Document:

Exhibit

EXECUTION VERSION
PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT (as amended or otherwise modified from time to time, this “Agreement”) dated as of August 5, 2016 is among XL GROUP LTD, an exempted company incorporated in Bermuda with limited liability (“XL Group”), XLIT LTD., an exempted company incorporated in the Cayman Islands with limited liability (“XLIT”), X.L. AMERICA, INC., a Delaware corporation (“XL America”), XL BERMUDA LTD, an exempted company incorporated in Bermuda with limited liability (“XL Bermuda”), XL RE EUROPE SE, a European public limited liability company registered in Ireland (“XL Re Europe”), XL INSURANCE COMPANY SE, a European public limited liability company registered in England and Wales (“XL Insurance”), XL LIFE LTD, an exempted company incorporated in Bermuda with limited liability (“XL Life”), CATLIN INSURANCE COMPANY (UK) LTD,  a private limited company incorporated in England and Wales (“Catlin Insurance”) and CATLIN RE SWITZERLAND LTD., a company limited by shares organized under the laws of Switzerland (“Catlin Switzerland” and together with XL Group, XLIT, XL America, XL Bermuda, XL Re Europe, XL Insurance, XL Life and Catlin Insurance, each a “Pledgor” and collectively, the “Pledgors”) and The Bank of New York Mellon, not in its individual capacity but solely as Collateral Agent (in such capacity, the “Collateral Agent”), for the benefit of the Secured Parties (as defined below).
W I T N E S S E T H:
WHEREAS, the Pledgors, various financial institutions, the Collateral Agent and The Bank of Tokyo-Mitsubishi UFJ, Ltd., as Administrative Agent, have entered into a Secured Credit Agreement dated as of August 5, 2016 (as amended or otherwise modified from time to time, the “Credit Agreement”); and
WHEREAS, under the Credit Agreement, each of the Pledgors has agreed to grant to the Collateral Agent security interests in each of their respective Accounts (as defined below), and each of the Pledgors has agreed to deliver cash and Eligible Assets to its Accounts from time to time in order to secure its obligations under the Credit Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1.Definitions.  In addition to terms defined in the preamble and recitals, (a) capitalized terms used but not defined herein have the respective meanings set forth in the Credit Agreement, and (b) the following terms have the following meanings (such definitions to be applicable to both the singular and plural forms of such terms):
“Account” means, with respect to any Pledgor, the segregated account (and includes any sub-accounts thereof and deposit accounts related thereto) in the name of such Pledgor and bearing the account number specified on Schedule II of the Control Agreement with respect to such Pledgor (as the same may be redesignated, renumbered or otherwise modified from time to time, and including any account opened in replacement of or in substitution for such account).

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“Cash Collateral Account” has the meaning given to it in Section 6(f).
“Collateral” has the meaning given to it in Section 2.
“Control Agreement” means the Collateral Account Control Agreement, dated as of August 5, 2016, among the Pledgors, the Collateral Agent, as pledgee, the Custodian, the Administrative Agent and The Bank of New York Mellon, as service provider.
“Custodian” means The Bank of New York Mellon (or any successor thereto permitted under the Control Agreement).
“Enforcement Event” means the occurrence and continuation of any Event of Default under the Credit Agreement, which has not been waived by the Administrative Agent; provided that no Enforcement Event shall be deemed to have occurred with respect to XL Re Europe, XL Insurance, XL Life, Catlin Insurance or Catlin Switzerland or any other Account Party that is not also a Guarantor (collectively, the “Non-Guarantor Entities”), unless such Non-Guarantor Entity is the defaulting party.
“Enforcement Event Notice” means a notice delivered from the Administrative Agent to the Collateral Agent (with a copy to XL Group) stating (i) that an Enforcement Event has occurred and is continuing and (ii) which  Pledgors are subject to such Enforcement Event.
“Investment Property” shall have the meaning provided in  Article 9 of the UCC.
“L/C Report” shall have the meaning provided in the Control Agreement.
“Liabilities” means, with respect to any Pledgor and to the extent owing to one or more Secured Parties, (i) all Obligations of such Pledgor, (ii) all obligations of such Pledgor under this Agreement and the Control Agreement, and (iii) all other obligations of such Pledgor directly related to any Letter of Credit issued for the account of such Pledgor, in each case, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, now or hereafter existing, or due or to become due.
“Notice of Exclusive Control” has the meaning given to it in Section 6(d).
“Obligations” means, with respect to any Pledgor, the Reimbursement Obligations (and interest thereon) and all other amounts from time to time owing to the Lenders, the Collateral Agent, the Existing Agent or the Administrative Agent by such Pledgor under any of the Credit Documents.
“Proceeds” means all “proceeds” as such term is defined in Section 9-102(a)(64) of the UCC.
“Secured Parties” means the Lenders, the Issuing Lenders, the Existing Agent, the Administrative Agent and the Collateral Agent.
“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York.

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2.    Grant of Security Interest.  As security for the payment of all of its Liabilities (and not the Liabilities of any other Pledgor), each Pledgor hereby assigns to the Collateral Agent, and grants to the Collateral Agent a continuing security interest in, as agent for the benefit of the Secured Parties, all right, title and interest of such Pledgor in the following property of such Pledgor, whether now or hereafter existing or acquired, regardless of where located (the “Collateral”):
(a)    its Account and all cash, Eligible Assets and all other property (including Investment Property) held therein or credited thereto from time to time;
(b)    to the extent related to any property described in this Section 2, all books, correspondence, credit files, records and other papers; and
(c)    all Proceeds of any of the foregoing.
3.    Warranties.  Each Pledgor warrants that:
(a)    such Pledgor is the sole entitlement holder of its Account and no other Person (other than the Collateral Agent pursuant to this Agreement and the Custodian pursuant to the Control Agreement) has control or possession of, or any other interest in, such Account or any cash, Eligible Assets or other property held in or credited to such Account and, without limiting the foregoing, no control agreements exist with respect to its Collateral other than the Control Agreement;
(b)    such Pledgor is and will be the lawful owner of all of its Collateral, free of all Liens, other than Liens permitted under Section 7.03(i) of the Credit Agreement (but solely to the extent the taxes, assessments, charges, levies or claims giving rise to such Liens are not yet due or remain payable without penalty or the validity thereof is being contested in good faith and by appropriate proceedings diligently conducted and so long as such reserves or other appropriate provisions as may be required by GAAP, Local GAAP, SAP or SFR, as the case may be, shall have been made therefor), the security interest created hereunder and Liens in favor of the Custodian, as securities intermediary, with respect to its Account; and
(c)    under the laws of the State of New York, (i) this Agreement creates a security interest that is enforceable against the Collateral in which such Pledgor has rights as of the date hereof and will create a security interest that is enforceable against the Collateral in which such Pledgor hereafter acquires rights at the time such Pledgor acquires any such rights and (ii) upon the execution and delivery of the Control Agreement by the parties thereto and the filing of the financing statements described in Section 4(a) against each Pledgor (and in respect of each Pledgor registered in England and Wales, subject to due registration of this Agreement at Companies House), the Collateral Agent will have a perfected and first priority security interest in the Collateral in which such Pledgor has rights as of the date thereof, and will, subject to any perfection requirements, have a first priority security interest in the Collateral in which such Pledgor hereafter acquires rights at the time such Pledgor acquires any such rights, in each case securing the payment and performance of the Liabilities of such Pledgor.
4.    Agreements of the Pledgors; Control; Withdrawals.

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(a)    Each Pledgor will, at the Administrative Agent’s reasonable request, at any time and from time to time, promptly execute and deliver to the Collateral Agent such financing statements, amendments and other documents (including recording a charge or filing (i) in the case of a Pledgor organized under the laws of a state of the United States, in such state, (ii) in the case of a Pledgor not incorporated or organized under the laws of a state of the United States, in the District of Columbia and, if applicable, in the state of the United States in which such Pledgor maintains its chief executive office as such office is identified to the Collateral Agent by such Pledgor), and do such other related acts as the Collateral Agent (acting at the written direction of the Administrative Agent) may reasonably request, in order to establish and maintain valid, attached and perfected first-priority security interests under the laws of the State of New York in the Collateral in favor of the Collateral Agent, free and clear of all Liens except Liens in favor of the Custodian.
(b)    Each Pledgor irrevocably authorizes the Collateral Agent (at the request of the Administrative Agent) at any time, and from time to time, to file and/or record in any United States jurisdiction any initial financing statement and/or charge and amendments thereto that (i) reasonably describes the Collateral, including, without limitation, the collateral description set forth in Exhibit A and (ii) contains any other information required by Section 5 of Article 9 of the UCC of the jurisdiction wherein such financing statement or amendment is filed regarding the sufficiency or filing office acceptance of any financing statement or amendment, the applicable laws of the jurisdiction of organization of such Pledgor with respect to recording a security interest. Each Pledgor acknowledges that pursuant to the Control Agreement, the Collateral Agent has “control” (as that term is used in Section 9-106 of the UCC) of any securities account comprising such Pledgor’s Account pursuant to Sections 9-106(a), 9-106(c) and 8-106(d)(2) of the UCC and also “control” (as that term is used in Section 9-104 of the UCC) of any deposit account comprising such Pledgor’s Account pursuant to Section 9-104 of the UCC.
(c)    Subject to the terms of the Control Agreement, the parties agree that unless and until such time as the Collateral Agent (acting at the written direction of the Administrative Agent) shall deliver a Notice of Exclusive Control to the Custodian in respect of the Account of a Pledgor (and at any time after the written rescission by the Collateral Agent (acting at the written direction of the Administrative Agent) of such Notice of Exclusive Control), and upon two (2) Business Days’ notice to the Administrative Agent and the Collateral Agent, each Pledgor shall have the right to instruct the Custodian to:
(i)    substitute any cash or Eligible Assets held in the Account of such Pledgor with other cash or Eligible Assets, provided that, (i) immediately after giving effect to such substitution, the Borrowing Base of such Pledgor is at least equal to the aggregate face value (or its Dollar Equivalent) of all Letters of Credit issued on behalf of such Pledgor and (ii) such substitution shall precede the related release; and
(ii)    to the extent that the Borrowing Base of such Pledgor exceeds the aggregate face value (or its Dollar Equivalent) of all Letters of Credit issued on behalf of such Pledgor, transfer cash or Eligible Assets from such Account to any 

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account specified by such Pledgor in an amount equal to such excess, in each case, in accordance with the terms of the Credit Agreement.
For the avoidance of doubt, any substituted (in the case of the foregoing clause (i)) or withdrawn (in the case of the foregoing clause (ii)) cash or Eligible Assets shall cease to secure the Liabilities and shall be released without further action from the Liens granted to the Secured Parties hereunder.
(d)    Each Pledgor agrees that, immediately upon the delivery of a Notice of Exclusive Control with respect to its Account (but only for so long as such Notice of Exclusive Control has not been rescinded), (i) it will not have the right to make or request any withdrawal from such Account (including any sub-account or related account thereof) or otherwise to direct the Custodian’s disposition of any Collateral of such Pledgor, and (ii) the Collateral Agent has the exclusive right (acting at the written direction of the Administrative Agent) to direct the Custodian’s disposition of the Collateral of such Pledgor without further consent of or notice to such Pledgor.  No Pledgor shall give any consent or waiver, authorize any assumption, make any modification or supplement, or take any other action with respect to any Collateral in any manner inconsistent with the manner in which such Pledgor acts with respect to investments of the same type held by such Pledgor for its own account.
5.    Voting Rights; Rights to Income.
(a)    Each Pledgor agrees, immediately upon the delivery of a Notice of Exclusive Control with respect to its Account (but for so long as such Notice of Exclusive Control has not been rescinded), (a) that the Collateral Agent (acting at the written direction of the Administrative Agent) may exercise (to the exclusion of such Pledgor) the voting power and all other incidental rights of ownership with respect to any Investment Property constituting such Pledgor’s Collateral, and such Pledgor hereby grants the Collateral Agent an irrevocable proxy, exercisable under such circumstances, to vote such Investment Property, and (b) to promptly deliver to the Collateral Agent such additional proxies and other documents as may be necessary to allow the Collateral Agent (acting at the written direction of the Administrative Agent) to exercise such voting power.  The Collateral Agent agrees that unless and until a Notice of Exclusive Control with respect to the Account of a Pledgor shall have been delivered by the Administrative Agent to the Collateral Agent (and at any time after the rescission of such Notice of Exclusive Control), such Pledgor will have the exclusive voting power with respect to any Investment Property constituting Collateral of such Pledgor and the Collateral Agent will, upon the written request of such Pledgor and upon the written direction of the Administrative Agent, promptly deliver such proxies and other documents, if any, as shall be reasonably requested by such Pledgor and completed and provided for execution to the Collateral Agent which are necessary to allow such Pledgor to exercise that voting power.
(b)    Unless and until such time as the Collateral Agent (acting at the written direction of the Administrative Agent) shall deliver a Notice of Exclusive Control to the Custodian in respect of the Account of a Pledgor (and at any time after the rescission of such Notice of Exclusive Control), such Pledgor shall be entitled to receive (by delivery of the Custodian to such Pledgor in accordance with the Control Agreement) all cash dividend payments, interest payments and other distributions of cash received by the Custodian in respect of any assets of such Pledgor credited to the Account 

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of such Pledgor free and clear of any Lien granted under this Agreement; provided, that after receipt of any such Notice of Exclusive Control (but only for so long as such Notice of Exclusive Control has not been rescinded), the Collateral Agent (acting at the written direction of the Administrative Agent) shall instruct the Custodian to deposit and retain in the Account of such Pledgor all such cash dividend payments, interest payments and other distributions of cash received by the Custodian in respect of any assets of such Pledgor credited to such Account. At all times, any distributions other than cash received by the Custodian in respect of any Collateral of such Pledgor shall be delivered by the Custodian to the Account related to such Collateral, and the security interest granted under this Agreement with respect to Collateral credited to such Account shall automatically attach to such distributions other than cash for the benefit of the Secured Parties.
6.    Default and Remedies upon an Enforcement Event.  (a)  If the Collateral Agent has received an Enforcement Event Notice with respect to one or more Pledgors (which notice(s) have not been rescinded), then the Collateral Agent may (and shall if so directed by the Administrative Agent in writing) apply all or any portion of the credit balance of the Account of each such Pledgors to the payment of the respective Liabilities of such Pledgor (and not the Liabilities of any other Pledgor).
(b)    Without limiting the foregoing, if the Collateral Agent has received an Enforcement Event Notice with respect to one or more Pledgors (which notice(s) have not been rescinded), the Collateral Agent (acting at the written direction of the Administrative Agent) may exercise all the rights of a secured party under the UCC (whether or not in effect in the jurisdiction where such rights are exercised) with respect to the Collateral of such Pledgors.
(c)    Without limiting clause (a) above, each Pledgor agrees that, if the Collateral Agent has received an Enforcement Event Notice with respect to it (which notice has not been rescinded), then any item of its Collateral may be sold for cash or on credit or for future delivery without assumption of any credit risk, in any number of lots at the same or different times, at any exchange, brokers’ board or elsewhere, by public or private sale (to the extent permitted by applicable law), and at such times and on such terms, as the Collateral Agent, acting at the written direction of the Administrative Agent, shall elect.  The Collateral Agent shall give the applicable Pledgor such notice of any private or public sales as may be required by the UCC or other applicable law.  Each Pledgor recognizes that the Collateral Agent may be unable to make a public sale of any or all of the Collateral of such Pledgor, by reason of prohibitions contained in applicable securities laws or otherwise, and expressly agrees that a private sale to a restricted group of purchasers for investment and not with a view to any distribution thereof (to the extent permitted by applicable law) shall be considered a commercially reasonable sale.  The Collateral Agent shall have the right upon any such public sale, and, to the extent permitted by law, upon any such private sale, to purchase the whole or any part of the Collateral of such Pledgor so sold, free of any right or equity of redemption, which right or equity of redemption the applicable Pledgor hereby releases to the extent permitted by law.
(d)    Without limiting clause (a) above, if the Collateral Agent has received an Enforcement Event Notice with respect to one or more Pledgors (which notice(s) have not been rescinded), the Collateral Agent (acting at the written direction of the Administrative Agent) shall have the right to deliver to the Custodian, in accordance with the Control Agreement, a “Notice of 

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Exclusive Control” in respect of the respective Account of each such Pledgor (a “Notice of Exclusive Control”) pursuant to which the Collateral Agent shall have the right (acting at the written direction of the Administrative Agent), so long as the Enforcement Event Notice in respect of any particular Pledgor has not been rescinded, to execute and deliver to the Custodian any entitlement order, to execute and deliver other instructions directing the disposition of the Collateral of any such particular Pledgor, to vote and to give consents, ratifications and waivers with respect to the Collateral of any such particular Pledgor and exercise all rights, privileges or options pertaining to the Collateral of any such particular Pledgor, as if the Collateral Agent were the absolute owner thereof; provided, that the Collateral Agent hereby covenants that it will not deliver to the Custodian a Notice of Exclusive Control with respect to the Account of any Pledgor or otherwise instruct the Custodian to liquidate, transfer, restrict transfer of or otherwise act on the Collateral of any Pledgor until it has received an Enforcement Event Notice in respect of such Pledgor (which notice has not been rescinded).
(e)    For the purpose of enabling the Collateral Agent to exercise its rights under this Section 6 or otherwise in connection with this Agreement, each Pledgor hereby constitutes and appoints the Collateral Agent (and any of the Collateral Agent’s officers, employees or agents designated by the Collateral Agent) its true and lawful attorney-in-fact, with full power and authority to (i) sign and file any financing statements or other documents, papers or instruments which must be executed or filed to perfect or continue perfection, maintain the priority of or provide notice of the pledge of and security interest in the Collateral of such Pledgor under the laws of the state of New York, in each case at the written direction of the Administrative Agent and (ii) if the Collateral Agent has received an Enforcement Event Notice in respect of a Pledgor (which has not been rescinded), do any and all acts that the Administrative Agent requests in writing (including deliver a Notice of Exclusive Control pursuant to Section 6(f)) and things for and on behalf of the Pledgors that are necessary or desirable to protect, collect, realize upon and preserve the Collateral of such Pledgor, to enforce the Collateral Agent’s rights with respect to the Collateral of such Pledgor and to accomplish the purposes hereof.  Such appointment by the Pledgors is coupled with an interest and is irrevocable so long as all Liabilities of the Pledgors have not been paid and performed in full.  Each Pledgor ratifies, to the extent permitted by law, all that the Collateral Agent shall lawfully and in good faith do or cause to be done by virtue of and in compliance with this Section 6(e).
(f)    To the extent that any of the Liabilities of a Pledgor may be contingent, unmatured or unliquidated (including with respect to undrawn amounts under any Letter of Credit) after such time as an Enforcement Event Notice with respect to such Pledgor shall have been delivered to the Collateral Agent (and which has not been rescinded), the Collateral Agent (acting at the written direction of the Administrative Agent) (i) shall instruct the Custodian to retain the proceeds of any sale, collection, disposition or other realization upon the Collateral of such Pledgor (or any portion thereof) up to the amount of any Liabilities of such Pledgor in a separate cash collateral account related to the Account of such Pledgor (a “Cash Collateral Account”) until such time as the Administrative Agent directs the Collateral Agent to apply such proceeds to the Liabilities of such Pledgor as they become due (and not to the Liabilities of any other Pledgor), and such Pledgor agrees that such retention of such proceeds by the Collateral Agent shall not be deemed strict foreclosure with respect thereto; (ii) may conclusively rely on any estimate made by the 

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Administrative Agent of the liquidated amount of any such contingent, unmatured or unliquidated claims against or in respect of a Pledgor and apply the proceeds of the Collateral of such Pledgor against such amount as directed by the Administrative Agent; and (iii) otherwise may proceed in any other manner permitted by applicable law.  Each Pledgor agrees that any Cash Collateral Account shall be a blocked account and that upon the irrevocable deposit of funds into such account, such Pledgor shall not have any right of withdrawal with respect to such funds and any funds deposited into a Cash Collateral Account shall not be withdrawn by it.  Each Pledgor hereby grants to the Collateral Agent a continuing security interest in all right, title and interest of such Pledgor in and to any Cash Collateral Account and the deposits and funds held therein, and the Collateral Agent shall have all rights of a secured creditor under the UCC with respect thereto.  Each Pledgor irrevocably waives the right to make any withdrawal from any Cash Collateral Account until the earlier of (i) the written rescission of the applicable Enforcement Event Notice and (ii) payment in full in cash of all Liabilities of such Pledgor and the termination or expiration of each Letter of Credit issued for the account of such Pledgor pursuant to the Credit Agreement. Upon the written rescission of the applicable Enforcement Event Notice, the balance, if any, in any Cash Collateral Account shall be promptly returned to the respective Pledgor.
(g)    Except as otherwise provided in this Agreement, EACH PLEDGOR HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE COLLATERAL AGENT’S TAKING POSSESSION OR THE COLLATERAL AGENT’S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES, and each Pledgor hereby further waives, to the extent permitted by law: (i) all damages occasioned by such taking of possession or any such disposition except any damages which are the direct result of the Collateral Agent’s gross negligence, bad faith or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision), and (ii) all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral of such Pledgor or any portion thereof, and each Pledgor, for itself and all who may claim under it, insofar as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws.  To the extent permitted by applicable law, any sale of, or the grant of options to purchase, or any other realization upon, any Collateral shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of the relevant Pledgor therein and thereto, and shall be a perpetual bar both at law and in equity against such Pledgor and against any Persons claiming or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under such Pledgor.
7.    Application of Proceeds; Releases; Etc.  (a)  The Collateral Agent shall apply the proceeds of any sale or other disposition or collection of any Collateral of any Pledgor to the Liabilities of such Pledgor in the order directed by the Administrative Agent in accordance with the terms of the Credit Agreement.
(b)    Upon release of the Collateral of each Pledgor pursuant to Section 10.15(b) of the Credit Agreement, the Collateral Agent (acting at the written direction of the Administrative Agent) shall (i) deliver or pay, or cause the Custodian to deliver or pay in accordance with the Control 

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Agreement, to the account specified by each Pledgor (or its designee) any surplus Collateral held in the Account of such Pledgor (or any proceeds thereof held by the Collateral Agent elsewhere), and (ii) execute and deliver any financing statement amendments or termination statements or such other documents, releases, forms, instruments, notices, supplements or other agreements as may be provided to it by the Pledgors to terminate any financing statements or registrations in any applicable jurisdictions, or evidence the termination thereof or any other documents filed with respect to, or otherwise relating to, the Collateral.  The obligations of the Collateral Agent under this Section 7(b) shall survive the termination of this Agreement.
8.    General.  (a)  All notices and other communications provided for hereunder shall be in accordance with Section 10.01 of the Credit Agreement.
(b)    Each Pledgor agrees to pay all expenses, including reasonable and documented attorney’s fees and charges (including time charges of attorneys who are employees of the Collateral Agent), paid or incurred by the Collateral Agent in endeavoring to collect the Liabilities of such Pledgor, or any part thereof, and in enforcing this Agreement against such Pledgor, and such obligations will themselves be Liabilities.
(c)    No delay on the part of the Collateral Agent in the exercise of any right or remedy shall operate as a waiver thereof, and no single or partial exercise by the Collateral Agent of any right or remedy shall preclude other or further exercise thereof or the exercise of any other right or remedy.
(d)    This Agreement shall remain in full force and effect until the Commitments have terminated, all Liabilities (other than any contingent indemnification obligations as to which no claim has been asserted) have been paid in full and each Letter of Credit has terminated or expired pursuant to the Credit Agreement (or otherwise dealt with to the satisfaction of the Administrative Agent, Issuing Lenders and Lenders in respect thereof).  At such time, the Administrative Agent in writing will instruct the Collateral Agent to provide the Custodian with written instructions in the form required to terminate the Control Agreement.  If at any time all or any part of any payment theretofore applied by the Collateral Agent to any of the Liabilities is or must be rescinded or returned by the Collateral Agent for any reason whatsoever (including the insolvency, bankruptcy, examinership or reorganization of any Pledgor), such Liabilities shall, for the purposes of this Agreement, to the extent that such payment is or must be rescinded or returned, be deemed to have continued in existence, notwithstanding such application by the Collateral Agent, and this Agreement shall continue to be effective or be reinstated, as the case may be, as to such Liabilities, all as though such application by the Collateral Agent had not been made.
(e)    Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.
(f)    This Agreement shall be construed in accordance with and governed by the law of the State of New York.

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(g)    The rights and privileges of the Collateral Agent hereunder shall inure to the benefit of its successors and assigns.  No Person other than the parties hereto is an intended or third-party beneficiary of any of the provisions of this Agreement.
(h)    This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts, and each such counterpart shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.  Delivery of an executed signature page of this Agreement by email or facsimile transmission shall be effective as delivery of a manually executed counterpart hereof.
(i)    Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in the Borough of Manhattan in the City of New York and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Agreement shall affect any right that the Administrative Agent, the Collateral Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement against any Pledgor or its properties in the courts of any jurisdiction.
(j)    Neither the Collateral Agent nor the Administrative Agent shall be responsible or liable for any failure or delay in the performance of its obligations under this Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including acts of God; earthquakes; fires; floods; wars; civil or military disturbances; sabotage; epidemics; riots; interruptions, loss or malfunctions of utilities, computers (hardware or software) or communications service; accidents; labor disputes; acts of civil or military authority; governmental actions; or inability to obtain labor, material, equipment or transportation.
(k)    XL Group agrees to indemnify the Collateral Agent against and to hold the Collateral Agent harmless from all damages, liabilities or claims, and all reasonable costs and expenses including reasonable and documented fees of counsel, including any claim by any Pledgor or the Administrative Agent, that are sustained by the Collateral Agent as a result of the Collateral Agent’s action or inaction in connection with or otherwise arising out of this Agreement, the Credit Agreement or any other Credit Document, except to the extent arising out of the Collateral Agent’s gross negligence, bad faith or willful misconduct. In the event of any conflict between the indemnity in Section 10.03(b) of the Credit Agreement or any other Credit Document and the indemnity in this Section 8(k) (including with respect to any standards of care), the indemnity in this Section 8(k) shall govern. The foregoing indemnity shall be a continuing obligation of the Pledgors and their respective successors and assigns, notwithstanding the termination of this Agreement.

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(l)    The Collateral Agent may conclusively rely on an Enforcement Event Notice received from the Administrative Agent, without any further inquiry or investigation of any kind, for so long as it has not received written notice of the rescission of such Enforcement Event Notice by and from the Administrative Agent.  Subject to the terms of the Credit Agreement, at any such time after its initial delivery of an Enforcement Event Notice in respect of a Pledgor to the extent no Event of Default remains continuing with respect to such Pledgor, the Administrative Agent shall deliver a notice of rescission to the Collateral Agent informing it that the Enforcement Event Notice has been rescinded.
(m)    Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement in any court referred to in paragraph (i) of this Section.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(n)    To the extent that any Pledgor has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service of notice, attachment prior to judgment, attachment in aid of execution or execution, on the ground of sovereignty or otherwise) with respect to itself or its property, it hereby irrevocably waives, to the fullest extent permitted by applicable law, such immunity in respect of its obligations under this Agreement.
(o)    EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
(p)    The obligations of each Pledgor hereunder shall remain in full force and effect without regard to, and shall not be impaired by any exercise or non-exercise, or any waiver of, any right, remedy, power or privilege under or in respect of this Agreement or any other Credit Document.
(q)    Any Person that is required to execute a counterpart of this Agreement after the date hereof pursuant to the requirements of the Credit Agreement or any other Credit Document shall become a Pledgor hereunder by (x) executing a counterpart hereof and delivering same to the Collateral Agent, or by executing an assumption agreement in form and substance reasonably satisfactory to the Collateral Agent (acting at the written direction of the Administrative Agent), (y) delivering supplements to Schedule I and II to the Control Agreement as are necessary to cause 

11
1950332.06D-NYCSR07A - MSW

such schedules to be complete and accurate with respect to such additional Pledgor on such date and complying with Section 10.14 of the Credit Agreement and (z) taking all actions as specified in this Agreement as would have been taken by such Pledgor had it been an original party to this Agreement, in each case with all documents required above to be delivered to the Collateral Agent and with all documents and actions required above to be taken to the reasonable satisfaction of the Collateral Agent (acting at the written direction of the Administrative Agent).
(r)    Following receipt by the Collateral Agent of a Resignation Letter from a Pledgor as to its resignation as an Account Party in accordance with Section 10.04(h) of the Credit Agreement and so long as no Letters of Credit issued on behalf of such Account Party (or any Reimbursement Obligations in respect thereof) are outstanding and all interest, fees and other Obligations payable by such Account Party have been paid in full (as established in the Resignation Letter upon which the Collateral Agent may conclusively rely), the Collateral Agent, at the request and expense of XL Group, will promptly execute and deliver to XL Group any documents of release and/or authorize the filing of a proper instrument or instruments (including a release of all Liens granted by such Account Party hereunder and UCC terminations statements on form UCC-3 reflecting the same) reasonably requested by XL Group acknowledging the release of such Pledgor, and will duly assign, transfer and deliver to such Pledgor (without recourse and without any representation or warranty) such of the Collateral of such Pledgor as may be in the possession of the Collateral Agent or Custodian and as has not theretofore been sold or otherwise applied or released pursuant to this Agreement.
(s)    By the execution and delivery of this Agreement, each Pledgor acknowledges that it has by a separate written instrument, designated and appointed CT Corporation System, 111 Eighth Avenue, 13th floor, New York, New York 10011 (or any successor entity thereto), as its authorized agent upon which process may be served in any suit or proceeding arising out of or relating to this Agreement that may be instituted in any federal or state court in the State of New York.  Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 10.01 of the Credit Agreement.  Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
(t)    The parties hereto acknowledge and agree that any Guarantor may, but is not required to, deliver any cash or Eligible Assets to the Account of any Pledgor for the purpose of securing the Liabilities of such Pledgor and that upon any such cash or Eligible Assets being credited to the Account of any Pledgor, such cash and Eligible Assets shall be deemed to be Collateral of such Pledgor.
(u)    Notwithstanding anything herein to the contrary, each party hereto agrees that the Administrative Agent may provide multiple directions and/or instructions to the Collateral Agent in a single writing; provided that no such instructions or directions shall relate to contingent events in the future.
[Signature pages follow]

12
1950332.06D-NYCSR07A - MSW

IN WITNESS WHEREOF, this Agreement has been duly executed as of the day and year first above written.
PLEDGORS:

XL GROUP LTD

By    /s/ Stephen Robb    
Name:    Stephen Robb
Title:    Corporate Controller

XLIT LTD.

By    /s/ Stephen Robb    
Name:    Stephen Robb
Title:    Director

By    /s/ Peter Porrino    
Name:    Peter Porrino
Title:    Director

[Signature Page to Pledge Agreement]

X.L. AMERICA, INC.

By    /s/ Toni Ann Perkins    
Name:    Toni Ann Perkins
Title:    Assistant Secretary

XL BERMUDA LTD

By    /s/ C. Stanley Lee    
Name:    C. Stanley Lee
Title:    Director

[Signature Page to Pledge Agreement]
509265-1569-14601-Active.14931912
1950332.06D-NYCSR07A - MSW

Signed for and on behalf of 
XL RE EUROPE SE, 
by its duly authorized attorney 
in the presence of:
		
	By
	/s/ David Watson     
Name:    David Watson 
Title:        Attorney 

/s/ Michele Mulready     
Witness 
    Name:    Michele Mulready 
    Title:        Attorney

[Signature Page to Pledge Agreement]

Executed by XL INSURANCE COMPANY SE, acting by:

/s/ Paul Bradbrook    
Director and member of the administrative organ

Name of director and member of the administrative organ: Paul Bradbrook
in the presence of:

/s/ Marie Rees        
Name of witness: Marie Rees
Address: 9 Lichfield Rd, Northwood Hills,     Middlesex HA6 1LY
Occupation: Chartered Secretary

[Signature Page to Pledge Agreement]

XL LIFE LTD

By    /s/ Mark Twite    
Name:    Mark Twite
Title:        Director

[Signature Page to Pledge Agreement]

•

Executed by CATLIN INSURANCE COMPANY (UK) LTD., acting by:

/s/ Paul Bradbrook    
Director

Name of director: Paul Bradbrook
in the presence of:

/s/ Marie Rees        
Name of witness: Marie Rees
Address: 9 Lichfield Rd, Northwood Hills,     Middlesex HA6 1LY
Occupation: Chartered Secretary

[Signature Page to Pledge Agreement]

CATLIN RE SWITZERLAND LTD.
By /s/ Esther Kramer     
Name:    Esther Kramer 
Title:    Director
By /s/ Benno Schaffhauser     
Name:    Benno Schaffhauser 
Title:    Chief Financial Officer

[Signature Page to Pledge Agreement]

COLLATERAL AGENT:

THE BANK OF NEW YORK MELLON

By    /s/ Jose Alcantara    
Name:    Jose Alcantara
Title:    Vice President

Address:    101 Barclay Street, 7E 
        New York, NY 10286 
        Attn:  Insurance Trust Group 

Facsimile Number:        (732) 667-9536

[Signature Page to Pledge Agreement]

Acknowledged and, with respect to Section 8(l), agreed to by: 

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., 
as Administrative Agent 

By:    /s/ Suzanne Ley     
    Name:    Suzanne Ley
Title:    Vice President

[Signature Page to Pledge Agreement]

Exhibit A

[see attached]

        

ANNEX A TO UCC FINANCING STATEMENT
DEBTOR:                SECURED PARTY:
XL Life Ltd                The Bank of New York Mellon, as Collateral Agent
One Bermudiana Road        101 Barclay Street, 7E
Hamilton HM 08            New York, New York 10286
Bermuda 
DESCRIPTION OF COLLATERAL:
All right, title and interest of Debtor in the following property, whether now owned or hereafter existing or acquired, regardless of where located:
(a)    its Account and all cash, Eligible Assets and all other property (including Investment Property) held therein or credited thereto from time to time;
(b)    to the extent related to any property described herein, all books, correspondence, credit files, records and other papers; and
(c)    all Proceeds of any of the foregoing.
DEFINITIONS
Capitalized terms used herein and not otherwise defined herein shall have the respective meanings assigned to such terms in the Credit Agreement.
“Account” means, with respect to the Debtor, all segregated accounts (and includes any sub-accounts thereof and deposit accounts related thereto) in the name of Debtor and bearing an account number that contains the first four digits and the last three digits specified on Schedule I hereto (as the same may be redesignated, renumbered or otherwise modified from time to time, and including any account opened in replacement of or in substitution for such account).
 “Administrative Agent” means The Bank of Tokyo-Mitsubishi UFJ, Ltd. in its capacity as Administrative Agent.
 “Credit Agreement” means the Secured Credit Agreement dated as of August 5, 2016, among the Debtor, the other Account Parties, various financial institutions, the Secured Party, as Collateral Agent and the Administrative Agent (as amended, restated, supplemented or modified from time to time). 
“Eligible Assets” shall mean the Eligible Assets specified in the definition of “Advance Rate” in the Credit Agreement (as may be modified from time to time in accordance with the terms of the Credit Agreement).

        

  “Investment Property” shall have the meaning provided in  Article 9 of the UCC.
“Proceeds” means all “proceeds” as such term is defined in Section 9-102(a)(64) of the UCC.
“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York.

        

SCHEDULE I
CUSTODY ACCOUNTS

	
	
	JP1FXXXX862Exhibit

 FIRST AMENDMENT TO DISTRIBUTION, LICENSE,  
DEVELOPMENT AND SUPPLY AGREEMENT

This First Amendment to Distribution, License, Development and Supply Agreement (the “Amendment”) is made and entered into effective as of May 31, 2016 (the “Effective Date”) by and between AstraZeneca UK Limited, a company incorporated in England under no. 3674842 whose registered office is at 2 Kingdom Street, London, W2 6BD, England (“AstraZeneca”), and Impax Laboratories, Inc., a Delaware corporation located at 30831 Huntwood Avenue, Hayward, CA 94544 (“Impax”), and amends that certain Distribution, License, Development and Supply Agreement by and between AstraZeneca and Impax dated January 31, 2012 (the “Agreement”).  AstraZeneca and Impax are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

RECITALS

WHEREAS, the Parties entered into the Agreement to grant Impax the right to distribute and sell certain pharmaceutical products containing zolmitriptan (Zomig®) in the Territory (as defined in the Agreement), to seek regulatory approval for one or more new indications with respect to such products, to develop one or more additional products for commercialization in the Territory, and other related rights described therein; 

WHEREAS, among other things, AstraZeneca retained rights to continue to be the holder of NDAs for such products in the Territory, which included the obligation to complete certain Selected Mandated Studies (as defined in the Agreement);

WHEREAS, the Selected Mandated Studies include the obligation to conduct the juvenile toxicity study and pediatric study under PREA for the acute treatment of migraine in pediatric patients ages 6 to 11 years, as set forth by the U.S. Food and Drug Administration and further described in the protocol for such study attached as Exhibit A to this Amendment (the “PREA Commitment Study,” as further described below); and

WHEREAS, AstraZeneca and Impax have agreed to effect the transfer from AstraZeneca to Impax of certain activities and obligations with respect to the PREA Commitment Study on the terms and subject to the conditions set forth in this Amendment.

NOW, THEREFORE, in consideration of the premises and the mutual promises and conditions hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, do hereby agree as follows:

1.    Definitions.  Any capitalized term not otherwise defined in this Amendment shall have the meaning set forth in the Agreement.

2.    Amendment to Article 1 (Definitions) of the Agreement.  Article 1 of the Agreement is hereby amended by adding the following definitions:

[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

“1.226.    “Party Written Consent” means (a) with respect to a matter to be agreed 
by the Parties, the mutual written agreement of the Parties or the mutual consent of the Parties in writing, in each case executed on behalf of each Party by an appropriate officer or employee of such Party and (b) with respect to a matter to be consented to or approved by a Party, the written consent or agreement of such Party executed by an appropriate officer or employee of such Party.”

 “1.227.    “PREA Commitment Study” means that certain Selected Mandated Study commitment required to be performed by the FDA [****] including (a) the activities set forth in the PREA Commitment Study Clinical Protocol, (b) the Toxicology Study, and (c) subject to Section 7.2.9, any subsequent amendments and modifications to the scope of such PREA Commitment Study, or any additional Studies as determined by the JDC, on the one hand, and the FDA, on the other hand.”  

“1.228.    “PREA Commitment Study Clinical Protocol” means the protocol for the PREA Commitment Study attached to this Amendment as Exhibit A.”  

“1.229.    “PREA Development Plan” means the written operational development plan to conduct the PREA Commitment Study as established by the JDC.”

“1.230.    “PREA Study Obligations” means Impax’s obligations solely in relation to the PREA Commitment Study as set forth in Section 4.6 of this Agreement.”

“1.231.     “PREA Toxicology Study” means the juvenile rat toxicology Study to be conducted by Impax over an expected period of [****] prior to the commencement of the activities set forth in the PREA Commitment Study Clinical Protocol.  The protocol for the PREA Toxicology Study is attached to this Amendment as Exhibit B.”

3.    Amendment to Article 2 (Governance) of the Agreement.  Article 2 of the Agreement is hereby amended as follows:

(a)    Section 2.2.1 of the Agreement is hereby amended by adding the Joint Development Committee to the definition of Joint Committees as follows:

“Within fifteen (15) days after the Effective Date, the Parties shall establish a joint operating committee (the “Joint Operating Committee” or “JOC” and collectively with the JSC and the JDC (as defined in Section 2.6.1), the “Joint Committees”):

(b)    A new Section 2.6 shall be added to Article 2 as follows:

2.6.    PREA Commitment Study Joint Development Committee. 
 
2.6.1.    Formation.  Solely for the purposes of the conduct of the PREA Commitment Study, the Parties shall establish a joint development committee (the “Joint Development Committee” or “JDC”) by the date that is thirty (30) days after the Effective Date.  The 

2
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

JDC shall consist of three (3) representatives from each of the Parties, each with the requisite experience and seniority to enable such person to make decisions on behalf of the Parties with respect to the issues falling within the jurisdiction of the JDC.  At least one (1) representative from each Party shall have a background in clinical operations, and at least one (1) representative from each Party shall have a regulatory affairs background.  From time to time, each Party may substitute one (1) or more of its representatives to the JDC on written notice to the other Party.  AstraZeneca shall select from its representatives the chairperson for the JDC.  From time to time, AstraZeneca may change the representative who shall serve as chairperson on written notice to Impax.  The general provisions applicable to the JOC set forth in Sections 2.3 and 2.4 shall apply to the conduct of the JDC during the duration of the PREA Commitment Study mutatis mutandis.  Upon the earlier of (i) full performance by Impax of the PREA Commitment Study and (ii) termination of Impax’s performance of the PREA Commitment Study in accordance with Sections 4.7.1 or 4.7.2, the JDC shall be dissolved and Sections 2.6.1, 2.6.2, 2.6.3 and 2.6.4 shall cease to be of any further effect.  

2.6.2.    Specific Responsibilities.  Upon the formation of the JDC and subject in all cases to final approval by [****] the JDC shall agree upon and execute the PREA Development Plan.  The PREA Development Plan shall consider all aspects of the conduct of the trial, including but not limited to, protocol development, site selection, the use of a contract research organization, CRF and database design, and such other matters as the JDC may determine are necessary based on FDA recommendations or requirements with respect to such Study.  Such PREA Development Plan shall be finalized by the JDC within [****] of the formation of the JDC.  For clarity, the Parties acknowledge and agree that the third sentence of Section 2.1.3(i) regarding escalation of certain disputes shall be inapplicable to disputes relating to the PREA Development Plan, and that [****] shall have final decision-making authority with respect to the PREA Development Plan and all regulatory interactions related thereto; provided, however, that [****] shall give good faith consideration to the input of [****] in making such decisions and in conducting such interactions.  

2.6.3.    General Responsibilities.    In addition to the JDC’s specific responsibilities, the JDC shall serve as a general consultative forum to review and discuss the PREA Commitment Study.  In particular, the JDC shall serve as a forum for:  

		
	(i)
	discussing and periodically reviewing any updates to the PREA Development Plan;

		
	(ii)
	making such other decisions as may be delegated to the JDC pursuant to this Agreement, or otherwise by written agreement of the Parties;

		
	(iii)
	establishing other working groups to implement the foregoing responsibilities, which working groups shall have such responsibilities and be comprised of such equal number of employees from each of the Parties with such expertise and seniority, as the JDC may direct from time to time, and supervise and direct the activities of such working groups and accept 

3
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

reports and recommendations from such working groups;

		
	(iv)
	discussing any proposed amendment to the scope of activities under PREA Development Plan and the nature and scope of any potential increase in the budget associated with such proposed amendment, as set forth in Section 7.2.9 of the Agreement;

		
	(v)
	if applicable, discussing and agreeing upon the process associated with wind down, closing or transfer to AstraZeneca or a Third Party of the PREA Commitment Study; and

		
	(vi)
	providing updates on the PREA Commitment Study to AstraZeneca.

2.6.4    Dispute Resolution.  Each Party’s representatives on the JDC shall use reasonable efforts to reach consensus with the other Party’s representatives on all matters within the jurisdiction of the JDC.  If the JDC cannot, or does not, reach consensus on an issue at a meeting (or within such other period as the Parties may mutually agree), then either Party shall have the right to refer the dispute to the JSC for resolution and a special meeting of the JSC shall be called for such purpose.  For avoidance of doubt, the JDC shall not have decision-making power for any matter outside the scope of PREA Commitment Study, and notwithstanding any provision of this Agreement to the contrary, neither the JDC nor the JSC shall have the authority to alter or amend the PREA Development Plan without [****] express written consent.

4.    Amendment to Article 4 (Development Activities) of the Agreement.  Article 4 of the Agreement is hereby amended as follows:

(a)    Section 4.1.1 of the Agreement is hereby amended by adding the following sentence immediately after the last sentence of the Section:

“Without limiting the foregoing, the Parties acknowledge and agree that Impax shall conduct the PREA Commitment Study in accordance with the provisions of Section 4.6 below unless and until Impax’s performance thereof is terminated pursuant to Section 4.7.1, 4.7.2 or 14.2.1 below.  For clarity, except as specifically provided in this Agreement with respect to Impax’s performance of the PREA Commitment Study, the PREA Commitment Study shall continue to be construed as a Selected Mandated Study, as such term is defined and utilized in this Agreement.”

(b)    Section 4.1.2 of the Agreement is hereby amended by adding the following subsection (iii):

		
	“(iii)
	The foregoing subsections (i) and (ii) shall not apply to the PREA Commitment Study, which shall be conducted by Impax in accordance with Section 4.6 below. Notwithstanding the fact that Impax shall at any time perform the PREA Commitment Study, the PREA Commitment Study shall not for any purposes in this Agreement 

4
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

be construed as an Impax Study, as such term is defined and utilized in this Agreement.”

(c)    A new Section 4.1.6 shall be added to Section 4.1 as follows:

“4.1.6    Ownership and Use of Study Data from Selected Mandated Studies. AstraZeneca shall be the sole owner of all Study Data arising from the Selected Mandated Studies, including the PREA Commitment Study (the “Selected Mandated Study Data”).  Impax shall provide AstraZeneca with copies of all Study Data arising from the PREA Commitment Study upon AstraZeneca’s request, or in any event following completion of the PREA Commitment Study.  AstraZeneca hereby grants to Impax a non-exclusive, perpetual, royalty-free, license (including a right of reference) to access and use the Selected Mandated Study Data in connection with the development (including regulatory activities) manufacture, use and sale of Licensed Products and products containing the Licensed Compound in the Field and in the Territory.”

(d)    Section 4.2 of the Agreement is hereby amended to read as follows:

“4.2.    Development Costs.  Except as provided herein, Impax shall be responsible for all costs and expenses in connection with (i) all Impax Studies and (ii) Impax’s performance of the PREA Commitment Study.  For the avoidance of doubt, AstraZeneca shall bear, and shall not be entitled to reimbursement for, any costs and expenses incurred in connection with the performance of (i) the Selected Mandated Studies (other than the PREA Commitment Study) and (ii) the PREA Commitment Study to the extent performed by any person other than Impax, its Affiliates, Sublicensees, Subcontractors or any other Third Party acting on behalf of Impax in connection therewith.  This Section 4.2 is without prejudice to the PREA Royalty Reduction, which shall apply as set forth in Section 7.2.8.”

(e)    Section 4.5.2 of the Agreement is hereby amended to read as follows:

“4.5.2    Through the JOC, AstraZeneca shall keep Impax reasonably informed on at least a quarterly basis with regard to the progress and status of the Selected Mandated Studies (other than the PREA Commitment Study) and any AstraZeneca Study.”

(f)    A new Section 4.6 shall be added to Article 4 as follows:

“4.6.    PREA Commitment Study.  

4.6.1    Conduct of the PREA Commitment Study.  Notwithstanding the foregoing Section 4.1.1 or anything to the contrary in this Agreement, Impax shall perform the PREA Commitment Study in accordance with the remainder of this Section 4.6.  Impax (and its Affiliates and Subcontractors) shall perform the PREA Commitment Study in accordance with the PREA Development Plan and shall use Commercially 

5
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

Reasonable Efforts to complete and prepare the final clinical study report for the PREA Commitment Study within the timeframe set forth in the PREA Development Plan; provided, however, [****].  With respect to the PREA Commitment Study, Impax shall be responsible for day-to-day decisions regarding its own performance of the PREA Commitment Study in accordance with the PREA Development Plan, including but not limited to:

		
	(i)
	planning individual activities;

		
	(ii)
	deciding on how and when to assign what resources and execute other activities needed to complete the work; 

		
	(iii)
	determining if the PREA Commitment Study will be undertaken by contract research organizations; provided, that the selection of a contract research organization to the PREA Commitment Study will be subject to Party Written Consent of both Impax and AstraZeneca, where such consent shall not be unreasonably withheld or delayed by either Party;

		
	(iv)
	site selection; and

		
	(v)
	CRF and database design.

4.6.2    Regulatory Documentation.  As set forth in Section 5.2.1, AstraZeneca shall continue to hold the IND, NDA and Product Labeling and Inserts and shall be the regulatory sponsor for the PREA Commitment Study regardless of whether Impax, AstraZeneca or any third person performs activities in relation to such Study.  AstraZeneca shall be responsible, at AstraZeneca’s sole expense, for the preparation and filing of all Regulatory Documentation in relation to the PREA Commitment Study, including without limitation the application and any documentation required in connection with any supplemental NDA for a Licensed Product, as set forth in Section 5.2.1, regardless of whether Impax, AstraZeneca or any third person performs activities in relation to such Study.  AstraZeneca shall also be responsible for reporting to any Regulatory Authority information relating to serious adverse events (“SAEs”) arising from Impax’s performance of the PREA Commitment Study, provided that Impax will promptly notify AstraZeneca of the occurrence of any such SAE, and shall provide AstraZeneca with data and information relating to the SAE and required pursuant to the Safety Agreement, or that is necessary for AstraZeneca to fulfill such reporting obligation under Applicable Law, and Impax shall reasonably cooperate with AstraZeneca in connection with such reporting.  All such Regulatory Documentation shall be owned by AstraZeneca in accordance with Section 5.1.1.  Without limiting the foregoing, Impax shall be responsible for preparing and providing to AstraZeneca upon preparation thereof the annual summary required by the FDA of activities conducted in relation to the PREA Commitment Study during such twelve (12) month period. 

6
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

4.6.3    Clinical Supply.  AstraZeneca shall be responsible, at its expense, for supplying all Licensed Products, as well as any control, comparator or placebo compound for use in the PREA Commitment Study as set forth in the PREA Development Plan regardless of whether Impax, AstraZeneca or any Third Party performs such Study.” 

(g)    A new Section 4.7 shall be added to Article 4 as follows:

“4.7.    Termination of Impax’s Obligation to Perform the PREA Commitment Study

4.7.1    Termination for Safety Reasons.  AstraZeneca shall have the right to terminate Impax’s continued performance of the PREA Commitment Study with immediate effect by giving written notice that AstraZeneca in good faith believes that Impax’s continued performance of the PREA Commitment Study would present a substantial safety risk.   

4.7.2    Other Termination.  Either Party may, subject to Section 4.7.3, terminate Impax’s continued performance of the PREA Commitment Study upon written notice to the other Party if:

		
	(i)
	the FDA determines in writing that it no longer requires the PREA Commitment Study to be completed;

		
	(ii)
	the FDA (i) requires that the PREA Commitment Study [****];

		
	(iii)
	the FDA requires any other change to the design of the PREA Commitment Study as currently envisaged in the PREA Commitment Study Clinical Protocol, that would, in Impax’s reasonable opinion, result in non-reimbursable costs to Impax, to the extent associated with such material changes and excluding any other costs incurred by Impax, of more than [****]; or

		
	(iv)
	the JDC or AstraZeneca establishes a PREA Development Plan or subsequently amends an existing PREA Development Plan to include additional activities that are not expressly contemplated in the PREA Commitment Study Clinical Protocol and which would if undertaken, in Impax’s reasonable opinion, result in non-reimbursable costs to Impax, to the extent associated with such additional activities and excluding any other costs incurred by Impax, of more than [****].

4.7.3    Alternatives to Termination. Prior to any termination of Impax’s performance of the PREA Commitment Study by either Party, the Parties shall first refer the matter giving rise to a potential termination right to the JDC for good faith discussion of potential resolution of such matter without requiring termination of Impax’s continued performance of the PREA Commitment Study. 

7
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

4.7.4    Effects of Termination of the PREA Commitment Study.  If either Party elects to terminate Impax’s continued performance of the PREA Commitment Study prior to completion pursuant to Sections 4.7.1 or 4.7.2, the Parties shall promptly meet to discuss the process for either (a) winding down and closing the PREA Commitment Study, or (b) in the case of termination under Section 4.7.2(b) through (d), at AstraZeneca’s request and reasonable discretion, transferring the conduct of the PREA Commitment Study to AstraZeneca or a Third Party.  Termination of Impax’s performance of the PREA Commitment Study pursuant to this Section 4.7 at any time shall relieve Impax of any further obligation to conduct the PREA Commitment Study other than as may be required in connection with any transfer to AstraZeneca or a Third Party, any winddown activities or as otherwise required by Applicable Law.  To the extent the FDA thereafter continues to require the performance of the PREA Commitment Study, AstraZeneca shall conduct such Study in accordance with its general obligations under Section 4.1.1.  Section 7.2.10 shall apply following any termination of Impax’s performance of the PREA Commitment Study”

5.    Amendment to Article 7 (Payments and Records) of the Agreement.  Article 7 of the Agreement is hereby amended as follows:

(a)    The first sentence of Section 7.2.4 shall be amended to read as follows: 

“7.2.4.    Maximum Amount of Royalty Reduction.  Notwithstanding any term or condition of this Agreement to the contrary, except as set forth in Section 7.2.8 and 7.2.9, in no event shall the royalties payable to AstraZeneca pursuant to Sections 7.2.1 and 7.2.2 be reduced by more than [****] in any Calendar Quarter as a result of any reductions, offsets or setoffs permitted pursuant to this Agreement, whether taken in a Calendar Quarter alone or in the aggregate with other permitted reductions or offsets, including pursuant to Section 7.2.3 and Section 8.15.”

(b)    The first sentence of Section 7.2.5 shall be amended to read as follows:

7.2.5.    Other Limitation on Royalty Reductions.  Notwithstanding any right of offset or reduction of royalties provided in this Agreement, except as provided in Sections 7.2.8 and 7.2.9, in no event shall any offset or reduction in royalties payable by Impax, including pursuant to Sections 7.2.3, 8.15, 10.4.2, and 10.6 whether such reduction is calculated alone or as aggregated with other permitted reductions or offsets, cause the royalty amount payable by Impax to AstraZeneca in any Calendar Quarter to fall below the [****] with respect to such Calendar Quarter [****] in the Territory.”

(c)    New Sections 7.2.8, 7.2.9 and 7.2.10 shall be added to Article 7 as follows:

“7.2.8    Royalty Adjustment for PREA Commitment Study.  In consideration for Impax’s agreement to conduct and bear the costs and expenses associated with the PREA Commitment Study, the Parties agree that commencing in the Calendar Quarter ending June 30, 2016, the total Royalty Payments payable by Impax to AstraZeneca in each Calendar 

8
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

Quarter under this Section 7.2 shall be reduced in the absolute amounts set forth in the table below, in an aggregate absolute amount of thirty million dollars ($30,000,000) (such amounts, the “PREA Royalty Reduction”):

	
			
	Year
	Calendar Quarter
	Reduction of Aggregate Royalty Payment in each applicable Calendar Quarter

	2016
	Calendar Quarter ending June 30, 2016
	$[****]

	2016
	Calendar Quarter ending September 30, 2016
	$[****]

	2016
	Calendar Quarter ending December 31, 2016
	$[****]

	2017
	Calendar Quarter ending March 31, 2017
	$[****]

	2017
	Calendar Quarter ending June 30, 2017
	$[****]

	2017
	Calendar Quarter ending September 30, 2017
	$[****]

	2017
	Calendar Quarter ending December 31, 2017
	$[****]

	2018
	Calendar Quarter ending March 31, 2018
	$[****]

	2018
	Calendar Quarter ending June 30, 2018
	$[****]

	2018
	Calendar Quarter ending September 30, 2018
	$[****]

	2018
	Calendar Quarter ending December 31, 2018
	$[****]

	2019
	Calendar Quarter ending March 31, 2019
	$[****]

	2019
	Calendar Quarter ending June 30, 2019
	$[****]

	2019
	Calendar Quarter ending September 30, 2019
	$[****]

9
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

	
			
	2019
	Calendar Quarter ending December 31, 2019
	$[****]

	2020
	Calendar Quarter ending March 31, 2019
	$[****]

	2020
	Calendar Quarter ending June 30, 2020
	$[****]

	2020
	Calendar Quarter ending September 30, 2020
	$[****]

	2020
	Calendar Quarter ending December 31, 2020
	$[****]

	Total PREA Royalty Reduction
	$30,000,000

    
For clarity, the PREA Royalty Reduction shall apply in each Calendar Quarter for the Calendar Years set forth in the table above after any deductions applicable under Sections 7.2.3, 8.15, 10.4.2 and 10.6, and shall not be subject to the limitations set forth in Sections 7.2.4 and 7.2.5.  If the PREA Royalty Reduction in any Calendar Quarter calculated in accordance with the table above exceeds the amount of the aggregate of the Royalty Payments  payable to AstraZeneca in such Calendar Quarter, the Royalty Payment owed for such Calendar Quarter shall be reduced to zero dollars ($0) and AstraZeneca shall pay to Impax in immediately available funds, within [****] following the delivery by Impax to AstraZeneca of the reports and payments for such Calendar Quarter under Section 7.3, an amount equal to the difference between the absolute amount of the applicable PREA Royalty Reduction and the Royalty Payment that would have been owed for such Calendar Quarter prior to application of the PREA Royalty Reduction.  For clarity, any completion by Impax of the PREA Commitment Study prior to the date of application of the last PREA Royalty Reduction shall not in any way reduce the aggregate PREA Royalty Reduction set forth in the table above, or in way vary the dates of application thereof as set forth herein this Section 7.2.8.

7.2.9    Changes to PREA Commitment Study.  The Parties acknowledge and agree that in the event that (a) the FDA requires changes to the design and/or scope of the PREA Commitment Study or (b) the JDC or the JSC requires Impax to perform additional activities that are not included within the PREA Commitment Study Clinical Protocol, the Parties, through the JDC, shall promptly estimate in good faith any additional costs associated with such changes that are in Impax’s reasonable opinion reasonably likely to be incurred by Impax in performance thereof and thereafter the Parties shall, prior to the implementation of such changes to the design and/or scope of the PREA Commitment Study by Impax or the performance by Impax of such additional activities, discuss and agree upon an increase in the amount of the PREA Royalty Reduction (and the Calendar Quarters in which such PREA Royalty Reduction shall apply) to compensate Impax for such additional costs.

10
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

7.2.10    Royalty Reduction in the Event of Early Termination.  In the event Impax’s performance of the PREA Commitment Study is terminated by either Party prior to completion in accordance with Section 4.7.1 or 4.7.2 (but not, for the avoidance of doubt, in the event of an alleged material breach by Impax of its PREA Study Obligations), the PREA Royalty Reduction shall continue to apply following the effective date of such termination for the limited periods set forth as follows:

		
	(i)
	if the effective date of termination occurs prior to [****], the PREA Royalty Reduction shall apply in full as set forth in the table in Section 7.2.8, up to and including the end of the [****] after which no further PREA Royalty Reduction shall apply towards future Royalty Payments;

		
	(ii)
	if the effective date of termination occurs between [****], the PREA Royalty Reduction shall apply in full for the Calendar Quarter in which such termination occurs, and for the following [****] Calendar Quarters after which no further PREA Royalty Reduction shall apply towards future Royalty Payments;

		
	(iii)
	if the effective date of termination occurs between [****], the PREA Royalty Reduction shall apply in full for the Calendar Quarter in which such termination occurs, and for the following [****] Calendar Quarters after which no further PREA Royalty Reduction shall apply towards future Royalty Payments; and

		
	(iv)
	if the effective date of termination occurs between [****], the PREA Royalty Reduction shall apply in full through to [****], provided that if the Parties agree upon additional funding for the PREA Commitment Study pursuant to Section 7.2.9 such that the PREA Royalty Reduction continues to apply after [****], the Parties shall also agree upon an equitable adjustment to the application of the PREA Royalty Reduction upon any termination of the PREA Commitment Study based on the principles set forth in this Section 7.2.10 (iii) and (iv) after which no further PREA Royalty Reduction shall apply towards future Royalty Payments.

For clarity, in no event will any amounts already applied by Impax by way of a PREA Royalty Reduction in any Calendar Quarter prior to the effective date of termination of Impax’s performance of the PREA Commitment Study be refundable to AstraZeneca.  Following the conclusion or transfer of the PREA Commitment Study, and following the application of the PREA Royalty Reductions following termination as set forth in this Section 7.10.2(i) through (iv), as applicable, the Royalty Payments shall revert to those as expressed under Section 7.2 of the Agreement without application of the PREA Royalty Reduction.”

6.    Amendment to Article 13 (Indemnity) of the Agreement.  Article 13 of the Agreement is hereby amended as follows:

11
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

(a)    Section 13.1.8 shall be amended to read as follows:

“13.1.8 the conduct of any Impax Study or the breach, gross negligence, or willful or intentional misconduct by Impax in the conduct of the PREA Commitment Study:”

(b)    Section 13.2.7 shall be amended to read as follows:

“13.2.7  the conduct of the Selected Mandated Studies or any AstraZeneca Studies;”

7.    Amendment to Article 14 (Term, Termination and Other Remedies) of the Agreement.  Article 14 of the Agreement is hereby amended as follows:

(a)    Section 14.2.1 shall be amended to read as follows:

“14.2.1. Material Breach.  If either Party (the “Non-Breaching Party”) believes that the other Party (the “Breaching Party”) has materially breached one or more material obligations under this Agreement, then the Non-Breaching Party may deliver notice of such material breach to the Breaching Party (a “Default Notice”).  If the Breaching Party disputes that it has committed a material breach of one or more of its material obligations under this Agreement, then it may refer the matter to the JOC or, in relation to any alleged material breach of the PREA Study Obligations, the JDC for dispute resolution in accordance with Section 2.2.3 or, solely in connection to disputes in relation to the PREA Study Obligations, Section 2.6.4, and, if the JOC is unable to resolve the dispute as contemplated in Section 2.2.3 or the JDC is unable to resolve the dispute as contemplated in Section 2.6.4, then to the JSC for dispute resolution in accordance with Sections 2.1.1 and 2.1.3 (except that (i) the provisions of the third sentence of Section 2.1.3(i) (regarding the power to make final resolutions held by the Senior Officer of Impax) and (ii) disputes in connection to the PREA Study Obligations shall not apply for purposes of this Section 14.2.1). If the JOC and the JSC or, in relation to any alleged material breach of the PREA Study Obligations, the JDC and JSC, are unable to resolve the dispute, and the Breaching Party fails to cure such alleged breach within [****] after the receipt of the Default Notice, or in the case of a Payment default, within [****] after receipt of the Default Notice, the Non-Breaching Party may: (i) in the event of a material breach other than an alleged material breach by Impax of its PREA Study Obligations, terminate this Agreement upon written notice to the Breaching Party and (ii) in the event of an alleged material breach by Impax of its PREA Study Obligations, AstraZeneca may immediately terminate Impax’s continued performance of the PREA Commitment Study, in which case no further PREA Royalty Reduction shall apply towards future Royalty Payments.  Notwithstanding the foregoing, in the event of a breach (other than a payment breach or a breach by Impax under Section 3.5) cannot be cured within such [****] period, the period for cure may be extended an additional [****] provided that the Breaching Party has promptly commenced efforts to cure such breach after the Default Notice and thereafter diligently continues such efforts. For clarity, breach by Impax of the PREA Study Obligations shall not give rise to any right of AstraZeneca to terminate this Agreement.”

12
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

(b)    Section 14.3.1 shall be amended to read as follows:

“14.3.1. Except with respect to the PREA Commitment Study and the PREA Study Obligations, termination of which is exclusively governed by Section 4.7 of this Agreement, Impax may terminate this Agreement any time after December 31, 2015, by giving AstraZeneca [****] prior written notice thereof.”

8.    No Other Amendments.  Except as expressly amended by this Amendment, all of the terms and conditions of the Agreement remain in full force and effect and apply equally to this Amendment.

9.    Counterparts; Facsimile Execution.  This Amendment may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  This Amendment may be executed by facsimile or electronically transmitted signatures and such signatures shall be deemed to bind each Party hereto as if they were original signatures.

THIS AMENDMENT IS EXECUTED by the authorized representatives of the Parties as of the date first written above.

	
		
	ASTRAZENECA UK LIMITED
	IMPAX LABORATORIES, INC.

	By: /s/ William (Liam) Mcllveen
Name: William (Liam) Mcllveen
Title: Authorized Signatory 
	By: /s/ Fred Wilkinson
Name: Fred Wilkinson 
Title:  President and CEO 

	 
	 

13
[****] = Certain confidential information contained in this document, marked by brackets, has been omitted and filed separately with the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.  Confidential treatment has been requested with respect to the omitted portions.

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