounds for rejection.  Heraeus shall not be liable for damage or
loss to the Picoplatin API occurring following delivery of the Picoplatin API
to PONIARD’s designated carrier, except where caused by Heraeus failing to
provide proper instructions to PONIARD’s designated carrier or failure of
Heraeus to properly package the Picoplatin API.

 

Article 6 Rejected Picoplatin API

 

6.1                               Rejection of Nonconforming Picoplatin API

 

If PONIARD detects nonconformance with the Specifications of Picoplatin
API or cGMP Requirements, PONIARD shall notify Heraeus of the rejection
including a detailed explanation of the nonconformance according to Section 4.4
or 5.9.  Upon receipt of such notice,
Heraeus shall investigate such alleged nonconformance, and (a) if Heraeus
agrees that such Picoplatin API was nonconforming at the time of delivery,
Heraeus shall replace the Picoplatin API pursuant to Section 6.3 or (b) if
Heraeus disagrees with PONIARD’s determination that such Picoplatin API was
nonconforming at the time of delivery, Heraeus shall dispute the rejection
pursuant to Section 6.2.

 

6.2                               Dispute of Rejected Products

 

Heraeus may, at its option, within *** (***) Business Days of receipt
of any notice rejecting any Batch pursuant to Section 4.4 or 6.1 challenge
such rejection by notifying PONIARD of such challenge in writing.

 

(a)                                  In
the event that Heraeus challenges a rejection caused by nonconformance of the
Picoplatin API to the Specifications, PONIARD and Heraeus shall conduct a joint
investigation to determine the cause of the failure.  If the parties cannot resolve this challenge
within *** (***) Business Days after PONIARD’s receipt of Heraeus’s challenge,
then the parties shall submit a sample of the Picoplatin API to an independent
testing laboratory acceptable to both parties for testing against the
Specifications.  The test results of the
independent laboratory testing shall be final and 

 

11

 

binding upon PONIARD and
Heraeus, and the fees and expense of such testing shall be borne by the party
against which the independent laboratory makes its findings.

 

(b)                                 In
the event that Heraeus challenges a rejection caused by nonconformance to the
cGMP Requirements, PONIARD and Heraeus shall conduct a joint investigation to determine
the cause of the failure. If the parties cannot resolve this challenge within
*** (***) Business Days after PONIARD’s receipt of Heraeus’s challenge, then
the parties shall mutually agree to appoint an independent consultant with
specific expertise in the cGMP area of dispute whose judgement will be final
and binding upon PONIARD and Heraeus, and the fees and expense of such
consultation shall be borne by the party against which the consultant makes
their findings.

 

6.3                               Replacement of Nonconforming Picoplatin API

 

In the event that a shipment of Picoplatin API is nonconforming,
Heraeus shall be obligated to deliver to PONIARD, within *** (***) working days
from the date either of agreement by Heraeus of nonconformance or of
determination of nonconformance pursuant to Section 6.2, conforming
Picoplatin API as substitute.  If during
the above mentioned grace period Heraeus should not deliver any Picoplatin API
as substitute free of charge or if the Picoplatin API delivered subsequently
should not be in conformance with the Specifications, PONIARD may withdraw from
the respective Firm Purchase Order and claim damages from Heraeus instead of
performance.  Such damages, in terms of
amount, shall be limited to *** of the nonconforming quantity of Picoplatin API
delivered.  Any claim for any loss of
profit or loss of sales or any other economic loss shall be excluded unless
Heraeus has caused such nonconformance of Picoplatin API intentionally.  PONIARD shall pay for the replacement
Picoplatin API unless it has previously paid for the nonconforming Picoplatin
API.

 

6.4                               Destruction of Rejected Products

 

PONIARD shall be obligated to return any rejected Picoplatin API to
Heraeus, but only after the parties have followed the procedures specified
under Section 6.3.  If the
nonconformance was due to Heraeus’s negligence or misconduct or to Heraeus’s
breach of its obligations under this Agreement, as may be agreed by Heraeus or
determined by the independent testing laboratory or consultant named in Section 6.2,
Heraeus shall receive the net platinum value of the rejected Picoplatin API and
shall bear the costs associated with Picoplatin API replacement.  In the event that PONIARD chooses to return
Picoplatin API conforming to the Specification at the time of delivery and
which is fully paid by PONIARD for destruction, PONIARD shall receive the net
platinum value of the rejected Picoplatin API.

 

Article 7 Intellectual Property
Rights

 

7.1                               Title

 

Title to all work in process, including documentation, to manufacture
the Picoplatin API, and all completed Picoplatin API, shall at all times remain
in PONIARD.  The parties agree that, as
between the parties, each party owns its respective Confidential Information
and that PONIARD owns all PONIARD Patent Rights and PONIARD Know How.  Heraeus shall not intentionally use in the
Manufacturing Process any Intellectual Property owned by any Third Party,
except with the prior written consent of PONIARD.

 

7.2                               No Grant of Rights

 

Except as otherwise provided herein, neither party hereto shall be
deemed by this Agreement to have been granted any right, title or interest in
the Intellectual Property of the other party, expressly or by implication.

 

12

 

7.3                               Grant of License

 

During the term of this Agreement, PONIARD hereby grants to Heraeus a
paid up, royalty-free, non-exclusive license, without the right to sublicense,
to PONIARD’s Know How and PONIARD Patent Rights reasonably necessary to conduct
the manufacturing activities described in Article 2 to supply to PONIARD
Picoplatin API hereunder, but only for such purposes.  The parties agree that the grant contained in
this Section 7.3 is personal to Heraeus only, and Heraeus agrees to make
use of PONIARD Patent Rights or PONIARD Know How only in accordance with this
license and only by Heraeus.

 

7.4                               Ownership of Process Improvements

 

Any Process Improvements (whether or not patentable) developed by
Heraeus shall be solely owned by PONIARD and shall be deemed to be PONIARD’s
Confidential Information, and PONIARD may obtain patent, copyright and other
Intellectual Property protection therein worldwide. Heraeus agrees to promptly
disclose and hereby assigns to PONIARD as they occur any such Process
Improvements developed by Heraeus during the course of fulfilling its
obligations under this Agreement. 
PONIARD shall grant a fully paid, royalty free, worldwide nonexclusive
license without the right to sublicense, to Heraeus to use the Process
Improvements without restriction except for the manufacture of Picoplatin API
for a party other than PONIARD.

 

7.5                               Patents

 

With respect to any Process Improvements as defined in Article 1
(ee), PONIARD shall decide, at its sole discretion, whether, when and where to
file any patent applications and whether to abandon any patents or patent
applications.  Upon request by PONIARD,
and at PONIARD’s cost, Heraeus shall provide PONIARD with reasonable assistance
in obtaining or enforcing any Intellectual Property protection in PONIARD’s
name covering any Process Improvements.

 

7.6                               Use of Trademarks

 

Nothing contained herein shall give either party any right to use any
trademark of the other party except for labeling the Picoplatin API for
PONIARD.  All trademarks and service
marks adopted by PONIARD to identify the Picoplatin API are and shall remain
the property of PONIARD.

 

Article 8 Confidential Information

 

8.1                               Obligation of Confidentiality

 

It is contemplated that in the course of the performance of this
Agreement each party may, from time to time, disclose Confidential Information
to the other.  Each party agrees:

 

(a)                                  not,
without the prior written consent of the other party, to disclose, publish or
distribute any Confidential Information of the other party to any Third Party
other than its attorneys, accountants, employees and agents who are under an
obligation of confidentiality on terms substantially similar to those set out
in this Agreement, who have been informed of the confidential nature of the
Confidential Information and who require such information in the performance of
their duties;

 

(b)                                 not
to use, copy, duplicate, reproduce, translate or adapt, either directly or
indirectly, any of the Confidential Information of the other party for any
purpose other than the performance of this Agreement, without the other party’s
prior written approval; and

 

(c)                                  to
take all reasonable steps to prevent material in its possession that contains
or refers to Confidential Information of the other party from being discovered,
used or copied by Third 

 

13

 

Parties and that it shall
use reasonable steps to protect and safeguard all Confidential Information of
the other party in its possession from all unauthorized use or disclosure.

 

8.2                               Disclosure with Consent

 

A party receiving Confidential Information may, with the written
consent of the disclosing party, disclose such Confidential Information to
entities or persons other than its attorneys, accountants, employees and agents
on such terms and conditions as the disclosing party may specify.

 

8.3                               Publicity

 

During the term of this Agreement, the parties agree that no press
release or public announcement regarding this Agreement or the relationship of
the parties (except to the extent that it may be legally required) shall be
made unless mutually agreed to prior to the release or dissemination of any
such press release or public announcement.

 

8.4                               Disclosure Required by Law

 

No provision of this Agreement shall be construed so as to preclude any
disclosure of Confidential Information of Heraeus by PONIARD as may be inherent
in or reasonably necessary to the securing from any Regulatory Authority of any
necessary approval or license, including, without limitation, the filing of a
NDA or a Validation Report with the FDA or its foreign equivalents.

 

8.5                               Duration of Obligation

 

Unless otherwise agreed between the parties, the obligations of the
parties relating to Confidential Information set out in this Article 8
shall expire *** (***) years after expiration or earlier termination of this
Agreement.

 

8.6                               Terms of the Agreement

 

The terms and existence of this Agreement shall be deemed the
Confidential Information of PONIARD.

 

Article 9 Representations and
Warranties

 

9.1                               Heraeus’s Representations and Warranties

 

Heraeus hereby represents and warrants to PONIARD as follows:

 

(a)                                  Heraeus
has been duly organized and is validly subsisting and in good standing in its
jurisdiction of organization, has the power to enter this Agreement and to
carry on the business as now being conducted;

 

(b)                                 the
financial statements of Heraeus furnished to PONIARD have been prepared by
Heraeus’s accountants, are true, correct and complete in all material respects
and present fairly the financial condition of Heraeus as of the date thereof,
including Heraeus’s assets and liabilities as of such date and the revenues,
expenses and results of Heraeus’s operations for the preceding fiscal year;

 

(c)                                  Heraeus
is up-to-date and not in default in respect of all payments to be made by it
under any loans, agreements or other financing arrangements with any financial
institution or other person;

 

(d)                                 Heraeus
shall conduct the manufacturing of the Picoplatin API hereunder in a competent,
workmanlike fashion and in accordance with cGMP Requirements, the Master Batch
Record, the Specifications and any applicable Validation Protocols at the
Facility and all related manufacturing facilities and equipment shall satisfy
Installation Qualification and Operational Qualification requirements, taking
into account the requirements of the Project;

 

14

 

(e)           the
manufacturing of the Picoplatin API shall be performed by Heraeus in accordance
with the schedule set out in the Exhibits A-E, if this is technically feasible;

 

(f)            the
Facility, including equipment and systems, complies with cGMP Requirements;

 

(g)           each
Batch manufactured by Heraeus under this Agreement and designated in advance by
PONIARD as a Batch to be used for final dosage pharmaceutical products which
are intended to be used in humans shall comply with the Specifications and
shall not be adulterated or misbranded within the meaning of the Act;

 

(h)           all
analytical work shall be performed in a manner and in a laboratory which
complies with cGMP Requirements and all related testing procedures as well as
all equipment shall be validated prior to the Processing;

 

(i)            Heraeus
shall not intentionally infringe or misappropriate the intellectual property
rights of any Third Party in the Processing of the Picoplatin API or the
performance of its obligations under this Agreement.  This shall not apply if the infringement or
misappropriation by Heraeus is the result of complying with the instructions of
PONIARD;

 

(j)            all
personnel furnished by Heraeus to perform the Processing shall be qualified to
perform the tasks and functions which they are assigned;

 

(k)           Heraeus
is not debarred and has not and shall not use in any capacity the services of
any person debarred under the provisions of the Generic Drug
Enforcement Act of 1992, as amended from time to time and Heraeus
shall immediately notify PONIARD if it or any of its personnel become subject
of a debarment investigation by the FDA;

 

(l)            the
Processing of the Picoplatin API shall be performed by Heraeus in accordance
with all in Germany applicable national, state and local laws, regulations,
orders and guidelines, including, without limitation, all Environmental Laws of
Germany;

 

(m)          Heraeus
has obtained and shall maintain in full force and effect all applicable
licenses, permits, certificates, authorizations or approvals from governmental
authorities necessary to support the Processing of the Picoplatin API under
this Agreement;

 

(n)           Heraeus
has not made and shall not make any commitments to Third Parties inconsistent
with or in derogation of Heraeus’s obligations under this Agreement, and
Heraeus is free of any obligations that would prevent it from entering into
this Agreement; and

 

(o)           Heraeus
has not made and shall not make, in the performance of the Processing of the
Picoplatin API hereunder, any use of the Intellectual Property of any Third
Party except as approved in writing by PONIARD.

 

9.2          PONIARD’s Representations and Warranties

 

PONIARD hereby represents and warrants to Heraeus as follows:

 

(a)           PONIARD
has been duly incorporated and organized and is validly subsisting and in good
standing in its jurisdiction of incorporation, has the corporate power to enter
this Agreement and to carry on the business as now being conducted by it;

 

(b)           PONIARD
has obtained and shall maintain in full force and effect all applicable
licenses, permits, certificates, authorizations or approvals required to be
maintained by PONIARD in order for PONIARD to conduct its business;

 

(c)           PONIARD
shall be solely responsible that the Picoplatin API is fit for use as an active
pharmaceutical ingredient and that Picoplatin API which has been manufactured
by Heraeus in accordance with the Master Batch Record and conforming to the
Specifications and delivered to 

 

15

 

PONIARD will be used for
Picoplatin program development activities and clinical studies and commercial
sale of Picoplatin Drug Product;

 

(d)                                 PONIARD
shall be responsible that only such Picoplatin API that is in conformance with
the Specifications will be used for the manufacture of final dosage
pharmaceutical products;

 

(e)                                  to
the best of PONIARD’s knowledge, the PONIARD Know How and/or PONIARD Patent
Rights as well as any and all instructions of PONIARD relating to the
development, manufacture and delivery of Picoplatin API do not infringe any
Third Party property rights. Should further instructions of PONIARD cause
Heraeus to infringe any Third Party property rights, PONIARD shall indemnify
Heraeus as set forth in 10.1 (a) (vi).

 

9.3                               NO OTHER WARRANTIES

 

THE WARRANTIES SET OUT IN SECTIONS 6.1, 9.1 AND 9.2 ARE THE SOLE
WARRANTIES MADE BY EITHER PARTY TO THE OTHER, AND THERE ARE NO OTHER
WARRANTIES, REPRESENTATIONS OR GUARANTEES OF ANY KIND WHATSOEVER, EITHER
EXPRESS OR IMPLIED, REGARDING THE LABELED PRODUCT OR ANY OTHER MATERIALS OR
SERVICES TO BE SUPPLIED HEREUNDER, INCLUDING, BUT NOT LIMITED TO ANY EXPRESS OR
IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.  Heraeus makes no representation, warranty or guarantee
of any kind, express or implied, with respect to the Specifications, any
Validation Protocol or any other analytical procedures or processes, and in
particular, Heraeus makes no representation, warranty or guarantee that such
Specifications, protocols, procedures or processes shall be fit for any
particular purpose, and PONIARD shall be obligated to satisfy itself that such
Specifications, protocols, procedures and processes are suitable for and
compatible with PONIARD’s intended purpose of use.  PONIARD hereby acknowledges that it has been
advised by Heraeus to undertake its own due diligence with respect to the
Specifications, protocols, procedures and processes provided, specified or
agreed to by Heraeus under this Agreement.

 

Article 10 Indemnification

 

10.1                        Scope of Indemnification

 

(a)                                  PONIARD
shall defend, hold harmless and indemnify Heraeus and its Affiliates and their
respective directors, officers, employees and agents (“Heraeus
Indemnified Parties”), from and against all actions, claims,
demands, proceedings, suits, losses, damages, costs and expenses (including,
without limitation, reasonable attorneys’ fees) (in this Article, “Claims”) of whatsoever kind or nature (including, without
limitation, in respect of death, injury, loss or damage to any person or
property) arising out of or resulting from any Third Party claim arising out or
of resulting from:

 

(i)            the
use of the Picoplatin API by PONIARD;

 

(ii)           the
conduct of any clinical trials in which the Picoplatin API is used;

 

(iii)          the
promotion, marketing, distribution or sale by PONIARD, whether directly or
through distributors, of the Picoplatin API; or

 

(iv)          the
use of the PONIARD Know How and/or PONIARD Patent Rights or any other
instructions of PONIARD relating to the development or manufacture of
Picoplatin API;

 

except to the proportionate extent that any such Claims were caused by
the negligence or wrongful conduct of any Heraeus Indemnified Party, the
failure of the Picoplatin API to conform to the Specifications or the breach of
this Agreement by Heraeus.

 

16

 

(b)                                 Heraeus
shall defend, hold harmless and indemnify PONIARD and its Affiliates and their
directors, officers, employees and agents (“PONIARD
Indemnified Parties”), from and against all Claims of whatsoever
kind or nature including reasonable attorneys’ fees (including, without
limitation, in respect of death, injury, loss or damage to any person or
property) arising out of or resulting from any Third Party claim arising from
or resulting from:

 

(i)            any
breach of any representation or warranty of Heraeus contained in this
Agreement;

 

(ii)           any
failure by Heraeus to comply with the cGMP Requirements;

 

(iii)          any
personal injury or product liability relating to or arising from the Picoplatin
API supplied by Heraeus under this Agreement, but only to the extent such
personal injury or product liability arises from Heraeus’s negligence or
wrongful conduct or breach of this Agreement or failure of the Picoplatin API
to conform to the Specifications ;

 

except to the proportionate extent that any such Claim was caused by
the negligence or wrongful conduct of any PONIARD Indemnified Party.

 

10.2                        Indemnification Procedure

 

The indemnities contained in this Article 10 shall be conditional
on compliance with the terms and conditions set out in this Section 10.2.  The indemnifying party shall defend, contest,
or otherwise protect against any such Claims at its own cost and expense
provided that within one (1) month after having obtained knowledge of the
assertion of such Claims written notice is given, of any Claims for which
indemnification might be claimed.  The
indemnified party may, but shall not be obligated to, participate at its own
expense in a defense thereof by counsel of its own choosing, but the
indemnifying party shall be entitled to control the defense unless the
indemnified party has relieved the indemnifying party from liability with
respect to the particular matter.  If the
indemnifying party fails to timely and diligently defend, contest, or otherwise
protect against any such Claims, the indemnified party may, but shall not be
obligated to, defend, contest, or otherwise protect against the same, and make
any compromise or settlement thereof and recover the costs thereof from the
indemnifying party, including reasonable legal fees and costs and
disbursements, and all amounts paid as a result of such Claims or the
compromise or settlement thereof, provided, however, that if the indemnifying
party undertakes the timely and diligent defense of such matter, the
indemnified party shall not be entitled to recover from the indemnifying party
for its costs incurred in the defense thereof. 
The indemnified party shall cooperate and provide such assistance as the
indemnifying party may reasonably request in connection with the defense of the
matter subject to indemnification.  The
indemnifying party shall not settle or compromise any Claim without the prior
written consent of the indemnified party, which consent shall not be
unreasonably withheld.

 

Article 11 Insurance

 

Heraeus shall provide to PONIARD evidence that Heraeus has obtained
insurance coverage reasonably satisfactory to PONIARD in relation to its
manufacturing facilities and the performance of its obligations under this
Agreement, including, without limitation, comprehensive general liability
insurance, product liability insurance and any additional insurance required by
any applicable laws.

 

Article 12 Recalls

 

12.1                        Implementation of Recalls

 

If either party has grounds to implement a Recall, the party
recommending such Recall shall immediately notify the other party in writing of
such grounds.  PONIARD shall have the
sole responsibility to implement any Recall of the Picoplatin API.  Heraeus shall reasonably cooperate with
PONIARD in implementing any Recall of the Picoplatin API.

 

17

 

Nothing in Article 12.2 or 12.3 is intended to limit the
indemnification provisions in Article 10.1.

 

12.2                        Heraeus’s Liability for Recall

 

In the event of a Recall arising from Heraeus’s breach of this
Agreement or negligence or willful misconduct, Heraeus shall reimburse or
credit PONIARD for any of Heraeus’s manufacturing fees, shipping fees, taxes,
platinum cost and other charges, paid by PONIARD to Heraeus in respect of the
Recalled Picoplatin API, including any Picoplatin API that cannot be shipped
due to the Recall.

 

12.3                        PONIARD’s Liability for Recall

 

In the event of a Recall arising from PONIARD’s breach of this
Agreement, PONIARD shall reimburse Heraeus for any costs reasonably expended by
Heraeus to effect the Recall.

 

Article 13 Term and Termination

 

13.1                        Term

 

This Agreement shall be effective on the Effective Date and shall
continue until December 31, 2013 thereafter (the “Initial Term”). This
Agreement will be renewed automatically for *** commencing at the expiration of
the Initial Term and *** commencing at the end of the first renewal term unless
either PONIARD terminates the Agreement by giving Heraeus written notice of
intent to terminate at least *** (***) months prior to the expiration of the
Initial Term or the first renewal term or Heraeus terminates the Agreement by
giving PONIARD written notice of intent to terminate at least *** (***) months
prior to the expiration of the first renewal term. The Initial Term as may be
extended is referred to herein as the “Term.”

 

13.2                        Termination

 

Upon the occurrence of the following events, this Agreement may be
terminated on thirty (30) calendar days’ prior written notice:

 

(a)                                  upon
mutual agreement of the parties;

 

(b)                                 by
PONIARD upon any change of control of Heraeus;

 

(c)                                  by
PONIARD if Heraeus or any of its personnel performing services related to this
Agreement becomes debarred;

 

(d)                                 by
either party if the other party makes a general assignment for the benefit of
creditors, or if a petition in bankruptcy or under any insolvency law is filed
by or against the other party and such petition is not dismissed within sixty
(60) days after it has been filed; or

 

(e)                                  by
either party upon the breach of any material provision of this Agreement by the
other party if the breach is not cured within thirty (30) calendar days after
written notice thereof to the party in default;

 

(f)                                    by
Heraeus if PONIARD or any of its personnel dealing with Picoplatin API related
to this Agreement becomes debarred.

 

13.3                        Transfer of Technology

 

On expiration or termination of this Agreement through any means and
for any reason, the license granted to Heraeus shall terminate and Heraeus
shall cooperate with PONIARD by providing to PONIARD, copies or drafts of, to
the extent they exist:

 

18

 

(a)                                  Heraeus’s
CM&C documentation in support of PONIARD’s filing of its NDA for
Picoplatin;

 

(b)                                 Development,
Manufacturing and Validation Reports relating to the Picoplatin API;

 

(c)                                  Heraeus’s
Master Batch Records for the Picoplatin API;

 

(d)                                 pertinent
analytical reports and manufacturing instructions relating to the Picoplatin
API; and

 

(e)                                  all
technology, know how, or other Intellectual Property relating to the Process
Improvements, all in a form and with content reasonably satisfactory to PONIARD
as required to enable PONIARD’s reasonably competent staff to transfer the
Process of manufacturing the Picoplatin API (to the extent such Process exists
at the time of termination) to a Third Party or an Affiliate of PONIARD.  Heraeus shall also conduct a technical review
meeting with PONIARD to address issues raised by PONIARD regarding the
information so provided.  PONIARD shall
have a fully-paid, royalty-free, worldwide license, with right to sublicense,
under such technology, know how or other Intellectual Property (to the extent
not assigned to PONIARD pursuant to Article 7) to use, manufacture, have
manufactured, sell and import Picoplatin.

 

(f)            PONIARD
shall reimburse Heraeus at a rate of EU *** per hour for personnel costs to
assist in the transfer of the information provided in sections (a) – (e).

 

13.4                        Return of Starting Materials

 

On expiration or termination of this Agreement, Heraeus shall, within
thirty (30) calendar days, return to PONIARD all supplies of Picoplatin API,
process intermediates, and analytical reference materials in its possession or
control in any form.  The cost of
returning any such supplies shall be at PONIARD’s cost and expense.

 

13.5                        Return of Confidential Information

 

On expiration or termination of this Agreement unless otherwise agreed
between the parties, each party shall:

 

(a)                                  promptly
cease all use of the Confidential Information of the other party and ensure
that its employees cease all use thereof, except to the extent a license
thereto survives expiration or termination of this Agreement; and

 

(b)                                 upon
written request of the other party,

 

(i)            return
to the other party all copies of the Confidential Information of the other
party in its control or possession, subject to Section 13.3 and the
retention of one (1) complete copy for archival purposes and to satisfy
any applicable legal requirements; and

 

(ii)           destroy
any and all copies or other reproductions or extracts of the Confidential
Information of the other party and all other documents, computer files,
memoranda, notes or other writings prepared based on such Confidential
Information.

 

13.6                        Survival of Obligations

 

Notwithstanding the termination of this Agreement, Articles 1, 8,
9, 10, 11, 12 and 14 and Sections 2.3, 3.2, 4.1, 7.1, 7.2, 7.4, 7.5, 7.6, 13.3,
13.4, 13.5 and 13.6 shall survive the expiration or earlier termination of this
Agreement.  Upon termination of this
Agreement for any reason other than a material breach by PONIARD and upon
PONIARD’s request, outstanding Firm Purchase Orders must be completed under the
terms of this Agreement which shall survive until the batch is accepted by
Poniard.

 

19

 

Article 14 General Provisions

 

14.1                        Assignment

 

This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their successors and assigns.  This Agreement shall be assignable in whole
or in part by PONIARD without the consent of Heraeus, however, Heraeus shall
not assign this Agreement in whole or in part without the prior written consent
of PONIARD, such consent not to be unreasonably withheld.  Any assignee shall assume all obligations of
its assignor under this Agreement.  No
assignment shall relieve any party of responsibility for the performance of any
accrued obligation that such party then has hereunder.  Any assignment in violation of this Section 14.1
shall be void.

 

14.2                        Force Majeure

 

Any delay in the performance of any of the duties or obligations of any
party (except the payment of money due hereunder) caused by an event outside
the affected party’s reasonable control shall not be considered a breach of
this Agreement, and unless provided to the contrary herein, the time required
for performance shall be extended for a period equal to the period of such
delay.  Such events shall include without
limitation, acts of God; insurrections; riots; embargoes; labor disputes,
including strikes, lockouts, job actions, or boycotts; fires; explosions;
floods; shortages of material or energy; delays in the delivery of raw
materials; or other unforeseeable causes beyond the reasonable control and
without the fault or negligence of the party so affected.  In order to take the benefit of this Section,
the party so affected shall give prompt notice to the other party of such cause
and shall take whatever reasonable steps are necessary to relieve the effect of
such cause as rapidly as reasonably possible. 
If performance is affected for a period of more than six (6) months,
the unaffected party may terminate this Agreement by notice in writing to the
affected party.

 

14.3                        Injunction

 

Each party agrees that the other party may be irreparably damaged if
any provision of this Agreement is not performed in accordance with its
terms.  Accordingly, each party shall be
entitled to apply for an injunction or injunctions to prevent breaches of any
of the provisions of this Agreement by the other party, without showing or
proving any actual or threatened damage, notwithstanding any rule of law
or equity to the contrary, and may specifically enforce such provisions by an
action instituted in a court having jurisdiction.  These specific remedies are in addition to
any other remedy to which the parties may be entitled at law or in equity.

 

14.4                        Notice

 

Unless otherwise provided herein, any notice required or permitted to
be given hereunder shall be faxed, mailed by overnight mail, certified mail
postage prepaid, or delivered by hand to the party to whom such correspondence
is required or permitted to be given hereunder at the addresses set out
below.  If mailed, any such
correspondence shall be deemed to have been given five (5) Business Days
after mailing, as evidenced by the postmark at the point of mailing.  If delivered by hand, any such correspondence
shall be deemed to have been given when received by the party to whom such
correspondence is given and if faxed, any such correspondence shall be deemed
to have been given on the first Business Day following facsimile transmission,
as evidenced by written and dated receipt of the receiving party.

 

20

 

	
  If to PONIARD:

  	
   

  	
  With a copy to:

  
	
  Poniard
  Pharmaceuticals, Inc.

  	
   

  	
  Poniard
  Pharmaceuticals, Inc.

  
	
  300 Elliott Ave, Ste 500

  	
   

  	
  300 Elliott Ave, Ste 500

  
	
  Seattle, Washington

  	
   

  	
  Seattle, Washington

  
	
  98119

  	
  U.S.A.

  	
   

  	
  98119               U.S.A.

  
	
  Attention:

  	
  VP Legal

  	
   

  	
  Attention:

  	
  Sr Director, Product Development

  
	
  Telephone:

  	
  (206) 286-2526

  	
   

  	
  Telephone:

  	
  (206) 286-2536

  
	
  Facsimile:

  	
  (206) 286-2537

  	
   

  	
  Facsimile: 

  	
  (206) 284-7112

  
	
   

  	
   

  	
   

  
	
  If to Heraeus:

  	
   

  	
   

  
	
  W.
  C. Heraeus GmbH

  	
   

  	
   

  
	
  Chemicals
  Division

  	
   

  	
   

  
	
  Business
  Unit Pharma

  	
   

  	
   

  
	
  Heraeusstr.
  12 - 14

  	
   

  	
   

  
	
  63450
  Hanau, GERMANY.

  	
   

  	
   

  
	
  Attention:

  	
  Manager, Business Unit Pharma

  	
   

  	
   

  
	
  Telephone:

  	
  +49 (6181) 35-5255

  	
   

  	
   

  
	
  Facsimile:

  	
  +49 (6181) 35-4302

  	
   

  	
   

  
						

 

Either party may change the address to which any correspondence to it
is to be addressed by notification to the other party as provided herein.

 

14.5                        Relationship of Parties

 

It is not the intent of the parties hereto to form any partnership or
joint venture.  Each party shall, in
relation to its obligations hereunder, act as an independent contractor, and
nothing in this Agreement shall be construed to give such party the power or
authority to act for, bind or commit the other party in any way whatsoever.

 

14.6                        Severability

 

If any term or provision of this Agreement shall for any reason be held
invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability shall not affect any other term or provision hereof, and
this Agreement shall be interpreted and construed as if such term or provision,
to the extent the same shall have been held to be invalid, illegal or
unenforceable, had never been contained herein.

 

14.7                        Waiver

 

No waiver or modification of any of the terms of this Agreement shall
be valid unless in writing and signed by an authorized representative of the
parties hereto.  Failure by any party to
enforce any rights under this Agreement shall not be construed as a waiver of
such rights, nor shall a waiver by any party in one or more instances be
construed as constituting a continuing waiver or as a waiver in other
instances.

 

21

 

IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be executed by their
duly authorized representatives on the day and year written below.

 

	
  PONIARD PHARMACEUTICALS, INC.

  	
   

  	
  W. C. HERAEUS GMBH

  
	
  by its
  authorized signatory: 

  	
   

  	
  by its
  authorized signatory: 

  	
  March 18, 2008

  
	
  24, MAR08

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
  By:

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/ Ronald
  Martell

  	
   

  	
   

  	
  /s/ Gerald
  Ritter

  
	
   

  	
  Name: Ronald
  Martell

  	
   

  	
   

  	
  Name:

  
	
   

  	
  Title:
  President and COO

  	
   

  	
   

  	
  Title:  ppa. Gerald Ritter

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael Schwarz

  
	
   

  	
   

  	
   

  	
   

  	
  W.C. Heraeus GmbH

  
	
   

  	
   

  	
   

  	
   

  	
  Business Unit Pharma

  
	
   

  	
   

  	
   

  	
   

  	
  Michael Schwarz

  
	
   

  	
   

  	
   

  	
   

  	
  Manager BU Pharma

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Alexander Wörner

  
	
   

  	
   

  	
   

  	
   

  	
  W.C. Heraeus GmbH

  
	
   

  	
   

  	
   

  	
   

  	
  Business Unit Pharma

  
	
   

  	
   

  	
   

  	
   

  	
  Alexander Wörner

  
	
   

  	
   

  	
   

  	
   

  	
  Sales Manager

  
								

 

22

 

 

EXHIBIT A

 

PICOPLATIN SPECIFICATIONS AND
PACKAGING

 

Picoplatin
API shall meet the specifications attached hereto.

 

23

 

Heraeus

 

	
  Specification

  	
  ***

  
	
   

  	
  ***

  
	
  Customer:
  Poniard Pharmaceuticals Inc.

  	
  ***

  

 

cis-[(ammine)dichloro(2-methylpyridine)platinum(II)]

 

Picoplatin Drug Substance

 

Formula:       cis-[PtCI2(NH3)(C6H8N)]

***(1)

 

(1) Remainder
of page redacted.

 

24

 

Picoplatin
API shall be delivered in *** according to the description attached hereto.

 

***(2)

 

(2) Two
pages redacted.

 

25

 

 

 

26

 

EXHIBIT B

 

OUTLINE OF PICOPLATIN
MANUFACTURING PROCESS

 

Picoplatin
API shall be produced according to the manufacturing outline attached
hereto.  The exact process will be
described in the Batch Records for this *** process.

 

***(3)

 

(3) One
table redacted.

 

27

 

EXHIBIT C

 

HERAEUS INVESTMENT AND DEDICATED
EQUIPMENT FOR PICOPLATIN MANUFACTURE

 

Heraeus
shall manufacture Picoplatin API in a multi-purpose facility (MAPI) to be
installed at the Heraeus site in Hanau, Germany.

 

In
order to produce Picoplatin API according to the manufacturing process
summarized in Exhibit B additional equipment dedicated to the manufacture
of Picoplatin API is required.  ***.

 

Description
of the dedicated equipment

 

The
dedicated equipment consists of ***. 
***(4)

 

(4) Remainder
of page redacted.

 

28

 

***(5)

 

(5) Entire
page redacted.

 

29

 

Poniard
shall undertake to repay the investment for dedicated equipment in the amount
of:

 

Euro  958,000.

 

                ***

 

30

 

EXHIBIT D

 

FORECASTING SYSTEM FOR PICOPLATIN

 

***

 

As
outlined in Article 5 of this Agreement, Poniard will provide to Heraeus
*** forecasts (“Long Range Forecasts”) in the following format:

 

***

 

Additionally,
Poniard will provide to Heraeus *** rolling forecasts (“Rolling Forecasts”) of
the estimated Picoplatin API requirements during the respective periods. Format
shall be as follows:

 

***

 

31

 

EXHIBIT E

 

COMMERCIAL PRICING PICOPLATIN /
CALCULATION OF PAYBACK FOR DEDICATED EQUIPMENT COSTS / PAYBACK FOR DEDICATED
EQUIPMENT COSTS

 

 

COMMERCIAL PRICING PICOPLATIN API

 

 

***(6)

 

(6) Remainder
of page redacted.

 

32

 

***(7)

 

(7) Entire page redacted.

 

33

 

***

 

 

CALCULATION
OF PAYBACK FOR DEDICATED EQUIPMENT COSTS /

PAYBACK FOR DEDICATED EQUIPMENT COSTS

 

All costs mentioned
hereunder are based on a cost estimate for dedicated equipment of

 

Euro  958,000 
***

 

as outlined in Exhibit C.
They will be amended as the planning and construction of the dedicated
equipment progresses.

 

Investment and financing
costs of Heraeus for the set-up of dedicated equipment shall be covered by
Poniard in form of a surcharge on the first ***kgs of Picoplatin API ordered
and delivered under the terms of this Agreement, however no later than by December 31,
2013.

 

***(8)

 

(8) Remainder of page redacted.

 

34

 

***

 

If Poniard has ordered and
received less than ***kgs Picoplatin API by December 31, 2013 Poniard
shall pay the remaining amortization costs by ***. The formula for calculating
the open amortization costs shall be

 

EUR
958,000  ***

 

If, during the term of this
Agreement, Picoplatin does not show the anticipated results in the course of
the clinical development and Poniard decides not to pursue the further
development of Picoplatin, Poniard shall inform Heraeus immediately in writing.
In this case, the remaining amortization of dedicated equipment becomes due
according to the above formula within *** days from submission of the written
information.

 

If this Agreement is
terminated by Poniard pursuant to Section 13.2 or 14.2, Poniard shall not
be responsible for paying the remaining amortization of dedicated equipment.

 

35

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