Document:

Credit Agreement (5-Year Facility)

 Exhibit 10.2 
 EXECUTION COPY 
  

 U.S. $1,000,000,000 
 FIVE YEAR CREDIT AGREEMENT 
 Dated as of April 19, 2007 
 Among

 UNITED PARCEL SERVICE, INC. 
 as Borrower 
 THE INITIAL LENDERS NAMED HEREIN 
 as Initial Lenders 
 and 
 CITIGROUP GLOBAL MARKETS INC. 
 and

 J.P. MORGAN SECURITIES INC. 
 as Arrangers 
 JPMORGAN CHASE BANK, N.A. 
 as Syndication Agent 
 and 
 BARCLAYS BANK PLC 
 BNP PARIBAS

 MELLON BANK NA 
 and

 WELLS FARGO BANK, N.A. 
 as Co-Documentation Agents 
 and 
 CITIBANK, N.A. 
 as Administrative Agent 
  

 TABLE OF CONTENTS 
 ARTICLE I 
 DEFINITIONS AND ACCOUNTING TERMS 
  

			
	 SECTION 1.01. Certain Defined Terms
	  	1
	 SECTION 1.02. Computation of Time Periods
	  	16
	 SECTION 1.03. Accounting Terms
	  	16
		
	ARTICLE II	  	
		
	AMOUNTS AND TERMS OF THE ADVANCES	  	
		
	 SECTION 2.01. The Revolving Credit Advances
	  	16
	 SECTION 2.02. Making the Revolving Credit Advances
	  	17
	 SECTION 2.03. The Competitive Bid Advances
	  	19
	 SECTION 2.04. Fees
	  	23
	 SECTION 2.05. Termination or Reduction of the Commitments
	  	23
	 SECTION 2.06. Repayment of Revolving Credit Advances
	  	24
	 SECTION 2.07. Interest on Revolving Credit Advances
	  	24
	 SECTION 2.08. Interest Rate Determination
	  	24
	 SECTION 2.09. Optional Conversion of Revolving Credit Advances
	  	26
	 SECTION 2.10. Prepayments of Advances
	  	26
	 SECTION 2.11. Increased Costs
	  	27
	 SECTION 2.12. Illegality
	  	27
	 SECTION 2.13. Payments and Computations
	  	28
	 SECTION 2.14. Taxes
	  	30
	 SECTION 2.15. Sharing of Payments, Etc
	  	32
	 SECTION 2.16. Extensions of Termination Date
	  	33
	 SECTION 2.17. Substitution of Lender
	  	33
	 SECTION 2.18. Evidence of Debt
	  	34
		
	ARTICLE III	  	
		
	CONDITIONS TO EFFECTIVENESS AND LENDING	  	
		
	 SECTION 3.01. Conditions Precedent to Effectiveness of Sections 2.01 and 2.03
	  	34
	 SECTION 3.02. Conditions Precedent to Each Revolving Credit Borrowing
	  	35
	 SECTION 3.03. Conditions Precedent to Each Competitive Bid Borrowing
	  	36
	 SECTION 3.04. Determinations Under Section 3.01
	  	36
	 SECTION 3.05. Labor Dispute
	  	36
		
	ARTICLE IV	  	
		
	REPRESENTATIONS AND WARRANTIES	  	
		
	 SECTION 4.01. Representations and Warranties of the Borrower
	  	37

			
	ARTICLE V	  	
		
	COVENANTS OF THE BORROWER	  	
		
	 SECTION 5.01. Affirmative Covenants
	  	39
	 SECTION 5.02. Negative Covenants
	  	42
		
	ARTICLE VI	  	
		
	EVENTS OF DEFAULT	  	
		
	 SECTION 6.01. Events of Default
	  	43
		
	ARTICLE VII	  	
		
	THE AGENT	  	
		
	 SECTION 7.01. Authorization and Action
	  	45
	 SECTION 7.02. Agent’s Reliance, Etc
	  	45
	 SECTION 7.03. Citibank and Its Affiliates
	  	46
	 SECTION 7.04. Lender Credit Decision
	  	46
	 SECTION 7.05. Indemnification
	  	46
	 SECTION 7.06. Successor Agent
	  	47
	 SECTION 7.07. Sub-Agent
	  	47
	 SECTION 7.08. Other Agents
	  	47
		
	ARTICLE VIII	  	
		
	MISCELLANEOUS	  	
		
	 SECTION 8.01. Amendments, Etc
	  	47
	 SECTION 8.02. Notices, Etc
	  	48
	 SECTION 8.03. No Waiver; Remedies
	  	49
	 SECTION 8.04. Costs and Expenses
	  	49
	 SECTION 8.05. Right of Setoff
	  	51
	 SECTION 8.06. Binding Effect
	  	52
	 SECTION 8.07. Assignments, Designations and Participations
	  	52
	 SECTION 8.08. Confidentiality
	  	57
	 SECTION 8.09. Governing Law
	  	57
	 SECTION 8.10. Execution in Counterparts
	  	57
	 SECTION 8.11. Jurisdiction, Etc
	  	57
	 SECTION 8.12. Judgment
	  	57
	 SECTION 8.13. Substitution of Currency
	  	58
	 SECTION 8.14. Patriot Act Notice
	  	58

  

 ii 

 SCHEDULE 
  

			
	 Schedule I -
	  	 Applicable Lending Offices

 EXHIBITS 
  

			
	 Exhibit A-1 -
	  	Form of Revolving Credit Note
	 Exhibit A-2 -
	  	Form of Competitive Bid Note
	 Exhibit B-1 -
	  	Form of Notice of Revolving Credit Borrowing
	 Exhibit B-2 -
	  	Form of Notice of Competitive Bid Borrowing
	 Exhibit C -
	  	Form of Assignment and Acceptance
	 Exhibit D -
	  	Form of Designation Agreement
	 Exhibit E -
	  	Form of Opinion of Counsel for the Borrower
	 Exhibit F -
	  	Debenture Indenture

  

 iii 

 FIVE YEAR CREDIT AGREEMENT 
 Dated as of April 19, 2007 
 UNITED PARCEL SERVICE, INC., a Delaware corporation (the
“Borrower”), the banks, financial institutions and other institutional lenders (collectively, the “Initial Lenders”) listed on the signature pages hereof, Citibank, N.A. (“Citibank”), as administrative
agent (in such capacity, the “Agent”) for the Lenders (as hereinafter defined), JPMorgan Chase Bank, N.A., as syndication agent, Barclays Bank PLC, BNP Paribas, Mellon Bank NA and Wells Fargo Bank, N.A., as co-documentation agents,
and Citigroup Global Markets Inc. and J.P. Morgan Securities Inc., as joint arrangers and book managers (in such capacity, the “Arrangers”), agree as follows: 
 ARTICLE I 
 DEFINITIONS AND ACCOUNTING TERMS 
 SECTION 1.01. Certain Defined Terms. 
 As used in this Agreement, the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined): 
 “Advance” means a Revolving Credit Advance or a Competitive Bid Advance, as the context may require. 
 “Affiliate” means, as to any Person, any other Person that, directly or indirectly, controls, is controlled by or is
under common control with such Person; provided, however, that Overseas Partners shall not be deemed to be an Affiliate of the Borrower. 
 “Agent” has the meaning specified in the recital of parties to this Agreement. 
 “Agent’s Account” means (a) in the case of Advances denominated in Dollars, the account of the Agent maintained by the Agent at Citibank at its office at Two Penns Way, New Castle, Delaware 19720, Account
No. 36852248, Attention: Bank Loan Syndications, (b) in the case of Advances denominated in any Foreign Currency, the account of the Sub-Agent designated in writing from time to time by the Agent to the Borrower and the Lenders for such
purpose and (c) in any such case, such other account of the Agent as is designated in writing from time to time by the Agent to the Borrower and the Lenders for such purpose. 

 “Applicable Fee Percentage” means, as of any date, a percentage per
annum determined by reference to the Public Debt Rating in effect on such date as set forth below: 
  

				
	 Level 1
 AA- / Aa3 or above
	  	0.040	%
	 Level 2
 Lower than Level 1
 but at least
 A- / A3
	  	0.050	%
	 Level 3
 Lower than Level 2
	  	0.060	%

 “Applicable Lending Office” means, with respect to each Lender,
such Lender’s Domestic Lending Office in the case of a Base Rate Advance and such Lender’s Eurocurrency Lending Office in the case of a Eurocurrency Rate Advance and, in the case of a Competitive Bid Advance, the office of such Lender
notified by such Lender to the Agent and the Borrower as its Applicable Lending Office with respect to such Competitive Bid Advance. 
 “Applicable Margin” means, as of any date, a percentage per annum determined by reference to the Public Debt Rating in effect on such date as set forth below: 
  

							
	 Public Debt Rating
S&P/Moody’s
	  	 Applicable Margin for
 Base Rate
 Advances
	 	 	 Applicable Margin
 for
 Eurocurrency Rate
 Advances
	 
	 Level 1
 AA- / Aa3 or above
	  	0.00	%	 	0.110	%
	 Level 2
 Lower than Level 1 but at least
 A- / A3
	  	0.00	%	 	0.150	%
	 Level 3
 Lower than Level 2
	  	0.00	%	 	0.190	%

 “Arrangers” has the meaning specified in the recital of parties to
this Agreement. 
 “Assignment and Acceptance” means an assignment and acceptance entered into by a Lender
and an Eligible Assignee, and accepted by the Agent, in substantially the form of Exhibit C hereto. 
 “Attributable
Debt” has the meaning specified in the Debenture Indenture. 
 “Base Rate” means a fluctuating
interest rate per annum in effect from time to time, which rate per annum shall at all times be equal to the highest of: 
 (a) the rate of interest announced publicly by Citibank in New York, New York, from time to time, as Citibank’s base rate; 
  

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 (b) the sum (adjusted to the nearest 1/16 of 1% or, if there is no nearest 1/16 of 1%, to
the next higher 1/16 of 1%) of (i) 1/2 of 1% per annum plus (ii) the rate obtained by dividing (A) the latest three-week moving average of secondary market morning offering rates in the United States for three-month certificates
of deposit of major United States money market banks, such three-week moving average (adjusted to the basis of a year of 360 days) being determined weekly on each Monday (or, if such day is not a Business Day, on the next succeeding Business Day)
for the three-week period ending on the previous Friday by Citibank on the basis of such rates reported by certificate of deposit dealers to and published by the Federal Reserve Bank of New York or, if such publication shall be suspended or
terminated, on the basis of quotations for such rates received by Citibank from three New York certificate of deposit dealers of recognized standing selected by Citibank, by (B) a percentage equal to 100% minus the average of the daily
percentages specified during such three-week period by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, but not limited to, any emergency, supplemental or other
marginal reserve requirement) for Citibank with respect to liabilities consisting of or including (among other liabilities) three-month Dollar nonpersonal time deposits in the United States, plus (iii) the average during such three-week period
of the annual assessment rates estimated by Citibank for determining the then current annual assessment payable by Citibank to the Federal Deposit Insurance Corporation (or any successor) for insuring Dollar deposits of Citibank in the United
States; and 
 (c) 1/2 of 1% per annum above the Federal Funds Rate. 
 “Base Rate Advance” means a Revolving Credit Advance denominated in Dollars that bears interest as provided in
Section 2.07(a)(i). 
 “Beneficial Ownership” means beneficial ownership as determined in accordance
with Rule 13d-3 of the Securities and Exchange Commission under the Exchange Act, as in effect on the date hereof. 
 “Borrower” has the meaning specified in the recital of parties to this Agreement. 
 “Borrower’s Account” means an account of the Borrower designated in writing by the Borrower to the Agent. 
 “Borrowing” means a Revolving Credit Borrowing or a Competitive Bid Borrowing, as the context may require. 
 “Business Day” means a day of the year on which banks are not required or authorized by law to close in New York City and, if the applicable Business Day relates to any Eurocurrency Rate Advances
or LIBO Rate Advances, on which dealings are carried on in the London interbank market and banks are open for business in London and in the country of issue of the currency of such Eurocurrency Rate Advance or LIBO Rate Advance (or, in the case of
an Advance denominated in Euro, on which the Trans- 

  

 3 

 
European Automated Real-Time Gross Settlement Express Transfer (TARGET) System is open) and, if the applicable Business Day relates to any Local Rate
Advances, on which banks are open for business in the country of issue of the currency of such Local Rate Advance. 
 “Capital Lease Obligations” of any Person means all obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination
thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP. 
 “Change of Control” means the occurrence of either of the following: 
 (a)
any Person or two or more Persons acting in concert other than a Permitted Person shall have acquired Beneficial Ownership, directly or indirectly, through a purchase, merger or other transaction or series of transactions or otherwise, of Voting
Stock of the Borrower to which 10% or more of the total Voting Power of the Borrower is attributable; or 
 (b) Permitted
Persons shall have Beneficial Ownership of (i) less than 75% of the shares of common stock of the Borrower and (ii) Voting Stock of the Borrower to which less than 75% of the total Voting Power of the Borrower is attributable. 

“Citibank” has the meaning specified in the recital of parties to this Agreement. 
 “Commitment” has the meaning specified in Section 2.01. 
 “Committed Currencies” means lawful currency of the United Kingdom of Great Britain and Northern Ireland, lawful currency
of The Swiss Federation, lawful currency of Japan and Euros. 
 “Competitive Bid Advance” means an advance by
a Lender to the Borrower as part of a Competitive Bid Borrowing resulting from the auction bidding procedure described in Section 2.03 and refers to a Fixed Rate Advance, a LIBO Rate Advance or a Local Rate Advance, as the context may require.

 “Competitive Bid Borrowing” means a borrowing consisting of simultaneous Competitive Bid Advances from
each of the Lenders whose offer to make one or more Competitive Bid Advances as part of such borrowing has been accepted by the Borrower under the auction bidding procedure described in Section 2.03. 
 “Competitive Bid Note” means a promissory note of the Borrower payable to the order of any Lender, in substantially the
form of Exhibit A-2 hereto, evidencing the indebtedness of the Borrower to such Lender resulting from a Competitive Bid Advance made by such Lender. 
 “Competitive Bid Reduction” has the meaning specified in Section 2.01. 
  

 4 

 “Confidential Information” means information that the Borrower furnishes
to the Agent or any Lender in a writing designated as confidential, but does not include any such information that is or becomes generally available to the public or that is or becomes available to the Agent or such Lender from a source other than
the Borrower (unless the Agent or such Lender knows that such information is not generally available to the public). 
 “Consolidated” refers to the consolidation of accounts in accordance with GAAP. 
 “Consolidated Net Tangible Assets” has the meaning specified in the Debenture Indenture. 
 “Convert”, “Conversion” and “Converted” each refers to a conversion of Revolving Credit Advances of one Type into Revolving Credit Advances of the other Type pursuant to Section 2.08
or 2.09. 
 “Debenture Indenture” means the Indenture, dated as of December 1, 1989, between United
Parcel Service of America, Inc. and Chemical Bank pursuant to which the 8-3/8% Debentures Due April 1, 2020 were issued, as in effect on the date of this Agreement (without giving effect to any amendment, supplement or other modification
thereto, any repayment or covenant defeasance thereunder or any termination thereof), a copy of which is attached as Exhibit F hereto. 
 “Debt” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, or with respect to deposits with or advances of any kind to such Person, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or
other title retention agreements relating to property or assets purchased by such Person, (e) all obligations of such Person issued or assumed as the deferred purchase price of property or services (excluding payables incurred in the ordinary
course of business), (f) all Debt of others secured by (or for which the holder of such Debt has an existing right, contingent or otherwise, to be secured by) any Lien on property or assets owned or acquired by such Person (other than
Non-Recourse Debt), (g) all Guarantees by such Person of Debt of others, (h) all Capital Lease Obligations of such Person and (i) all obligations of such Person in respect of Hedge Agreements; provided, however, that at
any given time the term “obligations” as used in this clause (i) shall only include the net amounts due and payable at such time under any such agreements or arrangements. The Debt of any Person shall include the Debt of any
partnership in which such Person is a general partner. 
 “Declining Lender” has the meaning specified in
Section 2.16. 
 “Default” means any Event of Default or any event that would constitute an Event of
Default but for the requirement that notice be given or time elapse or both. 
 “Designated Bidder” means
(a) an Eligible Assignee or (b) a special purpose corporation that is engaged in making, purchasing or otherwise investing in commercial 

  

 5 

 
loans in the ordinary course of its business and that issues (or the parent of which issues) commercial paper rated at least “Prime-1” (or the then
equivalent grade) by Moody’s or “A-1” (or the then equivalent grade) by S&P that, in either case, (i) is organized under the laws of the United States or any state thereof or the District of Columbia or any jurisdiction that
issues the applicable Foreign Currency, (ii) shall have become a party to this Agreement pursuant to Section 8.07(d), (e) and (f) and (iii) is not otherwise a Lender. 
 “Designation Agreement” means a designation agreement entered into by a Lender (other than a Designated Bidder) and a
Designated Bidder, and accepted by the Agent, in substantially the form of Exhibit D hereto. 
 “Dollars” and
the sign “$” mean lawful currency of the United States of America. 
 “Domestic Lending
Office” means, with respect to any Lender, the office of such Lender specified as its “Domestic Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a Lender, or
such other office of such Lender as such Lender may from time to time specify to the Borrower and the Agent. 
 “Effective Date” has the meaning specified in Section 3.01. 
 “Eligible
Assignee” means (i) a Lender; (ii) an Affiliate of a Lender that is otherwise an Eligible Assignee; (iii) a commercial bank organized under the laws of the United States, or any state thereof, and having total assets in
excess of $1,000,000,000, calculated in accordance with the accounting principles prescribed by the regulatory authority applicable to such bank in its jurisdiction of organization; (iv) a commercial bank organized under the laws of any other
country that is a member of the OECD, or a political subdivision of any such country, and having total assets in excess of $1,000,000,000, calculated in accordance with the accounting principles prescribed by the regulatory authority applicable to
such bank in its jurisdiction of organization, so long as such bank is acting through a branch or agency located in the country in which it is organized or another country that is described in this clause (iv); (v) the central bank of any
country that is a member of the OECD; or (vi) a finance company, insurance company or other financial institution or fund (whether a corporation, partnership, trust or other entity) organized under the laws of the United States, or any state
thereof, that is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business and having total assets in excess of $1,000,000,000, calculated in accordance with the accounting principles prescribed
by the regulatory authority applicable to such entity in its jurisdiction of organization; provided, however, that neither the Borrower nor an Affiliate of the Borrower shall qualify as an Eligible Assignee. 
 “Equivalent” in Dollars of any Foreign Currency on any date means the equivalent in Dollars of such Foreign Currency
determined by using the quoted spot rate at which the Sub-Agent’s principal office in London offers to exchange Dollars for such Foreign Currency in London prior to 4:00 P.M. (London time) (unless otherwise indicated by the terms of this
Agreement) on such date as is required pursuant to the 

  

 6 

 
terms of this Agreement, and the “Equivalent” in any Foreign Currency of Dollars means the equivalent in such Foreign Currency of Dollars
determined by using the quoted spot rate at which the Sub-Agent’s principal office in London offers to exchange such Foreign Currency for Dollars in London prior to 4:00 P.M. (London time) (unless otherwise indicated by the terms of this
Agreement) on such date as is required pursuant to the terms of this Agreement. 
 “ERISA” means the Employee
Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. 
 “ERISA Affiliate” means any trade or business (whether or not incorporated) that is a member of a group of which the Borrower is a member and which is treated as a single employer under Section 414 of the Internal
Revenue Code. 
 “EURIBO Rate” means, for any Interest Period, the rate appearing on Page 248 of the
Moneyline Telerate Service (or on any successor or substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by
the Agent from time to time for purposes of providing quotations of interest rates applicable to deposits in Euro by reference to the Banking Federation of the European Union Settlement Rates for deposits in Euro) at approximately 10:00 a.m., London
time, two Business Days prior to the commencement of such Interest Period, as the rate for deposits in Euro with a maturity comparable to such Interest Period or, if for any reason such rate is not available, the average (rounded upward to the
nearest whole multiple of 1/16 of 1% per annum, if such average is not such a multiple) of the respective rates per annum at which deposits in Euros are offered by the principal office of each of the Reference Banks in London, England to prime
banks in the London interbank market at 11:00 A.M. (London time) two Business Days before the first day of such Interest Period in an amount substantially equal (x) in the case of Revolving Credit Borrowings, to such Reference Bank’s
Eurocurrency Rate Advance comprising part of such Revolving Credit Borrowing to be outstanding during such Interest Period and for a period equal to such Interest Period (subject, however, to the provisions of Section 2.08(e)) or (y) in
the case of Competitive Bid Borrowings, to the amount that would be the Reference Banks’ respective ratable shares of such Borrowing if such Borrowing were to be a Revolving Credit Borrowing to be outstanding during such Interest Period and for
a period equal to such Interest Period (subject, however, to the provisions of Section 2.08(e)). 
 “Euro” means the lawful currency of the European Union as constituted by the Treaty of Rome which established the European Community, as such treaty may be amended from time to time and as referred to in the EMU
legislation. 
 “Eurocurrency Liabilities” has the meaning assigned to that term in Regulation D. 

“Eurocurrency Lending Office” means, with respect to any Lender, the office of such Lender specified as its
“Eurocurrency Lending Office” opposite its name on Schedule I hereto or in the Assignment and Acceptance pursuant to which it became a 

  

 7 

 
Lender (or, if no such office is specified, its Domestic Lending Office), or such other office of such Lender as such Lender may from time to time specify to
the Borrower and the Agent. 
 “Eurocurrency Rate” means, for any Interest Period for each Eurocurrency Rate
Advance comprising part of the same Revolving Credit Borrowing, an interest rate per annum equal to the rate per annum obtained by dividing (a)(i) in the case of any Revolving Credit Advance denominated in Dollars or any Committed Currency other
than Euro, the rate per annum (rounded upward to the nearest whole multiple of 1/16 of 1% per annum) appearing on Reuters Screen LIBOR01 Page (or any successor page) as the London interbank offered rate for deposits in Dollars or the applicable
Committed Currency at approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest Period or, if for any reason such rate is not available, the average (rounded
upward to the nearest whole multiple of 1/16 of 1% per annum, if such average is not such a multiple) of the rate per annum at which deposits in Dollars or the applicable Committed Currency is offered by the principal office of each of the
Reference Banks in London, England to prime banks in the London interbank market at 11:00 A.M. (London time) two Business Days before the first day of such Interest Period in an amount substantially equal to such Reference Bank’s
Eurocurrency Rate Advance comprising part of such Revolving Credit Borrowing to be outstanding during such Interest Period and for a period equal to such Interest Period or, (ii) in the case of any Revolving Credit Advance denominated in Euros,
the EURIBO Rate by (b) a percentage equal to 100% minus the Eurocurrency Rate Reserve Percentage for such Interest Period. If the Reuters Screen LIBOR01 Page (or any successor page) is unavailable, the Eurocurrency Rate for any Interest Period
for each Eurocurrency Rate Advance comprising part of the same Revolving Credit Borrowing shall be determined by the Agent on the basis of applicable rates furnished to and received by the Agent from the Reference Banks two Business Days before the
first day of such Interest Period, subject, however, to the provisions of Section 2.08(e). 
 “Eurocurrency Rate Advance” means a Revolving Credit Advance denominated in Dollars or a Committed Currency that bears interest as provided in Section 2.07(a)(ii). 
 “Eurocurrency Rate Reserve Percentage” means, for any Interest Period for all Eurocurrency Rate Advances or LIBO Rate
Advances comprising part of the same Borrowing, the reserve percentage applicable two Business Days before the first day of such Interest Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or
any successor) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for a member bank of the Federal Reserve System in New York City with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the interest rate on Eurocurrency Rate Advances or LIBO Rate Advances is
determined) having a term equal to such Interest Period. 
 “Event of Default” has the meaning specified in
Section 6.01. 
  

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 “Exchange Act” means the Securities Exchange Act of 1934, as amended
from time to time, and the regulations promulgated and rulings issued thereunder. 
 “Extending Lender” has
the meaning specified in Section 2.16. 
 “Federal Funds Rate” means, for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for such day on such transactions
received by the Agent from three federal funds brokers of recognized standing selected by it. 
 “Financial
Officer” of any corporation means the chief financial officer, principal accounting officer, treasurer, assistant treasurer or controller of such corporation. 
 “Fiscal Year” means, with respect to any Person, the period commencing on January 1 and ending on December 31
of any calendar year. 
 “Fixed Rate Advances” has the meaning specified in Section 2.03(a)(i), which
Advances may be denominated in Dollars or in any Foreign Currency, bear interest at a fixed rate, and with respect to any Fixed Rate Advances denominated in Foreign Currency, may either be sourced or not sourced from the jurisdiction of issuance of
such Foreign Currency. 
 “Foreign Currency” means any Committed Currency, the lawful currency of Canada, the
lawful currency of Norway, the lawful currency of Sweden, the lawful currency of Denmark, the lawful currency of Hong Kong, the lawful currency of Singapore, the lawful currency of Australia, the lawful currency of New Zealand and any other lawful
currency (other than Dollars) that is freely transferable or convertible into Dollars. 
 “GAAP” has the
meaning specified in Section 1.03. 
 “Governmental Authority” means any federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory body. 
 “Guarantee” of or by
any Person means any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Debt of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such Person, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Debt or to purchase (or to advance or supply funds for the purchase of)
any security for the payment of such Debt, (b) to purchase property, securities or services for the purpose of assuring the owner of such debt of the payment of such Debt or (c) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Debt; provided, however, that the 

  

 9 

 
term “Guarantee” shall not include endorsements for collection or deposit, in either case in the ordinary course of business. 
 “Hedge Agreements” means interest rate swap, cap or collar agreements, interest rate future or option contracts, currency
swap agreements, currency future or option contracts and other similar agreements. 
 “Incurrence” has the
meaning specified in Section 5.02(a). 
 “Indemnified Party” has the meaning specified in
Section 8.04(b). 
 “Indemnified Matters” has the meaning specified in Section 8.04(b). 

“Initial Lender” has the meaning specified in the recital of parties to this Agreement. 
 “Interest Period” means, for each Eurocurrency Rate Advance comprising part of the same Revolving Credit Borrowing and
each LIBO Rate Advance comprising part of the same Competitive Bid Borrowing, the period commencing on the date of such Eurocurrency Rate Advance or LIBO Rate Advance or the date of the Conversion of any Base Rate Advance into such Eurocurrency Rate
Advance and ending on the last day of the period selected by the Borrower pursuant to the provisions below and, thereafter, each subsequent period commencing on the last day of the immediately preceding Interest Period and ending on the last day of
the period selected by the Borrower pursuant to the provisions below. The duration of each such Interest Period shall be (a) in the case of Eurocurrency Rate Advances, one, two, three or six months, or, subject to clause (iii) below, nine
or twelve months, as the Borrower may, upon notice received by the Agent not later than 11:00 A.M. (New York City time) on the third Business Day prior to the first day of such Interest Period, select and (b) in the case of LIBO Rate Advances,
a minimum of seven days; provided, however, that: 
 (i) the Borrower may not select any Interest Period that
ends after the Termination Date; 
 (ii) Interest Periods commencing on the same date for Eurocurrency Rate Advances
comprising part of the same Revolving Credit Borrowing or for LIBO Rate Advances comprising part of the same Competitive Bid Borrowing shall be of the same duration; 
 (iii) in respect of any Eurocurrency Rate Advances, the Borrower shall not be entitled to select an Interest Period having a duration of
nine or twelve months unless, by 2:00 P.M. (New York City time) on the third Business Day prior to the first day of such Interest Period, each Lender notifies the Agent that such Lender will be providing funding for such Borrowing with such Interest
Period (the failure of any Lender to so respond by such time being deemed for all purposes of this Agreement as an objection by such Lender to the requested duration of such Interest Period); provided that, if any or all of the Lenders object
to the requested duration of such Interest Period, the duration of the Interest 

  

 10 

 
Period for such Borrowing shall be one, two, three or six months, as specified by the Borrower in the applicable Notice of Borrowing as the desired
alternative to an Interest Period of nine or twelve months; 
 (iv) whenever the last day of any Interest Period would
otherwise occur on a day other than a Business Day, the last day of such Interest Period shall be extended to occur on the next succeeding Business Day, provided, however, that, if such extension would cause the last day of such
Interest Period to occur in the next following calendar month, the last day of such Interest Period shall occur on the next preceding Business Day; and 
 (v) whenever the first day of (A) any Interest Period in respect of Eurocurrency Rate Advances or (B) any Interest Period in respect of LIBO Rate Advances the durations of which are one, two, three or six
months, occurs on a day of an initial calendar month for which there is no numerically corresponding day in the calendar month that succeeds such initial calendar month by the number of months equal to the number of months in such Interest Period,
such Interest Period shall end on the last Business Day of such succeeding calendar month. 
 “Internal Revenue
Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. 
 “Lenders” means the Initial Lenders and each Person that shall become a party hereto pursuant to Section 8.07(a), (b) and (c) and, except when used in reference to a Revolving Credit
Advance, a Revolving Credit Borrowing, a Revolving Credit Note, a Commitment or a related term, each Designated Bidder. 
 “LIBO Rate” means, for any Interest Period for all LIBO Rate Advances comprising part of the same Competitive Bid Borrowing, an interest rate per annum equal to the rate per annum obtained by dividing (a)(i) in the case of
any Competitive Bid Borrowing denominated in Dollars or any Foreign Currency other than Euros, the rate per annum (rounded upward to the nearest whole multiple of 1/16 of 1% per annum) appearing on Reuters Screen LIBOR01 Page (or any successor
page) as the London interbank offered rate for deposits in Dollars or the applicable Foreign Currency at approximately 11:00 A.M. (London time) two Business Days prior to the first day of such Interest Period for a term comparable to such Interest
Period or, if for any reason such rate is not available, the average (rounded upward to the nearest whole multiple of 1/16 of 1% per annum, if such average is not such a multiple) of the rate per annum at which deposits in Dollars or the
applicable Foreign Currency is offered by the principal office of each of the Reference Banks in London, England to prime banks in the London interbank market at 11:00 A.M. (London time) two Business Days before the first day of such Interest
Period in an amount substantially equal to the amount that would be the Reference Banks’ respective ratable shares of such Borrowing if such Borrowing were to be a Revolving Credit Borrowing to be outstanding during such Interest Period and for
a period equal to such Interest Period or (ii) in the case of any Competitive Bid Borrowing denominated in Euros, the EURIBO Rate by (b) a percentage equal to 100% minus the 

  

 11 

 
Eurocurrency Rate Reserve Percentage for such Interest Period. If the Reuters Screen LIBOR01 Page (or any successor page) is unavailable, the LIBO Rate for
any Interest Period for each LIBO Rate Advance comprising part of the same Competitive Bid Borrowing shall be determined by the Agent on the basis of applicable rates furnished to and received by the Agent from the Reference Banks two Business Days
before the first day of such Interest Period, subject, however, to the provisions of Section 2.08(e). 
 “LIBO Rate Advances” means a Competitive Bid Advance denominated in Dollars or in any Foreign Currency and bearing interest based on the LIBO Rate. 
 “Lien” means any lien, security interest or other charge or encumbrance of any kind, including, without limitation, the
lien or retained security title of a conditional vendor and any easement, right of way or other encumbrance on title to real property and, in the case of securities, any purchase option, call or similar right of a third party with respect to such
securities. 
 “Local Rate Advance” means a Competitive Bid Advance denominated in any Foreign Currency
sourced from the jurisdiction of issuance of such Foreign Currency and bearing interest at a fixed rate. 
 “Margin
Stock” means all “margin stock” within the meaning of Regulation U. 
 “Material Adverse
Change” means any material adverse change in the business, assets, operations or financial condition of the Borrower and its Subsidiaries, taken as a whole. For purposes hereof, it is understood and agreed that the occurrence of a labor
dispute shall not in and of itself constitute a Material Adverse Change. 
 “Material Adverse Effect” means
(a) a material adverse effect on the business, assets, operations or financial condition of the Borrower and its Subsidiaries, taken as a whole, (b) material impairment of the ability of the Borrower to perform any of its obligations under
this Agreement or any Notes or (c) material impairment of the rights of or benefits available to the Lenders under this Agreement or any Notes. For purposes hereof, it is understood and agreed that the occurrence of a labor dispute shall not in
and of itself constitute a Material Adverse Effect. 
 “Material Subsidiary” means any Subsidiary of the
Borrower having (a) 5% or more of the Consolidated Net Tangible Assets or (b) 5% or more of the total revenues appearing on the most recently prepared Consolidated income statements of the Borrower and its Subsidiaries as of the end of the
immediately preceding fiscal quarter of the Borrower. 
 “Moody’s” means Moody’s Investors Service,
Inc. 
 “Non-Recourse Debt” means, with respect to any Person, Debt for which such Person neither
(a) provides credit support nor (b) is directly or indirectly liable. 
 “Note” means a Revolving
Credit Note or a Competitive Bid Note, as the context may require. 
  

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 “Notice of Competitive Bid Borrowing” has the meaning specified in
Section 2.03(a). 
 “Notice of Revolving Credit Borrowing” has the meaning specified in
Section 2.02(a). 
 “OECD” means the Organization for Economic Cooperation and Development and any
successor. 
 “Overseas Partners” means Overseas Partners Ltd., a Bermuda corporation. 
 “Patriot Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Pub. L. 107-56, signed into law October 26, 2001. 
 “Payment Office”
means, for any Foreign Currency, such office of Citibank as shall be from time to time selected by the Agent and notified by the Agent to the Borrower and the Lenders. 
 “PBGC” means the Pension Benefit Guaranty Corporation and any successor. 
 “Permitted Person” means the UPS Managers Stock Trust, the UPS Stock Trust, the UPS Savings Plan, the UPS Qualified Stock
Ownership Plan (QSOP), the Annie E. Casey Foundation, any retiree or present or former employee of the Borrower or any of its Subsidiaries or their respective present or former spouse, relatives (by consanguinity or law), estate or heirs (or their
respective spouse’s estate or heirs) or any other Person that has Beneficial Ownership of the common stock of the Borrower on the date of this Agreement, or any Person that is created for the benefit of any of the foregoing after the date of
this Agreement. 
 “Person” means an individual, partnership, corporation (including a business trust), joint
stock company, trust, unincorporated association, joint venture, limited liability company or other entity, or a government or any political subdivision or agency thereof. 
 “Plan” means any pension plan subject to the provisions of Title IV of ERISA or Section 412 of the Internal Revenue
Code that is maintained for employees of the Borrower or any ERISA Affiliate. 
 “Public Debt Rating” means,
as of any date, the higher rating that has been most recently announced by either S&P or Moody’s, as the case may be, for any class of non-credit enhanced long-term senior unsecured debt issued by the Borrower. For purposes of the
foregoing, (a) if only one of S&P and Moody’s shall have in effect a Public Debt Rating, the Applicable Margin and the Applicable Fee Percentage shall be determined by reference to the available rating; (b) if neither S&P nor
Moody’s shall have in effect a Public Debt Rating, the Applicable Margin and the Applicable Fee Percentage will be set in accordance with Level 3 under the definition of “Applicable Margin” or “Applicable Fee Percentage”, as
the case may be; (c) if the ratings established by S&P and Moody’s 

  

 13 

 
shall fall within different levels, the Applicable Margin and the Applicable Fee Percentage shall be based upon the higher rating; provided,
however, that if the lower of such ratings is more than one level below the level of the higher of such ratings, then the Applicable Margin and the Applicable Fee Percentage shall be based upon the level immediately above the level of the
lower of such ratings; (d) if any rating established by S&P or Moody’s shall be changed, such change shall be effective as of the date on which such change is first announced publicly by the rating agency making such change; and
(e) if S&P or Moody’s shall change the basis on which ratings are established, each reference to the Public Debt Rating announced by S&P or Moody’s, as the case may be, shall refer to the then equivalent rating by S&P or
Moody’s, as the case may be; provided, however, that if prior thereto the Borrower has selected, and the Required Lenders have approved, a rating agency to replace S&P or Moody’s, as the case may be, such selection shall
be deemed to be S&P or Moody’s, as the case may be, for all purposes hereof. 
 “Reference Banks”
means Citibank, Barclays Bank PLC and JPMorgan Chase Bank, N.A. or if any such Lender assigns all of its Commitment, the Advances owing to it and any Note or Notes held by it pursuant to Section 8.07(a), such other Lender as may be designated
by the Required Lenders and approved by the Borrower (such approval not to be unreasonably withheld). 
 “Register” has the meaning specified in Section 8.07(g). 
 “Regulation A”,
“Regulation D”, “Regulation T”, “Regulation U” or “Regulation X” means Regulation A, Regulation D, Regulation T, Regulation U or Regulation X, respectively, of the Board of
Governors of the Federal Reserve System, in each case as in effect from time to time, and all official rulings and interpretations thereunder or thereof, respectively. 
 “Replacement Lender” has the meaning specified in Section 2.16. 
 “Reportable Event” means any reportable event as defined in Section 4043(b) of ERISA or the regulations issued
thereunder with respect to a Plan (other than a Plan maintained by an ERISA Affiliate that is considered an ERISA Affiliate only pursuant to subsection (m) or (o) of Section 414 of the Internal Revenue Code). 
 “Required Lenders” means at any time Lenders owed greater than 50% of the then aggregate unpaid principal amount (based
on the Equivalent in Dollars at such time) of the Revolving Credit Advances owing to Lenders, or, if no such principal amount is then outstanding, Lenders having greater than 50% of the Commitments. 
 “Restricted Subsidiary” has the meaning specified in the Debenture Indenture. 
 “Revolving Credit Advance” means an advance by a Lender to the Borrower as part of a Revolving Credit Borrowing and
refers to a Base Rate Advance or a Eurocurrency Rate Advance (each of which shall be a “Type” of Revolving Credit Advance), as the context may require. 
  

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 “Revolving Credit Borrowing” means a borrowing consisting of
simultaneous Revolving Credit Advances of the same Type made by each of the Lenders pursuant to Section 2.01. 
 “Revolving Credit Borrowing Minimum” means, in respect of Revolving Credit Advances denominated in Dollars, $25,000,000, in respect of Revolving Credit Advances denominated in Sterling, £25,000,000, in respect of
Revolving Credit Advances denominated in Swiss Francs, CHF25,000,000, in respect of Revolving Credit Advances denominated in Yen, ¥2,500,000,000 and, in respect of Revolving Credit Advances denominated in Euros, €25,000,000. 
 “Revolving Credit Borrowing Multiple” means, in respect of Revolving Credit Advances denominated in Dollars, $1,000,000,
in respect of Revolving Credit Advances denominated in Sterling, £1,000,000, in respect of Revolving Credit Advances denominated in Swiss Francs, CHF1,000,000, in respect of Revolving Credit Advances denominated in Yen, ¥100,000,000 and,
in respect of Revolving Credit Advances denominated in Euros, €1,000,000. 
 “Revolving Credit Note”
means a promissory note of the Borrower payable to the order of any Lender, delivered pursuant to a request made under Section 2.18 in substantially the form of Exhibit A-1 hereto, evidencing the aggregate indebtedness of the Borrower to such
Lender resulting from the Revolving Credit Advances made by such Lender. 
 “Revolving Credit Prepay Minimum”
means, in respect of Revolving Credit Advances denominated in Dollars, $10,000,000, in respect of Revolving Credit Advances denominated in Sterling, £10,000,000, in respect of Revolving Credit Advances denominated in Swiss Francs,
CHF10,000,000, in respect of Revolving Credit Advances denominated in Yen, ¥1,000,000,000 and, in respect of Revolving Credit Advances denominated in Euros, €10,000,000. 
 “Sale and Leaseback Transaction” has the meaning specified in the Debenture Indenture. 
 “SEC” means the Securities and Exchange Commission, and any successor thereto and any analogous Governmental Authority.

 “Secured Indebtedness” has the meaning specified in the Debenture Indenture. 
 “S&P” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc.

 “Sub-Agent” means Citibank International plc. 
 “Subsidiary” of any Person means any corporation, partnership, joint venture, limited liability company, trust or estate
of which (or in which) more than 50% of (a) the Voting Power to elect a majority of the board of directors of such corporation (irrespective of whether at the time capital stock of any other class or classes of such 

  

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corporation shall or might have voting power upon the occurrence of any contingency), (b) the interest in the capital or profits of such partnership or
joint venture or (c) the beneficial interest in such trust or estate is at the time owned or controlled by such Person, by such Person and one or more of its other Subsidiaries or by one or more of such Person’s other Subsidiaries;
provided, however, that Overseas Partners shall not be deemed to be a Subsidiary of the Borrower. 
 “Termination Date” means the earlier of (a) April 19, 2012, subject to the extension thereof pursuant to Section 2.16, and (b) the date of termination in whole of the Commitments pursuant to
Section 2.05 or 6.01; provided, however, that the Termination Date of any Lender that is a Declining Lender to any requested extension pursuant to Section 2.16 shall be the earlier of (x) the Termination Date in effect
immediately prior to such extension and (y) the date of termination in whole of the Commitments pursuant to Section 2.05 or 6.01 for all purposes of this Agreement. 
 “Type” has the meaning specified in the definition of “Revolving Credit Advance”. 
 “Voting Power” means, with respect to any Voting Stock of any Person at any time, the number of votes entitled to vote
generally in the election of directors of such Person that are attributable to such Voting Stock at such time divided by the number of votes entitled to vote generally in the election of directors of such Person that are attributable to all shares
of capital stock of such Person (including such Voting Stock) at such time. 
 “Voting Stock” means capital
stock issued by a corporation, or equivalent interests in any other Person, the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such
Person, even if the right so to vote has been suspended by the happening of such a contingency. 
 SECTION 1.02. Computation of Time
Periods. In this Agreement in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each means
“to but excluding”. 
 SECTION 1.03. Accounting Terms. All accounting terms not specifically defined herein shall be
construed in accordance with generally accepted accounting principles consistent with those applied in the preparation of the financial statements referred to in Section 4.01(e) (“GAAP”). 
 ARTICLE II 
 AMOUNTS AND TERMS OF THE ADVANCES

 SECTION 2.01. The Revolving Credit Advances. Each Lender severally agrees, on the terms and conditions hereinafter set forth, to
make Revolving Credit Advances to the Borrower from time to time on any Business Day during the period from the Effective Date until the Termination Date in an aggregate amount (based in respect of any Revolving Credit 
  

 16 

 
Advances to be denominated in a Committed Currency by reference to the Equivalent thereof in Dollars determined on the date of delivery of the applicable
Notice of Revolving Credit Borrowing) not to exceed at any time outstanding the Dollar amount set forth opposite such Lender’s name on Schedule I hereto, if such Lender has entered into any Assignment and Acceptance, set forth for such Lender
in the Register maintained by the Agent pursuant to Section 8.07(c), as such amount may be reduced pursuant to Section 2.05 (such Lender’s “Commitment”), provided that the aggregate amount of the Commitments of
the Lenders shall be deemed used from time to time to the extent of the aggregate amount (based in respect of any Competitive Bid Advance denominated in a Foreign Currency by reference to the Equivalent thereof in Dollars at such time) of the
Competitive Bid Advances then outstanding and such deemed use of the aggregate amount of the Commitments shall be allocated among the Lenders ratably according to their respective Commitments (such deemed use of the aggregate amount of the
Commitments being a “Competitive Bid Reduction”). Each Revolving Credit Borrowing shall be in an amount not less than the Revolving Credit Borrowing Minimum or the Revolving Credit Borrowing Multiple in excess thereof (or, if less,
an amount equal to the remaining aggregate amount of unused Commitments or equal to the amount by which the aggregate amount of a proposed Competitive Bid Borrowing requested by the Borrower exceeds the aggregate amount of Competitive Bid Advances
offered to be made by the Lenders and accepted by the Borrower in respect of such Competitive Bid Borrowing, if such Competitive Bid Borrowing is made on the same date as such Revolving Credit Borrowing) and shall consist of Revolving Credit
Advances of the same Type and in the same currency made on the same day by the Lenders ratably according to their respective Commitments. Within the limits of each Lender’s Commitment, the Borrower may borrow under this Section 2.01,
prepay pursuant to Section 2.10 and reborrow under this Section 2.01. 
 SECTION 2.02. Making the Revolving Credit Advances.
(a) Each Revolving Credit Borrowing shall be made on notice, given not later than (x) 11:00 A.M. (New York City time) on the third Business Day prior to the date of the proposed Revolving Credit Borrowing in the case of a Revolving
Credit Borrowing consisting of Eurocurrency Rate Advances denominated in Dollars, (y) 4:00 P.M. (London time) on the third Business Day prior to the date of the proposed Revolving Credit Borrowing in the case of a Revolving Credit Borrowing
consisting of Eurocurrency Rate Advances denominated in any Committed Currency, or (z) 11:00 A.M. (New York City time) on the date of the proposed Revolving Credit Borrowing in the case of a Revolving Credit Borrowing consisting of Base Rate
Advances, by the Borrower to the Agent (and, in the case of a Revolving Credit Borrowing consisting of Eurocurrency Rate Advances denominated in any Committed Currency, simultaneously to the Sub-Agent), which shall give to each Lender prompt notice
thereof by telecopier. Each such notice of a Revolving Credit Borrowing (a “Notice of Revolving Credit Borrowing”) shall be by telephone, confirmed promptly in writing, or by telecopier, in substantially the form of Exhibit B-1
hereto, specifying therein the requested (i) date of such Revolving Credit Borrowing, (ii) Type of Advances comprising such Revolving Credit Borrowing, (iii) aggregate amount of such Revolving Credit Borrowing, (iv) location of
the Borrower’s Account to which funds are to be advanced and (v) in the case of a Revolving Credit Borrowing consisting of Eurocurrency Rate Advances, initial Interest Period and currency for each such Revolving Credit Advance. Each Lender
shall, before 1:00 P.M. (New York City time) on the date of such Revolving Credit Borrowing, in the case of a Revolving Credit Borrowing consisting of Advances denominated in Dollars, and before 4:00 P.M. (London time) on the date of
such Revolving Credit Borrowing, in the case of a 

  

 17 

 
Revolving Credit Borrowing consisting of Eurocurrency Rate Advances denominated in any Committed Currency, make available for the account of its Applicable
Lending Office to the Agent at the applicable Agent’s Account, in same day funds, such Lender’s ratable portion of such Revolving Credit Borrowing. After the Agent’s receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the Agent will make such funds available to the Borrower in same day funds at the applicable Borrower’s Account located in the United States or United Kingdom of Great Britain and Northern Ireland (or in
such other jurisdiction as shall be acceptable to all Lenders). 
 (b) Anything in subsection (a) of this Section 2.02 to the
contrary notwithstanding, the Borrower may not select Eurocurrency Rate Advances for any Revolving Credit Borrowing if the aggregate amount of such Revolving Credit Borrowing is less than the Revolving Credit Borrowing Minimum or if the obligation
of the Lenders to make Eurocurrency Rate Advances shall then be suspended pursuant to Section 2.08 or 2.12. 
 (c) Each Notice of
Revolving Credit Borrowing shall be irrevocable and binding on the Borrower. In the case of any Revolving Credit Borrowing that the related Notice of Revolving Credit Borrowing specifies is to be comprised of Eurocurrency Rate Advances, the Borrower
shall indemnify each Lender against any loss, cost or expense incurred by such Lender as a result of any failure by the Borrower to fulfill on or before the date specified in such Notice of Revolving Credit Borrowing for such Revolving Credit
Borrowing the applicable conditions set forth in Article III, including, without limitation, any loss (excluding loss of anticipated profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired
by such Lender to fund the Revolving Credit Advance to be made by such Lender as part of such Revolving Credit Borrowing when such Revolving Credit Advance, as a result of such failure, is not made on such date. 
 (d) Unless the Agent shall have received notice from a Lender prior to the time of any Revolving Credit Borrowing that such Lender will not make
available to the Agent such Lender’s ratable portion of such Revolving Credit Borrowing, the Agent may assume that such Lender has made such portion available to the Agent on the date of such Revolving Credit Borrowing in accordance with
subsection (a) of this Section 2.02 and the Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If and to the extent that such Lender shall not have so made such ratable portion
available to the Agent, such Lender and the Borrower severally agree to repay to the Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Agent, at (i) in the case of the Borrower, the higher of (A) the interest rate applicable at the time to Revolving Credit Advances comprising such Revolving Credit Borrowing and (B) the cost of
funds incurred by the Agent in respect of such amount and (ii) in the case of such Lender, the higher of (A) the Federal Funds Rate in the case of Advances denominated in Dollars or (B) the cost of funds incurred by the Agent in
respect of such amount in the case of Advances denominated in Committed Currencies. If such Lender shall repay to the Agent such corresponding amount, such amount so repaid shall constitute such Lender’s Revolving Credit Advance as part of such
Revolving Credit Borrowing for purposes of this Agreement. 
  

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 (e) The failure of any Lender to make the Revolving Credit Advance to be made by it as part of any
Revolving Credit Borrowing shall not relieve any other Lender of its obligation, if any, hereunder to make its Revolving Credit Advance on the date of such Revolving Credit Borrowing, but no Lender shall be responsible for the failure of any other
Lender to make the Revolving Credit Advance to be made by such other Lender on the date of any Revolving Credit Borrowing. 
 SECTION 2.03.
The Competitive Bid Advances. (a) Each Lender severally agrees that the Borrower may make Competitive Bid Borrowings under this Section 2.03 from time to time on any Business Day during the period from the date hereof until the date
occurring prior to the Termination Date in the manner set forth below; provided that, following the making of each Competitive Bid Advance, the aggregate amount of the Advances then outstanding (based, in respect of any Advance denominated in
a Foreign Currency, on the Equivalent in Dollars at the time such Competitive Bid Borrowing is requested) shall not exceed the aggregate amount of the Commitments of the Lenders (computed without regard to any Competitive Bid Reduction). 

(i) The Borrower may request a Competitive Bid Borrowing under this Section 2.03 by delivering to the Agent (and, in the case of a
Competitive Bid Borrowing not consisting of Fixed Rate Advances or LIBO Rate Advances to be denominated in Dollars, simultaneously to the Sub-Agent), by telephone, promptly confirmed in writing, or by telecopier, a notice of a Competitive Bid
Borrowing (a “Notice of Competitive Bid Borrowing”), in substantially the form of Exhibit B-2 hereto, specifying therein the requested (A) date of such proposed Competitive Bid Borrowing, (B) aggregate amount of such
proposed Competitive Bid Borrowing, (C) interest rate basis and day count convention to be offered by the Lenders, (D) currency of such proposed Competitive Bid Borrowing, (E) maturity date for repayment of each Competitive Bid
Advance to be made as part of such Competitive Bid Borrowing (which maturity date may not be earlier than the date occurring seven days after the date of such Competitive Bid Borrowing or later than the Termination Date and, in the case of any LIBO
Rate Advance to be made as part of such Competitive Bid Borrowing, shall be the last day of the interest period for such LIBO Rate Advance), (F) interest payment date or dates relating thereto, (G) location of the Borrower’s Account
to which funds are to be advanced and (H) any other terms to be applicable to such Competitive Bid Borrowing, not later than (w) 10:00 A.M. (New York City time) at least one Business Day prior to the date of the proposed Competitive Bid
Borrowing, if the Borrower shall specify in the Notice of Competitive Bid Borrowing that the rates of interest to be offered by the Lenders shall be fixed rates per annum (the Advances comprising any such Competitive Bid Borrowing being referred to
herein as “Fixed Rate Advances”) and that the Advances comprising such proposed Competitive Bid Borrowing shall be denominated in Dollars, (x) 10:00 A.M. (New York City time) at least four Business Days prior to the date of the
proposed Competitive Bid Borrowing, if the Borrower shall specify in the Notice of Competitive Bid Borrowing that the Advances comprising such Competitive Bid Borrowing shall be LIBO Rate Advances denominated in Dollars, (y) 10:00 A.M.
(London time) at least two Business Days prior to the date of the proposed Competitive Bid Borrowing, if the Borrower shall specify in the Notice of Competitive Bid Borrowing that the Advances comprising such proposed Competitive Bid Borrowing shall
be either Fixed Rate 

  

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Advances denominated in any Foreign Currency or Local Rate Advances denominated in any Foreign Currency and (z) 10:00 A.M. (London time) at least
four Business Days prior to the date of the proposed Competitive Bid Borrowing, if the Borrower shall instead specify in the Notice of Competitive Bid Borrowing that the Advances comprising such Competitive Bid Borrowing shall be LIBO Rate Advances
denominated in any Foreign Currency. The Agent or the Sub-Agent, as the case may be, shall in turn promptly notify each Lender of each request for a Competitive Bid Borrowing received by it from the Borrower by sending such Lender a copy of the
related Notice of Competitive Bid Borrowing. 
 (ii) Each Lender may, if, in its sole discretion, it elects to do so,
irrevocably offer to make one or more Competitive Bid Advances to the Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates of interest (including default rates not to exceed 1% per annum above the rate per annum
required to be paid on such Competitive Bid Advance) specified by such Lender in its sole discretion, by notifying the Agent or the Sub-Agent, as the case may be (which shall give prompt notice thereof to the Borrower), (A) before
10:00 A.M. (New York City time) on the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of Fixed Rate Advances denominated in Dollars, (B) before 10:00 A.M. (New York City time)
three Business Days before the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of LIBO Rate Advances, denominated in Dollars, (C) before 12:00 noon (London time) on the Business Day prior
to the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of either Fixed Rate Advances denominated in any Foreign Currency or Local Rate Advances denominated in any Foreign Currency and
(D) before 12:00 noon (London time) on the third Business Day prior to the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of LIBO Rate Advances denominated in any Foreign Currency, of the
minimum amount and maximum amount of each Competitive Bid Advance which such Lender would be willing to make as part of such proposed Competitive Bid Borrowing (which amounts or the Equivalent thereof in Dollars, as the case may be, of such proposed
Competitive Bid may, subject to the proviso to the first sentence of this Section 2.03(a), exceed such Lender’s Commitment, if any), the rate or rates of interest therefor and such Lender’s Applicable Lending Office with respect to
such Competitive Bid Advance; provided that if the Agent in its capacity as a Lender shall, in its sole discretion, elect to make any such offer, it shall notify the Borrower of such offer at least 30 minutes before the time and on the date
on which notice of such election is to be given to the Agent or to the Sub-Agent, as the case may be, by the other Lenders. If any Lender shall elect not to make such an offer, such Lender shall so notify the Agent before 10:00 A.M.
(New York City time) or the Sub-Agent before 12:00 noon (London time) on the date on which notice of such election is to be given to the Agent or to the Sub-Agent, as the case may be, by the other Lenders, and such Lender shall not be obligated
to, and shall not, make any Competitive Bid Advance as part of such Competitive Bid Borrowing; provided that the failure by any Lender to give such notice shall not cause such Lender to be obligated to make any Competitive Bid Advance as part
of such proposed Competitive Bid Borrowing. 
  

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 (iii) The Borrower shall, in turn, (A) before 11:00 A.M. (New York City
time) on the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of Fixed Rate Advances denominated in Dollars, (B) before 11:00 A.M. (New York City time) three Business Days before
the date of such proposed Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of LIBO Rate Advances denominated in Dollars, (C) before 3:00 P.M. (London time) on the Business Day prior to the date of such proposed
Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of either Fixed Rate Advances denominated in any Foreign Currency or Local Rate Advances denominated in any Foreign Currency and (D) before 3:00 P.M. (London time)
on the third Business Day prior to the date of such Competitive Bid Borrowing, in the case of a Competitive Bid Borrowing consisting of LIBO Rate Advances denominated in any Foreign Currency, either: 
 (x) cancel such Competitive Bid Borrowing by giving the Agent notice to that effect, or 
 (y) accept one or more of the offers made by any Lender or Lenders pursuant to subsection (a)(ii) of this Section 2.03, in its sole
discretion, by giving notice to the Agent or to the Sub-Agent, as the case may be, of the amount of each Competitive Bid Advance (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount,
notified to the Borrower by the Agent or the Sub-Agent, as the case may be, on behalf of such Lender for such Competitive Bid Advance pursuant to subsection (a)(ii) of this Section 2.03) to be made by each Lender as part of such Competitive Bid
Borrowing, and reject any remaining offers made by Lenders pursuant to subsection (a)(ii) of this Section 2.03, by giving the Agent or the Sub-Agent, as the case may be, notice to that effect. The Borrower shall accept the offers made by any
Lender or Lenders to make Competitive Bid Advances in order of the lowest to the highest rates of interest offered by such Lenders; provided, however, that if the Borrower has a reasonable basis to believe that acceptance of the offer
of any such Lender has a reasonable likelihood of subjecting the Borrower to additional costs pursuant to the provisions of Section 2.11, 2.12 or 2.14, the Borrower may reject the offer of such Lender and accept the offer of the Lender offering
the next lowest rate of interest. Subject to the next preceding sentence, if two or more Lenders have offered the same interest rate, the amount to be borrowed at such interest rate will be allocated among such Lenders in proportion to the amount
that each such Lender offered at such interest rate. 
 (iv) If the Borrower notifies the Agent or the Sub-Agent, as the case
may be, that such Competitive Bid Borrowing is cancelled pursuant to subsection (a)(iii)(A)(x) of this Section 2.03, the Agent or the Sub-Agent, as the case may be, shall give prompt notice thereof to the Lenders and such Competitive Bid
Borrowing shall not be made. 
 (v) If the Borrower accepts one or more of the offers made by any Lender or Lenders pursuant
to subsection (a)(iii)(A)(y) of this Section 2.03, the Agent or the Sub-Agent, as the case may be, shall in turn promptly notify (A) each Lender that has made an offer as described in subsection (a)(ii) of this Section 2.03, of the
date and aggregate 

  

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amount of such Competitive Bid Borrowing and whether or not any offer or offers made by such Lender pursuant to subsection (a)(ii) of this Section 2.03
have been accepted by the Borrower, (B) each Lender that is to make a Competitive Bid Advance as part of such Competitive Bid Borrowing, of the amount of each Competitive Bid Advance to be made by such Lender as part of such Competitive Bid
Borrowing, and (C) each Lender that is to make a Competitive Bid Advance as part of such Competitive Bid Borrowing, upon receipt, that the Agent or the Sub-Agent, as the case may be, has received forms of documents appearing to fulfill the
applicable conditions set forth in Article III. Each Lender that is to make a Competitive Bid Advance as part of such Competitive Bid Borrowing shall, before 12:00 noon (New York City time), in the case of Competitive Bid Advances to be
denominated in Dollars or 11:00 A.M. (London time), in the case of Competitive Bid Advances to be denominated in any Foreign Currency, on the date of such Competitive Bid Borrowing specified in the notice received from the Agent or the Sub-Agent, as
the case may be, pursuant to clause (A) of the next preceding sentence or any later time when such Lender shall have received notice from the Agent or the Sub-Agent, as the case may be pursuant to clause (C) of the next preceding sentence,
make available for the account of its Applicable Lending Office to the Agent (x) in the case of a Competitive Bid Borrowing denominated in Dollars, at its address referred to in Section 8.02, in same day funds, such Lender’s portion
of such Competitive Bid Borrowing in Dollars and (y) in the case of a Competitive Bid Borrowing in a Foreign Currency, at the Payment Office for such Foreign Currency as shall have been notified by the Agent to the Lenders prior thereto, in
same day funds, such Lender’s portion of such Competitive Bid Borrowing in such Foreign Currency. Upon fulfillment of the applicable conditions set forth in Article III and after receipt by the Agent of such funds, the Agent will make such
funds available to the Borrower at the location specified by the Borrower in its Notice of Competitive Bid Borrowing. Promptly after each Competitive Bid Borrowing the Agent will notify each Lender of the amount of the Competitive Bid Borrowing, the
consequent Competitive Bid Reduction and the dates upon which such Competitive Bid Reduction commenced and is then scheduled to terminate. 
 (b) Each Competitive Bid Borrowing shall be in an aggregate amount of $25,000,000 (or the Equivalent thereof in any Foreign Currency rounded up to the nearest 1,000,000 units of such Foreign Currency, determined as of the time of the
applicable Notice of Competitive Bid Borrowing) or an integral multiple of $1,000,000 (or the Equivalent thereof in any Foreign Currency rounded up to the nearest 100,000 units of such Foreign Currency, determined as of the time of the applicable
Notice of Competitive Bid Borrowing) in excess thereof and, following the making of each Competitive Bid Borrowing, the Borrower shall be in compliance with the limitation set forth in the proviso to the first sentence of subsection (a) of this
Section 2.03. 
 (c) Within the limits and on the conditions set forth in this Section 2.03, the Borrower may from time to time
borrow under this Section 2.03, repay pursuant to subsection (d) of this Section 2.03, and reborrow under this Section 2.03, provided that a Competitive Bid Borrowing shall not be made within three Business Days of the
date of any other Competitive Bid Borrowing. 
  

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 (d) The Borrower shall repay to the Agent for the account of each Lender that has made a Competitive Bid
Advance, on the maturity date of each Competitive Bid Advance (such maturity date being that specified by the Borrower for repayment of such Competitive Bid Advance in the related Notice of Competitive Bid Borrowing delivered pursuant to subsection
(a)(i) of this Section 2.03 and provided in the Competitive Bid Note evidencing such Competitive Bid Advance), the then unpaid principal amount of such Competitive Bid Advance. The Borrower may prepay any principal amount of any Competitive Bid
Advance, subject to the provisions of Sections 2.10 and 8.04(c), with the consent of the respective Lender of such Competitive Bid Advance. 
 (e) The Borrower shall pay interest on the unpaid principal amount of each Competitive Bid Advance from the date of such Competitive Bid Advance to the date the principal amount of such Competitive Bid Advance is repaid in full, at the rate
of interest for such Competitive Bid Advance specified by the Lender making such Competitive Bid Advance in its notice with respect thereto delivered pursuant to subsection (a)(ii) of this Section 2.03, payable on the interest payment date or
dates specified by the Borrower for such Competitive Bid Advance in the related Notice of Competitive Bid Borrowing delivered pursuant to subsection (a)(i) of this Section 2.03, as provided in the Competitive Bid Note evidencing such
Competitive Bid Advance. Upon the occurrence and during the continuance of an Event of Default, the Borrower shall pay interest on the amount of unpaid principal of and interest on each Competitive Bid Advance owing to a Lender, payable in arrears
on the date or dates interest is payable thereon, at a rate per annum equal to the default rate specified by the appropriate Lender in respect of such Competitive Bid Advance. 
 (f) The indebtedness of the Borrower resulting from each Competitive Bid Advance made to the Borrower as part of a Competitive Bid Borrowing shall be
evidenced by a separate Competitive Bid Note of the Borrower payable to the order of the Lender making such Competitive Bid Advance. Upon repayment in full of each Competitive Bid Advance in accordance with the provisions of subsection (d) of
this Section 2.03 and the terms of the Competitive Bid Note evidencing such Competitive Bid Advance, the Lender holding such Competitive Bid Note shall cancel such Note and return such Note to the Borrower. 
 SECTION 2.04. Fees. (a) Facility Fee. The Borrower agrees to pay to the Agent for the account of each Lender (other than the Designated
Bidders) a facility fee on the aggregate amount of such Lender’s Commitment from the Effective Date in the case of each Initial Lender and from the effective date specified in the Assignment and Acceptance pursuant to which it became a Lender
in the case of each other Lender until the Termination Date at a rate per annum equal to the Applicable Fee Percentage, payable in arrears quarterly on the last day of each March, June, September and December, commencing June 30, 2007, and on
the Termination Date. 
 (b) Agent’s Fees. The Borrower shall pay to the Agent for its own account such fees as may from time to
time be agreed between the Borrower and the Agent. 
 SECTION 2.05. Termination or Reduction of the Commitments. The Borrower shall
have the right, upon at least three Business Days’ notice to the Agent, to terminate in whole or reduce ratably in part the unused portions of the respective Commitments of the Lenders, 

  

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provided that each partial reduction shall be in the aggregate amount of $25,000,000 or an integral multiple of $1,000,000 in excess thereof and
provided further that the aggregate amount of the Commitments of the Lenders shall not be reduced to an amount that is less than the aggregate principal amount of the Competitive Bid Advances denominated in Dollars then outstanding
plus the Equivalent in Dollars (determined as of the date of the notice of prepayment) of the aggregate principal amount of the Competitive Bid Advances denominated in Foreign Currencies then outstanding. 
 SECTION 2.06. Repayment of Revolving Credit Advances. The Borrower shall repay to the Agent for the ratable account of the Lenders on the
Termination Date the aggregate principal amount of the Revolving Credit Advances then outstanding. 
 SECTION 2.07. Interest on Revolving
Credit Advances. (a) Scheduled Interest. The Borrower shall pay interest on the unpaid principal amount of each Revolving Credit Advance owing to each Lender from the date of such Revolving Credit Advance until such principal amount shall
be paid in full, at the following rates per annum: 
 (i) Base Rate Advances. During such periods as such Revolving
Credit Advance is a Base Rate Advance, a rate per annum equal at all times to the sum of (A) the Base Rate in effect from time to time plus (B) the Applicable Margin in effect from time to time, payable in arrears quarterly on the
last day of each March, June, September and December during such periods and on the date such Base Rate Advance shall be Converted or paid in full. 
 (ii) Eurocurrency Rate Advances. During such periods as such Revolving Credit Advance is a Eurocurrency Rate Advance, a rate per annum equal at all times during each Interest Period for such Revolving Credit
Advance to the sum of (A) the Eurocurrency Rate for such Interest Period for such Revolving Credit Advance plus (B) the Applicable Margin in effect from time to time, payable in arrears on the last day of such Interest Period and,
if such Interest Period has a duration of more than three months, on each day that occurs during such Interest Period every three months from the first day of such Interest Period and on the date such Eurocurrency Rate Advance shall be Converted or
paid in full. 
 (b) Default Interest. Upon the occurrence and during the continuance of an Event of Default, the Borrower shall pay
interest on (i) the unpaid principal amount of each Revolving Credit Advance owing to each Lender, payable in arrears on the dates referred to in subsection (a)(i) or (a)(ii) of this Section 2.07, at a rate per annum equal at all times to
1% per annum above the rate per annum required to be paid on such Revolving Credit Advance pursuant to subsection (a)(i) or (a)(ii) of this Section 2.07 and (ii) the amount of any interest, fee or other amount payable hereunder that
is not paid when due, from the date such amount shall be due until such amount shall be paid in full, payable in arrears on the date such amount shall be paid in full and on demand, at a rate per annum equal at all times to 1% per annum above
the rate per annum required to be paid on Base Rate Advances pursuant to subsection (a)(i) of this Section 2.07. 
 SECTION 2.08.
Interest Rate Determination. (a) Each Reference Bank agrees, if requested by the Agent, to furnish to the Agent timely information for the purpose of 

  

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determining each Eurocurrency Rate and each LIBO Rate. If any one or more of the Reference Banks shall not furnish such timely information to the Agent for
the purpose of determining any such interest rate, the Agent shall determine such interest rate on the basis of timely information furnished by the remaining Reference Banks, subject to the provisions of subsection (e) of this
Section 2.08. The Agent shall give prompt notice to the Borrower and the Lenders of the applicable interest rate determined by the Agent for purposes of Section 2.07(a)(i) or 2.07(a)(ii), and the rate, if any, furnished by each Reference
Bank for the purpose of determining the interest rate under Section 2.07(a)(ii). 
 (b) If, with respect to any Eurocurrency Rate
Advances, the Required Lenders notify the Agent that (i) they are unable to obtain matching deposits in the London inter-bank market at or about 11:00 A.M. (London time) on the second Business Day before the making of a Borrowing in sufficient
amounts to fund their respective Revolving Credit Advances as a part of such Borrowing during its Interest Period or (ii) the Eurocurrency Rate for any Interest Period for such Advances will not adequately reflect the cost to such Required
Lenders of making, funding or maintaining their respective Eurocurrency Rate Advances for such Interest Period, the Agent shall forthwith so notify the Borrower and the Lenders, whereupon (A) the Borrower will, on the last day of the then
existing Interest Period therefor, (1) if such Eurocurrency Rate Advances are denominated in Dollars, either (x) prepay such Advances or (y) Convert such Advances into Base Rate Advances and (2) if such Eurocurrency Rate Advances
are denominated in any Committed Currency, either (x) prepay such Advances or (y) exchange such Advances into an Equivalent amount of Dollars and Convert such Advances into Base Rate Advances and (B) the obligations of the Lenders to
make, or to Convert Revolving Credit Advances into, Eurocurrency Rate Advances shall be suspended until the Agent shall notify the Borrower and the Lenders that the circumstances causing such suspension no longer exist. 
 (c) If the Borrower shall fail to select the duration of any Interest Period for any Eurocurrency Rate Advances in accordance with the provisions
contained in the definition of “Interest Period” in Section 1.01, the Agent will forthwith so notify the Borrower and the Lenders and such Advances will automatically, on the last day of the then existing Interest Period therefor,
(i) if such Eurocurrency Rate Advances are denominated in Dollars, Convert into Base Rate Advances and (ii) if such Eurocurrency Rate Advances are denominated in a Committed Currency, be exchanged for an Equivalent amount of Dollars and
Convert into Base Rate Advances. 
 (d) On the date on which the aggregate unpaid principal amount of Eurocurrency Rate Advances comprising
any Borrowing shall be reduced, by payment or prepayment or otherwise, to less than the Revolving Credit Borrowing Minimum, such Advances shall automatically (i) if such Eurocurrency Rate Advances are denominated in Dollars, Convert into Base
Rate Advances and (ii) if such Eurocurrency Rate Advances are denominated in a Committed Currency, be exchanged for an Equivalent amount of Dollars and Convert into Base Rate Advances. 
 (e) Upon the occurrence and during the continuance of any Event of Default, (i) each Eurocurrency Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, (A) if such Eurocurrency Rate Advances are denominated in Dollars, be Converted into Base Rate Advances and (B) if such Eurocurrency Rate Advances are 

  

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denominated in any Committed Currency, be exchanged for an Equivalent amount of Dollars and be Converted into Base Rate Advances and (ii) the obligation
of the Lenders to make, or to Convert Advances into, Eurocurrency Rate Advances shall be suspended. 
 (f) If Reuters Screen LIBOR01 Page is
unavailable and fewer than two Reference Banks furnish timely information to the Agent for determining the Eurocurrency Rate or LIBO Rate for any Eurocurrency Rate Advances or LIBO Rate Advances, as the case may be, after the Agent has requested
such information, 
 (i) the Agent shall forthwith notify the Borrower and the Lenders that the interest rate cannot be
determined for such Eurocurrency Rate Advances or LIBO Rate Advances, as the case may be, 
 (ii) with respect to Eurocurrency
Rate Advances, each such Advance will automatically, on the last day of the then existing Interest Period therefor, (A) if such Eurocurrency Rate Advance is denominated in Dollars, Convert into a Base Rate Advance and (B) if such
Eurocurrency Rate Advance is denominated in any Committed Currency, be prepaid by the Borrower or be automatically exchanged for an Equivalent amount of Dollars and be Converted into a Base Rate Advance (or if such Advance is then a Base Rate
Advance, will continue as a Base Rate Advance), and 
 (iii) the obligations of the Lenders to make Eurocurrency Rate Advances
or LIBO Rate Advances, or to Convert Revolving Credit Advances into Eurocurrency Rate Advances, shall be suspended until the Agent shall notify the Borrower and the Lenders that the circumstances causing such suspension no longer exist. 

SECTION 2.09. Optional Conversion of Revolving Credit Advances. The Borrower may on any Business Day, upon notice given to the Agent not later
than 11:00 A.M. (New York City time) on the third Business Day prior to the date of the proposed Conversion and subject to the provisions of Sections 2.08, 2.12 and 8.04(c), Convert Revolving Credit Advances denominated in Dollars of one Type
comprising the same Borrowing into Revolving Credit Advances denominated in Dollars of the other Type; provided, however, that any Conversion of Base Rate Advances into Eurocurrency Rate Advances shall be in an amount not less than the
minimum amount specified in Section 2.02(b). Each such notice of a Conversion shall, within the restrictions specified above, specify (a) the date of such Conversion, (b) the Dollar denominated Revolving Credit Advances to be
Converted, and (c) if such Conversion is into Eurocurrency Rate Advances, the duration of the initial Interest Period for each such Advance. Each notice of Conversion shall be irrevocable and binding on the Borrower. 
 SECTION 2.10. Prepayments of Advances. (a) Optional. The Borrower may, upon at least two Business Days’ notice in the case of
Eurocurrency Rate Advances and notice on the same Business Day in the case of Base Rate Advances to the Agent stating the proposed date and aggregate principal amount of the prepayment, and if such notice is given the Borrower shall, prepay the
outstanding principal amount of such Advances comprising part of the same Borrowing in whole or ratably in part, together with accrued interest to the date of such prepayment on the principal amount prepaid; provided, however, that
(a) each partial prepayment shall be in an aggregate principal amount of not less than the Revolving Credit Prepay Minimum 

  

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or a Revolving Credit Borrowing Multiple in excess thereof and (b) in the event of any such prepayment of a Eurocurrency Rate Advance, the Borrower
shall be obligated to reimburse the Lenders in respect thereof pursuant to Section 8.04(c). 
 (b) Mandatory. (i) If, on any
date, the Agent notifies the Borrower that, on any interest payment date, the sum of (A) the aggregate principal amount of all Advances denominated in Dollars then outstanding plus (B) the Equivalent in Dollars (determined on the third
Business Day prior to such interest payment date) of the aggregate principal amount of all Advances denominated in Foreign Currencies then outstanding exceeds 105% of the aggregate Commitments of the Lenders on such date, the Borrower shall, as soon
as practicable and in any event within two Business Days after receipt of such notice, subject to the proviso to this sentence set forth below, prepay the outstanding principal amount of any Advances owing by the Borrower in an aggregate amount
sufficient to reduce such sum to an amount not to exceed 100% of the aggregate Commitments of the Lenders on such date together with any interest accrued to the date of such prepayment on the aggregate principal amount of Advances prepaid;
provided that if the aggregate principal amount of Base Rate Advances outstanding at the time of such required prepayment is less than the amount of such required prepayment, the portion of such required prepayment in excess of the aggregate
principal amount of Base Rate Advances then outstanding shall be deferred until the earliest to occur of the last day of the Interest Period of the outstanding Eurocurrency Rate Advances or the outstanding LIBO Rate Advances and/or the maturity date
of the outstanding Local Rate Advances or Fixed Rate Advances, as the case may be, in an aggregate amount equal to the excess of such required prepayment. The Agent shall give prompt notice of any prepayment required under this Section 2.10(b)
to the Borrower and the Lenders, and shall provide prompt notice to the Borrower of any such notice of required prepayment received by it from any Lender. 
 (ii) Each prepayment made pursuant to this Section 2.10(b) shall be made together with any interest accrued to the date of such prepayment on the principal amounts prepaid and, in the case of any prepayment of a
Eurocurrency Rate Advance, a LIBO Rate Advance, a Fixed Rate Advance or a Local Rate Advance on a date other than the last day of an Interest Period or at its maturity, any additional amounts which the Borrower shall be obligated to reimburse to the
Lenders in respect thereof pursuant to Section 8.04(c). The Agent shall give prompt notice of any prepayment required under this Section 2.10(b) to the Borrower and the Lenders. 
 SECTION 2.11. Increased Costs. (a) If, due to either (i) the introduction of or any change (other than any change by way of imposition or
increase of reserve requirements included in the Eurocurrency Rate Reserve Percentage) in or in the interpretation of any law or regulation or (ii) the compliance with any guideline or request from any central bank or other Governmental
Authority including, without limitation, any agency of the European Union or similar monetary or multinational authority (whether or not having the force of law), there shall be any increase in the cost as measured from the date hereof to any Lender
of agreeing to make or making, funding or maintaining Eurocurrency Rate Advances or LIBO Rate Advances, then the Borrower shall from time to time, upon demand by such Lender (with a copy of such demand to the Agent), promptly pay to the Agent for
the account of such Lender additional amounts sufficient to compensate such Lender for such increased cost. A certificate as to the amount of 

  

 27 

 
such increased cost, submitted to the Borrower and the Agent by such Lender, shall be conclusive and binding for all purposes, absent manifest error.

 (b) If any Lender (other than the Designated Bidders) determines that compliance with any law or regulation or any guideline or request
from any central bank or other Governmental Authority (whether or not having the force of law) affects or would affect the amount of capital required or expected to be maintained by such Lender or any corporation controlling such Lender and that the
amount of such capital is increased by or based upon the existence of such Lender’s commitment to lend hereunder and other commitments of this type, then, upon demand by such Lender (with a copy of such demand to the Agent), the Borrower shall
promptly pay to the Agent for the account of such Lender, from time to time as specified by such Lender, additional amounts sufficient to compensate such Lender or such corporation in the light of such circumstances, to the extent that such Lender
reasonably determines such increase in capital to be allocable to the existence of such Lender’s commitment to lend hereunder. A certificate as to such amounts submitted to the Borrower and the Agent by such Lender shall be conclusive and
binding for all purposes, absent manifest error. 
 SECTION 2.12. Illegality. Notwithstanding any other provision of this Agreement,
if any Lender shall notify the Agent that the introduction of or any change in or in the interpretation of any law or regulation by any governmental authority charged with such interpretation makes it unlawful, or any central bank or other
Governmental Authority asserts that it is unlawful, for any Lender or its Eurocurrency Lending Office to perform its obligations hereunder to make Eurocurrency Rate Advances or LIBO Rate Advances in Dollars or any Foreign Currency or to fund or
maintain Eurocurrency Rate Advances in Dollars or any Committed Currency or LIBO Rate Advances in Dollars or any Foreign Currency hereunder, (a) each Eurocurrency Rate Advance or LIBO Rate Advance, as the case may be, will automatically, upon
such demand (i) if such Eurocurrency Rate Advance or LIBO Rate Advance is denominated in Dollars, be Converted into a Base Rate Advance or an Advance that bears interest at the rate set forth in Section 2.07(a)(i), as the case may be, and
(ii) if such Eurocurrency Rate Advance or LIBO Rate Advance is denominated in any Foreign Currency, be exchanged into an Equivalent amount of Dollars and be Converted into a Base Rate Advance or an Advance that bears interest at the rate set
forth in Section 2.07(a)(i), as the case may be, and (b) the obligation of the Lenders to make Eurocurrency Rate Advances or LIBO Rate Advances or to Convert Revolving Credit Advances into Eurocurrency Rate Advances shall be suspended
until the Agent shall notify the Borrower and the Lenders that the circumstances causing such suspension no longer exist. 
 SECTION 2.13.
Payments and Computations. (a) The Borrower shall make each payment hereunder (except with respect to principal of, interest on, and other amounts relating to, Advances denominated in a Foreign Currency) not later than 1:00 P.M.
(New York City time) on the day when due, without setoff or counterclaim, in Dollars to the Agent at the applicable Agent’s Account in same day funds. The Borrower shall make each payment hereunder with respect to principal of, interest
on, and other amounts relating to, Advances denominated in a Foreign Currency not later than 11:00 A.M. (at the Payment Office for such Foreign Currency) on the day when due, without setoff or counterclaim, in such Foreign Currency to the
Agent, by deposit of such funds to the applicable Agent’s Account in same day funds. The Agent will promptly thereafter cause to be distributed like funds relating to the 

  

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payment of principal or interest or facility fees ratably (other than amounts payable pursuant to Section 2.03, 2.11, 2.14 or 8.04(c)) to the Lenders
for the account of their respective Applicable Lending Offices, and like funds relating to the payment of any other amount payable to any Lender to such Lender for the account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an Assignment and Acceptance and recording of the information contained therein in the Register pursuant to Section 8.07(d), from and after the effective date specified in such
Assignment and Acceptance, the Agent shall make all payments hereunder and under any Notes in respect of the interest assigned thereby to the Lender assignee thereunder, and the parties to such Assignment and Acceptance shall make all appropriate
adjustments in such payments for periods prior to such effective date directly between themselves. 
 (b) The Borrower hereby authorizes the
Agent, if and to the extent payment owed to any Lender is not made when due hereunder or under any Note held by such Lender, to charge from time to time against any or all of the Borrower’s accounts with the Agent any amount so due. 

(c) All computations of interest based on the Base Rate shall be made by the Agent on the basis of a year of 365 or 366 days, as the case may be, all
computations of interest based on the Eurocurrency Rate or the Federal Funds Rate and of facility fees shall be made by the Agent on the basis of a year of 360 days and computations in respect of Competitive Bid Advances shall be made by the Agent
or the Sub-Agent, as the case may be, as specified in the applicable Notice of Competitive Bid Borrowing (or, in each case of Advances denominated in Foreign Currencies where market practice differs, in accordance with market practice), in each case
for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest or facility fees are payable. Each determination by the Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error. 
 (d) Whenever any payment hereunder or under any Notes shall be stated to be due on a day
other than a Business Day, such payment shall be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of payment of interest or facility fees, as the case may be; provided,
however, that, if such extension would cause payment of interest on or principal of Eurocurrency Rate Advances or LIBO Rate Advances to be made in the next following calendar month, such payment shall be made on the next preceding Business
Day. 
 (e) Unless the Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Lenders
hereunder that the Borrower will not make such payment in full, the Agent may assume that the Borrower has made such payment in full to the Agent on such date and the Agent may, in reliance upon such assumption, cause to be distributed to each
Lender on such due date an amount equal to the amount then due such Lender. If and to the extent the Borrower shall not have so made such payment in full to the Agent, each Lender shall repay to the Agent forthwith on demand such amount distributed
to such Lender together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to the Agent, at (i) the Federal Funds Rate in the case 

  

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of Advances denominated in Dollars or (ii) the cost of funds incurred by the Agent in respect of such amount in the case of Advances denominated in
Foreign Currencies. 
 (f) To the extent that the Agent receives funds for application to the amounts owing by the Borrower under or in
respect of this Agreement or any Note in currencies other than the currency or currencies required to enable the Agent to distribute funds to the Lenders in accordance with the terms of this Section 2.13, the Agent shall be entitled to convert
or exchange such funds into Dollars or into a Foreign Currency or from Dollars to a Foreign Currency or from a Foreign Currency to Dollars, as the case may be, to the extent necessary to enable the Agent to distribute such funds in accordance with
the terms of this Section 2.13; provided that the Borrower and each of the Lenders hereby agree that the Agent shall not be liable or responsible for any loss, cost or expense suffered by the Borrower or such Lender as a result of any
conversion or exchange of currencies affected pursuant to this Section 2.13(f) or as a result of the failure of the Agent to effect any such conversion or exchange; and provided further that the Borrower agrees to indemnify the
Agent and each Lender, and hold the Agent and each Lender harmless, for any and all losses, costs and expenses incurred by the Agent or any Lender for any conversion or exchange of currencies (or the failure to convert or exchange any currencies) in
accordance with this Section 2.13(f). 
 SECTION 2.14. Taxes. (a) Any and all payments by the Borrower hereunder or under any
Notes shall be made, in accordance with Section 2.13, free and clear of and without deduction for any and all present or future taxes, levies, imposts, deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Lender and the Agent, taxes imposed on its net income, as well as any branch profit taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which such Lender is
located, franchise taxes measured by income imposed on it, by the jurisdiction under the laws of which such Lender or the Agent (as the case may be) is organized or any political subdivision thereof and, in the case of each Lender, taxes imposed on
its net income, and franchise taxes measured by income imposed on it, by the jurisdiction of such Lender’s Applicable Lending Office or any political subdivision thereof (all such non-excluded taxes, levies, imposts, deductions, charges,
withholdings and liabilities in respect of payments hereunder or under any Notes being hereinafter referred to as “Taxes”). If the Borrower shall be required by law to deduct any Taxes from or in respect of any sum payable hereunder
or under any Note to any Lender or the Agent (i) the sum payable shall be increased as may be necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section 2.14) such
Lender or the Agent (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable law. 
 (b) In addition, the Borrower agrees to pay any
present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies that arise from any payment made hereunder or under any Notes or from the execution, delivery or registration of, or otherwise with respect
to, this Agreement or any Notes hereinafter referred to as “Other Taxes”). 
  

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 (c) The Borrower shall indemnify each Lender and the Agent for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed by any jurisdiction on amounts payable under this Section 2.14) paid by such Lender or the Agent or any of its Affiliates (as the case may be) and any liability (including
penalties, interest and expenses) arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally asserted. This indemnification shall be made within 30 days from the date such Lender, the Agent or such
Affiliate (as the case may be) makes written demand therefor. 
 (d) Within 30 days after the date of any payment of Taxes, the Borrower
shall furnish to the Agent, at its address referred to in Section 8.02, the original or a certified copy of a receipt evidencing payment thereof. If no Taxes are payable in respect of any payment hereunder or under any Notes, the Borrower will
furnish to the Agent, at such address, a certificate from each appropriate taxing authority, or an opinion of counsel acceptable to the Agent, in either case stating that such payment is exempt from or not subject to Taxes. 
 (e) Each Lender organized under the laws of a jurisdiction outside the United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Initial Lender and on the date of the Assignment and Acceptance pursuant to which it becomes a Lender in the case of each other Lender, and from time to time thereafter if requested in writing by the Borrower (but only
so long as such Lender remains lawfully able to do so), shall provide each of the Agent and the Borrower with Internal Revenue Service form W-8BEN or W-8ECI, or (in the case of a Lender that has certified in writing to the Agent that it is not a
“bank” as defined in Section 881(c)(3)(A) of the Internal Revenue Code) Form W-8 (and, if such Non-U.S. Lender delivers a Form W-8, a certificate representing that such Non-U.S. Lender is not a “bank” for purposes of
Section 881(c) of the Internal Revenue Code, is not a 10-percent shareholder (within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code) of the Borrower and is not a controlled foreign corporation related to the Borrower
(within the meaning of Section 864(d)(4) of the Internal Revenue Code)),as appropriate, or any successor form prescribed by the Internal Revenue Service, certifying that such Lender is entitled to benefits under an income tax treaty to which
the United States is a party which reduces the rate of withholding tax on payments of interest or certifying that the income receivable pursuant to this Agreement is effectively connected with the conduct of a trade or business in the United States.
Each such Lender shall provide the Agent and the Borrower with a new form W-8BEN, W-8ECI or W-8, as appropriate, if and at such time as the previously provided form becomes invalid. If the form provided by a Lender at the time such Lender first
becomes a party to this Agreement or at any other time indicates a United States interest withholding tax rate in excess of zero, withholding tax at such rate shall be considered excluded from “Taxes” as defined in Section 2.14(a).

 (f) For any period with respect to which a Lender has failed to provide the Borrower with the appropriate form described in subsection
(e) of this Section 2.14 (other than if such failure is due to a change in law occurring subsequent to the date on which a form originally was required to be provided, or if such form otherwise is not required under the first sentence of
subsection (e) of this Section 2.14), such Lender shall not be entitled to indemnification under subsection (a) or (c) of this Section 2.14 with respect to Taxes imposed by the United States by reason of such failure;
provided, however, that should a Lender become subject to Taxes because 

  

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of its failure to deliver a form required hereunder, the Borrower shall take such steps as the Lender shall reasonably request to assist the Lender to
recover such Taxes. 
 (g) Notwithstanding any contrary provisions of this Agreement, in the event that a Lender that originally provided
such form as may be required under subsection (e) of this Section 2.14 thereafter ceases to qualify for complete exemption from United States withholding tax, such Lender, with the prior written consent of the Borrower, which consent shall
not be unreasonably withheld, may assign its interest under this Agreement to any assignee and such assignee shall be entitled to the same benefits under this Section 2.14 as the assignor provided that the rate of United States withholding tax
applicable to such assignee shall not exceed the rate then applicable to the assignor. 
 (h) Any Lender claiming any additional amounts
payable pursuant to this Section 2.14 agrees to use reasonable efforts (consistent with its internal policy and legal and regulatory restrictions) to change the jurisdiction of its Eurocurrency Lending Office if the making of such a change
would avoid the need for, or reduce the amount of, any such additional amounts that may thereafter accrue and would not, in the reasonable judgment of such Lender, be otherwise disadvantageous to such Lender. 
 (i) If any Lender or Agent, as the case may be, obtains a refund of any Taxes or Other Taxes for which payment has been made pursuant to this
Section 2.14, which refund in the good faith judgment of such Lender or Agent, as the case may be (and without any obligation to disclose its tax records) is allocable to such payment made under this Section 2.14, the amount of such refund
(together with any interest received thereon and reduced by reasonable costs incurred in obtaining such refund) promptly shall be paid to the Borrower to the extent payment has been made by the Borrower pursuant to this Section 2.14,
provided, however, if the jurisdiction which refunded such Taxes or Other Taxes subsequently asserts such Taxes or Other Taxes are due, then the Borrower shall indemnify such Lender or the Agent, as the case may be, pursuant to
Section 2.14(c). Each Lender and Agent shall take such action, as the Borrower may reasonably request, in order to apply for and obtain any refund of such amounts the Borrower reasonably determines to be appropriate under the circumstances;
provided that any such actions shall be at the sole cost and expense of the Borrower. 
 SECTION 2.15. Sharing of Payments,
Etc. If any Lender shall obtain any payment (whether voluntary, involuntary, through the exercise of any right of setoff, or otherwise) on account of the Revolving Credit Advances owing to it (other than pursuant to Section 2.11, 2.14 or
8.04(c)) in excess of its ratable share of payments on account of the Revolving Credit Advances obtained by all the Lenders, such Lender shall forthwith purchase from the other Lenders such participations in the Revolving Credit Advances owing to
them as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Lender,
such purchase from each Lender shall be rescinded and such Lender shall repay to the purchasing Lender the purchase price to the extent of such recovery together with an amount equal to such Lender’s ratable share (according to the proportion
of (i) the amount of such Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so
recovered. The Borrower agrees that any 

  

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Lender so purchasing a participation from another Lender pursuant to this Section 2.15 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of setoff) with respect to such participation as fully as if such Lender were the direct creditor of the Borrower in the amount of such participation. 
 SECTION 2.16. Extensions of Termination Date. No earlier than 60 days and no later than 45 days prior to each anniversary of the Effective Date,
the Borrower may, by written notice to the Agent, request that the Termination Date then in effect be extended for a 1-year period. Such request shall be irrevocable and binding upon the Borrower. The Agent shall promptly notify each Lender of such
request. If a Lender agrees, in its individual and sole discretion, to so extend its Commitment (an “Extending Lender”), it shall deliver to the Agent a written notice of its agreement to do so no earlier than 30 days and no later
than 20 days prior to such anniversary date and the Agent shall notify the Borrower of such Extending Lender’s agreement to extend its Commitment no later than 15 days prior to such anniversary date. The Commitment of any Lender that fails to
accept or respond to the Borrower’s request for extension of the Termination Date (a “Declining Lender”) shall be terminated on the Termination Date then in effect (without regard to any extension by other Lenders) and on such
Termination Date the Borrower shall pay in full the principal amount of all Advances owing to such Declining Lender, together with accrued interest thereon to the date of such payment of principal and all other amounts payable to such Declining
Lender under this Agreement. The Agent shall promptly notify each Extending Lender of the aggregate Commitments of the Declining Lenders. The Extending Lenders, or any of them, may offer to increase their respective Commitments by an aggregate
amount up to the aggregate amount of the Declining Lenders’ Commitments and any such Extending Lender shall deliver to the Agent a notice of its offer to so increase its Commitment no later than 15 days prior to such anniversary date. To the
extent of any shortfall in the aggregate amount of extended Commitments, the Borrower shall have the right to require any Declining Lender, to assign in full its rights and obligations under this Agreement to one or more Eligible Assignees
designated by the Borrower and acceptable to the Agent, such acceptance not to be unreasonably withheld, that agree to accept all of such rights and obligations (each a “Replacement Lender”), provided that (i) such
increase and/or such assignment is otherwise in compliance with Section 8.07, (ii) such Declining Lender receives payment in full of the principal amount of all Advances owing to such Declining Lender, together with accrued interest
thereon to the date of such payment of principal and all other amounts payable to such Declining Lender under this Agreement and (iii) any such increase shall be effective on such anniversary date and any such assignment shall be effective on
the date specified by the Borrower and agreed to by the Replacement Lender and the Agent. If, but only if, Extending Lenders and Replacement Lenders have agreed to provide Commitments in an aggregate amount greater than 50% of the aggregate amount
of the Commitments outstanding immediately prior to such anniversary date, the Termination Date shall be extended by one year. 
 SECTION
2.17. Substitution of Lender. If the obligation of any Lender to make Eurocurrency Rate Advances or Competitive Bid Advances has been suspended pursuant to Section 2.12 or any Lender has demanded compensation or the Borrower is otherwise
required to pay additional amounts under Section 2.11 or 2.14, the Borrower shall have the right to seek a substitute lender or lenders who qualify as Eligible Assignees to assume, in accordance with the provisions of Section 8.07, the
Commitment of such Lender and to purchase the Revolving 
  

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Credit Advances or Competitive Bid Advances made by such Lender (without recourse to or warranty by such Lender). 
 SECTION 2.18. Evidence of Debt. (a) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Revolving Credit Advance owing to such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder in respect
of Revolving Credit Advances. The Borrower agrees that upon notice by any Lender to the Borrower (with a copy of such notice to the Agent) to the effect that a Revolving Credit Note is required or appropriate in order for such Lender to evidence
(whether for purposes of pledge, enforcement or otherwise) the Revolving Credit Advances owing to, or to be made by, such Lender, the Borrower shall promptly execute and deliver to such Lender a Revolving Credit Note payable to the order of such
Lender in a principal amount up to the Commitment of such Lender. 
 (b) The Register maintained by the Agent pursuant to
Section 8.07(g) shall include a control account, and a subsidiary account for each Lender, in which accounts (taken together) shall be recorded (i) the date and amount of each Borrowing made hereunder, the Type of Advances comprising such
Borrowing and, if appropriate, the Interest Period applicable thereto, (ii) the terms of each Assignment and Acceptance delivered to and accepted by it, (iii) the amount of any principal or interest due and payable or to become due and
payable from the Borrower to each Lender hereunder and (iv) the amount of any sum received by the Agent from the Borrower hereunder and each Lender’s share thereof. 
 (c) Entries made in good faith by the Agent in the Register pursuant to subsection (b) above, and by each Lender in its account or accounts pursuant
to subsection (a) above, shall be prima facie evidence of the amount of principal and interest due and payable or to become due and payable from the Borrower to, in the case of the Register, each Lender and, in the case of such
account or accounts, such Lender, under this Agreement, absent manifest error; provided, however, that the failure of the Agent or such Lender to make an entry, or any finding that an entry is incorrect, in the Register or such account
or accounts shall not limit or otherwise affect the obligations of the Borrower under this Agreement. 
 ARTICLE III 
 CONDITIONS TO EFFECTIVENESS AND LENDING 
 SECTION 3.01. Conditions Precedent to Effectiveness of Sections 2.01 and 2.03. Sections 2.01 and 2.03 of this Agreement shall become effective on and as of the first date (the “Effective Date”) on which the following
conditions precedent have been satisfied: 
 (a) The Borrower shall have notified each Lender and the Agent in writing as to
the proposed Effective Date. 
 (b) The Borrower shall have paid all fees and other amounts due and payable. 
 (c) The Borrower shall have repaid all outstanding advances and shall have paid all other amounts payable under the Five Year Credit
Agreement dated as of April 

  

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21, 2005 among the Borrower, the lenders parties thereto and Citibank, N.A., as administrative agent, and the commitments under each such credit facility
shall have been terminated. 
 (d) On the Effective Date, the following statements shall be true and the Agent shall have
received for the account of each Lender a certificate signed by a duly authorized officer of the Borrower, dated the Effective Date, stating that: 
 (i) the representations and warranties contained in Section 4.01 are correct in all material respects on and as of the Effective Date; and 
 (ii) no event has occurred and is continuing that constitutes a Default. 
 (e) The Agent shall have received on or before the Effective Date the following, each dated such day, in form and substance satisfactory
to the Agent and (except for the Revolving Credit Notes) in sufficient copies for each Lender: 
 (i) The Revolving Credit
Notes to the order of the Lenders to the extent requested by any Lender pursuant to Section 2.18. 
 (ii) Certified
copies of the resolutions of the board of directors of the Borrower approving this Agreement and any Notes, and of all documents evidencing other necessary corporate action and governmental approvals, if any, with respect to this Agreement and any
Notes. 
 (iii) A certificate of the Secretary or an Assistant Secretary of the Borrower certifying the names and true
signatures of the officers of the Borrower authorized to sign this Agreement and any Notes and the other documents to be delivered hereunder. 
 (iv) A favorable opinion of King & Spalding LLP, counsel for the Borrower, substantially in the form of Exhibit E hereto. 
 (v) A favorable opinion of Shearman & Sterling LLP, counsel for the Agent, in form and substance satisfactory to the Agent.

 SECTION 3.02. Conditions Precedent to Each Revolving Credit Borrowing. The obligation of each Lender to make a Revolving Credit
Advance on the occasion of each Revolving Credit Borrowing shall be subject to the conditions precedent that the Effective Date shall have occurred and on the date of such Revolving Credit Borrowing the following statements shall be true (and each
of the giving of the applicable Notice of Revolving Credit Borrowing and the acceptance by the Borrower of the proceeds of such Revolving Credit Borrowing shall constitute a representation and warranty by the Borrower that on the date of such
Borrowing such statements are true): 
 (a) the representations and warranties contained in Section 4.01 (except the
representations set forth in subsection (f) or (g) (i) thereof) are correct in all material respects on and as of the date of such Revolving Credit Borrowing, before and after 

  

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giving effect to such Revolving Credit Borrowing and to the application of the proceeds therefrom, as though made on and as of such date; and 
 (b) no event has occurred and is continuing, or would result from such Revolving Credit Borrowing or from the application of the proceeds
therefrom, that constitutes a Default. 
 SECTION 3.03. Conditions Precedent to Each Competitive Bid Borrowing. The obligation of each
Lender that is to make a Competitive Bid Advance on the occasion of a Competitive Bid Borrowing to make such Competitive Bid Advance as part of such Competitive Bid Borrowing is subject to the conditions precedent that (a) the Agent shall have
received the written confirmatory Notice of Competitive Bid Borrowing with respect thereto, (b) on or before the date of such Competitive Bid Borrowing, but prior to such Competitive Bid Borrowing, the Agent shall have received a Competitive
Bid Note payable to the order of such Lender for each of the one or more Competitive Bid Advances to be made by such Lender as part of such Competitive Bid Borrowing, in a principal amount equal to the principal amount of the Competitive Bid Advance
to be evidenced thereby and otherwise on such terms as were agreed to for such Competitive Bid Advance in accordance with Section 2.03, and (c) on the date of such Competitive Bid Borrowing the following statements shall be true (and each
of the giving of the applicable Notice of Competitive Bid Borrowing and the acceptance by the Borrower of the proceeds of such Competitive Bid Borrowing shall constitute a representation and warranty by the Borrower that on the date of such
Competitive Bid Borrowing such statements are true): 
 (i) the representations and warranties contained in Section 4.01
(except the representations set forth in subsection (f) or (g)(i) thereof) are correct in all material respects on and as of the date of such Competitive Bid Borrowing, before and after giving effect to such Competitive Bid Borrowing and to the
application of the proceeds therefrom, as though made on and as of such date; and 
 (ii) no event has occurred and is
continuing, or would result from such Competitive Bid Borrowing or from the application of the proceeds therefrom, that constitutes a Default. 
 SECTION 3.04. Determinations Under Section 3.01. For purposes of determining compliance with the conditions specified in Section 3.01, each Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to the Lenders unless an officer of the Agent responsible for the transactions contemplated by this Agreement shall have
received notice from such Lender prior to the proposed Effective Date, as notified by the Borrower to the Lenders, specifying its objection thereto. The Agent shall promptly notify the Borrower and the other Lenders of the occurrence of any such
objection. The Agent shall promptly notify the Borrower and the Lenders of the Effective Date. 
 SECTION 3.05. Labor Dispute.
Notwithstanding any condition precedent to the contrary contained herein, a labor dispute of any sort involving employees of the Borrower or its Subsidiaries shall not prevent the Borrower from borrowing hereunder unless as a result thereof 

  

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the Borrower is in violation of the covenant set forth in Section 5.02(c) or a Default exists under Section 6.01(a) or (e). 
 ARTICLE IV 
 REPRESENTATIONS AND WARRANTIES

 SECTION 4.01. Representations and Warranties of the Borrower. The Borrower represents and warrants as follows: 
 (a) Each of the Borrower and its Subsidiaries (i) is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, except, in the case of any such Subsidiary, where the failure so to qualify would not result in a Material Adverse Effect, (ii) has the requisite power and authority to own its property and assets and to carry
on its business as now conducted, except, in the case of any such Subsidiary, where the failure so to qualify would not result in a Material Adverse Effect, (iii) is qualified to do business in every jurisdiction where such qualification is
required, except where the failure so to qualify would not result in a Material Adverse Effect and (iv) in the case of the Borrower, has the corporate power and authority to execute, deliver and perform its obligations under this Agreement and
any Notes and each other agreement or instrument contemplated thereby to which it is or is to be a party and to borrow under this Agreement. 
 (b) The execution, delivery and performance by the Borrower of this Agreement and any Notes to be delivered by it and the consummation of the transactions contemplated thereby are within the Borrower’s corporate
powers, have been duly authorized by all necessary corporate action and, if required, stockholder action, and do not (i) contravene the charter or other constitutive documents or by-laws of the Borrower or any Subsidiary of the Borrower,
(ii) violate any law or order of any Governmental Authority or any provision of any indenture or other material agreement or instrument to which the Borrower or any Subsidiary of the Borrower is a party or by which any of them or any of their
property is or may be bound or affected, (iii) conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under any such indenture, agreement or other instrument or (iv) result in the
creation or imposition of any Lien upon or with respect to any property or assets now owned or hereafter acquired by the Borrower or any Subsidiary of the Borrower. 
 (c) No authorization, approval or other action by, and no notice to or filing with, any Governmental Authority is required for the due
execution, delivery and performance by the Borrower of this Agreement or any Notes to be delivered by it, or for the consummation of the transactions contemplated hereby and thereby, except for such authorizations, approvals, actions, notices or
filings that have been made or obtained and are in full force and effect. 
 (d) This Agreement has been, and any Notes to be
delivered by it when delivered hereunder will have been, duly executed and delivered by the Borrower. This Agreement is, and any Notes when delivered hereunder will be, the legal, valid and 

  

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binding obligation of the Borrower enforceable against the Borrower in accordance with their respective terms (subject, as to the enforcement of remedies, to
applicable bankruptcy, reorganization, insolvency, moratorium and similar laws affecting creditors’ rights generally). 
 (e) The Consolidated balance sheet of the Borrower and its Subsidiaries as at December 31, 2006, and the related Consolidated statements of income and cash flows of the Borrower and its Subsidiaries for the Fiscal Year then ended, all
audited and certified by Deloitte & Touche LLP, independent public accountants, copies of which have been furnished to each Lender, fairly present in all material respects the Consolidated financial condition of the Borrower and its
Subsidiaries at such dates and the Consolidated results of the operations of the Borrower and its Subsidiaries for the periods ended on such dates, all in accordance with GAAP consistently applied. Such balance sheets and the notes thereto disclose
all material liabilities, direct or contingent, of the Borrower and its Subsidiaries on a Consolidated basis as of the dates thereof required to be reflected or disclosed therein in accordance with GAAP. 
 (f) There has been no Material Adverse Change since December 31, 2006. 
 (g) Except as set forth in the financial statements referred to in subsection (e) of this Section 4.01, there is no pending or,
to the knowledge of the Borrower, threatened action, suit, investigation, litigation or proceeding affecting the Borrower or any of its Material Subsidiaries or any business, property or rights of the Borrower or any Material Subsidiary (i) as
to which there is a reasonable possibility of an adverse determination and which, if adversely determined, is reasonably expected to have, individually or in the aggregate, a Material Adverse Effect or (ii) that purports to affect the legality,
validity or enforceability of this Agreement, any Note or the consummation of the transactions contemplated hereby or thereby. Neither the Borrower nor any of its Subsidiaries is in violation of any law, rule or regulation (including, without
limitation, any ERISA or environmental law, rule or regulation), or in default with respect to any judgment, writ, injunction or decree of any Governmental Authority, where such violation or default is reasonably expected to result in a Material
Adverse Effect. 
 (h) Neither the Borrower nor any of its Subsidiaries is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of purchasing or carrying Margin Stock. No part of the proceeds of any Advance will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any
purpose which entails a violation of, or which is inconsistent with, the provisions of the Regulations of the Board of Governors of the Federal Reserve System, including Regulation T, U or X thereof. 
 (i) Neither the Borrower nor any of its Subsidiaries is an “investment company”, as defined in, or subject to regulation under,
the Investment Company Act of 1940, as amended. 
 (j) The Borrower will use the proceeds of the Advances as a commercial
paper backstop and for other lawful general corporate purposes. 
  

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 (k) Each of the Borrower and its Subsidiaries has filed or caused to be filed all federal
income tax and all other material state and local tax returns required to have been filed by it and has paid or caused to be paid all taxes shown to be due and payable on such returns or on any assessments received by it, except taxes that are
otherwise permitted to remain unpaid in accordance with the provisions of Section 5.01(b). 
 (l) All information,
reports, financial statements, exhibits or schedules prepared or furnished by or on behalf of the Borrower to the Agent, Arrangers or any Lender in connection with the negotiation of this Agreement or delivered pursuant hereto contained, contains or
will contain no material misstatement of fact and did not omit, does not omit and will not omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were, are or will be made, not
misleading. 
 ARTICLE V 
 COVENANTS OF THE BORROWER 
 SECTION 5.01. Affirmative Covenants. So long as any Advance shall remain unpaid or any Lender
shall have any Commitment hereunder, the Borrower will, and will cause each of its Material Subsidiaries to, unless the Required Lenders shall otherwise consent in writing: 
 (a) Compliance with Laws, Etc. Comply with all applicable laws, rules, regulations and orders of any Governmental Authority,
whether now in effect or hereafter enacted, such compliance to include, without limitation, compliance with ERISA, applicable environmental laws and the Patriot Act, except for such noncompliance as would not result in a Material Adverse Effect.

 (b) Payment of Taxes, Etc. Pay and discharge promptly when due all taxes, assessments and governmental charges or
levies imposed upon it or upon its income or profits or in respect of its property, before the same shall become delinquent or in default; provided, however, that such payment and discharge shall not be required with respect to any
such tax, assessment, charge or levy so long as the validity or amount thereof shall be contested in good faith by appropriate proceedings or where the failure to pay such tax, assessment, charge or levy would not result in a Material Adverse
Effect. The charges, accruals and reserves on the books of the Borrower and its Subsidiaries in respect of taxes, assessments, charges and levies are, in the opinion of the Borrower, adequate. 
 (c) Maintenance of Insurance. (i) Keep its insurable properties adequately insured at all times by financially sound and
reputable insurers, (ii) maintain such other insurance, to such extent and against such risks, including fire and other risks insured against by extended coverage, as is customary with companies in the same or similar businesses, including
public liability insurance against claims for personal injury or death or property damage occurring upon, in, about or in connection with the use of any properties owned, occupied or controlled by the Borrower or any of its Material Subsidiaries, in
such amount as the Borrower or such Subsidiary shall reasonably deem 

  

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necessary and (iii) maintain such other insurance as may be required by law (it being understood that the Borrower may self-insure against certain risks
to the extent reasonable or customary with companies similarly situated). 
 (d) Preservation of Corporate Existence,
Etc. Preserve and maintain the Borrower’s corporate existence; obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, franchises, authorizations, patents, copyrights, trademarks and tradename
material to the conduct of its business (unless the failure to so preserve or renew would not result in a Material Adverse Effect); and engage, and cause its Material Subsidiaries to engage principally in businesses of the same general types as
those conducted on the date of this Agreement or reasonably related or incidental thereto; provided, however, that the Borrower and its Subsidiaries may consummate any merger or consolidation permitted under Section 5.02(d), and
provided, further, that the Borrower or its Subsidiaries may from time to time convey, transfer or otherwise dispose of or discontinue any business to the extent such conveyance, transfer, disposition or discontinuation would not result in a
Material Adverse Effect. 
 (e) Keeping of Books. Keep, and cause each of its Material Subsidiaries to keep, proper
books of record and account, in which entries that are complete and correct in all material respects shall be made of all financial transactions and the assets and business of the Borrower and each such Subsidiary in accordance with generally
accepted accounting principles in effect from time to time. 
 (f) Maintenance of Properties, Etc. Maintain and
preserve all of its properties material to the conduct of its business in good repair, working order and condition, ordinary wear and tear excepted, and from time to time make, or cause to be made, all needful and proper repairs, renewals,
additions, improvements and replacements thereto necessary in order that the business carried on in connection therewith may be properly conducted at all times. 
 (g) Reporting Requirements. In the case of the Borrower, furnish to the Agent and each Lender (other than a Designated Bidder):

 (i) within 120 days after the end of each Fiscal Year of the Borrower, Consolidated balance sheets of the Borrower and its
Subsidiaries showing the financial condition of the Borrower and its Subsidiaries as of the close of such Fiscal Year and the related statements of Consolidated income and statements of Consolidated cash flow as of and for such Fiscal Year, all such
Consolidated financial statements of the Borrower and its Subsidiaries to be reported on by Deloitte & Touche LLP or other independent accountants of nationally recognized standing or otherwise acceptable to the Required Lenders;

 (ii) within 60 days after the end of the first three fiscal quarters of each Fiscal Year, unaudited Consolidated balance
sheets and statements of Consolidated income and statements of Consolidated cash flow showing the financial condition and results of operations of the Borrower as of the end of each such quarter and, with respect to statements of Consolidated cash
flow, for the 

  

 40 

 
then-elapsed portion of the Fiscal Year, certified by a Financial Officer of the Borrower as presenting fairly in all material respects the financial
position and results of operations of the Borrower on a Consolidated basis and as having been prepared in accordance with GAAP, in each case subject to normal year-end audit adjustments and the absence of notes thereto; 
 (iii) promptly after the same are publicly available, copies of all annual registration statements (other than exhibits thereto, pricing
supplements and any registration statements (A) on Form S-8 (or its equivalent) or (B) in connection with asset securitization transactions) and reports on Form 10-K and 10-Q (or their equivalents), which the Borrower shall have filed with
the SEC under Section 13 or 15(d) of the Exchange Act and not otherwise required to be delivered to the Agent pursuant hereto; 
 (iv) concurrently with subsections (h)(i) and (h)(ii) of this Section 5.01, a certificate of a Financial Officer of the Borrower stating compliance, as of the dates of the financial statements being furnished at such time, with the
covenants set forth in Sections 5.02(a) and (c); 
 (v) concurrently with subsections (h)(i) and (h)(ii) of this
Section 5.01, a certificate of the Person referred to therein (which certificate furnished by the independent accountants referred to in subsection (h)(i) of this Section 5.01 may be limited to accounting matters and disclaim
responsibility for legal interpretations) certifying that to the best of his, her or its knowledge no Default or Event of Default has occurred and, in the case of a certificate of a Financial Officer of the Borrower, if such a Default or Event of
Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto; 
 (vi) prompt written notice of a Reportable Event or Reportable Events, or of the Borrower’s failure to make a required installment or other payment (within the meaning of Section 412(n)(1) of the Internal
Revenue Code), shall have occurred with respect to any Plan or Plans, in any case that is reasonably expected to result in liability of the Borrower or any Subsidiary to the PBGC or to a Plan in an aggregate amount exceeding $100,000,000;

 (vii) prompt written notice of any Default, if such Default is then continuing, specifying the nature and extent thereof
and any corrective action taken or proposed to be taken with respect thereto; 
 (viii) prompt written notice of the filing or
commencement of, or any overt threat or notice of intention of any Person to file or commence, any action, suit, arbitration proceeding or other proceeding, whether at law or in equity or by or before any Governmental Authority, against the Borrower
or any Material Subsidiary thereof that is reasonably expected to result in a Material Adverse Effect; 
  

 41 

 (ix) prompt written notice of the issuance by any Governmental Authority of any
injunction, order, decision or other restraint prohibiting, or having the effect of prohibiting, the making of the Advances or the initiation of any litigation or similar proceedings seeking any such injunction, order or other restraint; and

 (x) prompt written notice of any Change of Control. 
 Financial reports required to be delivered pursuant to clauses (i), (ii) and (iii) above shall be deemed to have been delivered on the date on
which the Borrower notifies the Agent that such reports are posted on the Borrower’s website at www.ups.com under “Investor Relations”, and such posting shall be deemed to satisfy the financial reporting requirements of clauses (i),
(ii) and (iii) above, it being understood that the Borrower shall provide all other reports and certificates required to be delivered under this Section 5.01(g) in the manner set forth in Section 8.02. 
 SECTION 5.02. Negative Covenants. So long as any Advance shall remain unpaid or any Lender shall have any Commitment hereunder, the Borrower will
not, and will not permit any of its Subsidiaries to, without the written consent of the Required Lenders: 
 (a) Secured
Indebtedness. In the case of the Borrower and each of its Restricted Subsidiaries, create, assume, incur or guarantee, or permit any Restricted Subsidiary to create, assume, incur or guarantee (each such creation, assumption, incurrence or
guarantee being an “Incurrence”), any Secured Indebtedness without making provision whereby all amounts outstanding under this Agreement and any Notes shall be secured equally and ratably with (or prior to) such Secured Indebtedness
(together with, if the Borrower shall so determine, any other Debt of the Borrower or such Restricted Subsidiary then existing or thereafter created that is not subordinate to such amounts outstanding under this Agreement and any Notes) so long as
such Secured Indebtedness shall be outstanding, unless such Secured Indebtedness, when added to (i) the aggregate amount of all Secured Indebtedness then outstanding (not including in this computation (A) any Secured Indebtedness if all
amounts outstanding under this Agreement and any Notes are secured equally and ratably with (or prior to) such Secured Indebtedness and (B) any Secured Indebtedness that is concurrently being retired) and (ii) the aggregate amount of all
Attributable Debt then outstanding pursuant to Sale and Leaseback Transactions entered into by the Borrower after December 1, 1989, or entered into by any Restricted Subsidiary after December 1, 1989, or, if later, the date on which such
Subsidiary became a Restricted Subsidiary (not including in this computation any Attributable Debt that is currently being retired) would not exceed 10% of Consolidated Net Tangible Assets at the time of such Incurrence. 
 (b) Sale and Lease-Back Transactions. In the case of the Borrower and its Restricted Subsidiaries, enter into any Sale and
Leaseback Transaction unless at such time it would be permitted to enter into such Sale and Leaseback Transaction pursuant to Section 1006 of the Debenture Indenture. 
  

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 (c) Mergers, Etc. In the case of the Borrower, merge or consolidate with or into,
or convey, transfer, lease or otherwise dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to, any Person, or permit another Person to merge into
it, except that (i) any Subsidiary of the Borrower may merge into the Borrower, and (ii) the Borrower may merge or consolidate with or into any other Person so long as the Borrower is the surviving corporation; provided, in each
case, that no Default shall have occurred and be continuing at the time of such proposed transaction or would result therefrom. 
 ARTICLE VI

 EVENTS OF DEFAULT 
 SECTION
6.01. Events of Default. If any of the following events (“Events of Default”) shall occur and be continuing: 
 (a) the Borrower shall fail to pay (i) any principal of any Advance when the same becomes due and payable or (ii) any interest on any Advance or any other amount payable under this Agreement or any Note when the same becomes due
and payable and such failure to pay such interest or such other amount shall remain unremedied for three Business Days; or 
 (b) any representation or warranty made or deemed made by the Borrower (or any of its officers) in or in connection with this Agreement or any Borrowing under this Agreement, or any representation, warranty, statement or information
contained in any report, certificate, financial statement or other instrument furnished in connection with or pursuant to this Agreement, shall prove to have been incorrect in any material respect when made or deemed made; or 
 (c) the Borrower shall fail to perform or observe (i) any term, covenant or agreement contained in subsection (d) (as to the
Borrower’s corporate existence) or (g) (other than subsections (g)(i) through (g)(vi)) of Section 5.01 or Section 5.02 or (ii) any other term, covenant or agreement contained in this Agreement or any Note on its part to be
performed or observed if such failure to perform such other term, covenant or agreement shall remain unremedied for 30 days after written notice thereof shall have been given to the Borrower by the Agent; or 
 (d) the Borrower or any of its Subsidiaries shall fail to pay any principal of or premium or interest on any Debt that is outstanding in a
principal amount of at least $200,000,000 in the aggregate (but excluding Debt under this Agreement or any Notes) of the Borrower or such Subsidiary (as the case may be), when the same becomes due and payable (whether at maturity, by acceleration or
otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such Debt; or any other event shall occur or condition shall exist under any agreement or instrument relating
to any such Debt and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of 

  

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such event or condition is to accelerate (with or without notice or lapse of time or both) the maturity of such Debt; or 
 (e) the Borrower or any of its Material Subsidiaries shall generally not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general assignment for the benefit of creditors; or any proceeding shall be instituted by or against the Borrower or any of its Material Subsidiaries seeking to adjudicate it a bankrupt or
insolvent, or seeking liquidation, winding up, reorganization, arrangement, adjustment, protection, relief, or composition of it or its debts under any law relating to bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee, custodian or other similar official for it or for any substantial part of its property and, in the case of any such proceeding instituted against it (but not instituted by it),
either such proceeding shall remain undismissed or unstayed for a period of 60 days, or any of the actions sought in such proceeding (including, without limitation, the entry of an order for relief against, or the appointment of a receiver, trustee,
custodian or other similar official for, it or for any substantial part of its property) shall occur; or the Borrower or any of its Material Subsidiaries shall take any corporate action to authorize any of the actions set forth above in this
subsection (e); or 
 (f) any final judgment or order for the payment of money in excess of $100,000,000 in the aggregate
shall be rendered against the Borrower or any of its Material Subsidiaries or any combination thereof and either (i) enforcement proceedings shall have been commenced by any creditor upon such judgment or order or (ii) there shall be any
period of 45 consecutive days during which a stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, shall not be in effect; or 
 (g) any Change of Control shall have occurred; or 
 (h) a Reportable Event or Reportable Events, or a failure to make a required installment or other payment (within the meaning of
Section 412(n)(1) of the Internal Revenue Code), shall have occurred with respect to any Plan or Plans that reasonably could be expected to result in liability of the Borrower or any Subsidiary to the PBGC or to a Plan in an aggregate amount
exceeding $100,000,000 and, within 30 days after the reporting of any such Reportable Event or Reportable Events to the Agent, the Agent shall have notified the Borrower, in writing that (i) the Required Lenders have made a determination that,
on the basis of such Reportable Event or Reportable Events or the failure to make a required payment, there are reasonable grounds (A) for the termination of such Plan or Plans by the PBGC or (B) for the appointment by the appropriate
United States District Court of a trustee to administer such Plan or Plans and (ii) as a result thereof, an Event of Default exists hereunder; or the PBGC shall have instituted proceedings to terminate any Plan or Plans with vested unfunded
liabilities aggregating in excess of $100,000,000; or a trustee shall be appointed by a United States District Court to administer any such Plan or Plans and the Borrower is being requested to make a payment with respect to vested unfunded
liabilities aggregating in excess of $100,000,000; 
  

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then, and in any such event, the Agent (i) shall at the request, or may with the consent, of the Required Lenders, by notice to the Borrower, declare
the obligation of each Lender to make Advances to be terminated, whereupon the same shall forthwith terminate, and (ii) shall at the request, or may with the consent, of the Required Lenders, by notice to the Borrower, declare the Advances, all
interest thereon and all other amounts payable under this Agreement to be forthwith due and payable, whereupon the Advances, all such interest and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest
or further notice of any kind, all of which are hereby expressly waived by the Borrower; provided, however, that in the event of an actual or deemed entry of an order for relief with respect to the Borrower or any of its Subsidiaries
under the Federal Bankruptcy Code, (A) the obligation of each Lender to make Advances shall automatically be terminated and (B) the Advances, all such interest and all such amounts shall automatically become and be due and payable, without
presentment, demand, protest or any notice of any kind, all of which are hereby expressly waived by the Borrower. 
 ARTICLE VII 

THE AGENT 
 SECTION 7.01. Authorization
and Action. Each Lender hereby appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers and discretion under this Agreement as are delegated to the Agent by the terms hereof, together with such
powers and discretion as are reasonably incidental thereto. As to any matters not expressly provided for by this Agreement (including, without limitation, enforcement or collection of any Notes), the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions shall be binding upon
all Lenders and all holders of Notes; provided, however, that the Agent shall not be required to take any action that exposes the Agent to personal liability or that is contrary to this Agreement or applicable law. The Agent agrees to
give to each Lender prompt notice of each notice given to it by the Borrower or any of its Subsidiaries pursuant to the terms of this Agreement. 
 SECTION 7.02. Agent’s Reliance, Etc. Neither the Agent nor any of its directors, officers, agents or employees shall be liable for any action taken or omitted to be taken by it or them under or in connection with this Agreement,
except for its or their own gross negligence or willful misconduct. Without limitation of the generality of the foregoing, the Agent: (i) may treat the payee of any Note as the holder thereof until the Agent receives and accepts an Assignment
and Acceptance entered into by the Lender that is the payee of such Note, as assignor, and an Eligible Assignee, as assignee, as provided in Section 8.07; (ii) may consult with legal counsel (including counsel for the Borrower),
independent public accountants and other experts selected by it and shall not be liable for any action taken or omitted to be taken in good faith by it in accordance with the advice of such counsel, accountants or experts; (iii) make no
warranty or representation to any Lender and shall not be responsible to any Lender for any statements, warranties or representations (whether written or oral) made in or in connection with this Agreement; (iv) shall not have any duty to
ascertain or to inquire as to the performance, observance or satisfaction of any of the terms, covenants or conditions of this Agreement on the 

  

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part of the Borrower or any of its Subsidiaries or the existence at any time of any Default or to inspect the property (including the books and records) of
the Borrower or any of its Subsidiaries; (v) shall not be responsible to any Lender for the due execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any other instrument or document furnished
pursuant hereto; and (vi) shall incur no liability under or in respect of this Agreement by acting upon any notice, consent, certificate or other instrument or writing (which may be by telecopier or telegram) believed by it to be genuine and
signed or sent by the proper party or parties. 
 SECTION 7.03. Citibank and Its Affiliates. With respect to its Commitment, the
Advances made by it and any Note issued to it, Citibank shall have the same rights and powers under this Agreement as any other Lender and may exercise the same as though it were not the Agent; and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated, include Citibank in its individual capacity. Citibank and its Affiliates may accept deposits from, lend money to, act as trustee under indentures of, accept investment banking engagements from and
generally engage in any kind of business with, the Borrower, any of its Subsidiaries and any Person who may do business with or own securities of the Borrower or any such Subsidiary, all as if Citibank were not the Agent and without any duty to
account therefor to the Lenders. The Agent shall have no duty to disclose any information obtained or received by it or any of its Affiliates relating to the Borrower or any of its Subsidiaries to the extent such information was obtained or received
in any capacity other than as Agent. 
 SECTION 7.04. Lender Credit Decision. Each Lender acknowledges that it has, independently and
without reliance upon the Agent or any other Lender and based on the financial statements referred to in Section 4.01 and such other documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into
this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Agent or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement. 
 SECTION 7.05. Indemnification. The Lenders (other than the
Designated Bidders) agree to indemnify the Agent and its Affiliates (to the extent not reimbursed by the Borrower), ratably according to the respective principal amounts of the Revolving Credit Advances then owed to each of them (or if no Revolving
Credit Advances are at the time outstanding, ratably according to the respective amounts of their Commitments), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever that may be imposed on, incurred by, or asserted against the Agent or such Affiliate in any way relating to or arising out of this Agreement or any action taken or omitted by the Agent under this
Agreement (collectively, the “Indemnified Costs”), provided that no Lender shall be liable for any portion of such Indemnified Costs resulting from the Agent’s or such Affiliate’s gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender (other than the Designated Bidders) agrees to reimburse the Agent and its Affiliates promptly upon demand for its ratable share of any out-of-pocket expenses (including counsel fees and
disbursements) incurred by the Agent or such Affiliate in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or 

  

 46 

 
otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, to the extent that the Agent or such Affiliate is not
reimbursed for such expenses by the Borrower. In the case of any investigation, litigation or proceeding giving rise to any Indemnified Costs, this Section 7.05 applies whether any such investigations, litigation or proceeding is brought by the
Agent, any Lender or a third party. 
 SECTION 7.06. Successor Agent. The Agent may resign at any time by giving written notice
thereof to the Lenders and the Borrower and may be removed at any time with or without cause by the Required Lenders. Upon any such resignation or removal, the Required Lenders shall have the right to appoint a successor Agent with the approval of
the Borrower so long as no Event of Default exists, such approval not to be unreasonably withheld or delayed. If no successor Agent shall have been so appointed by the Required Lenders, and shall have accepted such appointment, within 30 days after
the retiring Agent’s giving of notice of resignation or the Required Lenders’ removal of the retiring Agent, then the retiring Agent may, on behalf of the Lenders, with the approval of the Borrower, such approval not to be unreasonably
withheld, appoint a successor Agent, which shall be a commercial bank organized under the laws of the United States of America or of any State thereof and having a combined capital and surplus of at least $500,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, discretion, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations under this Agreement. After any retiring Agent’s resignation or removal hereunder as Agent, the provisions of this Article VII shall inure to its benefit as to any actions taken or omitted to be taken by it while
it was Agent under this Agreement. 
 SECTION 7.07. Sub-Agent. The Sub-Agent has been designated under this Agreement to carry out
certain duties of the Agent as described herein. The Sub-Agent shall be subject to each of the obligations in this Agreement to be performed by the Sub-Agent, and each of the Borrower and the Lenders agrees that the Sub-Agent shall be entitled to
exercise each of the rights and shall be entitled to each of the benefits of the Agent under this Agreement as relate to the performance of its obligations hereunder. 
 SECTION 7.08. Other Agents. Each Lender hereby acknowledges that none of the documentation agents or any other Lender designated as any “Agent” on the signature pages hereof has any right, power,
obligation, liability, responsibility or duty under this Agreement other than those applicable to all Lenders as such. 
 ARTICLE VIII

 MISCELLANEOUS 
 SECTION 8.01.
Amendments, Etc. No amendment or waiver of any provision of this Agreement or the Revolving Credit Notes, nor consent to any departure by the Borrower therefrom, shall in any event be effective unless the same shall be in writing and signed
by the Required Lenders, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that no amendment, waiver or consent shall, unless in writing
and signed by all the Lenders (other than the Designated 

  

 47 

 
Bidders), do any of the following: (a) waive any of the conditions specified in Section 3.01, (b) except as permitted in accordance with
Section 2.16, increase the Commitments of the Lenders, (c) reduce the principal of, or interest on, the Revolving Credit Advances or any fees or other amounts payable hereunder, (d) except as permitted in accordance with
Section 2.16, postpone any date fixed for any payment of principal of, or interest on, the Revolving Credit Advances or any fees or other amounts payable hereunder, (e) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Revolving Credit Advances, or the number of Lenders, that shall be required for the Lenders or any of them to take any action hereunder or (f) amend this Section 8.01; and provided further that no amendment,
waiver or consent shall, unless in writing and signed by the Agent in addition to the Lenders required above to take such action, affect the rights or duties of the Agent under this Agreement or any Note. 
 SECTION 8.02. Notices, Etc. (a) All notices and other communications provided for hereunder shall be either (x) in writing (including
telecopier or telegraphic communication) and mailed, telecopied, telegraphed or delivered or (y) as and to the extent set forth in Section 8.02(b) and in the proviso to this Section 8.02(a), if to the Borrower, at its address at 55
Glenlake Parkway, N.E., Atlanta, Georgia 30328, Attention: Financial Resources Department (telecopier number (404) 828-6562); if to any Initial Lender, at its Domestic Lending Office specified opposite its name on Schedule I hereto; if to any
other Lender, at its Domestic Lending Office specified in the Assignment and Acceptance pursuant to which it became a Lender; if to the Agent, at its address at Two Penns Way, Suite 200, New Castle, Delaware 19720, Attention: Bank Loan Officer
(telecopier number (212) 994-0961); if to the Sub-Agent, at its address at 4 Harbour Exchange Square, London, United Kingdom, E14 9GE, Attention: Ian Hayton (telecopier number 44-208-638-3824) or, as to the Borrower or the Agent, at such other
address as shall be designated by such party in a written notice to the other parties and, as to each other party, at such other address as shall be designated by such party in a written notice to the Borrower and the Agent, provided that
materials required to be delivered pursuant to Section 5.01(g)(i), (ii) or (iii) may be delivered to the Agent as specified in Section 8.02(b) or as otherwise specified to the Borrower by the Agent. All such notices and
communications shall, when mailed, telecopied, telegraphed or e-mailed, be effective when deposited in the mails, telecopied, delivered to the telegraph company or confirmed by e-mail, respectively, except that notices and communications to the
Agent pursuant to Article II, III or VII shall not be effective until received by the Agent. Delivery by telecopier of an executed counterpart of any amendment or waiver of any provision of this Agreement or any Notes or of any Exhibit hereto to be
executed and delivered hereunder shall be effective as delivery of a manually executed counterpart thereof. 
 (b) So long as Citibank or any
of its Affiliates is the Agent, materials required to be delivered pursuant to Section 5.01(g)(i), (ii) or (iii) shall be deemed delivered to the Agent and each Lender to the extent such materials are posted (within the time periods
set forth in Section 5.01(g)(i), (ii) or (iii)) on the Borrower’s web site (www.ups.com), under “Investor Relations.” The Borrower may also deliver such materials to the Agent in an electronic medium in a format acceptable
to the Agent and the Lenders by e-mail at oploanswebadmin@citigroup.com. The Borrower agrees that the Agent may make such materials, as well as any other written information, documents, instruments and other material relating to the Borrower, any of
its Subsidiaries or any other materials or matters relating to this Agreement, the Notes or any of the transactions contemplated hereby, in each case to the extent 

  

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that the Agent’s communication thereof to the Lenders is otherwise proper hereunder (collectively, the “Communications”) available to
the Lenders by posting such notices on Intralinks or a substantially similar electronic system (the “Platform”). The Borrower acknowledges that (i) the distribution of material through an electronic medium is not necessarily
secure and that there are confidentiality and other risks associated with such distribution, (ii) the Platform is provided “as is” and “as available” and (iii) neither the Agent nor any of its Affiliates warrants the
accuracy, adequacy or completeness of the Communications or the Platform and each expressly disclaims liability for errors or omissions in the Communications or the Platform. No warranty of any kind, express, implied or statutory, including, without
limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by the Agent or any of its Affiliates in connection with the Platform.

 (c) Each Lender agrees that notice to it (as provided in the next sentence) (a “Notice”) specifying that any
Communications have been posted to the Platform shall constitute effective delivery of such information, documents or other materials to such Lender for purposes of this Agreement; provided that if requested by any Lender the Agent shall
deliver a copy of the Communications to such Lender by e-mail or telecopier. Each Lender agrees (i) to notify the Agent in writing of such Lender’s e-mail or telecopier address to which a Notice may be sent by electronic transmission
(including by electronic communication) on or before the date such Lender becomes a party to this Agreement (and from time to time thereafter to ensure that the Agent has on record an effective e-mail or telecopier address for such Lender) and
(ii) that any Notice may be sent to such e-mail or telecopier address. 
 SECTION 8.03. No Waiver; Remedies. No failure on the
part of any Lender or the Agent to exercise, and no delay in exercising, any right, power or privilege hereunder or under any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any such right, power or privilege
preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law. 
 SECTION 8.04. Costs and Expenses. (a) The Borrower agrees to pay on demand all reasonable out-of-pocket costs and expenses of the Agent and
Citigroup Global Markets Inc. in connection with the preparation, execution, delivery, modification and amendment of this Agreement, any Notes and the other documents to be delivered hereunder, including, without limitation, (i) all syndication
(including printing, distribution and bank meetings) expenses and (ii) the reasonable fees and expenses of counsel for the Agent with respect thereto. The Borrower further agrees to pay on demand all reasonable out-of-pocket costs and expenses
of the Agent and the Lenders, if any (including, without limitation, reasonable counsel fees and expenses), in connection with the enforcement (whether through negotiations, legal proceedings or otherwise) of this Agreement, any Notes and the other
documents to be delivered hereunder, including, without limitation, reasonable fees and expenses of counsel for the Agent and each Lender in connection with the enforcement of rights under this Section 8.04(a). 
 (b) The Borrower agrees to defend, protect, indemnify and hold harmless the Agent, each Arranger, each Lender, each of their Affiliates and their
officers, directors, 

  

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employees, agents and advisors (each, an “Indemnified Party”) from and against any and all liabilities, obligations, losses (other than loss
of profits), damages, penalties, actions, judgments, suits, claims, costs, expenses and disbursements of any kind or nature whatsoever (excluding any taxes and including, without limitation, the reasonable fees and disbursements of counsel for such
Indemnified Party in connection with any investigative, administrative or judicial proceeding, whether or not such Indemnified Party shall be designated a party thereto), imposed on, incurred by, or asserted against such Indemnified Party in any
manner relating to or arising out of this Agreement, any Notes, any of the transactions contemplated hereby or thereby, the Commitments, the use of proceeds, or any act, event or transaction related or attendant thereto (collectively, the
“Indemnified Matters”); provided, however, the Borrower shall have no obligation to an Indemnified Party hereunder with respect to Indemnified Matters directly caused by or directly resulting from the willful
misconduct or gross negligence of such Indemnified Party, as determined by a court of competent jurisdiction. In the case of an investigation, litigation or other proceeding to which the indemnity in this Section 8.04(b) applies, such indemnity
shall be effective whether or not such investigation, litigation or proceeding is brought by the Borrower, its directors, equityholders or creditors or an Indemnified Party or any other Person, whether or not any Indemnified Party is otherwise a
party thereto and whether or not the transactions contemplated hereby are consummated. The Borrower also agrees not to assert any claim for special, indirect, consequential or punitive damages against the Agent, any Lender, any of their Affiliates,
or any of their respective directors, officers, employees, attorneys and agents, on any theory of liability, arising out of or otherwise relating to any Notes, this Agreement, any of the transactions contemplated herein or the actual or proposed use
of the proceeds of the Advances. 
 (c) Promptly after receipt by any Indemnified Party of written notice of any Indemnified Matter in
respect of which indemnity may be sought by it under this Section 8.04, such Indemnified Party shall notify the Borrower thereof; provided that failure to give any such notice hereunder shall not affect the obligation of the Borrower under this
Section 8.04. Thereafter, such Indemnified Party and the Borrower shall consult, to the extent appropriate, with a view to minimizing the cost to the Borrower of its obligations hereunder. In case any such Indemnified Party receives written
notice of any Indemnified Matter in respect of which indemnity may be sought by it hereunder and it notifies the Borrower thereof, the Borrower shall be entitled to participate in the defense thereof, and to the extent that the Borrower may elect by
notice delivered to such Indemnified Party promptly after receiving aforesaid notice from such Indemnified Party, to assume the defense thereof, with counsel reasonably satisfactory at all times to such Indemnified Party and at the Borrower’s
expense; provided, that if (i) the use of counsel chosen by the Borrower to represent such Indemnified Party would present such counsel with a conflict of interest or (ii) the parties against whom any Indemnified Matter arises
include both such Indemnified Party and the Borrower and such Indemnified Party shall have reasonably concluded that there may be legal defenses available to it or other Indemnified Parties which are different from or additional to those available
to the Borrower and may conflict therewith, such Indemnified Party shall have the right to select separate counsel to assume such legal defense and otherwise to participate in the defense of such Indemnified Matter on behalf of such Indemnified
Party at the Borrower’s expense. Upon receipt of notice from the Borrower to such Indemnified Party of the Borrower’s election so to assume the defense of such Indemnified Matter, and approval of counsel by such Indemnified Party, the
Borrower shall not be liable to such Indemnified Party for any legal expenses subsequently incurred by such Indemnified Party 

  

 50 

 
in connection with the defense thereof unless (i) such Indemnified Party shall have employed counsel in connection with the assumption of legal defenses
in accordance with the proviso to the next preceding sentence, (ii) the Borrower shall not have employed within a reasonable time and continued to employ counsel reasonably satisfactory to such Indemnified Party to represent such Indemnified
Party, or (iii) the Borrower shall have approved the employment of counsel for such Indemnified Party at the Borrower’s expense. The Borrower shall not be liable for any settlement of any claim, action or proceeding effected without its
written consent, which consent shall not be unreasonably withheld. The Borrower will not settle any claim, action or proceeding affecting any Indemnified Party in respect of which indemnity may be sought against the Borrower under this Agreement,
whether or not such Indemnified Party is an actual or potential party to such claim, action or proceeding, without such Indemnified Party’s written consent, which shall not be unreasonably withheld, unless such settlement (x) does not
require any performance by or adverse admission of such Indemnified Party, (y) does not adversely affect its business and (z) includes an unconditional release of such Indemnified Party from all liability arising out of such claim, action
or proceeding. 
 (d) If any payment of principal of, or Conversion of, any Eurocurrency Rate Advance, LIBO Rate Advance or Local Rate
Advance is made by the Borrower to or for the account of a Lender other than on the last day of the Interest Period for such Advance, as a result of a payment or Conversion pursuant to Section 2.08(c) or (d), 2.10 or 2.12, acceleration of the
maturity of the Advances pursuant to Section 6.01 or for any other reason, or by an Eligible Assignee to a Lender other than on the last day of the Interest Period for such Advance upon an assignment of rights and obligations under this
Agreement pursuant to Section 8.07 as a result of a demand by the Borrower pursuant to Section 8.07(a), the Borrower shall, upon demand by such Lender (with a copy of such demand to the Agent), pay to the Agent for the account of such
Lender any amounts required to compensate such Lender for any additional losses, costs or expenses that it may reasonably incur as a result of such payment or Conversion, including, without limitation, any loss (excluding loss of anticipated
profits), cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by any Lender to fund or maintain such Advance. If the amount of the Committed Currency purchased by any Lender in the case of a
Conversion or exchange of Advances in the case of Section 2.08 or 2.12 exceeds the sum required to satisfy such Lender’s liability in respect of such Advances, such Lender agrees to remit to the Borrower such excess. 
 (e) Without prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in
Sections 2.11, 2.14 and 8.04 shall survive the payment in full of principal, interest and all other amounts payable hereunder and under any Notes. 
 SECTION 8.05. Right of Setoff. Upon (a) the occurrence and during the continuance of any Event of Default and (b) the making of the request or the granting of the consent specified by
Section 6.01 to authorize the Agent to declare the Advances due and payable pursuant to the provisions of Section 6.01, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, but excluding any accounts designated as collateral accounts securing other Debt) at any time held and other indebtedness at any
time owing by such Lender or such Affiliate to or for the credit or 

  

 51 

 
the account of the Borrower against any and all of the obligations of the Borrower now or hereafter existing under this Agreement and any Note held by such
Lender, whether or not such Lender shall have made any demand under this Agreement or such Note and although such obligations may be unmatured. Each Lender agrees promptly to notify the Borrower after any such setoff and application, provided
that the failure to give such notice shall not affect the validity of such setoff and application. The rights of each Lender and its Affiliates under this Section 8.05 are in addition to other rights and remedies (including, without limitation,
other rights of setoff) that such Lender and its Affiliates may have. 
 SECTION 8.06. Binding Effect. This Agreement shall become
effective (other than Sections 2.01 and 2.03, which shall only become effective upon satisfaction of the conditions precedent set forth in Sections 3.01 and 3.03) when it shall have been executed by the Borrower, the Agent and when the Agent shall
have been notified by each Initial Lender that such Initial Lender has executed it and thereafter shall be binding upon and inure to the benefit of the Borrower, the Agent and each Lender and their respective successors and assigns, except that the
Borrower shall not have the right to assign its rights hereunder or any interest herein without the prior written consent of the Lenders. 
 SECTION 8.07. Assignments, Designations and Participations. (a) Each Lender (other than a Designated Bidder) may, with the consent of the Borrower, such consent not to be unreasonably withheld or delayed, and shall, so long as no
Default has occurred and is continuing and if demanded by the Borrower (pursuant to the provisions of Section 2.17) upon at least five Business Days’ notice to such Lender and the Agent, assign to one or more Persons all or a portion of
its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment, the Revolving Credit Advances owing to it and any Revolving Credit Note or Notes held by it); provided, however,
that: 
 (i) each such assignment shall be of a constant, and not a varying, percentage of all rights and obligations under
this Agreement (other than any right to make Competitive Bid Advances, Competitive Bid Advances owing to it or Competitive Bid Notes), 
 (ii) except in the case of an assignment to a Person that, immediately prior to such assignment, was a Lender or an assignment of all of a Lender’s rights and obligations under this Agreement, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such assignment (determined as of the date of the Assignment and Acceptance with respect to such assignment) shall in no event be less than $10,000,000 or an integral multiple of
$1,000,000 in excess thereof, 
 (iii) each such assignment shall be to an Eligible Assignee, 
 (iv) each such assignment made as a result of a demand by the Borrower pursuant to this Section 8.07(a) shall be arranged by the
Borrower at the Borrower’s expense, shall be to an Eligible Assignee acceptable to the Agent (which acceptance shall not be unreasonably withheld) and shall be either an assignment of all of the rights and obligations of the assigning Lender
under this Agreement or an assignment of a portion of such rights and obligations made concurrently with another such assignment or other such assignments that together cover all of the rights and obligations of the assigning Lender under this
Agreement, 
  

 52 

 (v) no Lender shall be obligated to make any such assignment as a result of a demand by
the Borrower pursuant to this Section 8.07(a) unless and until such Lender shall have received one or more payments from either the Borrower or one or more Eligible Assignees in an aggregate amount at least equal to the aggregate outstanding
principal amount of the Advances owing to such Lender, together with accrued interest thereon to the date of payment of such principal amount and all other amounts payable to such Lender under this Agreement, and 
 (vi) the parties to each such assignment shall execute and deliver to the Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance, together with any Revolving Credit Note subject to such assignment and a processing and recordation fee of $3,500, 
 (vii) if such assignment shall be made as a result of a demand by the Borrower pursuant to this Section 8.07(a) to an assignee that, immediately prior to such assignment, was neither a Lender nor an Affiliate of
a Lender, an administrative fee of $3,500 shall have been paid by the Borrower to the Agent upon its demand, 
 (viii)
notwithstanding any other provision set forth in this Agreement, a Lender may assign to any of its Affiliates all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment, the
Revolving Credit Advances owing to it and any Revolving Credit Note or Notes held by it) upon notice to the Borrower and the Agent, with or without the consent of the Borrower or the Agent (but without releasing the obligations of the assigning
Lender hereunder except with the written consent of the Borrower), so long as such assignment is otherwise in compliance with this Agreement, and 
 (ix) notwithstanding any other provision set forth in this Agreement, a Lender may assign to any assignee all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Revolving Credit Advances owing to it and any Revolving Credit Note or Notes held by it) upon notice to the Agent, with or without the consent of the Borrower, so long as any Event of Default shall have occurred and be
continuing. 
 Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Assignment and Acceptance,
(A) the assignee thereunder shall be a party hereto and, to the extent that rights and obligations hereunder have been assigned to it pursuant to such Assignment and Acceptance, have the rights and obligations of a Lender hereunder and
(B) the Lender assignor thereunder shall, to the extent that rights and obligations hereunder have been assigned by it pursuant to such Assignment and Acceptance, relinquish its rights and be released from its obligations under this Agreement
(and, in the case of an Assignment and Acceptance covering all or the remaining portion of an assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto). 
  

 53 

 (b) By executing and delivering an Assignment and Acceptance, the Lender assignor thereunder and the
assignee thereunder confirm to and agree with each other and the other parties hereto as follows: 
 (i) other than as
provided in such Assignment and Acceptance, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or any
Note or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement or any Note or any other instrument or document furnished pursuant hereto; 
 (ii) such assigning Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of
the Borrower or the performance or observance by the Borrower of any of its obligations under this Agreement, any Note or any other instrument or document furnished pursuant hereto; 
 (iii) such assignee confirms that it has received a copy of this Agreement, together with copies of the financial statements referred to
in Section 4.01 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Acceptance; 
 (iv) such assignee will, independently and without reliance upon the Agent, such assigning Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement or any Note; 
 (v) such assignee confirms that it is an Eligible Assignee; 
 (vi) such assignee appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers and discretion
under this Agreement and any Note as are delegated to the Agent by the terms hereof and thereof, together with such powers and discretion as are reasonably incidental thereto; and 
 (vii) such assignee agrees that it will perform in accordance with their terms all of the obligations that by the terms of this Agreement
are required to be performed by it as a Lender. 
 (c) Upon its receipt of an Assignment and Acceptance executed by an assigning Lender and an
assignee representing that it is an Eligible Assignee, together with any Revolving Credit Note or Notes subject to such assignment, the Agent shall, if such Assignment and Acceptance has been completed and is in substantially the form of Exhibit C
hereto and has been consented to by the Borrower if such consent is required, (i) accept such Assignment and Acceptance, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. 
 (d) Each Lender (other than the Designated Bidders) may designate one or more banks or other entities to have a right to make
Competitive Bid Advances as a Lender pursuant to Section 2.03; provided, however, that (i) no such Lender shall be entitled to make more than five 

  

 54 

 
such designations, (ii) each such Lender making one or more of such designations shall retain the right to make Competitive Bid Advances as a Lender
pursuant to Section 2.03, (iii) each such designation shall be to a Designated Bidder and (iv) the parties to each such designation shall execute and deliver to the Agent, for its acceptance and recording in the Register, a
Designation Agreement. Upon such execution, delivery, acceptance and recording, from and after the effective date specified in each Designation Agreement, the designee thereunder shall be a party hereto with a right to make Competitive Bid Advances
as a Lender pursuant to Section 2.03 and the obligations related thereto. 
 (e) By executing and delivering a Designation Agreement,
the Lender making the designation thereunder and its designee thereunder confirm and agree with each other and the other parties hereto as follows: 
 (i) such Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement or any Note or any other instrument or document furnished pursuant hereto or thereto; 
 (ii) such Lender makes no representation or warranty and assumes no responsibility with respect to the financial condition of the Borrower
or the performance or observance by the Borrower of any of its obligations under this Agreement or any Note or any other instrument or document furnished pursuant hereto or thereto; 
 (iii) such designee confirms that it has received a copy of this Agreement, together with copies of the financial statements referred to
in Section 4.01 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Designation Agreement; 
 (iv) such designee will, independently and without reliance upon the Agent, such designating Lender or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under this Agreement or any Note; 
 (v) such designee confirms that it is a Designated Bidder; 
 (vi) such designee appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers and discretion
under this Agreement and any Note as are delegated to the Agent by the terms hereof and thereof, together with such powers and discretion as are reasonably incidental thereto; and 
 (vii) such designee agrees that it will perform in accordance with their terms all of the obligations which by the terms of this Agreement
are required to be performed by it as a Lender. 
 (f) Upon its receipt of a Designation Agreement executed by a designating Lender and a
designee representing that it is a Designated Bidder, the Agent shall, if such Designation Agreement has been completed and is substantially in the form of Exhibit D hereto, 

  

 55 

 
(i) accept such Designation Agreement, (ii) record the information contained therein in the Register and (iii) give prompt notice thereof to the
Borrower. 
 (g) The Agent shall maintain at its address referred to in Section 8.02 a copy of each Assignment and Acceptance and each
Designation Agreement delivered to and accepted by it and a register for the recordation of the names and addresses of the Lenders and, with respect to Lenders (other than Designated Bidders), the Commitment of, and principal amount of the Advances
owing to, each Lender from time to time (the “Register”). The entries in the Register shall be conclusive and binding for all purposes, absent manifest error, and the Borrower, the Agent and the Lenders shall treat only the Person
whose name is recorded in the Register as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower or any Lender at any reasonable time and from time to time upon reasonable prior notice.
The Agent shall be considered to act as the agent of the Borrower in connection with its duties in respect of the Register. 
 (h) Each
Lender may sell participations to one or more banks or other entities in or to all or a portion of its rights and obligations under this Agreement (including, without limitation, all or a portion of its Commitment, the Advances owing to it and any
Note or Notes held by it); provided, however, that (i) such Lender’s obligations under this Agreement (including, without limitation, its Commitment to the Borrower hereunder) shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the performance of such obligations, (iii) such Lender shall remain the holder of any such Note for all purposes of this Agreement, (iv) the Borrower, the Agent and the other
Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement and any Notes and (v) no participant under any such participation shall have any right to
approve any amendment or waiver of any provision of this Agreement or any Note or any consent to any departure by the Borrower therefrom, except to the extent that such amendment, waiver or consent would reduce the principal of, or interest on, the
Advances or any fees or other amounts payable hereunder, in each case to the extent subject to such participation, or postpone any date fixed for any payment of principal of, or interest on, the Advances or any fees or other amounts payable
hereunder, in each case to the extent subject to such participation. 
 (i) Any Lender may, in connection with any assignment, designation or
participation or proposed assignment, designation or participation pursuant to this Section 8.07, disclose to the assignee, designee or participant or proposed assignee, designee or participant, any information relating to the Borrower
furnished to such Lender by or on behalf of the Borrower; provided that, prior to any such disclosure, the assignee, designee or participant or proposed assignee, designee or participant shall agree to preserve the confidentiality of any
Confidential Information relating to the Borrower received by it from such Lender. 
 (j) Notwithstanding any other provision set forth in
this Agreement, any Lender may at any time create a security interest in all or any portion of its rights under this Agreement (including, without limitation, the Advances owing to it and any Note or Notes held by it) in favor of any Federal Reserve
Bank in accordance with Regulation A. 
  

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 SECTION 8.08. Confidentiality. None of the Agent or any Lender shall disclose any Confidential
Information to any Person without the consent of the Borrower, other than (a) to the Agent’s or such Lender’s Affiliates and their officers, directors, employees, agents, advisors, auditors and accountants and to actual or prospective
assignees and participants, and then only on a confidential basis, (b) as required by any law, rule or regulation or judicial process, (c) to any rating agency when required by it, provided that, prior to any such disclosure, such
rating agency shall undertake to preserve the confidentiality of any Confidential Information relating to the Borrower received by it from such Lender and (d) as requested or required by any state, federal or foreign authority or examiner
regulating banks or banking. 
 SECTION 8.09. Governing Law. This Agreement and all Notes shall be governed by, and construed in
accordance with, the laws of the State of New York. 
 SECTION 8.10. Execution in Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Agreement by telecopier shall be effective as delivery of a manually executed counterpart of this Agreement. 
 SECTION 8.11. Jurisdiction, Etc. (a) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any Notes, 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 any 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 any party may otherwise have to bring any action or proceeding relating to this Agreement or any Note in the courts of any jurisdiction. 
 (b) Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that 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 or any Note in any New York State or federal court. 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. 
 SECTION
8.12. Judgment. (a) If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder in Dollars into another currency, the parties hereto agree, to the fullest extent that they may effectively do so,
that the rate of exchange used shall be that at which in accordance with normal banking procedures the Agent could purchase Dollars with such other currency at Citibank’s principal office in London at 11:00 A.M. (London time) on the Business
Day preceding that on which final judgment is given. 
  

 57 

 (b) If for the purposes of obtaining judgment in any court it is necessary to convert a sum due hereunder
in a Foreign Currency into Dollars, the parties agree to the fullest extent that they may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures the Agent could purchase such Foreign
Currency with Dollars at Citibank’s principal office in London at 11:00 A.M. (London time) on the Business Day preceding that on which final judgment is given. 
 (c) The obligation of the Borrower in respect of any sum due from it in any currency (the “Primary Currency”) to any Lender or the Agent hereunder shall, notwithstanding any judgment in any other
currency, be discharged only to the extent that on the Business Day following receipt by such Lender or the Agent (as the case may be), of any sum adjudged to be so due in such other currency, such Lender or the Agent (as the case may be) may in
accordance with normal banking procedures purchase the applicable Primary Currency with such other currency; if the amount of the applicable Primary Currency so purchased is less than such sum due to such Lender or the Agent (as the case may be) in
the applicable Primary Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify such Lender or the Agent (as the case may be) against such loss, and if the amount of the applicable Primary Currency
so purchased exceeds such sum due to any Lender or the Agent (as the case may be) in the applicable Primary Currency, such Lender or the Agent (as the case may be) agrees to remit to the Borrower such excess. 
 SECTION 8.13. Substitution of Currency. If a change in any Foreign Currency occurs pursuant to any applicable law, rule or regulation of any
governmental, monetary or multi-national authority, this Agreement (including, without limitation, the definitions of Eurocurrency Rate and LIBO Rate) will be amended to the extent determined by the Agent (acting reasonably and in consultation with
the Borrower) to be necessary to reflect the change in currency and to put the Lenders and the Borrower in the same position, so far as possible, that they would have been in if no change in such Foreign Currency had occurred. 
 SECTION 8.14. Patriot Act Notice. Each Lender and the Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that
pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender
or the Agent, as applicable, to identify the Borrower in accordance with the Patriot Act. The Borrower shall provide, to the extent commercially reasonable, such information and take such actions as are reasonably requested by the Agent or any
Lenders in order to assist the Agent and the Lenders in maintaining compliance with the Patriot Act. 
  

 58 

 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their
respective officers thereunto duly authorized, as of the date first above written. 
  

			
	 UNITED PARCEL SERVICE, INC.

		
	 By
	 	 /s/ Gary T. Barth

	 Name:
	 	 Gary T. Barth

	 Title:
	 	 Authorized Representative

	
	 CITIBANK, N.A.,
 as Administrative Agent and a Lender

		
	 By
	 	 /s/ Carolyn A. Kee

	 Name:
	 	 Carolyn A. Kee

	 Title:
	 	 Vice President

	
	 JPMORGAN CHASE BANK, N.A.

		
	 By
	 	 /s/ Robert Kellas

	 Name:
	 	 Robert Kellas

	 Title:
	 	 Executive Director

	
	 BARCLAYS BANK PLC

		
	 By
	 	 /s/ Nicholas Bell

	 Name:
	 	 Nicholas Bell

	 Title:
	 	 Director

	
	 BNP PARIBAS

		
	 By
	 	 /s/ Berangere Allen

	 Name:
	 	 Berangere Allen

	 Title:
	 	 Vice President

		
	 By
	 	 /s/ Angela Arnold

	 Name:
	 	 Angela Arnold

	 Title:
	 	 Director

	
	 MELLON BANK NA

		
	 By
	 	 /s/ Robert J. Mitchell Jr.

	 Name:
	 	 Robert J. Mitchell Jr.

	 Title:
	 	 First Vice President

			
	WELLS FARGO BANK, NATIONAL
ASSOCIATION
		
	 By
	 	 /s/ David Corts

	 Name:
	 	 David Corts

	 Title:
	 	 Vice President

	
	 ING CAPITAL LLC

		
	 By
	 	 /s/ Naveen Sahney

	 Name:
	 	 Naveen Sahney

	 Title:
	 	 Director

	
	 MERRILL LYNCH BANK USA

		
	 By
	 	 /s/ Louis Alder

	 Name:
	 	 Louis Alder

	 Title:
	 	 Director

	
	 MORGAN STANLEY BANK

		
	 By
	 	 /s/ Daniel Twenge

	 Name:
	 	 Daniel Twenge

	 Title:
	 	 Authorized Signatory

	
	 STANDARD CHARTERED BANK

		
	 By
	 	 /s/ Steve Aloupis

	 Name:
	 	 Steve Aloupis

	 Title:
	 	 Senior Vice President

		
	 By
	 	 /s/ Andrew Y. Ng

	 Name:
	 	 Andrew Y. Ng

	 Title:
	 	 Director

	
	 UBS LOAN FINANCE LLC

		
	 By
	 	 /s/ Mary E. Evans

	 Name:
	 	 Mary E. Evans

	 Title:
	 	 Associate Director

		
	 By
	 	 /s/ David B. Julie

	 Name:
	 	 David B. Julie

	 Title:
	 	 Associate Director

			
	 WACHOVIA BANK, NATIONAL ASSOCIATION

		
	 By
	 	 /s/ Elaine Eaton

	 Name:
	 	 Elaine Eaton

	 Title:
	 	 Senior Vice President

	
	WILLIAM STREET COMMITMENT CORPORATION
		
	 By
	 	 /s/ Mark Walton

	 Name:
	 	 Mark Walton

	 Title:
	 	 Assistant Vice President

	
	 ABN AMRO BANK N.V.

		
	 By
	 	 /s/ David J. Thomas

	 Name:
	 	 David J. Thomas

	 Title:
	 	 Senior Vice President

	
	
		
	 By
	 	 /s/ Robert W. Hart

	 Name:
	 	 Robert W. Hart

	 Title:
	 	 Senior Vice President

	
	 BEAR STEARNS CORPORATE LENDING INC.

		
	 By
	 	 /s/ Victor Bulzacchelli

	 Name:
	 	 Victor Bulzacchelli

	 Title:
	 	 Vice President

	
	 CREDIT SUISSE , Cayman Islands Branch

		
	 By
	 	 /s/ Jay Chall

	 Name:
	 	 Jay Chall

	 Title:
	 	 Director

		
	 By
	 	 /s/ Alain Schmid

	 Name:
	 	 Alain Schmid

	 Title:
	 	 Assistant Vice President

	
	 ROYAL BANK OF CANADA

		
	 By
	 	 /s/ Meredith Majesty

	 Name:
	 	 Meredith Majesty

	 Title:
	 	 Authorized Signatory

			
	
	 STATE STREET BANK AND TRUST COMPANY

		
	 By
	 	 /s/ Juan G. Sierra

	 Name:
	 	 Juan G. Sierra

	 Title:
	 	 Vice President

	
	 WESTLB AG

		
	 By
	 	 /s/ William C. Schier

	 Name:
	 	 William C. Schier

	 Title:
	 	 Executive Director

		
	 By
	 	 /s/ Peter Stephan

	 Name:
	 	 Peter Stephan

	 Title:
	 	 Associate Director

 SCHEDULE I 
 APPLICABLE LENDING OFFICES 
 5-YEAR FACILITY 
  

								
	 Name of Lender
	  	Commitment	    	 Domestic Lending Office
	  	 Eurocurrency Lending Office

	ABN AMRO Bank N.V.	  	$	25,000,000	    	 540 West Madison Street
 Suite 2621
 Chicago, IL 60661
 Attn: Kymm Recht
 F: 312 992-5111
	  	 540 West Madison Street
 Suite 2621
 Chicago, IL 60661
 Attn: Kymm Recht
 F: 312 992-5111

	Barclays Bank PLC	  	$	75,000,000	    	 200 Park Avenue,. 4th Floor
 New York, NY
10166
 Attn: Nicholas Bell
 T: 212-412-4029
 F: 212-412-7600
	  	 200 Park Avenue,. 4th Floor
 New York, NY
10166
 Attn: Nicholas Bell
 T: 212-412-4029
 F: 212-412-7600

	Bear Stearns Corporate Lending Inc.	  	$	25,000,000	    	 383 Madison Avenue
 New York, NY 10179
 Attn: Evan Kaufman
 T: 212 272-0920
 F: 917 849-0792
	  	 383 Madison Avenue
 New York, NY 10179
 Attn: Evan Kaufman
 T: 212 272-0920
 F: 917 849-0792

	BNP Paribas	  	$	75,000,000	    	 919 Third Avenue
 New York, NY 10022
 Attn: Gabriel Candamo
 T: 212 471-6626
 F: 212 841-2683
	  	 919 Third Avenue
 New York, NY 10022
 Attn: Gabriel Candamo
 T: 212 471-6626
 F: 212 841-2683

	Citibank, N.A.	  	$	100,000,000	    	 Citibank, N.A.
 2 Penns Way Suite 200
 New Castle, DE 19720
 Attn: Bank Loan Syndications
 T: (302) 894-6023
 F: (212) 994-0961
	  	 Citibank, N.A.
 2 Penns Way Suite 200
 New Castle, DE 19720
 Attn: Bank Loan Syndications
 T: (302) 894-6023
 F: (212) 994-0961

	Credit Suisse First Boston, Cayman Islands Branch	  	$	25,000,000	    	 One Madison Avenue
 New York, NY 10010
 Attn: Ed Markowski
 T: 212 538-3380
 F: 212 325-9049
	  	 One Madison Avenue
 New York, NY 10010
 Attn: Ed Markowski
 T: 212 538-3380
 F: 212 325-9049

	ING Capital LLC	  	$	50,000,000	    	 1325 Avenue of the Americas
 New York, NY
10019
 Attn: Ermelinda Young
 T: 646 424-8240
 F: 646 424-8251
	  	 1325 Avenue of the Americas
 New York, NY
10019
 Attn: Ermelinda Young
 T: 646 424-8240
 F: 646 424-8251

	JP Morgan Chase Bank, N.A.	  	$	100,000,000	    	 JP Morgan Chase Bank
 1 Chase Manhattan Plaza

8th Floor
 New York, NY 10081
 Attn: May Fong
 T: (212) 552-7314
 F: (212) 552-5650
	  	 JP Morgan Chase Bank
 1 Chase Manhattan Plaza

8th Floor
 New York, NY 10081
 Attn: May Fong
 T: (212) 552-7314
 F: (212) 552-5650

								
	Mellon Bank NA	  	$	75,000,000	    	 Three Mellon Bank Center
 Room 1205
 Pittsburgh, PA 15258
 Attn: Paula Zawicki
 T: 412 234-3932
 F: 412 209-6141
	  	 Three Mellon Bank Center
 Room 1205
 Pittsburgh, PA 15258
 Attn: Paula Zawicki
 T: 412 234-3932
 F: 412 209-6141

	Merrill Lynch Bank USA	  	$	50,000,000	    	 15 W. South Temple, Suite 300
 Salt Lake City, UT
84101
 Attn: Dave Millett
 T: 801 526-8312
 F: 801 933-8641
	  	 15 W. South Temple, Suite 300
 Salt Lake City, UT
84101
 Attn: Dave Millett
 T: 801 526-8312
 F: 801 933-8641

	Morgan Stanley Bank	  	$	50,000,000	    	 1633 Broadway, 25th Floor
 New York, NY 10019
 Attn: Lisa
Malone
 T: 212 537-1312
 F: 212 537-1867
	  	 1633 Broadway, 25th Floor
 New York, NY 10019
 Attn: Lisa
Malone
 T: 212 537-1312
 F: 212 537-1867

	Royal Bank of Canada	  	$	25,000,000	    	 One Liberty Plaza, 4th Floor
 New York, NY 10006
 Attn: Manager, Loans
Administration
 T: 212 428-6338
 F: 212 428-2372
	  	 One Liberty Plaza, 4th Floor
 New York, NY 10006
 Attn: Manager, Loans
Administration
 T: 212 428-6338
 F: 212
428-2372

	Standard Chartered Bank	  	$	50,000,000	    	 1 Madison Avenue, 3rd Floor
 New York, NY 10010
 Attn: Vijayant
Jain
 T: 212 667-0499
 F: 212 667-0251
	  	 1 Madison Avenue, 3rd Floor
 New York, NY 10010
 Attn: Vijayant
Jain
 T: 212 667-0499
 F: 212 667-0251

	State Street Bank and Trust Company	  	$	25,000,000	    	 225 Franklin Street, MAO11
 Boston, MA 02110

Attn: Hector Lucero
 T: 617 664-0234
 F: 617 664-3941
	  	 225 Franklin Street, MAO11
 Boston, MA 02110

Attn: Hector Lucero
 T: 617 664-0234
 F: 617 664-3941

	UBS Loan Finance LLC	  	$	50,000,000	    	 677 Washington Blvd.
 Stamford, CT 06901
 Attn: Brian Gross
 T: 203 719-2814
 F: 203 719-3888
	  	 677 Washington Blvd.
 Stamford, CT 06901
 Attn: Brian Gross
 T: 203 719-2814
 F: 203 719-3888

	Wachovia Bank, National Association	  	$	50,000,000	    	 202 S. College Street
 Charlotte, NC 28204
 Attn: Chris Beam
 T: 704 715-2988
 F: 704 715-0099
	  	 Wachovia Bank - London
 1 Plantation Place
 London EC3M 3BD
 Attn: Michelle Clark
 T: 0207 956 4310
 F: 0207 929 4645

	Wells Fargo Bank, National Association	  	$	75,000,000	    	 201 Third Street
 MAC A0187-081
 San Francisco, CA 94103
 Attn: Neva Moritani
 T: 415 477-5456
 F: 415 979-0675
	  	 201 Third Street
 MAC A0187-081
 San Francisco, CA 94103
 Attn: Neva Moritani
 T: 415 477-5456
 F: 415 979-0675

								
	WestLB AG	  	$	25,000,000	    	 Herzogstr. 15
 Dusseldorf Germany 40217
 Attn: Annegret Huesken
 T: 49 211 826-3574
 F: 49 211 826-5447
	  	 Herzogstr. 15
 Dusseldorf Germany 40217
 Attn: Annegret Huesken
 T: 49 211 826-3574
 F: 49 211 826-5447

	William Street Commitment Corporation	  	$	50,000,000	    	 30 Hudson Street, 17th Floor
 Jersey City, NJ 07302
 Attn: Pedro
Ramirez
 T: 917 343-8319
 F: 212 428-1243
	  	 30 Hudson Street, 17th Floor
 Jersey City, NJ 07302
 Attn: Pedro
Ramirez
 T: 917 343-8319
 F: 212 428-1243

	
	  			    		  	
				
	TOTAL OF COMMITMENTS	  	$	1,000,000,000SETTLEMENT, LICENSE AND DEVELOPMENT AGREEMENT

 Exhibit 10.1 
 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
 SETTLEMENT, LICENSE AND DEVELOPMENT AGREEMENT 
 THIS SETTLEMENT, LICENSE AND DEVELOPMENT AGREEMENT (the “Agreement”), is entered into as of March 5, 2007 (the
“Execution Date”) by and between Tercica, Inc., a company incorporated under the laws of Delaware with offices at 2000 Sierra Point Parkway, Suite 400, Brisbane, CA 94005, United States of America (“Tercica”),
Insmed Incorporated, a company incorporated under the laws of Virginia with offices at 8720 Stony Point Parkway, Suite 200, Richmond, VA 23235, Insmed Therapeutic Proteins, Inc., a company incorporated under the laws of Colorado with offices at 2590
Central Avenue, Boulder, CO 80301, and Celtrix Pharmaceuticals, Inc., a company incorporated under the laws of Delaware with offices at 8720 Stony Point Parkway, Suite 200, Richmond, VA 23235 (collectively, “Insmed”) and Genentech,
Inc., a company incorporated under the laws of Delaware with offices at 1 DNA Way, South San Francisco, California 94080 (“GNE”). Tercica, GNE and Insmed are sometimes referred to herein individually as a “Party”
and collectively as the “Parties.” 
 RECITALS 
 Whereas, Tercica and GNE have entered into that certain License and Collaboration Agreement dated April 15, 2002, as amended on July 25,
2003 and November 25, 2003 (the “GNE US License”); and Tercica and GNE have also entered into that certain International License and Collaboration Agreement dated July 25, 2003 (the “GNE Ex-US License”);
whereby, inter alia, GNE has granted to Tercica a license under the GNE Patents (as defined below), including U.S. Patent No. 5,258,287; U.S. Patent No. 5,187,151; and U.S. Patent No. 6,331,414; 
 Whereas, certain disputes and controversies have arisen between the Parties relating to the claims, counter-claims, cross-claims, and demands set
forth in the following civil action filed on December 23, 2004: Genentech Inc., et al. v. Insmed Incorporated, et al., United States District Court for the Northern District of California (the “Court”), Case
No. 04-CV-05429-CW (EMC) (the “Lawsuit”). Tercica and GNE alleged that Insmed’s making, using, selling, offering to sell, importing or exporting of the product known as IPLEXTM, infringed or will infringe under 35
U.S.C. § 271(a) – (c) and (g), certain asserted claims of United States Patent Nos. 5,187,151 (the “‘151 Patent”), 5,258,287 (the “‘287 Patent”) and 6,331,414 (the “‘414
Patent”) (collectively, the “Asserted Patents”); 
 Whereas, Insmed denied such allegations and further
alleged, among other defenses, that the asserted claims of the Asserted Patents were invalid under various theories, including those arising under 35 U.S.C. § 102, 103, 112 and 135. Insmed further asserted that the ‘151 Patent was
unenforceable for alleged inequitable conduct; 
 Whereas, the Parties had a full and fair opportunity to litigate the case fully,
including asserting motions for summary judgment and jury trial; 
 Whereas, the Court adjudicated as a matter of law on June 30,
2006 that Insmed’s method of making the rhIGF-I component of IPLEXTM literally infringed Claims 1 and 9 of the ‘414 Patent (Docket No. 510), and Insmed subsequently stipulated that its methodology literally infringed Claims 2, 3,
4 and 10 of the ‘414 Patent; 
  

 1 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 Whereas, a jury trial that commenced on November 6, 2006, resulted in the Verdict Form
(Docket # 1006) filed December 6, 2006. The Jury further awarded damages to Tercica and GNE of $7.5 million and a royalty of 15% of IPLEXTM sales through December 6, 2006 (the “Damages”); 
 Whereas, legal proceedings among the Parties (and also Avecia Limited, a company incorporated under the laws of England and Wales, whose
registered office is at PO Box 42, Hexagon Tower, Blackley, Manchester M9 8ZS, United Kingdom (“Avecia”)) and relating to European Patent (UK) No. 0 571 417 have been commenced in the United Kingdom in the High Court of Justice
under action numbers HC 04 C 03940 and HC 05 C 00415 (the “UK Proceedings”); 
 Whereas, the Parties have determined
that it is in their mutual interest to avoid the expense, distraction, and uncertainty of further litigation and have therefore agreed to conclude and resolve all of their disputes under the Lawsuit and UK Proceedings and settle and consent to
judgment of such Lawsuit and UK Proceedings pursuant to the terms and conditions of this Agreement, the Consent Judgment and Permanent Injunction, and the UK Proceedings Settlement Agreement; and 
 Whereas, the Parties and Avecia have agreed, as of the date hereof, to enter into that certain Settlement Agreement (the “UK Proceedings
Settlement Agreement”) which sets forth the terms and conditions by which the Parties and Avecia have agreed to settle the UK Proceedings. 
 Now, therefore, in consideration of the releases and mutual promises, covenants and conditions contained herein, and other good and valuable consideration, including this Agreement, the Consent Judgment and
Permanent Injunction, and the UK Proceedings Settlement Agreement, the Parties agree as follows: 
 ARTICLE 1 
 DEFINITIONS 
 1.1
“Adult Primary IGF-1 Deficiency” means abnormally low concentrations of IGF-1 in adults that are: (a) not secondary to growth hormone deficiency; and (b) not secondary to specific pathophysiological states outside the
GH/IGF-1 system. 
 1.2 “Affiliate” means any corporation, company, partnership, joint venture and/or firm which
controls, is controlled by, or is under common control with a Party; provided that F. Hoffman-la Roche AG (including its subsidiaries) shall be considered a Third Party for purposes of this Agreement, rather than as an Affiliate of GNE. For purposes
of the foregoing sentence, “control” and, with correlative meanings, the terms “controlled by” and “under common control with”, mean (a) in the case of corporate entities, direct or indirect ownership of at least
fifty percent (50%) of the stock or shares having the right to vote for the election of directors and (b) in the case of non-corporate entities, direct or indirect ownership of at least fifty percent (50%) of the equity interest with
the power to direct the management and policies of such non-corporate entities. 
  

 2 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 1.3 “Agreement” has the meaning assigned to it in the preamble above.

 1.4 “Aggregated Named Patient and Off-Label Sales” has the meaning assigned to it in Section 7.1(a)(iv)(3).

 1.5 “ALS” means Lou Gehrig’s disease. 
 1.6 “ALS Portion” has the meaning assigned to it in Section 7.1(a)(iii). 
 1.7 “ALS Royalty” has the meaning assigned to it in Section 7.1(a)(iii). 
 1.8 “Avecia” has the meaning assigned to it in the Recitals of this Agreement. 
 1.9 “Booking Party” means the Party responsible for booking sales of a Product for an Opt-In Indication after Tercica or GNE has
exercised its Opt-In right. 
 1.10 “Claims” has the meaning assigned to it in Section 11.1. 
 1.11 “Commercialization Plan” means, in the event Tercica or GNE exercises its Co-Promotion Option for a particular Permitted
Indication, the plan prepared by the JCC that would govern the Parties’ co-promotion and related commercialization activities for a Product with respect to such Permitted Indication in accordance with Section 5.3(c). 
 1.12 “Committee” means the Joint Development Committee or Joint Commercialization Committee, as applicable. 
 1.13 “Completion” means, with respect to a given clinical trial, the completion of all data analysis to be conducted in connection with
such clinical trial. 
 1.14 “Confidential Information” has the meaning assigned to it in Section 9.1.

 1.15 “Control” with the correlative meaning “Controlled by” means, with respect to intellectual
property, possession of the right to grant a license or sublicense as provided for herein without violating (a) any law or governmental regulation applicable to such license or sublicense; or (b) the terms of any agreement or other
arrangement with any Third Party that exists as of the Effective Date, or, if the applicable intellectual property is acquired or the right to such intellectual property is to be granted after the Effective Date, the date of such acquisition or
proposed grant, whichever is later. 
 1.16 “Co-Promotion Agreement” has the meaning assigned to it in
Section 5.3(b). 
 1.17 “Co-Promotion Option” has the meaning assigned to it in Section 5.2. 
 1.18 “Co-Promotion Term” has the meaning assigned to it in Section 5.3(b). 
 1.19 “Court” has the meaning assigned to it in the Recitals of this Agreement. 
  

 3 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 1.20 “Damages” has the meaning assigned to it in the Recitals of this
Agreement. 
 1.21 “Data Services” has the meaning assigned to it in Section 5.5(a)(i). 
 1.22 “Development Costs” has the meaning assigned to it in Exhibit A. 
 1.23 “Diabetes” means a progressive disease of carbohydrate metabolism involving inadequate production or utilization of insulin
that is characterized by hyperglycemia and glycosuria. The term shall apply to any form of diabetes, including without limitation, Type 1 and Type 2 diabetes, as well as other hyperglycemic disorders, such as hyperinsulinemia, hyperlipidemia,
insulin-resistant diabetes such as Mendenhall’s Syndrome, Werner Syndrome, leprechaunism, lipoatrophic diabetes. 
 1.24
“Diabetes Orphan Indication” means any Diabetes indication that is also an Orphan Indication. 
 1.25
“Disclosing Party” has the meaning assigned to it in Section 9.1. 
 1.26 “Dispute” has the
meaning assigned to it in Section 13.1. 
 1.27 “Effective Date” has the meaning assigned to it in
Section 2.1. 
 1.28 “EMEA” means the European Medicines Agency, a decentralized body of the European Union.

 1.29 “European Union” or “EU” means all of the European Union member states as of the applicable
time during the Term. 
 1.30 “Excluded Indications” means (a) Excluded Indications as such term is defined in
Section 1.21 of the GNE US License, and (b) Excluded Indications as such term is defined in Section 1.19 of the GNE Ex-US License. 
 1.31 “Execution Date” has the meaning assigned to it in the preamble of this Agreement. 
 1.32
“Existing Insmed Indications” means myotonic muscular dystrophy, HIV related Adipose Redistribution Syndrome (HARS), retinopathy of prematurity, recovery from burns and trauma, and recovery from hip fracture. 
 1.33 “Existing Patient” has the meaning assigned to it in Section 3.1(a). 
 1.34 “FDA” means the United States Food and Drug Administration or its successor. 
 1.35 “Fully Burdened Manufacturing Costs” has the meaning assigned to it in Exhibit A. 
 1.36 “GNE Licenses” means both the GNE US License and the GNE Ex-US License, as each is defined in the Recitals of this
Agreement. 
  

 4 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 1.37 “GNE Patents” means (a) GNE Patents as such term is defined in
Section 1.35 of the GNE US License, and (b) GNE Patents as such term is defined in Section 1.33 of the GNE Ex-US License. 
 1.38 “IGF-1” means native-sequence insulin-like growth factor-1 from any species with or without an N-terminal methionine, allelic variants thereof, and sequence variants thereof wherein substitutions and/deletions
are made in the region from 1 to 5 amino acids from the N-terminus of the mature native-sequence IGF-1 of any species, including des-IGF-1 and variants wherein at least the glutamic acid residue is absent at position 3 from the N-terminus of
native-sequence human IGF-1. 
 1.39 “IGFBP-3” means native-sequence, insulin-like growth factor binding protein-3 as
described in WO 89/09268 published October 5, 1989, that binds IGF-1, including allelic variants of, and animal equivalents to, human BP3 as well as human BP3, for example, the bovine, ovine, porcine and equine species, and may be from any
source, whether natural, synthetic, or recombinant, provided that it will bind to the appropriate binding domain of IGF-1. 
 1.40
“IND” means an investigational new drug application as defined under United States law and foreign equivalents. 
 1.41 “Indemnified Party” has the meaning assigned to it in Section 11.4. 
 1.42
“Indemnifying Party” has the meaning assigned to it in Section 11.4. 
 1.43 “Infringing
Activity” means any manufacture, use, sale, offer for sale, or importation of a Product, either by Insmed or through an Affiliate or Sublicensee or subcontractor, that would infringe any unexpired GNE Patents in the Other Territory.

 1.44 “Insmed Patents” means all patents and patent applications Controlled by Insmed as of the Effective Date (if
any) or during the Term, in any country of the Territory, that claim the manufacture, use, sale, offer for sale, or importation of Product or IGF-1. 
 1.45 “Ipsen” means Tercica’s sublicensee of certain of the Licensed Patents, Beaufour Ipsen Pharma or its Affiliates, in the Other Territory, pursuant to that certain IncrelexTM
License and Collaboration Agreement between Tercica and Ipsen dated October 13, 2006. 
 1.46 “Joint Commercialization
Committee” or “JCC” means the committee formed by the Parties as described in Section 6.3(a). 
 1.47
“Joint Development Committee” or “JDC” means the committee formed by the Parties as described in Section 6.2(a). 
 1.48 “Launch Date” has the meaning assigned to it in Section 5.3(b). 
 1.49
“Lawsuit” has the meaning assigned to it in the Recitals of this Agreement. 
 1.50 “Licensed
Patents” means (a) the GNE Patents and (b) all patents and patent applications Controlled by Tercica as of the Effective Date or during the Term that claim the manufacture, use, sale or importation of Product and/or that claim the
manufacture, 

  

 5 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
use, sale, or importation of any product or process used in Insmed’s production of Product, including, but not limited to recombinant production of
IGF-1 or any IGF-1 binding protein, and purification of IGF-1 or any IGF-1 binding protein. 
 1.51 “Marketing
Authorization” means an approval necessary for the manufacture, marketing, importation and sale of a Product for one or more indications in a country or regulatory jurisdiction, which may include, without limitation, the approval of an NDA
or MAA, satisfaction of all applicable regulatory and notification requirements, and Pricing Approval (if required). For purposes of this definition, “Pricing Approval” means such approval, agreement, determination or governmental decision
establishing prices for a Product that can be charged to consumers and will be reimbursed by governmental authorities in countries, territories or possessions where governmental authorities or Regulatory Authorities of such country, territory or
possession approve or determine pricing of pharmaceutical products for reimbursement or otherwise. 
 1.52 “Material
Breach” has the meaning assigned to it in Section 12.2. 
 1.53 “Named Patient Basis” means the supply
of a Product for a particular individual for the treatment of an indication for which such Product does not yet have Marketing Authorization in the country in which it is prescribed, in response to a specific request of a prescribing physician for
such individual patient, where permitted by and in accordance with the laws of the EU member state(s) concerned and in accordance with Directive 2001/83/EC (and in particular Article 5 thereof), as amended by Directive 2004/27/EC, and Regulation
(EC) No. 726/2004. 
 1.54 “Named Patient Indications” means myotonic muscular dystrophy, HIV related Adipose
Redistribution Syndrome (HARS), retinopathy of prematurity, recovery from burns and trauma, and recovery from hip fracture. 
 1.55
“Net Sales” has the meaning assigned to it in Exhibit A. 
 1.56 “New Sales Tracking
Data” has the meaning assigned to it in Section 5.5(a)(ii). 
 1.57 “Non-ALS Portion” has the meaning
assigned to it in Section 7.1(a)(iv)(3) 
 1.58 “Non-Booking Party” means the Party that is not
responsible for booking sales of a Product for an Opt-In Indication after Tercica or GNE has exercised its Opt-In right. 
 1.59
“Non-Orphan Indication” means any Permitted Indication which is not an Orphan Indication. 
 1.60
“Non-Permitted Indications” means (a) primary IGFD, (b) severe primary IGFD, (c) Noonan’s syndrome, (d) growth hormone deficiency, (e) adult growth hormone deficiency (as approved by the FDA and
consisting of two subgroups: adult and child onset), (f) Adult Primary IGF-1 Deficiency, (g) idiopathic short stature, (h) any other short stature indications, (i) Laron’s Syndrome, (j) growth hormone insensitivity
(GHIS), (k) any diseases or conditions which are approved for sale by Tercica or GNE, as of the Effective Date, for the treatment by growth hormone, and (l) all Excluded Indications, which, for the purpose of this Agreement and 

  

 6 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
with respect to Insmed, includes ALS, but which inclusion for purposes of this definition of Non-Permitted Indications shall in no event be interpreted as a
concession on the part of either Tercica or GNE as to whether ALS is or is not included within the Excluded Indications with respect to Tercica’s license from GNE under the GNE Licenses. 
 1.61 “Non-Permitted Product” means (a) any product containing IGF-1 without any other bioactive agent, in any dosage or
formulation, including without limitation the product known as INCRELEX (mecasermin) that is sold by Tercica as of the Effective Date, or (b) any product containing a combination of IGF-1 and any other active ingredient(s) (excluding IGFBP-3
unless and only as permitted in Section 3.2(b) below). 
 1.62 “North American Territory” means the United States and
Canada. 
 1.63 “Off-Label Sales” has the meaning assigned to it in Section 7.1(a)(iv)(2). 
 1.64 “Operating Profit (Loss)” has the meaning assigned to it in Exhibit A. 
 1.65 “Opt-In” has the meaning assigned to it in Section 4.2(a). 
 1.66 “Opt-In Diabetes Orphan Indication” has the meaning assigned to it in Section 4.3(d). 
 1.67 “Opt-In Effective Date” has the meaning assigned to it in Section 4.2(b). 
 1.68 “Opt-In Exercise Notice” has the meaning assigned to it in Section 4.2(b). 
 1.69 “Opt-In Indication” has the meaning assigned to it in Section 4.2(b). 
 1.70 “Opt-In Information” means any and all information that is reasonably available to Insmed and which would be reasonably
material for Tercica and/or GNE to make a decision regarding the exercise of its Opt-In right at such stage of development and may include, without limitation, any of the following information to the extent generated: a copy of formulation,
stability, toxicology, pharmacokinetic, preclinical and clinical development plans and data; complete analysis, results, reports, and interpretations of the foregoing; an accounting of all Development Costs; any pertinent manufacturing information;
and any related FDA documentation (including the IND, clinical protocol, investigator’s brochure, FDA minutes and correspondence). 
 1.71 “Opt-In Party” has the meaning assigned to it in Section 4.2(b). 
 1.72 “Opt-In
Payment” has the meaning assigned to it in Section 4.2(e). 
 1.73 “Opt-In Period” has the meaning
assigned to it in Section 4.2(b). 
 1.74 “Opt-Out” has the meaning assigned to it in Section 4.4.

  

 7 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 1.75 “Orphan Indication” means an indication for which the FDA has granted
orphan status as defined in 21 C.F.R. Pt. 316, as may be amended from time to time. As of the Execution Date, such term is defined in 21 C.F.R. Pt. 316 as a rare disease or condition within the Permitted Indications which: (a) affects less than
200,000 persons in the U.S. or (b) affects more than 200,000 persons in the U.S. but for which there is no reasonable expectation that the cost of developing and making available in the U.S. a drug for such disease or condition will be
recovered from sales in the United States of such drug, as further defined in and for which Orphan Drug designation may be sought under the Orphan Drug Act of 1983. 
 1.76 “Other Territory” means all countries of the Territory other than the United States. 
 1.77 “Percentage Interest” has the meaning assigned to it in Section 4.2(a). 
 1.78 “Permanent
Injunction” has the meaning assigned to in Section 2.1. 
 1.79 “Permitted Indications” means all
indications except the Non-Permitted Indications. For the avoidance of doubt, Permitted Indications includes (a) the treatment by growth hormone of HIV patients with wasting or cachexia; and (b) all Existing Insmed Indications. 

1.80 “Phase III Enabling Trial” means, with respect to any given Permitted Indication, a human clinical trial on a sufficient
number of subjects (who are patients with the condition being addressed), with clinically meaningful, regulatorily recognized efficacy endpoints which generates statistically significant efficacy and establishes a safe and effective dose and is
designed such that, if successful, Insmed would be allowed by the FDA and/or EMEA to proceed with a pivotal clinical trial that would support the filing of an application for marketing approval for such Permitted Indication. As further discussed in
Section 6.2, the Joint Development Committee is responsible for determining whether a given proposed trial by Insmed meets the foregoing definition for a Phase III Enabling Trial prior to the conduct of such trial. 
 1.81 “Product” means any product containing IGF-1 and IGFBP-3, in any dosage, formulation or method of administration, or any
co-administration of IGF-1 and IGFBP-3, including without limitation the product known as IPLEX (mecasermin rinfabate) that is sold by Insmed as of the Execution Date. Product does not include any combination product containing IGF-1 and IGFBP-3 and
any other active ingredient(s). For purposes of this definition, the term “active ingredient(s)” does not include drug delivery vehicles, adjuvants, and excipients except for those that are recognized by the FDA as active ingredients.

 1.82 “Product Labeling” means (a) the full prescribing information for a Product approved by the applicable
Regulatory Authority, and (b) all labels and other written, printed or graphic information (including without limitation any Product trademarks) included in or placed upon any container, wrapper or package insert used with or for a Product.

 1.83 “Promotional Materials” means all sales representative training materials and all written, printed, graphic,
electronic, audio or video matter, including, without limitation, journal advertisements, sales visual aids, leave items, formulary binders, reprints, direct mail, direct-to-consumer advertising, internet postings, broadcast advertisements and sales
reminder aides (for example, note 

  

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pads, pens and other such items) intended for use or used by a Party or its Affiliates, sublicensees or licensees in connection with any promotion of a
Product for such Permitted Indication, but excluding Product Labeling. 
 1.84 “Receiving Party” has the meaning
assigned to it in Section 9.1. 
 1.85 “Regulatory Authority” means any government agency having the
responsibility for granting Marketing Authorizations and any other government entities with authority over the manufacturing and the marketing of a Product. 
 1.86 “ROW Territory” means all countries and territories in the Territory other than the countries in the North American Territory. 
 1.87 “Sale Country” means a country in which a Product is used, sold, offered for sale, or imported. 
 1.88 “Sales Tracking Dispute” has the meaning assigned to it in Section 7.1(f). 
 1.89 “Sales Tracking Methodology” has the meaning assigned to it in Section 5.5(a)(i). 
 1.90 “Sales Tracking Panel” has the meaning assigned to it in Section 5.5(d). 
 1.91 “Sole Promotion Option” has the meaning assigned to it in Section 5.2. 
 1.92 “Sublicensee” means a Third Party to whom Insmed or its Affiliates sublicenses its rights and obligations under
Section 3.1 of this Agreement. Sublicensee shall also include any Third Party who purchases its supply of Product, in finished form from Insmed, its Affiliates or Sublicensee for resale into the market, where, as a partial or full consideration
for such purchase, such Third Party has a payment obligation to Insmed, its Affiliates or Sublicensee that is a percentage of its net sales, including without limitation a royalty obligation. 
 1.93 “Supply Agreement” has the meaning assigned to it in Section 5.4(b). 
 1.94 “Term” has the meaning assigned to it in Section 12.1(a). 
 1.95 “Territory” means all countries of the world. 
 1.96 “Third Party” means a person or entity other than Tercica, GNE, Insmed, or any of their Affiliates. 
 1.97 “Trademark” means IPLEXTM and all other trademarks used or intended for use by Insmed or its Affiliates on the Effective Date or during the Term in connection with the marketing or
sale of a Product, other than the corporate names of Insmed and its Affiliates, their trade names, service marks, domain names, and associated logos and designs. 
 1.98 “Triggering Delivery” has the meaning assigned to it in Section 4.2(c). 
  

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 1.99 “UK Proceedings” has the meaning assigned to it in the Recitals of this
Agreement. 
 1.100 “UK Proceedings Settlement Agreement” has the meaning assigned to it in the Recitals of this
Agreement. 
 ARTICLE 2 
 CONSENT JUDGMENT AND PERMANENT INJUNCTION; 
 RELEASES AND WAIVER 
 2.1 Entry of Consent Judgment and Permanent Injunction. A Consent Judgment and Permanent Injunction in the form of Exhibit B will be
executed herewith (the “Permanent Injunction”), and the Parties agree to take all steps necessary to have the Permanent Injunction executed by the Court and filed with the Court and hereby authorize and instruct their respective
counsel to take those steps. This Agreement shall only become effective upon the execution of the Permanent Injunction by or on behalf of the Parties to the action and the Court, the entry and filing of the Permanent Injunction, and the execution of
the UK Proceedings Settlement Agreement in the form of Exhibit C (the date by which the last of such events has occurred, the “Effective Date”). 
 2.2 Waiver of Damages. Tercica waives all rights to any Damages awarded in the Lawsuit upon execution and entry by the Court of the Permanent Injunction and the execution of the UK Proceedings Settlement
Agreement. 
 2.3 Release by Tercica. Tercica, by and for itself and on behalf of its employees, agents, other representatives,
sublicensees, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, and assigns, irrevocably, perpetually and fully releases and discharges Insmed as well as Insmed’s employees, agents, fill-finishers,
customers, downstream sellers and users of a Product, and Insmed’s other representatives, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, licensees, distributors, and assigns, from any and all
claims, rights, demands, liabilities, obligations, damages, actions, and causes of action, of every kind and nature, in law, equity, or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed, arising out of any act,
omission, event, transaction or occurrence on or before the Effective Date solely to the extent relating to both (a) a Product and (b) the Licensed Patents; provided that this release shall not extend to and affect the rights and
obligations under the Permanent Injunction. 
 2.4 Release by GNE. GNE, by and for itself and on behalf of its employees, agents,
other representatives, sublicensees, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, and assigns, irrevocably, perpetually and fully releases and discharges Insmed as well as Insmed’s employees,
agents, fill-finishers, customers, downstream sellers and users of a Product, and Insmed’s other representatives, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, licensees, distributors, and
assigns, from any and all claims, rights, demands, liabilities, obligations, damages, actions, and causes of action, of every kind and nature, in law, equity, or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed,
arising out of any act, omission, event, transaction or occurrence on or before the Effective Date solely to the extent relating to both (a) a Product and (b) the GNE Patents; provided that this release shall not extend to and affect the
rights and obligations under the Permanent Injunction. 
  

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 2.5 Release by Insmed. Insmed, by and for itself and on behalf of its employees, agents, other
representatives, sublicensees, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, and assigns, irrevocably, perpetually and fully releases and discharges Tercica and GNE as well as each of Tercica’s
and GNE’s respective employees, agents, fill-finishers, customers, downstream sellers and users of Increlex, and Tercica’s and GNE’s other representatives, officers, directors, stockholders, partners, members, subsidiaries,
predecessors, successors, licensees, distributors, and assigns, from any and all claims, rights, demands, liabilities, obligations, damages, actions, and causes of action, of every kind and nature, in law, equity, or otherwise, known and unknown,
suspected and unsuspected, disclosed and undisclosed, arising out of any act, omission, event, transaction or occurrence on or before the Effective Date solely to the extent relating to both (a) the Insmed Patents and (b) any Non-Permitted
Products; provided that this release shall not affect the rights and obligations under the Permanent Injunction. 
 2.6 Waiver of
Section 1542 of California Civil Code. Each of Tercica, GNE and Insmed hereby declares and acknowledges the contents of Section 1542 of the California Civil Code, and that section and the benefits thereof are hereby expressly waived.
Section 1542 provides as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his
settlement with the debtor.” 
 2.7 Other Waivers and Stipulations. The Parties hereby incorporate by reference the conclusions
of law, the findings of fact, waivers and stipulations set forth in the Permanent Injunction. 
 2.8 Discontinuance of UK Proceedings.
The Parties shall promptly and permanently discontinue the claims and counterclaims in the UK Proceedings, on the basis that each Party shall be responsible for the costs incurred by it in connection with those proceedings (other than costs which
have already been paid by one Party to another pursuant to an order of the United Kingdom Court made prior to the Effective Date). The Parties shall accordingly enter into and perform the UK Proceedings Settlement Agreement relating to the UK
Proceedings in the form of Exhibit C forthwith following the execution of this Agreement. Insmed shall ensure that Avecia shall, and shall cause Avecia to, execute such settlement agreement and do all such acts and execute all such
documents as may be necessary or desirable to give effect to the provisions of such settlement agreement, including the discontinuance of the claims brought by Avecia against Tercica and GNE in the course of the UK Proceedings. Notwithstanding
anything to the contrary in this Section 2.8, as between Tercica and GNE, Tercica shall absorb and bear sole responsibility for payment of any fees, costs, and expenses incurred by GNE relating to the prosecution and/or defense of the Lawsuit
and/or the UK Proceedings (with the exception of the time and expenses of any GNE employee(s) allocated or attributed to such prosecution and/or defense, which costs shall be borne by GNE). 
  

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 2.9 Survival of this Article 2. The Parties hereby agree and acknowledge that the releases,
waivers, and covenants made in this Article 2 shall survive the expiration or any termination of this Agreement, including any termination based on a claim by a Party that another Party has breached this Agreement, the Permanent Injunction or the UK
Proceedings Settlement Agreement and any such breach shall not be construed as evidence of a failure of consideration for the granting of the releases, waivers and covenants set forth in this Article 2. 
 ARTICLE 3 
 LICENSE GRANTS

 3.1 Licenses to Insmed. 
 (a) Limited License for Non-Permitted Indications in the United States. Subject to the terms and conditions of this Agreement, including without limitation Insmed’s fulfillment of its royalty obligations under Section 7.1
below and Insmed’s continued compliance with its covenants in Section 3.5 and the Permanent Injunction and the UK Proceedings Settlement Agreement, Tercica hereby grants Insmed a non-exclusive, non-sublicenseable license or sublicense, as
applicable, under Tercica’s entire right, title and interest in and to the Licensed Patents to make, have made, use, sell, offer for sale, and import Product for sale in the United States for any Non-Permitted Indication solely for the
continuing treatment of any Existing Patient, for a period of twelve (12) months from the Effective Date. “Existing Patient” means no more than one hundred ten (110) patients for whom a Product is prescribed for a
Non-Permitted Indication as of the Effective Date. The Parties agree to send to prescribing physicians a joint letter in the form attached hereto as Exhibit D. The license granted under this Section 3.1(a) shall be royalty-free with
respect to Net Sales arising from sales to the Existing Patients during the first three (3) months after the Effective Date. If any such sales to Existing Patients occur after such three (3)-month period, such sales shall be royalty-bearing
pursuant to Section 7.1(a)(i), but only until the date which is twelve (12) months after the Effective Date. Any sales of a Product by Insmed to such Existing Patients after such twelve (12)-month period, or any sales of a Product by
Insmed to any patient who is not an Existing Patient for the treatment of any Non-Permitted Indication at any time after the Effective Date, shall be evidence of Material Breach by Insmed of this Section 3.1(a) and/or a violation of the
Permanent Injunction, and Tercica may take any action and/or seek any remedy in law or equity for such breach or violation. 
 (b) License
for Named Patient Indications in the European Union on Named Patient Basis. Subject to the terms and conditions of this Agreement, including without limitation Insmed’s fulfillment of its royalty obligations under Section 7.1 below,
and Insmed’s continued compliance with its covenants in Section 3.5 and the Permanent Injunction and UK Proceedings Settlement Agreement, Tercica hereby grants Insmed a limited, non-exclusive, non-sublicenseable, royalty-bearing license,
or sublicense, as applicable, under Tercica’s entire right, title and interest in and to the Licensed Patents to make, have made, use, sell, offer for sale, and import Product for sale in any country in the European Union solely for the
treatment of one or more of the Named Patient Indications, on a Named Patient Basis only; provided that Tercica and GNE each shall have the right to perform audits, either by itself or through its designee, on Insmed’s compliance with any laws,
regulations and guidelines applicable to conducting such activities on a Named Patient Basis in addition to, and pursuant to the procedures described in, Section 7.8. 
  

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 (c) License for Permitted Indications in the Territory. Subject to the terms and conditions of
this Agreement, including without limitation the exclusion of rights and restrictive covenants set forth in Section 3.1(e), Tercica’s and GNE’s Opt-In rights described in Section 4.2, Insmed’s royalty obligations under
Section 7.1 below, and Insmed’s continued compliance with its covenants in Section 3.5 and the Permanent Injunction and UK Proceedings Settlement Agreement, Tercica hereby grants Insmed a non-exclusive, royalty-bearing license, or
sublicense, as applicable, with the right to sublicense solely as permitted under this Section 3.1(c), under Tercica’s entire right, title and interest in and to the Licensed Patents to make, have made, use, sell, offer for sale, and
import Product for sale in all countries in the Territory, solely for use in the treatment of any of the Permitted Indications. Subject to Tercica’s and GNE’s Opt-In rights under Section 4.2, the license granted in this
Section 3.1(c) may be sublicensed by Insmed to Third Parties with the prior written consent of Tercica and GNE, such consent not to be unreasonably withheld or delayed. 
 (d) Limited Covenant-Not-To-Sue for ALS Indication on Named Patient Basis in Italy. Subject to the terms and conditions of this Agreement,
including without limitation Insmed’s fulfillment of its royalty obligations to GNE under Section 7.1 below, and Insmed’s continued compliance with its covenants in Section 3.5 and the Permanent Injunction and UK Proceedings
Settlement Agreement, each of GNE and Tercica hereby covenants that it shall not, to the extent it has the right to do so, enforce, or permit or encourage the enforcement of, against Insmed or its Affiliates any Licensed Patents in connection with
the making, having made and using of a Product for the limited purpose of: (i) using, selling, offering for sale, and importing Product for sale in Italy solely for the treatment of ALS on a Named Patient Basis only; provided that each of
Tercica and GNE shall have the right to perform audits, either by itself or through its designee, on Insmed’s compliance with any laws, regulations and guidelines applicable to conducting such activities on a Named Patient Basis in addition to,
and pursuant to the procedures described in, Section 7.8, and (ii) conducting a single non-pivotal clinical trial (i.e., such clinical trial cannot and shall not be used to support regulatory filing or application for Marketing
Authorizations anywhere in the Territory), for the ALS indication in Italy, in connection with Insmed’s treating patients in Italy for the ALS indication on a Named Patient Basis. For the avoidance of doubt, and notwithstanding the payment of
royalties solely to GNE pursuant to Section 7.1(a)(iii) based upon Insmed’s sales under this Section 3.1(d) and Tercica’s audit rights set forth in this Section 7.1(d), each of Tercica and GNE reserves the right to its
respective interpretation of the GNE Licenses as to whether the scope of the GNE Licenses includes a grant of rights to the ALS indication by GNE to Tercica. 
 (e) Diabetes Restriction in the Other Territory. Insmed hereby covenants that, notwithstanding the license grant in Section 3.1(c), it will not market, sell, offer for sale or have sold a Product for
Diabetes in the Other Territory to the extent the manufacture, use or sale of such Product would infringe, in the Other Territory and if not for the licenses granted under this Agreement, the patent rights licensed to Tercica and sublicensed to
Insmed under the GNE Licenses. 
  

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 (f) Included Subsidiary Rights. For avoidance of doubt, the above licenses and limited
covenant-not-to-sue granted in Sections 3.1(a) through (d) relating to a Product include the right to make (and have made) IGF-1 and IGFBP-3, solely for use in the manufacture of Product, but such licenses do not include the right to use, sell,
offer for sale or import either IGF-1 or IGFBP-3 separately. 
 3.2 Rights Granted to Tercica and GNE. 
 (a) Covenant not to Sue. Insmed hereby covenants that it shall not enforce, or permit or encourage the enforcement of, against Tercica, GNE or
Ipsen, or any of their respective Affiliates, sublicensees, successors or assigns any Insmed Patents in connection with the development or commercialization of any Non-Permitted Product in the Territory, and in the event Insmed transfers any right
under such Insmed Patents to a Third Party, Insmed shall ensure that such covenant not to sue is binding upon such Third Party in writing. 
 (b) License in the Event of an Opt-In. In the event Tercica and/or GNE exercises its Opt-In right with respect to a given Permitted Indication pursuant to Section 4.2 below, Insmed hereby grants such Opt-In Party a
non-exclusive, worldwide license, with the right to grant sublicenses as provided in this Section 3.2(b), under the Insmed Patents to make, have made, use, sell, offer for sale and import Product for the Opt-In Indication as and to the extent
permitted under this Agreement. Any sublicense by Tercica or GNE (or their assignees as permitted under Section 4.2(a)) under the rights granted in this Section 3.2(b) to a sublicensee other than a distributor, subcontractor or consultant
in the normal course of business shall be made by Tercica or GNE only with the consent of Insmed, such consent not to be unreasonably withheld, provided however that sublicenses to Ipsen shall not require the consent of Insmed. In addition, Insmed
agrees to execute all documents as may be reasonably required by Tercica or GNE or Ipsen or their authorized sublicensees for the purpose of recording any such sublicense(s) with any relevant regulatory or administrative authorities and in the event
Insmed transfers any right in the affected Insmed Patents to a Third Party, Insmed shall ensure that such Third Party is bound, in writing, by the obligation set forth in this sentence. 
 3.3 GNE Licenses. The Parties acknowledge that the license granted to Insmed under Section 3.1 above constitutes a sublicense with respect to
the GNE Patents under the licenses granted to Tercica by GNE under the GNE Licenses. As a result, the licenses granted under Section 3.1 above, and the terms and conditions of this Agreement, shall be subject to the terms and conditions of the
GNE Licenses. GNE hereby agrees to the granting of such sublicense to Insmed by Tercica as set forth in Section 3.1. Nothing in this Agreement shall be construed as: (a) the expansion or reduction of the scope of licenses Tercica received
from GNE under the GNE Licenses; or (b) implying whether or not the license granted to Tercica under the GNE Agreements includes the ALS indication. 
 3.4 No Implied Licenses. Except as explicitly set forth in this Agreement, no Party grants any license, express or implied, under its intellectual property rights to any other Party. Each Party covenants that
it will not use or practice any other Party’s intellectual property rights licensed to it under this Agreement except for the purposes expressly permitted in the applicable license grant. 
  

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 3.5 Insmed Covenants. In light of the Lawsuit and the Damages awarded therein, and in
consideration of the licenses granted by Tercica and GNE to Insmed in Section 3.1, Insmed hereby covenants the following (which covenants shall be in addition to those set forth in the Permanent Injunction): 
 (a) Insmed shall not, and shall cause its Affiliates and Sublicensees to not, directly or indirectly: (i) conduct clinical trials for or
otherwise seek any Marketing Authorization for, promote, market, or knowingly sell or offer for sale a Product for the treatment of any Non-Permitted Indication in any country in the Other Territory except as expressly permitted under
Section 3.1(b) above with respect to the Named Patient Indications on a Named Patient Basis and Section 3.1(d) above with respect to the ALS indication on a Named Patient Basis, for so long as (A) any such clinical trial or Marketing
Authorization uses or depends on the supply of such Product manufactured in a country in which such manufacture is covered by any unexpired Licensed Patents in such country, (B) any such promotion, marketing, sale or offer for sale of such
Product depends on the supply of such Product manufactured in a country in which such manufacture is covered by any unexpired Licensed Patents in such country, or (C) any such promotion, marketing, sale or offer for sale of such Product arises
from or depends on the use, sale, offer for sale, or importation of such Product in a country in which such use, sale, offer for sale, or importation is covered by any unexpired Licensed Patents in such country. For purposes of determining the
duration of such covenant in countries in the Other Territory where a Product is sold which is manufactured in the United States, the last to expire Licensed Patents with respect to such countries shall include U.S. Patent No. 6,331,414 to the
extent such patent covers the manufacture of the Product sold (or any components thereof). 
 (b) Within fifteen (15) business
days after the Effective Date, Insmed shall withdraw, or cause to be withdrawn, all currently pending applications for Marketing Authorization in the Other Territory, including specifically its currently pending application for Marketing
Authorization with the EMEA for a Product for the treatment of primary IGF-1 deficiency and patients with growth hormone gene deletion. 
 (c) Insmed shall not apply for or submit an application with the EMEA or any other governmental authority within the European Union or anywhere else in the Other Territory for Marketing Authorization of a Product for any of the
Non-Permitted Indications; provided, however, that for any such Marketing Authorization the foregoing covenant shall terminate upon the expiration of the last to expire Licensed Patents (i) that exists in a country in the European Union or the
Other Territory and that covers the manufacture, use, sale, offer for sale, or importation of such Product to be performed under the license of the Marketing Authorization, or (ii) that exists in a country in the Territory and that covers the
process by which such Product is manufactured in such country for subsequent use, sale, offer for sale, or importation in the European Union or other country in the Other Territory under the license of the Marketing Authorization. 
 (d) If Insmed or its Affiliates or Sublicensees challenge(s) the validity or enforceability of the Licensed Patents anywhere in the Territory,
then either Tercica or GNE shall have the right to terminate the licenses granted to Insmed under Section 3.1 of this Agreement pursuant to Section 12.3(a)(i) below. 
  

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 3.6 Non-Disparagement. Insmed, Tercica and GNE each shall not defame, libel, slander or
otherwise disparage in any manner, or tortiously interfere with the business, contracts, relationships or prospective economic advantage appurtenant to: (a) the market opportunity for any product (e.g., the size of the market for severe Primary
IGFD); or (b) any product of the other Parties. 
 ARTICLE 4 
 DEVELOPMENT AND OPT-IN RIGHTS 
 4.1 Development of Product Prior to
Opt-In. Unless and until Tercica or GNE exercises its Opt-In right under Section 4.2 below, Insmed shall have the sole responsibility for the development of a Product for use in a given Permitted Indication. As between the Parties to this
Agreement, Insmed shall bear all Development Costs incurred with respect to a Product for all Permitted Indications prior to the Opt-in Effective Date, subject to the Opt-In Party’s reimbursement of a portion of such Development Costs pursuant
to Section 4.2(e) below. 
 4.2 GNE and Tercica’s Opt-In Right for Permitted Indications. 
 (a) General. Tercica and GNE shall each have the option to co-develop a Product for any particular Permitted Indication at any time during the
period when such Product is being developed clinically for such Permitted Indication, until the end of the Opt-In Period for such Permitted Indication. Such co-development right, once exercised, allows Tercica or GNE as the Opt-In Party to fund 50%
(such percentage, the “Percentage Interest”) of the Development Costs for a Product for such Permitted Indication and participate in a corresponding 50% portion of the Operating Profit (Loss) resulting from the commercialization of
such Product for such Permitted Indication, participate in development decision-making, and participate in commercialization, all as and to the extent set forth below and in Article 5 (the “Opt-In”). It is understood and agreed that
Insmed shall not enter into any agreement with a Third Party to develop or commercialize a Product for any Permitted Indication prior to the expiration of the Opt-In Period for such Permitted Indication. It is further understood and agreed that
Tercica shall have the right to assign to Ipsen its Opt-In rights and obligations with respect to the ROW Territory or certain country(ies) within such ROW Territory, as well as its Co-Promotion Option and Sole Promotion Option, on a Permitted
Indication-by-Permitted Indication basis, in which case reference to “Tercica” as used in this Section 4.2 and in Sections 4.3 and 4.4, and in Article 5, shall also include Ipsen. It is also further understood and agreed that GNE
shall have the right to assign to a Third Party designee its Opt-In rights and obligations with respect to the ROW Territory or certain country(ies) within such ROW Territory, as well as its Co-Promotion Option and Sole Promotion Option, on a
Permitted Indication-by-Permitted Indication basis, subject to Insmed’s consent, not to be unreasonably withheld, in which case reference to “GNE” as used in this Section 4.2 and in Sections 4.3 and 4.4, and in Article 5, shall
also include such Third Party designee. 
 (b) Opt-In Period; Effectiveness. Tercica’s and GNE’s Opt-In rights shall
commence, on a Permitted Indication by Permitted Indication basis, at the commencement of the first human clinical trials of a Product for such Permitted Indication, and shall terminate on the earlier of: (i) exercise by Tercica or GNE of such
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Permitted Indication without exercise by either GNE or Tercica of its Opt-In rights (the “Opt-In Period” for such Permitted Indication), as
described in more detail in this Section 4.2. For the avoidance of doubt, Tercica and GNE may exercise their respective Opt-In rights at any time during the Opt-In Period in accordance with this Section 4.2 by providing written notice to
Insmed of the same (such notice, the “Opt-In Exercise Notice”). Insmed shall promptly submit a written confirmation to the Party whose Opt-In Exercise Notice has been received (unless otherwise properly rejected as not being
properly submitted by the potential Opt-In Party pursuant to this Section 4.2), along with an invoice detailing the amount of the Opt-In Payment due Insmed. Such Opt-In shall become effective upon receipt by Insmed of such Opt-In Payment (the
“Opt-In Effective Date”). At the Opt-In Effective Date, the Party having submitted such Opt-In Exercise Notice shall thereupon become an “Opt-In Party” and such Permitted Indication shall become an “Opt-In
Indication.” 
 (c) Opt-In Information; Triggering Delivery. On a regular basis but no less frequently than once per calendar
quarter, Insmed shall provide to Tercica and GNE a written progress report setting forth, for each Permitted Indication then undergoing development and as to which the Opt-In rights have not been exercised or lapsed: (i) a summary of all
clinical trials planned and actually conducted, as well as all results thereof, for a Product for treatment of each such Permitted Indication; (ii) all Opt-In Information that has not been previously disclosed to either Tercica or GNE as of
such time; and (iii) a summary of all Development Costs incurred as of such time with respect to such Permitted Indication. In particular, and notwithstanding such quarterly reporting obligation, Insmed shall, within sixty (60) days after
the Completion of the first Phase III Enabling Trial for a Product for such Permitted Indication, deliver to Tercica and GNE all Opt-In Information relating to such trial and any other Opt-In Information that has not been previously disclosed to
either Tercica or GNE, as well as a summary of all Development Costs incurred as of such time with respect to such Permitted Indication (this delivery of such Opt-in Information and Development Cost information is the “Triggering
Delivery”). Tercica and GNE shall use the Opt-In Information solely for the purpose of evaluating the Opt-In opportunity and such Opt-In Information and shall not disclose any non-public portion of such Opt-In Information to any Third Party
without the prior written consent of Insmed. Following delivery of any such Opt-in Information and Development Cost information, Insmed shall promptly supply any additional information or respond to any questions as requested by GNE or Tercica based
upon its review of such information. Upon the expiration of the Opt-In Period, each of GNE and Tercica shall return such Opt-In Information to Insmed if such Party has not exercised its Opt-In right under this Section 4.2. 
 (d) Opt-In Rights and Procedures. 
 (i) During the Opt-In Period, Tercica shall have the first right to exercise the Opt-In right throughout the Territory with respect to any Orphan Indication that is not a Diabetes Orphan Indication. In the event Tercica does not so
exercise such right within sixty (60) days of the Triggering Delivery, it shall notify Insmed and GNE in writing. Upon receipt of such written notice, GNE shall have an additional period of thirty (30) days following the date of such
notice by Tercica to elect to exercise the Opt-In right with respect to such Orphan Indication. For avoidance of doubt, this Opt-In right shall expire upon the first to occur of the exercise of the Opt-In Right, or ninety one (91) days after
the Triggering Delivery. 
  

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 (ii) During the Opt-In Period, GNE shall have the first right to exercise the Opt-In right
with respect to (1) any Non-Orphan Indications throughout the Territory and (2) any Diabetes Orphan Indication in the United States. In the event GNE does not so exercise such right within sixty (60) days of the Triggering Delivery,
it shall notify Insmed and Tercica in writing. Whereupon Tercica shall have an additional period of thirty (30) days following the date of such notice by GNE to elect to exercise the Opt-In right with respect to such Non-Orphan Indication or
such Diabetes Orphan Indication. For avoidance of doubt, this Opt-In right shall expire upon the first to occur of the exercise of the Opt-In Right, or ninety one (91) days after the Triggering Delivery. 
 (iii) If either Tercica or GNE provides Insmed with the Opt-In Exercise Notice within the Opt-In Period, then Insmed shall enter into a
co-development and, where such Opt-in Party so elects under Section 5.2, co-commercialization relationship with the Party providing Insmed with such notice, on the terms set forth in this Article 4 and in Article 5. 
 (e) Opt-In Payment; Accounting of Development Costs. The “Opt-In Payment” for a Product for a particular Permitted Indication
shall be an amount equal to fifty percent (50%) of the total Development Costs allocable to the development of such Product for such Permitted Indication, and incurred as of the date of receipt of the Opt-In Exercise Notice for such Permitted
Indication. Such Opt-In Payment shall be paid to Insmed in accordance with Section 4.2(b). All Development Costs incurred and allocable to any Permitted Indication as of the Effective Date will be provided, in writing, on a Permitted
Indication-by-Permitted Indication basis, by Insmed to Tercica and GNE within thirty (30) days following the Effective Date. During the Term and prior to the expiration of the Opt-In Period, Insmed shall be responsible for maintaining a
detailed account of all Development Costs expended for each Permitted Indication. 
 4.3 Consequences of Tercica or GNE’s Exercise of
Opt-In. If Tercica or GNE exercises the Opt-In in accordance with Section 4.2, the following shall apply: 
 (a) Collaborative
Development. Insmed and the Opt-In Party shall discuss, via the JDC, what if any operational matters in the development of a Product for such Opt-In Indication shall be the responsibility of the Opt-In Party. 
 (b) Ongoing Co-Funding of Development Costs. The Opt-In Party shall bear fifty percent (50%) of the total Development Costs incurred from the
day after the date of receipt of the Opt-In Exercise Notice for such Permitted Indication and allocable to the development of a Product for such Opt-In Indication. The process for reconciling payment of such Development Costs in order to give effect
to each Opt-In Party’s Percentage Interest shall be in accordance with Article 7 and Exhibit A. 
 (c) Decision-Making
Control. The Opt-In Party may have the deciding vote with respect to decisions in the JDC regarding such Opt-In Indication, as provided in Section 6.2(d)(ii). 
 (d) Right for GNE to Develop and Commercialize Diabetes. In the event that GNE is the Opt-In Party and the Opt-In Indication is a Diabetes Orphan Indication (an “Opt-In Diabetes Orphan
Indication”), at such time, if any, as GNE and Insmed using their respective scientific and business judgment disagree over whether the continued development of a Product for the Opt-In 

  

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Diabetes Orphan Indication is desirable (such that Insmed does not wish to continue development of such Product for the Opt-In Diabetes Orphan Indication),
GNE may elect to take over the development of such Product for the Opt-In Diabetes Orphan Indication at the sole expense of GNE and, upon notice to Insmed of such election, the Permitted Indications shall be amended to exclude such Opt-In Diabetes
Orphan Indication solely for the purposes of the rights granted to Insmed under Section 3.1(c), provided that: 
 (i) for all
other purposes of this Agreement, including without limitation the licenses granted by Insmed to GNE as the Opt-In Party under Section 3.2(b), the Permitted Indications shall be deemed to include such Opt-In Diabetes Orphan Indication;

 (ii) GNE shall become, if not already, the Booking Party for such Opt-In Diabetes Orphan Indication and shall have final decision
making authority in the commercialization of such Product for such Opt-In Diabetes Orphan Indication in the United States; and 
 (iii)
the profit-sharing arrangement applicable to such Opt-In Diabetes Orphan Indication shall continue only until the payments so received by Insmed from GNE equals the Development Costs incurred by Insmed for such Product for such Opt-In Diabetes
Orphan Indication, and thereafter the profit share arrangement for such Opt-In Diabetes Orphan Indication shall terminate and GNE shall pay to Insmed royalties on the Net Sales for such Opt-In Diabetes Orphan Indication in the United States at a
rate of [***]; provided that, such royalty payment obligation shall apply only in the event that the use, sale, offer for sale, or importation of such Product for use in the Opt-In Diabetes Orphan Indication would infringe the Insmed Patents, and
such royalty payment obligation shall thereafter expire upon the later of (y) the expiration of the last to expire Insmed Patents existing in the United States that would be infringed by the use, sale, offer for sale, or importation of such
Product for use in such Opt-In Diabetes Orphan Indication in the United States but for the license grant in Section 3.2(b), and (z) the expiration of the last to expire Insmed Patents existing in a country and that covers the actual method
of manufacture or use of such Product (or component thereof) as practiced by Insmed in the manufacture of such Product in such country that is subsequently sold for use in such Opt-In Diabetes Orphan Indication in the United States. 
 (e) Ongoing Sharing of Profits and Losses. As further described in Section 7.2, Insmed and the Opt-In Party shall share Operating Profit
(Loss) with respect to a given Opt-In Indication, based on the applicable Percentage Interest for such Opt-In Indication. 
 (f) Opt-In
Party’s Product Commercialization Rights for Opt-In Indication. If either Tercica or GNE exercises the Opt-In right under this Section 4.2, such Party shall have the right, at its discretion, to exercise the Sole Promotion Option or
the Co-Promotion Option for the respective Opt-In Indication pursuant to Section 5.2. In addition, following such exercise of the Opt-In right, Insmed shall have no right to seek, negotiate or enter into an agreement with, a Third Party partner
for the co-development and/or co-commercialization of a Product. 
  

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 4.4 Opt-Out Rights. An Opt-In Party for a particular Opt-In Indication shall have the right to
discontinue its ongoing funding obligations for such Opt-In Indication either in total or on a region-by-region or country-by-country basis in the Territory (the term “region” means and includes each of the following: the North American
Territory, the EU, and Japan) for such Opt-In Indication, for any or no reason, for a period of ten (10) business days after the completion of an ongoing clinical trial and the reporting of results from such clinical trial for a Product for the
treatment of such Opt-In Indication (the “Opt-Out”). An Opt-In Party may exercise such Opt-Out right by providing written notice to Insmed stating the same. Effective thirty (30) days following notice of such Opt-Out:
(a) such Party shall cease to be an Opt-In Party and the license granted under Section 3.2(b) for such Permitted Indication shall terminate, (b) such Party shall have no further obligation to co-fund the ongoing Development Costs of
such Product for such Permitted Indication other than for non-cancelable out-of-pocket costs incurred or committed to as of the effective date of the Opt-Out for activities previously approved in accordance herewith, (c) such Party shall have
no right to share in a portion of the Operating Profits (Loss) for such Product for such Permitted Indication, (d) such Permitted Indication shall cease to be an Opt-In Indication, (e) such Party shall no longer have the Sole Promotion
Option or Co-Promotion Option with respect to such Permitted Indication, and (f) such Party shall nor longer have any decision making control or input with respect to the development or commercialization of such Product for such Permitted
Indication. If Insmed continues the development and/or commercialization of such Product for such Permitted Indication thereafter, then such Opt-In Party, after exercising its Opt-Out right, shall receive a royalty on the Net Sales of a Product for
treatment of such Permitted Indication as further described in Section 7.1(a)(ii). For clarity, if an Opt-In Party exercises the Opt-Out right, it shall not have any right to a refund or reimbursement of any payments it had made to co-fund the
Development Costs for a Product for such Permitted Indication. 
 ARTICLE 5 
 COMMERCIALIZATION 
 5.1 Commercialization by Insmed. Insmed shall have
the primary right and responsibility for commercializing a Product for a given Permitted Indication; provided, however, that if the Opt-In Party for a particular Opt-In Indication elects to exercise its Co-Promotion Option or Sole Promotion Option
for such Opt-In Indication, then the Parties shall proceed as set forth in this Article 5 and the terms of the Co-Promotion Agreement (as defined in Section 5.3) or the terms of the Supply Agreement (as defined in Section 5.4) shall apply
to the commercialization of such Product for the treatment of such Opt-In Indication. 
 5.2 Commercialization by an Opt-In Party.
Subject to the proper exercise of the Opt-In right described in Section 4.2, Insmed hereby grants the Opt-In Party, for the corresponding Opt-In Indication: (a) an option to co-promote, worldwide, a Product with Insmed for the treatment of
such Opt-In Indication (the “Co-Promotion Option”); and (b) an option to assume sole responsibility for the commercialization of a Product for the treatment of such Opt-In Indication (the “Sole Promotion
Option”). It is further understood and agreed that Tercica shall have the right to assign to Ipsen such Co-Promotion Option or Sole Promotion Option with respect to the ROW Territory or certain country(ies) within such ROW Territory, in
which case the “Opt-In Party” as used in this Article 5 shall also include Ipsen. It is also further understood and agreed that GNE shall have the right to assign to a Third Party 

  

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designee such Co-Promotion Option or Sole Promotion Option with respect to the ROW Territory or certain country(ies) within such ROW Territory, in which case
the “Opt-In Party” as used in this Article 5 shall also include such Third Party designee. 
 5.3 Opt-In Party’s
Co-Promotion Option for Product for an Opt-In Indication. 
 (a) Exercise of Co-Promotion Option. The Opt-In Party may exercise the
Co-Promotion Option as to an Opt-In Indication by providing written notice to Insmed within sixty (60) days following the JDC’s decision (as set forth in approved minutes of the JDC) to file the first application for Marketing
Authorization for a Product for such Opt-In Indication in a given country. It is understood that such Co-Promotion Option shall be triggered with respect to the North American Territory and the ROW Territory independently, such that if, by way of
example, the Opt-In Party does not exercise its Co-Promotion Option for the North American Territory (or part thereof), it may nonetheless exercise its Co-Promotion Option for the ROW Territory (or part thereof), provided such Opt-In Party has not
exercised its right to Opt-Out of co-development for any such North American Territory or ROW Territory. If the Opt-In Party exercises the Co-Promotion Option, the Opt-In Party shall co-promote such Product for the treatment of such Opt-In
Indication with Insmed, during the Co-Promotion Term pursuant to the terms of a Co-Promotion Agreement, as further described in Section 5.3(b) below. Co-promotion of Product for the treatment of such Opt-In Indication shall be overseen and
coordinated by the JCC. 
 (b) Co-Promotion Agreement. Promptly following the Opt-In Party’s exercise of the Co-Promotion Option
with respect to a particular Opt-In Indication in a region or country, the Opt-In Party and Insmed shall engage in good faith negotiations to prepare and execute a definitive co-promotion agreement describing the co-promotion activities of the
Parties for promoting a Product for the treatment of such Opt-In Indication in such region or country (the “Co-Promotion Agreement”). The Co-Promotion Agreement will have the terms and conditions set forth in this Article 5 and in
the term sheet attached to this Agreement as Exhibit E, as well as such other terms as the Opt-In Party and Insmed may agree. The Opt-In Party and Insmed will use reasonably diligent efforts to execute the Co-Promotion Agreement at least
twelve (12) months prior to the anticipated receipt of Marketing Authorization for such Product for such Opt-In Indication as determined by the JCC (such date, the “Launch Date”) for the treatment of such Permitted Indication
in the relevant jurisdiction. The “Co-Promotion Term” will commence upon execution of the Co-Promotion Agreement and will extend for so long as Insmed is selling a Product or the termination of this Agreement, whichever occurs
first. 
 (c) Commercialization Plan. If the Opt-In Party exercises its Co-Promotion Option with respect to a particular Opt-In
Indication, the strategy and tactics for the commercial launch of a Product for the Opt-In Indication shall be described in a comprehensive plan that describes the launch and subsequent co-promotion and related commercialization activities for such
Product by the Opt-In Party and Insmed (including advertising, education, planning, marketing, sales force training and detail allocation) (the “Commercialization Plan”). The JCC shall prepare an initial draft of the
Commercialization Plan within one (1) month after the filing of the first application for Marketing Authorization and shall approve a final Commercialization Plan at least six (6) months prior to the anticipated Launch Date for such
Product for the treatment of such Opt-In Indication. The JCC shall update such Commercialization Plan as needed thereafter, but in any event annually. 
  

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 5.4 The Opt-In Party’s Sole Promotion Option for Product for an Opt-In Indication.

 (a) Exercise of Sole Promotion Option. The Opt-In Party may exercise the Sole Promotion Option for each of its Opt-In
Indications by providing written notice to Insmed within sixty (60) days following the JDC’s decision (as set forth in approved minutes of the JDC) to file an application for Marketing Authorization for a Product for such Opt-In Indication
in a given country. It is understood that such Sole Promotion Option shall be triggered with respect to the North American Territory and the ROW Territory independently, such that if, by way of example, the Opt-In Party does not exercise its Sole
Promotion Option for the North American Territory (or part thereof), it may nonetheless exercise its Sole Promotion Option for the ROW Territory (or part thereof), provided such Opt-In Party has not exercised its right to Opt-Out of co-development
for any such North American Territory or ROW Territory or part thereof. If the Opt-In Party exercises the Sole Promotion Option, the Opt-In Party shall thereafter have the sole right to market, promote, sell, and offer for sale such Product for the
treatment of such Opt-In Indication, in the region or country(ies) as to which such option is exercised, including without limitation, the sole right to book all sales of such Product for such Opt-In Indication. 
 (b) Supply of Product by Insmed. Promptly following the Opt-In Party’s exercise of the Sole Promotion Option, the Opt-In Party and Insmed
shall engage in good faith negotiations to prepare and execute a definitive supply agreement describing terms and conditions by which Insmed shall supply or cause to be supplied (by manufacturing itself or by procuring from a Third Party) commercial
quantities of finished, filled, and packaged Product to the Opt-In Party for such Opt-In Indication, at a price equal to Insmed’s Fully Burdened Manufacturing Cost not to exceed $2,500/gram (such agreement, the “Supply
Agreement”). The Supply Agreement will set forth the terms and conditions as the Opt-In Party and Insmed may agree and as are customary in an agreement of that type, including without limitation, any supply capacity constraints for a
Product, forecasting and ordering, inspection and rejection provisions, and remedies in the event of supply default, including the ability of the Opt-In Party to make or have made a Product itself in such event. The Opt-In Party and Insmed will
negotiate and execute the Supply Agreement at least twelve (12) months prior to the anticipated Launch Date of a Product for the treatment of such Opt-In Indication 
 (c) Trademark License. In the event Tercica and/or GNE exercises its Sole Promotion Option with respect to a given Opt-In Indication, Insmed hereby grants such Opt-In Party a non-exclusive, worldwide license,
with the right to grant sublicenses as provided in this Section 5.4(c), to use the Trademark in connection with the marketing, promotion and sale of a Product for use in the Opt-In Indication. Any sublicense by Tercica or GNE under the rights
granted in this Section 5.4(c) to a sublicensee other than Ipsen, or other than a distributor, subcontractor or consultant in the normal course of business, shall be made by Tercica or GNE only with the consent of Insmed, such consent not to be
unreasonably withheld. It is expressly understood that the Opt-In Party exercising such Sole Promotion Option shall not be required to use the Trademark in connection with the marketing or sale of a Product for such Opt-In Indication, but shall have
the right to re-brand such Product for such Opt-In Indication under a new trademark, in which event the Opt-In Party shall own all rights in and to such new trademark and all associated goodwill. 
  

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 5.5 Sales Tracking. The Parties recognize that, subject to the licenses granted in
Section 3.1, and in light of the Parties’ Opt-In rights with respect to given Permitted Indications, and Sole Promotion Option, a Product may be sold by Insmed for use in the treatment of one or more Permitted Indications as to which the
Opt-In Party has exercised its rights, as well as Permitted Indications as to which no Opt-In rights have been exercised, as well as to patients on a Named Patient Basis as provided in Section 3.1(b), and to Existing Patients under
Section 3.1(a), and may also be sold by either GNE or Tercica in the event of exercise of its Sole Promotion Option, for a given Opt-In Indication. In addition, Products marketed by Insmed (or its Sublicensee) or by GNE or Tercica (or their
designee) in the future for an approved Permitted Indication may nonetheless be prescribed for use in the treatment of one or more indications which are other than such approved Permitted Indication (i.e., “Off Label Sales”). Given that
different financial consideration is due and owing depending upon which of the foregoing situations is applicable (i.e., royalties vs. profit sharing), and in order to detect and account for such sales of Product in a manner most reflective of the
Parties’ intent, the Parties agree as follows: 
 (a) Sales Tracking Methodology. 
 (i) Initial Methodology. Within one hundred eighty (180) days after the Effective Date, Tercica and Insmed shall meet and agree upon a method
of tracking sales of Product for use in the treatment of each indication, in the country sold (a “Sales Tracking Methodology”) including (1) the use of data from Statements of Medical Necessity, or the acquisition of one or
more forms of prescription data (including by way of example, IMS Xponent, NDCHealth Information Network, or Drug Distribution Data) or other relevant pharmaceutical sales tracking research services (including by way of example, audits of the
corresponding statements of medical necessity, use of random sampling, use of data regarding distribution channels as a proxy for indication-specific sales or development of mathematical models for approximating indication-specific sales) generally
recognized in the pharmaceutical industry as having a reasonable degree of accuracy and reliability in the tracking of sales of pharmaceutical products that have a similar nature as, and are prescribed by similar physicians as, a Product for the
Named Patient Indications and Permitted Indications (the “Data Services”), and (2) the methodology for applying any such resulting data and information provided by such Data Services to determine the extent of sales in each
country which are attributable to each such indication. It is expressly understood that sales of a Product for any Non-Permitted Indications are not anticipated except to the Existing Patients, and only for a period not to exceed twelve
(12) months from the Effective Date, and any sales that are knowingly made to patients for use within a Non-Permitted Indication by Insmed or its Affiliates or Sublicensees and that are tracked to any Non-Permitted Indications after such twelve
(12) month period (or to any patients who are other than Existing Patients within such twelve (12) month period) will be evidence of Insmed’s breach of its covenant in Section 3.5 and its license under Section 3.1(a).

 (ii) Modifications to Methodology. The JCC may elect at any point to adopt a different or modified Sales Tracking Methodology,
upon request of either Party. If the JCC fails to agree on a different Sales Tracking Methodology proposed by either Tercica or Insmed, the Sales Tracking Methodology then in effect shall continue to be used. Notwithstanding the foregoing, it is

  

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understood and agreed by Tercica and Insmed that each shall have the right, at its own expense, to undertake such market research and analysis, including
“probes” or sampling of patient data, physician prescribing habits and the like (the “New Sales Tracking Data”) or otherwise propose modifications to the Sales Tracking Methodology at any time during the Term, and to
present such data or otherwise propose modifications to the Sales Tracking Methodology to the JCC to enhance the validity or reliability of the Sales Tracking Methodology. It shall be the JCC’s continuing obligation to review any such New Sales
Tracking Data in good faith, with the overriding obligation to ensure fair and accurate compensation to the Parties (as applicable) under this Agreement by tracking as accurately as reasonably possible, purchases of a Product for use in specific
indications. In the event that the JCC adopts a new Sales Tracking Methodology that incorporates New Sales Tracking Data proposed by a Party, the costs of such new Sales Tracking Methodology shall be allocated between Tercica and Insmed as provided
in Section 5.5(c). 
 (b) Implementation by Insmed. Promptly following the selection and adoption by the JCC of the Sales
Tracking Methodology (and any new Sales Tracking Methodology as applicable), Insmed hereby agrees to implement such Sales Tracking Methodology with respect to Insmed’s annual worldwide sales of Product. 
 (c) Costs. Insmed and Tercica shall share equally all costs incurred in implementing the Sales Tracking Methodology until such time as GNE
exercises its first Opt-In right, in which event all such costs shall be shared equally between Insmed, Tercica and GNE. 
 (d) Dispute
Resolution with Respect to Sales Tracking. Notwithstanding the dispute resolution mechanism set forth in Article 13 below, the Parties agree that all disputes relating to matters pertaining to sales tracking, including without limitation the
methodology(ies) to be used or implementation thereof, shall be resolved as soon as practicable as follows: Any Party shall bring such dispute to the attention of the other Parties by providing the other Parties with a written notice stating such
dispute, and the Parties shall use good faith efforts to resolve such dispute through the JCC within thirty (30) days after the receipt of such notice. If the JCC cannot reach resolution on such matter during such thirty (30)-day period, then
the matter shall be referred to the Chief Commercial Officer or equivalent (or his/her designee who has decision-making authority) of the Parties for resolution. If such executives cannot reach resolution on such matter within ten (10) business
days, then the Parties shall refer the matter to the Sales Tracking Panel (as defined below) for resolution, and the Sales Tracking Panel’s decision (which shall require the consent and agreement of 2 of the 3 panelists) on such matter shall be
final and binding upon all Parties. Notwithstanding the foregoing, GNE may, at its option, recuse itself from such disputes with respect to sales tracking at any time by providing the other Parties with written notice stating such election.
“Sales Tracking Panel” shall mean a panel of three experts, each of whom have experience in market research and intelligence gathering with respect to pharmaceutical products (e.g., former employees of IMS), and at least one of whom
has experience in market research and drug distribution and prescribing information collection involving specialty pharmaceuticals. The Parties shall appoint such experts serving on the Sales Tracking Panel within thirty (30) days after the
Effective Date through mutual agreement, and shall maintain the number of experts on such Sales Tracking Panel during the Term. 
  

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 ARTICLE 6 
 GOVERNANCE 
 6.1 Overview. The Parties desire to establish certain committees to facilitate
the sharing of information between the Parties and to coordinate the development and commercialization of a Product for the treatment of Permitted Indications (as applicable) and the implementation of the Sales Tracking Methodology. It is understood
and acknowledged by each Party that, subject to Tercica’s and GNE’s opt-in rights in Section 4.2, Insmed will be primarily responsible for the development and commercialization of a Product strictly in accordance with the licenses
granted by Tercica under Section 3.1. 
 6.2 Joint Development Committee. 
 (a) Formation; Composition. Within thirty (30) days after the Effective Date, the Parties shall establish a committee to oversee development
of a Product and to serve as a forum for sharing information regarding such development between the Parties (the “JDC”). Tercica and Insmed each shall initially appoint three (3) representatives to the JDC, and GNE may
initially appoint up to three (3) representatives to the JDC. Following any exercise of its Opt-In rights, GNE shall appoint or retain at least one (1) representative, but no more than three (3) representatives, to the JDC. The JDC
may change its size from time to time by mutual consent of its members, provided that the JDC shall include at all times an equal number of representatives of each of Tercica, Insmed, and where GNE so elects, of GNE. Each Party may replace its JDC
representatives at any time upon written notice to the other Party(ies). The JDC may invite non-members to participate in the discussions and meetings of the JDC, provided that such participants shall have no voting authority at the JDC. The JDC
will be chaired by Insmed. The chairperson shall be responsible for administering JDC meetings, but shall have no additional powers or rights beyond those held by the other representatives of the JDC. 
 (b) Specific Responsibilities of the JDC. In addition to its general responsibilities, the JDC shall in particular: 
 (i) prior to an Opt-In Party’s exercise of the Opt-In in accordance with Section 4.2 and throughout the Opt-In Period, facilitate the
flow of information from Insmed to Tercica and GNE with respect to the development of, and obtaining Marketing Authorization for, a Product for the treatment of any Permitted Indications; 
 (ii) prior to an Opt-In Party’s exercise of the Opt-In in accordance with Section 4.2 and throughout the Opt-In Period, determine,
prior to the conduct of such trial, whether a proposed clinical trial for a Product satisfies the criteria of a Phase III Enabling Trial for the applicable Opt-In Indication; and 
 (iii) following an Opt-In Party’s exercise of the Opt-In in accordance with Section 4.2 for a particular Permitted Indication,
coordinate and oversee the Parties’ development of a Product for the treatment of the applicable Opt-In Indication. 
 (c)
Meetings. The JDC shall meet at least once per calendar quarter after the Effective Date unless the Parties mutually agree in writing to a different frequency. The JDC may meet in person, by videoconference, or by teleconference. The location of

  

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TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
in-person JDC meetings will be held at locations alternately selected by Tercica, Insmed, and GNE. Each Party shall report to the JDC on all material issues
relating to the development of a Product promptly after such issues arise. Each Party will bear the expense of its respective JDC members’ participation in JDC meetings. Meetings of the JDC shall be effective only if at least one representative
of each Party having incumbent member(s) of the JDC is present or participating in such meeting. The chairperson of the JDC shall be responsible for keeping reasonably detailed written minutes of all JDC meetings that reflect, without limitation,
material decisions made at such meetings. Meeting minutes will be sent to each member of the JDC for review and approval within ten (10) business days after a meeting. 
 (d) Decision-Making. The JDC shall act by consensus. The representatives from each Party will have, collectively, one (1) vote on behalf of
that Party. If the JDC cannot reach consensus on any issue that comes before the JDC, then: 
 (i) prior to Tercica’s or
GNE’s exercise of the Opt-In in accordance with Section 4.2, Insmed shall have the deciding vote for all issues to be determined by the JDC; and 
 (ii) following the date when an Opt-In Party exercises its Opt-In rights, such Opt-In Party would have the deciding vote on all matters related to the Opt-In Indication before the JDC. 
 It is expressly understood and agreed that the control of decision-making authority by a Party so as to resolve a disagreement or deadlock at the JDC for any matter will
not relieve such Party from any of its representations, warranties, or covenants in this Agreement, nor will it enable such Party to unilaterally modify or amend the terms of this Agreement. 
 6.3 Joint Commercialization Committee. 
 (a) Formation; Composition. Promptly following the Effective Date but in no event later than thirty (30) days after the Effective Date, the Parties shall form a committee to, in the first instance agree upon and approve the
Sales Tracking Methodology, and, following exercise by an Opt-In Party of its Co-Promotion Option or Sole Promotion Option, coordinate and oversee the Parties’ respective commercialization activities with respect to a Product for the treatment
of any Permitted Indications (the “JCC”). Tercica and Insmed each shall initially appoint two (2) representatives to the JCC, and GNE may initially appoint up to two (2) representatives to the JCC. Following any exercise
of its Opt-In rights, GNE shall appoint at least one (1), but no more than two (2), representatives to JCC. The JCC may change its size from time to time by mutual consent of its members, provided that the JCC shall include at all times of an equal
number of representatives of each of Tercica, Insmed, and where GNE so elects, of GNE. Each Party may replace its JCC representatives at any time upon written notice to the other Party(ies). The JCC may invite non-members to participate in the
discussions and meetings of the JCC, provided that such participants shall have no voting authority at the JCC. The JCC will be chaired initially by Insmed. The chairperson shall be responsible for administering JCC meetings, but shall have no
additional powers or rights beyond those held by the other representatives on the JCC. 
  

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 (b) Meetings. The JCC shall meet at least twice per year after its formation pursuant to
Section 6.3(a) unless the Parties mutually agree in writing to a different frequency. The JCC may meet in person, by videoconference, or by teleconference. The location of in-person JCC meetings will be held at locations alternately selected by
Tercica, Insmed and GNE. Meetings of the JCC shall be effective only if at least one representative of each Party is present or participating in such meeting. Each Party shall report to the JCC on all material issues relating to the
commercialization of Products promptly after such issues arise. Each Party will bear the expense of its respective JCC members’ participation in JCC meetings. The chairperson will be responsible for preparing reasonably detailed written minutes
of JCC meetings that reflect, without limitation, material decisions made at such meetings. Such meeting minutes will be sent to each member of the JCC for review and approval within ten (10) business days after a meeting. 
 (c) Decision-Making. The JCC shall act by consensus. The representatives from each Party will have, collectively, one (1) vote on behalf of
that Party. If the JCC cannot reach consensus on any issue that comes before the JCC, then: 
 (i) prior to the date when, and if, an
Opt-In Party exercises its Sole Promotion Rights with respect to a particular Opt-In Indication pursuant to Section 5.4, and other than with respect to Sales Tracking Methodology matters, Insmed shall have the deciding vote for all issues to be
determined by the JCC; and 
 (ii) following the date when an Opt-In Party exercises its Sole Promotion Rights with respect to a
particular Opt-In Indication pursuant to Section 5.4, such Opt-In Party shall have the deciding vote for all issues to be determined by the JCC with respect to the commercialization of a Product for such Opt-In Indication. 
 It is expressly understood and agreed that the control of decision-making authority by a Party so as to resolve a disagreement or deadlock at the JCC for any matter will
not relieve such Party from any of its representations, warranties, or covenants in this Agreement, nor will it enable such Party to unilaterally modify or amend the terms of this Agreement. 
 6.4 General Committee Authority. Each Committee shall have solely the powers assigned to it in this Article 6 and elsewhere in this Agreement. No
Committee shall have any power to amend, modify, or waive compliance with this Agreement. 
 6.5 Discontinuation of Participation on a
Committee. Each Committee shall continue to exist until the first to occur of (a) the Parties mutually agreeing to disband the Committee, or (b) Tercica providing to Insmed written notice of its intention to disband and no longer
participate in such Committee. In any event, at any time Tercica and/or GNE may terminate its participation on any Committee, on thirty (30) days’ written notice. Unless the Parties agree otherwise in writing at the time, upon dissolution
of a Committee, such Committee’s powers and duties shall automatically be assumed by Insmed; provided, however, the Opt-In Party’s approval shall be required for any decisions made by Insmed after the dissolution of a Committee, such
approval not to be unreasonably withheld or delayed. 
  

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 ARTICLE 7 
 FINANCIALS 
 7.1 Royalty Payments for Non-Profit Share Indications. 
 (a) Insmed’s Royalty Obligations to Tercica and GNE. 
 (i) Royalties for Insmed’s Sales to Existing Patients Under Section 3.1(a). Insmed shall pay to Tercica a royalty equal to [***] of its Net Sales made pursuant to its license under Section 3.1(a)
to Existing Patients and which are booked after the end of the three (3) month period after the Effective Date, as set forth in Section 3.1(a). 
 (ii) Royalties for Insmed’s Sales Pursuant to its License under Section 3.1(c). Insmed shall pay to Tercica a royalty equal to [***] of its Net Sales arising from use of a Product for all Permitted
Indications for which (A) neither GNE nor Tercica has exercised its Opt-In right pursuant to Section 4.2 above; or (B) subsequent to Tercica’s or GNE’s exercise of its Opt-In right, such Party exercised its Opt-Out right
with respect to such Permitted Indication (but where such Opt-Out was exercised only as to a specific region or country, only Net Sales from such region or country shall be subject to such royalty). 
 (iii) Royalties for ALS Named Patient Sales in Italy. Insmed shall pay directly to GNE a royalty on all sales made on a Named Patient Basis for
the treatment of ALS in accordance with Section 3.1(d) as follows (such Net Sales referred to herein as the “ALS Portion,” and such royalty paid thereon referred to as the “ALS Royalty”): 
  

			
	 ALS Portion
	  	 Royalty Rates Applicable to ALS Portion

	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]

 (iv) Royalties for Other Named Patient Sales Pursuant to Section 3.1(b) and All Off-Label
Sales. 
 (1) For Named Patient Indications. Insmed shall pay to Tercica a royalty on all sales made on a Named Patient Basis for
the treatment of indications other than ALS in accordance with Section 3.1(b) pursuant to subsection (3) below. 
 (2) For All
Off Label Sales. Insmed shall pay to Tercica a royalty on its Net Sales attributable to use of a Product in the treatment of one or more Permitted Indications, which, at the time of such sale: (A) Insmed does not have Marketing
Authorization for such Product for such Permitted Indication in the country of sale, and (B) either (i) Insmed has not yet commenced any development of such Product for such Permitted Indication so that there was not an opportunity for
Tercica or GNE to exercise 

  

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the Opt-In right pursuant to Section 4.2, or (ii) Insmed has commenced such development of such Product but the Opt-In right described in
Section 4.2 has not yet been exercised (“Off-Label Sales”). In such event, the royalty owed to Tercica on such Off-Label Sales will be paid pursuant to subsection (3) below. If, following commencement of payment of
royalties for such Permitted Indication to Tercica pursuant to subsection (3) below, neither Tercica nor GNE exercises the Opt-In right described in Section 4.2 for such Permitted Indication, then upon grant of Marketing Authorization for
such Product in the treatment of such Permitted Indication in a given country, the royalty for sales of Product for such Permitted Indication in such country shall be [***]. 
 (3) Calculation of Royalties Due under Subsections (1) and (2) Above. For the purpose of this subsection (3), “Aggregated Named
Patient and Off-Label Sales” shall mean collectively, (A) the ALS Portion; (B) the annual Net Sales of all Products aggregated across all countries which result from Named Patient Basis sales other than ALS pursuant to
Section 3.1(b); and (C) the annual Net Sales of all Products aggregated across all countries which are Off-Label Sales. The Aggregated Named Patient and Off-Label Sales described in (B) and (C) shall be referred to as the
“Non-ALS Portion”. In calculating royalties due under this subsection (3), the following rules shall apply: 
 (a)
Determining Royalties Due for the Non-ALS Portion: The royalties due for the Non-ALS Portion shall equal the “Aggregated Royalty Amount” less the “ALS Credit”. 
 (i) The Parties shall determine the Aggregated Royalty Amount by applying the applicable royalty rates set forth in Table A below to the Annual
Aggregated Named Patient and Off-Label Sales; 
 Table A for Calculating Aggregated Royalty Amount: 
  

			
	 Annual Aggregated Named Patient and Off-Label Sales
	  	 Royalty Rates Applicable to Annual
 Aggregated Named Patient and Off-Label
 Sales

	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]

 (ii) The Parties shall then determine the ALS Credit by applying the applicable royalty
rates set forth in Table B below to the ALS Portion: 
 Table B for Calculating the ALS Credit: 
  

			
	 ALS Portion
	  	 Royalty Rates Applicable to ALS Portion

	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]

  

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 (b) Example. By way of illustration, if, for a given year, the ALS Portion is [***], the
Non-ALS Portion is [***], then the Aggregated Named Patient and Off-Label Sales shall be [***]. The royalties payable shall be calculated as follows: 
 (i) For the ALS Portion: As set forth in Section 7.1(a)(iii), the first [***] of the ALS Portion shall bear royalties at a rate of [***], resulting in a royalty obligation of [***]; and the next [***] of
the ALS Portion shall bear royalties at a rate of [***], resulting in a royalty obligation of [***]. The total royalty obligation for the ALS Portion shall be [***] and shall be paid directly to GNE 
 (ii) For the Non-ALS Portion: As set forth in Section 7.1(a)(iv), such royalty is equal to the Aggregated Royalty Amount minus the ALS
Credit, calculated as follows: 
 Aggregated Royalty Amount: 
  

					
	 Aggregated Named Patient
 and Off-Label Sales ([***])
	  	Royalties Per Table A	  	
	 [***]
	  		  	
			
	 [***]
	  		  	
			
	 [***]
	  		  	
			
	 [***]
	  		  	
			
	 [***]
	  		  	
			
	 [***]
	  	 	  	
	 Aggregated Royalty Amount
	  	[***]	  	

  

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 ALS Credit: 
  

							
	 ALS Portion ([***])
	 	Royalties Per Table B	 		  	
	 [***]
	 		 		  	
	[***]	 		 		  	
	 	 	 	 		  	
	 ALS Credit
	 	[***]	 		  	

 Royalties Due for Non-ALS Portion: The royalty payments for Non-ALS Portion shall be: [***]
and shall be paid directly to Tercica. 
 (b) Royalty Obligations to GNE with Respect to Tercica’s Opt-In Indication(s).
In the event GNE does not elect to exercise its Opt-In rights for a given Permitted Indication, but Tercica does so exercise its Opt-In rights for such Permitted Indication, for so long as Tercica has not exercised its Opt-Out right, Insmed or
Tercica, as the case may be and whichever is the Booking Party, shall pay to GNE the incremental rates set forth below, on annual Net Sales of all Products used in the treatment of such Permitted Indication, aggregated across all such Permitted
Indications as to which this Section 7.1(b) applies: 
  

			
	 Aggregate Annual Net Sales for all Products
 for all such Indications
	  	 Royalty Rate Applicable

	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]
		
	 [***]
	  	[***]

 Such royalties owed GNE shall be deducted from Actual Sales in calculating Operating Profit (Loss). 
 (c) Royalties for Mass Sales. Notwithstanding any other provision in this Section 7.1, Insmed shall pay to Tercica a royalty at the rate
equal to [***] of its Net Sales of any mass sales of a Product to a buyer who is governmental agency, quasi governmental agency, institution, foundation or other organization or entity and pursuant to a bulk sales contract or other arrangement, but
excluding any sales of a Product pursuant to contract or purchase order to distributors in the normal course of business for any intended use.  
 (d) Royalty Report and Payment. All royalty amounts payable to Tercica (or GNE as applicable) pursuant to this Section 7.1 shall be paid in Dollars within thirty (30) days after the end of each
calendar quarter with respect to Net Sales in such 

  

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calendar quarter. Each payment of royalties due to Tercica (or GNE as applicable) shall be accompanied by a statement, on a country-by-country basis, of the
amount of gross sales of Product for the applicable indication during the applicable calendar quarter, an itemized calculation of Net Sales in the Territory showing deductions provided for in the definition of Net Sales during such calendar quarter,
and a calculation of the amount of royalty payment due on such sales for such calendar quarter in accordance with Sections 7.1(a)(i), 7.1(a)(ii), 7.1(a)(iii), 7.1(a)(iv) and 7.1(b). 
 (e) Royalty Payment Term. All royalty obligations that apply to sales of Product for use in an indication in a Sale Country pursuant to this
Section 7.1 shall extend, on a Product-by-Product, Permitted Indication-by-Permitted Indication, and Sale Country-by-Sale Country basis, until the later of (a) the expiration of the last to expire Licensed Patents existing in such Sale
Country that would, but for the license grant in Section 3.1, be infringed by the use, sale, offer for sale, or importation of such Product for use in such Permitted Indication in such Sale Country and (b) the expiration of the last to
expire Licensed Patents existing in such Sale Country or other country, that would, but for the license grant in Section 3.1, be infringed by the actual method of manufacture or use of such Product (or a component thereof) as practiced by
Insmed in the manufacture of such Product in such Sale Country or such other country that is subsequently sold for use in such Permitted Indication in such Sale Country. 
 (f) Minimum Royalty. The Parties acknowledge that there may be dispute between the Parties with respect to which Net Sales are attributable to which Permitted Indication, or the calculation of any
royalties due thereunder, which may be ongoing as of the end of a given calendar quarter (the “Sales Tracking Dispute”). The Parties agree that Insmed’s royalty payment obligations under Section 7.1(a)(i) for sales of a
Product to Existing Patients and under Section 7.1(c) for mass sales shall not be affected by any Sales Tracking Dispute, and shall be due and owing at the end of the relevant quarter in accordance with Section 7.1(d) above regardless of
any then existing Sales Tracking Dispute. With respect to Insmed’s royalty payment obligations under Sections 7.1(a)(ii) through 7.1(a)(iv), or 7.1(b) or the payment of Operating Profit (Loss), any such Sales Tracking Dispute shall only affect
the payment of the portion of the royalties in dispute, and the remainder of the royalties (which shall at all times be at least [***] of all Net Sales for each Permitted Indication) shall nevertheless be due and owing at the end of the relevant
quarter in accordance with Section 7.1(d) above. 
 7.2 Sharing of Operating Profit of Product for an Opt-In Indication.

 (a) Profit Share. The Parties shall share the Operating Profit (Loss) for each Opt-In Indication based on the applicable
Percentage Interest for such Opt-In Indication. 
 (b) Quarterly Calculations. Each Party’s share of Operating Profit (Loss) will
be determined on a calendar quarterly basis, using a weighted average based on forecasted Actual Sales (as defined in Exhibit A) for a Product for the Opt-In Indication for the then current calendar year and actual Operating Profit (Loss) for
the completed calendar quarter. 
 (c) Quarterly Reconciliation. On a calendar quarterly basis after the end of each calendar quarter,
each Party’s actual share of Operating Profit (Loss) will be calculated and reconciled as follows: the forecasted Actual Sales for a Product for such Opt-In Indication for the then current calendar year will be adjusted based on the actual
sales booked for the recently-completed calendar 

  

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quarter and the forecasted Actual Sales for all remaining calendar quarters. Then, each Party’s share of cumulative Operating Profit (Loss) for all of
the completed calendar quarter(s) for such calendar year will be determined using a weighted average based on such newly-calculated Actual Sales and the actual Operating Profit (Loss) for all such completed calendar quarter(s) for such calendar
year. The payment to be made by one Party to the other Party for such recently-completed calendar quarter shall reflect such reconciliation, so that each Party will receive its share of then-current cumulative Operating Profit (Loss). 
 (d) Reconciliation Payments. If the Opt-In Party does not exercise its Sole Promotion Option, then, as between the Parties, Insmed shall be the
Booking Party for such Product for the Opt-In Indication. If the Opt-In Party exercises its Sole Promotion Option, then such Opt-In Party shall be the Booking Party for such Product for the Opt-In Indication. In accordance with the timeline set
forth in Exhibit A, for as long as any Product is being commercialized for an Opt-In Indication, the Non-Booking Party shall submit to the Booking Party a statement setting forth any expenditures incurred in any of the elements of calculation
of the Operating Profit (Loss) by such Non-Booking Party for the sale of Product for the Opt-In Indication during such calendar quarter, together with the information detailing the basis for the calculation of such expenditures, in detail and by
category of expenditure. The Booking Party shall consolidate any such Operating Profit (Loss) expenditures reported by such Non-Booking Party with those obtained directly by the Booking Party. The Booking Party shall, in accordance with the time
periods set forth in Exhibit A, notify such Non-Booking Party whether a reconciliation payment is due from one Party to the other based on its calculation pursuant to Section 7.2(c) above, and if so, the amount of such reconciliation
payment, so that the Parties will share the Operating Profit (Loss) for such calendar quarter in the ratio set forth in Section 7.2(a). The Party required to pay such reconciliation payment shall submit such payment to the other Party within
the time period set forth in Exhibit A. 
 7.3 GNE License Fee. Upon receipt of invoice from Tercica, Insmed shall reimburse
Tercica for license payments made to GNE pursuant to Section G.1(a)(x) of Exhibit G to the GNE US License. For clarity, Insmed shall have no further obligation under this Section 7.3 upon Insmed’s reimbursement of Tercica for the final
license payment made by Tercica to GNE pursuant to Section G.1(a)(x) of Exhibit G to the GNE US License, which final license payment is the last payment made to GNE by Tercica under such section of the GNE US License before the expiration of the
last to expire patent in the BP3 Patents (as that term is defined in Section 1.7 of the GNE US License) existing in the United States. For additional clarity, nothing in this Section 7.3 shall be construed to limit or amend Tercica’s
obligation to pay GNE any license payments due pursuant to Section G.1(a)(x) of Exhibit G to the GNE US License. 
 7.4 Taxes.
A Party receiving a payment pursuant to this Article 7 shall pay any and all taxes levied on such payment. If applicable law requires that taxes be deducted and withheld from a payment made pursuant to this Article 7, the remitting Party shall
(i) deduct those taxes from the payment; (ii) pay the taxes to the proper taxing authority; and (iii) send evidence of the obligation together with proof of payment to the other Party within sixty (60) days following that
payment. 
  

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 7.5 Blocked Currency. In each country where the local currency is blocked and cannot be
removed from the country, royalties accrued in that country shall be paid to the other Party in the country in local currency by deposit to a local bank designated by such Party, unless the Parties otherwise agree. 
 7.6 Foreign Exchange. The rate of exchange to be used in computing the amount of currency equivalent in Dollars owed to a Party under this
Agreement shall be made at the period-end rate of exchange quoted on the last business day of the applicable calendar quarter by Citibank in New York City. 
 7.7 Late Payments. If a Party does not receive payment of any sum due to it on or before the due date, simple interest shall thereafter accrue on the sum due to such Party until the date of payment at the per
annum rate of two percent (2%) over the then-current prime rate quoted by Citibank in New York City or the maximum rate allowable by applicable law, whichever is greater. All payments made hereunder shall be made net of any withholding taxes.

 7.8 Financial Records; Audits. Each Party will maintain complete and accurate records in sufficient detail to permit the other
Parties to confirm the accuracy of the Development Costs incurred by such Party and the calculation of royalty payments, Operating Profit (Loss), and other compensation payable under this Agreement. In addition, Insmed will maintain complete and
accurate records of its Named Patient Basis sales under Sections 3.1(b) and (d) in sufficient detail to permit GNE or Tercica to confirm the accuracy of such sales. Upon reasonable prior notice, such records shall be open during regular
business hours for a period of three (3) years from the creation of individual records for examination at the auditing Party’s expense, and not more often than once each calendar year, by an independent certified public accountant selected
by the auditing Party and reasonably acceptable to the audited Party for the sole purpose of verifying for the auditing Party the accuracy of the financial reports furnished by the audited Party pursuant to this Agreement or of any payments made by
the audited Party to the non-audited Party pursuant to this Agreement. Any such auditor shall not disclose the audited Party’s Confidential Information to the auditing Party, except to the extent such disclosure is necessary to verify the
accuracy of the financial reports furnished by the audited Party or the amount of payments due by the audited Party under this Agreement. Any amounts shown to be owed but unpaid shall be paid within thirty (30) days from the accountant’s
report, plus interest (as set forth in Section 7.6) from the original due date. The auditing Party shall bear the full cost of such audit unless such audit discloses an underpayment of the amount actually owed during the applicable calendar
year of more than five percent (5%), in which case the audited Party shall bear the full cost of such audit. 
 ARTICLE 8 

INTELLECTUAL PROPERTY 
 8.1
Prosecution of Patents. 
 (a) Licensed Patents. Tercica or GNE (as such rights and obligations are allocated between Tercica and
GNE under the GNE Licenses) shall have the sole right and authority to prepare, file, prosecute (including any interferences, reissue proceedings and 

  

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reexaminations) and maintain the Licensed Patents on a worldwide basis. Tercica or GNE (as such rights and obligations are allocated between Tercica and GNE
under the GNE Licenses) shall be responsible for all costs and expenses related to such preparation, filing, prosecution and maintenance of such Licensed Patents. 
 (b) Insmed Patents. Except as otherwise provided in this Section 8.1(b), Insmed shall have the sole right and authority to prepare, file, prosecute (including any interferences, reissue proceedings and
reexaminations) and maintain the patents within the Insmed Patents on a worldwide basis. Except as set forth in this Section 8.1(b), Insmed shall be responsible for all costs and expenses related to such preparation, filing, prosecution and
maintenance of such patents within the Insmed Patents. In the event that Tercica or GNE is the Opt-In Party for any Product for an Opt-In Indication, after the proper exercise of the Opt-In, and unless and until such Party exercises the Opt-Out with
respect to such Permitted Indication: (i) Insmed shall provide such Opt-In Party reasonable opportunity to review and comment on such prosecution efforts regarding such patents relating to a Product for the Opt-In Indication within the Insmed
Patents, (ii) Insmed shall provide such Opt-In Party with a copy of material communications from any patent authority in the Territory regarding such patents within the Insmed Patents, and shall provide drafts of any material filings or
responses to be made to such patent authorities a reasonable amount of time in advance of submitting such filings or responses, and (iii) if Insmed determines in its sole discretion to abandon or not maintain any patent within such patents
within the Insmed Patents anywhere in the Territory, then Insmed shall provide such Opt-In Party with thirty (30) days prior written notice of such determination (or such other period of time reasonably necessary to allow such Opt-In Party to
assume such responsibilities) and shall provide such Opt-In Party with the opportunity to prepare, file, prosecute and maintain such patent in the Territory on behalf of Insmed at such Opt-In Party’s sole expense. 
 (c) Cooperation in Prosecution. Each Party shall provide the other Parties all reasonable assistance and cooperation in the patent prosecution
efforts to the extent necessary or useful for the exercise of the other Parties’ right to control patents as provided above in this Section 8.1, including providing any necessary powers of attorney and executing any other required
documents or instruments for such prosecution. 
 8.2 Infringement of Patents by Third Parties. 
 (a) Notification. Each Party shall promptly notify the other Parties in writing of any existing or threatened infringement of the Licensed Patents
or any patents within the Insmed Patents of which it becomes aware, and shall provide evidence in such Party’s possession demonstrating such infringement. 
 (b) Infringement of Licensed Patents. Tercica or GNE (as such rights and obligations are allocated between Tercica and GNE under the GNE Licenses) shall have the exclusive right, but not the obligation, to
bring, at Tercica’s or GNE’s (as applicable) expense and in its sole control, an appropriate suit or other action against any person or entity engaged in such infringement of a Licensed Patent. 
  

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 (c) Infringement of Insmed Patents. Insmed shall have the exclusive right, but not the
obligation, to bring, at Insmed’s expense and in its sole control, an appropriate suit or other action against any person or entity engaged in such infringement of a patent within the Insmed Patents. 
 8.3 Infringement of Third Party Rights. 
 (a) Notice. If any Product manufactured, used or sold by either Party, its Affiliates, licensees or sublicensees becomes the subject of a Third Party’s claim or assertion of infringement of a patent granted by a jurisdiction
within the Territory relating to the manufacture, use, sale, offer for sale or importation of a Product, and if Tercica or GNE is the Opt-In Party for a Product for any Opt-In Indication implicated in such claim or assertion, then: (i) if the
Opt-In Party first has notice of the claim or assertion, it shall promptly notify Insmed; and (ii) if Insmed first has notice of the claim or assertion, it shall promptly notify such Opt-In Party. The Parties shall then promptly meet to
consider the claim or assertion and the appropriate course of action. 
 (b) Defense. Insmed shall have the first right, but not the
obligation, to defend any such claim, the costs to conduct such defense being at Insmed’s sole expense. If Insmed does not commence actions to defend such claim within five (5) business days after it had notice thereof, then such Opt-In
Party shall have the right, but not the obligation, to control the defense of such claim by counsel of its choice, at such Opt-In Party’s sole expense. Each of Insmed and the Opt-In Party shall reasonably cooperate with the other Party and
shall give reasonable consideration to the other Party’s input, including if required to conduct such defense, furnishing a power of attorney. 
 (c) Settlement. Neither Party shall enter into any settlement of any claim described in this Section 8.3 that affects the other Parties’ rights or interests without such other Parties’ written consent, which consent
shall not be unreasonably withheld or delayed. 
 ARTICLE 9 
 CONFIDENTIALITY 
 9.1 Confidential Information. All information, whether
in oral, written, graphic or electronic form, disclosed by either Party (“Disclosing Party”) to the other and/or any of its subsidiaries, subdivisions, parent companies, affiliates agents or consultants (“Receiving
Party”), and all notes, documents and materials prepared by or for either Party which reflect, interpret, evaluate, include or are derived therefrom, shall be deemed to be “Confidential Information.” In particular,
Confidential Information shall include, without limitation, any trade secret, proprietary information, invention, research and development work, work-in-process, technology, technique, know-how, design, specification, program, unpublished data,
procedure (including operating procedures), computer software, data base or programming, idea, sample, strategy, budget, projection, development, process, formulation, method, guideline, policy, proposal, contract, test data or data file, or any
engineering, manufacturing, marketing, servicing, financing, pricing, cost, profit, personnel or salary structure/compensation information relating to the past, present or future operations, products, services, technology, sales, suppliers, clients,
customers, employees, investigators, investors or business of Disclosing Party. In addition, 

  

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“Confidential Information” includes any trade secrets, data (technical or non-technical) or confidential information relating to the past,
present or future operations, organization, business, projects or finances of any Third Party to which Disclosing Party owes a duty of confidentiality including, without limitation, the mere fact that Disclosing Party is or may be working with or
for any client. 
 9.2 Non-use; Nondisclosure of Confidential Information. Receiving Party shall not use or disclose such Confidential
Information to others (except its employees, Affiliates and sublicensees who reasonably require same for the purposes hereof and who are bound to it by a like obligation as to confidentiality except as required by law) without the express written
permission of Disclosing Party, except for Confidential Information that (a) can be demonstrated by written records to be known to Receiving Party from a source other than Disclosing Party at the time of receipt; or (b) was subsequently
otherwise legally acquired by Receiving Party from a Third Party having an independent right to disclose the information; or (c) is now or later becomes publicly known without breach of this Agreement by Receiving Party or any Party that
received such Confidential Information from Receiving Party. 
 9.3 Permitted Disclosure of Confidential Information. Any Party may
disclose the other Party’s Confidential Information to the extent such disclosure is required by law, regulations (including without limitation the rules and regulations promulgated by the United States Securities Exchange Commission) and valid
court order, provided that such Party gives the other Party reasonable notice of such disclosure and uses reasonable efforts to obtain confidential treatment or a protective order for such information. Tercica shall have the right to disclose
Insmed’s Confidential Information to the extent such disclosure is required to satisfy its obligations under the GNE Licenses or any agreements with Ipsen, provided that such persons undertake to keep confidential such Confidential Information.

 9.4 Other Permitted Disclosure. Except as otherwise expressly provided herein or as otherwise set forth in Section 9.3, to the
extent reasonably necessary to carry on the activities contemplated in this Agreement, a Party shall be permitted to (a) disclose or grant use of Confidential Information received under this Agreement to any of its permitted sublicensees,
agents, consultants, clinical investigators, collaborators or contractors, under confidentiality and non-use obligations at least as stringent as those set forth in this Article 9; (b) disclose Confidential Information received under this
Agreement to actual or potential professional investors, acquirers, merger or other business partners or retained professional advisors (e.g. attorneys, accountants and investment bankers), under confidentiality and non-use obligations at least as
stringent as those set forth in this Article 9; and (c) to a Regulatory Authority to the extent necessary for obtaining Marketing Authorization for a Product. 
 9.5 Press Release. The Parties agree that the material terms of this Agreement are included within the Confidential Information of all Parties, subject to the special authorized disclosure set forth in this
Section 9.5. Tercica and Insmed have agreed to make a joint public announcement of the execution of this Agreement substantially in the form of the press release attached as Exhibit F on or after the Effective Date. 
  

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 9.6 Publication. 
 (a) If Opt-In Rights Have Not Been Exercised. In the event that (i) neither Tercica nor GNE has exercised its Opt-In rights under Section 4.2 when they became due, or (ii) the Opt-In Party has
subsequently exercised its Opt-Out right under Section 4.4, then Insmed shall have the right to publish or orally deliver a scientific article or speech relating to the development of Product for the Permitted Indication subject to the
confidentiality restrictions described in Sections 9.1 through 9.4. 
 (b) If Opt-In Rights Have Been Exercised. In the event that
either Tercica or GNE has exercised its Opt-In rights under Section 4.2, or during such time period as such rights are ongoing, and provided such Opt-In Party has not yet exercised its Opt-Out right under Section 4.4, then if Insmed or the
Opt-In Party (or potential Opt-In Party) wishes to publish or orally deliver a scientific article or speech relating to the development of Product for the Opt-In Indication, then the following shall apply: The Party wishing to make such proposed
oral disclosure or written publication shall submit to the other Party a draft of each such proposed oral disclosure or written publication at least thirty (30) days prior to the anticipated oral disclosure or the submission of the written
publication. As soon as reasonably possible, but in no event more than thirty (30) days after receipt of an advance copy of a publishing Party’s proposed oral disclosure or written publication, the reviewing Party shall inform the
publishing Party if the proposed oral disclosure or written publication contains any of the reviewing Party’s Confidential Information or could be expected to have a material adverse effect on any patent rights of the reviewing Party. If so
requested by the reviewing Party, the publishing Party shall amend any proposed oral disclosure or written publication to the extent necessary to protect the Confidential Information of the reviewing Party of which the publishing Party is made aware
by the reviewing Party and, if so requested by the reviewing Party, shall delay such proposed oral disclosure or written publication for a reasonable period of time to permit the timely preparation of a patent application by the reviewing Party.

 ARTICLE 10 
 REPRESENTATIONS AND WARRANTIES 
 10.1 Representations and Warranties of Tercica. Tercica makes the following
covenants, representations and warranties to each of the other Parties, as of the Effective Date, and does so in full understanding and acknowledgement that each of the other Parties is relying on the said representations and warranties in entering
into the present Agreement: 
 (a) Status. Tercica is a corporation organized and existing under the laws of the State of Delaware. No
action has been taken by the directors, officers or shareholders of Tercica to dissolve Tercica. Tercica has the corporate power and authority to enter into the present Agreement and to perform all its obligations hereunder. 
 (b) All Necessary Proceedings. Tercica has taken all necessary corporate actions and proceedings to enable it to enter into the present Agreement.

 (c) No Violation. The execution, delivery and performance of this Agreement by it (i) does not and will not violate or
conflict with any provision of law or any provision of its articles of incorporation or by-laws; and (ii) does not and will not, with or 

  

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without the passage of time or the giving of notice, result in the breach of, or constitute a default, cause the acceleration of performance, or require any
consent under, or result in the creation of any lien, charge or encumbrance upon any of its property or assets pursuant to any material instrument or agreement to which it is a party or by which it or its properties may be bound or affected.

 (d) GNE Licenses. As of the Effective Date, (i) the GNE Licenses are in full force and in effect in accordance with their
terms, (ii) Tercica is not in default or breach in any material respect of the GNE Licenses, (iii) to Tercica’s knowledge, there is no cause for early termination of the GNE Licenses, (iv) Tercica has provided to Insmed a copy of
the GNE Licenses; and (v) the terms under this Agreement are not in conflict with the terms in the GNE Licenses. Tercica shall (A) comply with and observe in all material respects its obligations under the GNE Licenses and (B) not
terminate or otherwise modify any terms or conditions of the GNE Licenses in any manner that would materially adversely affect Insmed’s rights under this Agreement without the prior written consent of Insmed. 
 10.2 Representations and Warranties of Insmed. Insmed makes the following covenants, representations and warranties to each of the other Parties,
as of the Effective Date, and does so in full understanding and acknowledgement that each of the other Parties is relying on the said representations and warranties in entering into the present Agreement: 
 (a) Status. Insmed is a corporation organized and existing under the laws of Virginia. No action has been taken by the directors, officers or
shareholders of Insmed to dissolve Insmed. Insmed has the corporate power and authority to enter into the present Agreement and to perform all its obligations hereunder. 
 (b) All Necessary Proceedings. Insmed has taken all necessary corporate actions and proceedings to enable it to enter into the present Agreement. 
 (c) No Violation. The execution, delivery and performance of this Agreement by it (i) does not and will not violate or conflict with any
provision of law or any provision of its articles of incorporation or by-laws; and (ii) does not and will not, with or without the passage of time or the giving of notice, result in the breach of, or constitute a default, cause the acceleration
of performance, or require any consent under, or result in the creation of any lien, charge or encumbrance upon any of its property or assets pursuant to any material instrument or agreement to which it is a party or by which it or its properties
may be bound or affected. 
 (d) Existing Patients. Insmed has provided to Tercica and GNE the accurate maximum number of all Existing
Patients as of the Execution Date as such number is set forth in Section 3.1(a) above. 
 (e) No Other Agreements. As of the
Effective Date, Insmed has neither entered into nor is a party to any agreement with either Tercica or GNE that relates to the subject matter of the Lawsuit, with the sole exception of this Agreement, the UK Proceedings Settlement Agreement, and the
Permanent Injunction. 
  

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 10.3 Representations and Warranties of GNE. GNE makes the following covenants, representations
and warranties to each of the other Parties, as of the Effective Date, and does so in full understanding and acknowledgement that each of the other Parties is relying on the said representations and warranties in entering into the present Agreement:

 (a) Status. GNE is a corporation organized and existing under the laws of the State of Delaware. No action has been taken by the
directors, officers or shareholders of GNE to dissolve GNE. GNE has the corporate power and authority to enter into the present Agreement and to perform all its obligations hereunder. 
 (b) All Necessary Proceedings. GNE has taken all necessary corporate actions and proceedings to enable it to enter into the present Agreement.

 (c) No Violation. The execution, delivery and performance of this Agreement by it (i) does not and will not violate or
conflict with any provision of law or any provision of its articles of incorporation or by-laws; and (ii) does not and will not, with or without the passage of time or the giving of notice, result in the breach of, or constitute a default,
cause the acceleration of performance, or require any consent under, or result in the creation of any lien, charge or encumbrance upon any of its property or assets pursuant to any material instrument or agreement to which it is a party or by which
it or its properties may be bound or affected. 
 10.4 THE WARRANTIES SET OUT ABOVE ARE THE ONLY WARRANTIES GIVEN BY ANY PARTY AND ARE
MADE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED. THERE IS NO OTHER CONDITION OR WARRANTY RELATING TO PRODUCT MERCHANTABILITY OR FIT FOR ANY PARTICULAR PURPOSE, ALL OF WHICH ARE HEREBY EXCLUDED AND DISCLAIMED. 
 ARTICLE 11 
 INDEMNIFICATION

 11.1 Indemnification by Tercica. Tercica shall defend, indemnify, and hold Insmed and GNE and each of Insmed’s and
GNE’s respective officers, directors, employees, and agents harmless from and against any and all Third Party claims, suits, proceedings, damages, expenses (including court costs and reasonable attorneys’ fees and expenses), and recoveries
(collectively, “Claims”) to the extent that such Claims arise out of, are based on, or result from (a) the development, manufacture, storage, handling, use, promotion, sale, offer for sale, and importation of Products by
Tercica or its sublicensees or Affiliates; (b) a breach of any of Tercica’s representations, warranties, and obligations under the Agreement; or (c) the willful misconduct or negligent acts of Tercica, its Affiliates, or the officers,
directors, employees, or agents of Tercica or its Affiliates. The foregoing indemnity obligation shall not apply if the indemnifiable Party fails to comply with the indemnification procedures set forth in Section 11.4, or to the extent that any
Claim arises from, is based on, or results from (i) the development, manufacture, storage, handling, use, promotion, sale, offer for sale, and importation of Products by Insmed or GNE or their respective Affiliates, sublicensees, or
distributors; (ii) a breach of any of Insmed’s or GNE’s respective representations, warranties, and obligations under the Agreement; or (iii) the willful misconduct or negligent acts of Insmed or GNE or their respective
Affiliates, or the officers, directors, employees, or agents thereof. 
  

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 11.2 Indemnification by Insmed. Insmed shall defend, indemnify, and hold Tercica and GNE and
each of Tercica’s and GNE’s respective officers, directors, employees, and agents harmless from and against any and all Claims to the extent that such Claims arise out of, are based on, or result from (a) the development, manufacture,
storage, handling, use, promotion, sale, offer for sale, and importation of Products by Insmed or its Affiliates, sublicensees, or distributors; (b) a breach of any of Insmed’s representations, warranties, and obligations under the
Agreement; or (c) the willful misconduct or negligent acts of Insmed or its Affiliates, or the officers, directors, employees, or agents of Insmed or its Affiliates. The foregoing indemnity obligation shall not apply if the indemnifiable Party
fails to comply with the indemnification procedures set forth in Section 11.4, or to the extent that any Claim arises from, is based on, or results from (i) the development, manufacture, storage, handling, use, promotion, sale, offer for
sale, and importation of Products by Tercica or GNE or their respective Affiliates or sublicensees for the treatment of Permitted Indications; (ii) a breach of any of Tercica’s or GNE’s respective representations, warranties, and
obligations under the Agreement; or (iii) the willful misconduct or negligent acts of Tercica or GNE or their respective Affiliates, or the officers, directors, employees, or agents thereof. 
 11.3 Indemnification by GNE. GNE shall defend, indemnify, and hold Tercica and Insmed and each of Tercica’s and Insmed’s respective
officers, directors, employees, and agents harmless from and against any and all Claims to the extent that such Claims arise out of, are based on, or result from (a) the development, manufacture, storage, handling, use, promotion, sale, offer
for sale, and importation of Products by GNE or its Affiliates, sublicensees, or distributors; (b) a breach of any of GNE’s representations, warranties, and obligations under the Agreement; or (c) the willful misconduct or negligent
acts of GNE or its Affiliates, or the officers, directors, employees, or agents of GNE or its Affiliates. The foregoing indemnity obligation shall not apply if the indemnifiable Party fails to comply with the indemnification procedures set forth in
Section 11.4, or to the extent that any Claim arises from, is based on, or results from (i) the development, manufacture, storage, handling, use, promotion, sale, offer for sale, and importation of Products by Tercica or Insmed or their
respective Affiliates or sublicensees; (ii) a breach of any of Tercica’s or Insmed’s respective representations, warranties, and obligations under the Agreement; or (iii) the willful misconduct or negligent acts of Tercica or
Insmed or their respective Affiliates, or the officers, directors, employees, or agents thereof. 
 11.4 Indemnification Procedures.
The Party claiming indemnity under this Article 10 (the “Indemnified Party”) shall give written notice to the Party from whom indemnity is being sought (the “Indemnifying Party”) promptly after learning of such
Claim. The Indemnified Party shall provide the Indemnifying Party with reasonable assistance, at the Indemnifying Party’s expense, in connection with the defense of the Claim for which indemnity is being sought. The Indemnified Party may
participate in and monitor such defense with counsel of its own choosing at its sole expense; provided, however, the Indemnifying Party shall have the right to assume and conduct the defense of the Claim with counsel of its choice. The Indemnifying
Party shall not settle any Claim without the prior written consent of the Indemnified Party, not to be unreasonably withheld, unless the settlement involves only the payment of money by the Indemnifying Party. So long as the Indemnifying Party is
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Party shall not settle any such Claim without the prior written consent of the Indemnifying Party. If the Indemnifying Party does not assume and conduct the
defense of the Claim as provided above, (a) the Indemnified Party may defend against, and consent to the entry of any judgment or enter into any settlement with respect to the Claim in any manner the Indemnified Party may deem reasonably
appropriate (and the Indemnified Party shall be given written notice to the Indemnifying Party of any settlement thereof and shall not settle without the consent of the Indemnifying Party), and (b) the Indemnifying Party will remain responsible
to indemnify the Indemnified Party as provided in this Article 11. 
 11.5 Limitation of Liability. NONE OF THE PARTIES SHALL BE
LIABLE TO ANY OTHER PARTY FOR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE, OR INDIRECT DAMAGES ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY NOTICE OF THE POSSIBILITY OF SUCH DAMAGES. NOTWITHSTANDING THE FOREGOING,
NOTHING IN THIS SECTION 11.5 IS INTENDED TO OR SHALL LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF ANY PARTY UNDER SECTIONS 11.1, 11.2 OR 11.3, OR DAMAGES AVAILABLE FOR A PARTY’S BREACH OF ITS CONFIDENTIALITY OBLIGATIONS IN
ARTICLE 9. 
 11.6 Insurance. Each Party shall procure and maintain insurance, including product liability insurance, adequate to
cover its obligations hereunder and which are consistent with normal business practices of prudent companies similarly situated at all times during which any Product is being clinically tested in human subjects or commercially distributed or sold.
It is understood that such insurance shall not be construed to create a limit of either Party’s liability with respect to its indemnification obligations under this Article 11. Each Party shall provide the other with written evidence of such
insurance upon request. Each Party shall provide the other with written notice at least thirty (30) days prior to the cancellation, non renewal or material change in such insurance or self-insurance which materially adversely affects the rights
of the other Party hereunder. 
 ARTICLE 12 
 TERM AND TERMINATION 
 12.1 Term and Overview of Termination Rights. 
 (a) Term. The term of the Agreement shall commence on the Effective Date and, unless sooner terminated as provided herein, shall continue in full
force and effect on a country-by-country basis until the later of (a) the expiration of all payment obligations described in Article 7 in such country; and (b) the expiration of Tercica and GNE’s Opt-In rights under Section 4.2
(the “Term”). Articles 1, 2, 9, 11 (to the extent the Claims arise from actions or omissions under this Agreement), 13 and 14 and Sections 3.2, 3.4, 3.5, 3.6, 7.8 and 12.6 shall survive the expiration of this Agreement. In addition
and pursuant to their terms, the Permanent Injunction and UK Proceedings Settlement Agreement shall remain in full force and effect following expiration of this Agreement. 
  

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 (b) Overview of Termination. As further described in Sections 12.3 and 12.4, each Party has
certain rights to terminate the Agreement in its entirety or on an indication-by-indication basis depending on whether another Party has breached this Agreement generally or with respect to a specific Permitted Indication or Non-Permitted
Indication. Section 12.2 sets forth the general procedures applicable in the event that a Party commits a Material Breach of the Agreement. Sections 12.3 and 12.4 describe the specific rights of GNE, Tercica and Insmed to terminate the
Agreement in its entirety or on an indication-by-indication basis due to the breach by another Party. 
 12.2 Material Breach; Procedures
Applicable in Event of a Material Breach by a Party. If a Party is in material breach or default with respect to any term or provision hereof and as specified below (such breach, a “Material Breach”), then the non-breaching
Party(ies) shall have the right to terminate this Agreement, either in its entirety or on an indication-by-indication basis (as further set forth in Sections 12.3 and 12.4 below), by providing such breaching Party written notice of termination
detailing such Material Breach, provided that such notice of termination shall only become effective at the end of a ninety (90) day period (however, termination shall become effective at the end of ten (10) days if Insmed or its
Affiliates or Sublicensees challenge(s) the validity or enforceability of any patent or patent application that is included in the Licensed Patents anywhere in the Territory and at the end of thirty (30) days in the case of failure to pay)
after such notice is received by the breaching Party, and only if such breaching Party fails to cure such Material Breach during the same period. Notwithstanding anything to the contrary in this Section 12.2, each of Tercica, Insmed, and GNE
may elect not to exercise its right to terminate this Agreement in its entirety or an indication-by-indication basis pursuant to this Article 12 for another Party’s uncured Material Breach, but instead elect to allow this Agreement to continue
in effect, in which case, the breaching Party shall continue to be liable to the non-breaching Party(ies) for such Material Breach. The non-breaching Party(ies) shall be entitled to pursue legal and equitable remedies arising from such Material
Breach that are available to it or them (as applicable), regardless of whether such non-breaching Party(ies) terminates this Agreement for such Material Breach. 
 12.3 Termination by GNE and/or Tercica for Insmed’s Material Breach. 
 (a) General Right to
Terminate for Material Breach by Insmed. 
 (i) Tercica’s and GNE’s Right to Terminate. 
 (1) Right to Terminate with Consent. Subject to Section 12.3(a)(i)(2) below, each of Tercica and GNE shall have the right to terminate this
Agreement in its entirety pursuant to Section 12.2 above, with the other non-breaching Party’s consent if: (A) Insmed commits a Material Breach with respect to a Non-Permitted Indication or ALS Indication (including without
limitation, Insmed’s sales of a Product beyond the scope of its license under Section 3.1(a) or Section 3.1(d) for the Non-Permitted Indication or the ALS Indication, respectively); (B) Insmed breaches any of its representations,
warranties, obligations, or covenants under this Agreement which are not specific to a particular Permitted Indication; (C) Insmed breaches the terms of the Permanent Injunction; (D) Insmed breaches the terms of the UK Proceedings
Settlement Agreement; or (E) Insmed commits a Material Breach with respect to more than one Permitted Indication. 
  

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 (2) Unilateral Right to Terminate. Notwithstanding Section 12.3(a)(i)(1) above, GNE
shall have the right to terminate this Agreement in its entirety pursuant to Section 12.2 above, without Tercica’s consent if: (A) Insmed or its Affiliates or Sublicensees challenge(s) the validity or enforceability of any patent or
patent application that is included in the GNE Patents anywhere in the Territory (whether or not with respect to a particular Permitted Indication); or (B) Insmed breaches its payment obligations to GNE under Article 7. Notwithstanding
Section 12.3(a)(i)(1) above, Tercica shall have the right to terminate this Agreement in its entirety pursuant to Section 12.2 above, without GNE’s consent if: (Y) Insmed or its Affiliates or Sublicensees challenge(s) the
validity or enforceability of any patent or patent application that is included in the Licensed Patents and that is not a GNE Patent anywhere in the Territory (whether or not with respect to a particular Permitted Indication); or (Z) Insmed
breaches its payment obligations to Tercica under Article 7. 
 (ii) Consequences of Termination by Tercica or GNE. If Tercica or GNE
terminates this Agreement in its entirety pursuant to Section 12.3(a)(i) above, then: 
 (1) the licenses granted to Insmed in
Section 3.1 shall immediately terminate; 
 (2) the Permanent Injunction and the UK Proceedings Settlement Agreement shall each
remain in full force and effect; 
 (3) Insmed shall immediately cease to make, have made, use, sell, offer for sale or import any
Product, either by itself or through an Affiliate, Sublicensee or subcontractor, in all countries of the Other Territory where an unexpired claim included in the Licensed Patents covers the composition of matter of, or the method of making or using,
any component contained in such Product; 
 (4) within five (5) business days after the effective date of such termination, in
the event and to the extent of any Infringing Activity, Insmed shall be automatically enjoined from engaging in and from inducing any Third Party to engage in any such Infringing Activity, such injunction to remain and continue in full force and
effect until the expiration of the last to expire of such GNE Patents covering such Infringing Activity, on a country-by-country basis; and 
 (5) all rights and obligations under this Agreement shall terminate except for the Parties’ rights and obligations under Sections 3.2, 3.4, 3.5, 3.6, 7.8 and 12.6, and Articles 1, 2, 9, 11 (to the extent the Claims arise from
actions or omissions under this Agreement), 13 and 14. 
 (b) Additional Rights to Terminate for Insmed’s Material Breach Where Such
Material Breach is with Respect to a Specific Permitted Indication that is an Opt-In Indication.  
 (i) Opt-In Party’s
Right to Terminate. If Insmed commits a Material Breach with respect to a Permitted Indication that is an Opt-In Indication, then the Opt-In Party shall have the right, without the other, non-Opt-In Party’s consent, to terminate this
Agreement only with respect to such Opt-In Indication, pursuant to Section 12.2 above. 
  

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 Notwithstanding the foregoing sentence, and as further described in Section 12.3(b)(iii), under certain
circumstances, GNE shall also have the right to terminate this Agreement with respect to an Opt-In Indication even if GNE is not the Opt-In Party for such Opt-In Indication. 
 (ii) Consequences of Termination by an Opt-In Party. If an Opt-In Party terminates this Agreement with respect to a particular Opt-In Indication
pursuant to Section 12.3(b)(i) above, then: 
 (1) the licenses granted to Insmed in Section 3.1 shall immediately terminate
with respect to such Opt-In Indication; 
 (2) the Permanent Injunction and the UK Proceedings Settlement Agreement shall each remain
in full force and effect; 
 (3) the Opt-In Party shall have the right to take over development of such Opt-In Indication in its
entirety, at its own expense, in accordance with the financial consequences as described in the remainder of this Section 12.3(b)(ii)(3). If the Opt-In Party elects to take over development of such Opt-In Indication in its entirety, then the
Percentage Interest of Insmed in such Opt-In Indication shall be reduced to a portion equal to the result of the following formula: 
  

							
	50% x	 	[	 	 Total Development Costs actually funded by Insmed prior to the date of the Material Breach
 50% x (Total Development Costs incurred by Insmed and the Opt-In Party to obtain regulatory
 approval of such Product in the given country at issue)
	 	]

 The profit-sharing arrangement (as adjusted pursuant to the formula in this Section 12.3(b)(ii)(3)) shall
continue only until the payments so received by Insmed equal the Development Costs actually incurred by Insmed for the Product for such Opt-In Indication, after which the profit share arrangement for such Opt-In Indication shall terminate. For
illustration, if Insmed has actually funded $4 million of the total Development Costs prior to the date of the Material Breach, and the total Development Costs incurred by Insmed and such Opt-In Party to obtain regulatory approval of the Product in
a given country at issue is $20 million, then Insmed’s newly calculated Percentage Interest after such termination shall be 50% x ($4 million/(50% x $20 million)) = 20%. The Opt-In Party shall share Operating Profit (Loss) with Insmed for such
Product for such Permitted Indication in such country on a 80:20 basis until Insmed receives a total of $4 million in proceeds from such Operating Profit (Loss) sharing, after which the profit share arrangement shall terminate. The principle of this
illustration shall also apply to Sections 12.3(b)(iii)(3), 12.4(b)(ii)(2)(b), and 12.5(b). 
 After the termination of the profit share arrangement for such
Opt-In Indication pursuant to subsection (3) above, the Opt-In Party shall pay to Insmed royalties on the Net Sales for such Opt-In Indication at a rate of [***], and such royalty payment obligation shall expire in a given Sale Country on a
Sale Country-by-Sale Country basis, upon the later of (A) the expiration of the last to expire Insmed Patents existing in such Sale Country that would be infringed by the use, sale, offer for sale, or importation of such Product for use in such
Opt-In Indication in such Sale Country but for the license grant in Section 3.2(b), and (B) the expiration of the last to expire Insmed Patents existing in such Sale Country or other country that covers the actual method of manufacture or
use of the Product (or a component thereof) as practiced by Insmed in the manufacture of the Product in such Sale Country or such other country that is subsequently sold for use in such Opt-In Indication in such Sale Country; 
  

 45 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 (4) the Opt-In Party (a) shall become, if not already, the Booking Party for such Opt-In
Indication; and (b) shall have the final decision making authority in the commercialization of such Product for such Opt-In Indication. 
 (iii) Right and Consequences of Termination by GNE When It is Not the Opt-In Party for the Permitted Indication. Notwithstanding anything to the contrary in this Section 12.3(b), if Insmed commits a Material Breach with respect
to an Opt-In Indication when Tercica is the Opt-In Party for such Opt-In Indication, then GNE shall have the right to terminate this Agreement with respect to such Opt-In Indication only in the event that Insmed’s Material Breach is an
underpayment to GNE of the royalties under Section 7.1(b). In the event of such termination: 
 (1) the licenses granted to
Insmed in Section 3.1 shall immediately terminate with respect to such Permitted Indication; 
 (2) the Permanent Injunction and
the UK Proceedings Settlement Agreement shall each remain in full force and effect; 
 (3) Tercica shall have the right to take over
development of such Permitted Indication in its entirety, at its own expense, in accordance with the financial consequences as described in remainder of this Section 12.3(b)(iii)(3). If Tercica elects to take over development of such Permitted
Indication in entirety, then the Percentage Interest of Insmed in such Permitted Indication shall be reduced to a portion equal to the result of the following formula: 
  

							
	50% x	 	[	 	 Total Development Costs actually funded by Insmed prior to the date of the Material Breach
 50% x (Total Development Costs incurred by Insmed and the Opt-In Party to obtain regulatory
 approval of such Product in the given country at issue)
	 	]

 The profit-sharing arrangement (as adjusted pursuant to the formula in this Section 12.3(b)(iii)(3)) shall
continue only until the payments so received by Insmed equal the Development Costs actually incurred by Insmed for a Product for such indication. The formula provided in this Section 12.3(b)(iii)(3) shall be interpreted based on the same
principle set forth in the illustration in Section 12.3(b)(ii)(3). Thereafter the profit share arrangement for such indication shall terminate and Tercica shall pay to Insmed royalties on the Net Sales for such Opt-In Indication at a rate of
[***], and such royalty payment obligation shall expire in a given Sale Country on a Sale Country-by-Sale Country basis, upon the later of (A) the expiration of the last to expire Insmed Patents existing in such Sale Country that would be
infringed by the use, sale, offer for sale, or importation of such Product for use in such Opt-In Indication in such Sale Country but for the license grant in Section 3.2(b), and (B) the expiration of the last to expire Insmed Patents
existing in such Sale Country or other country that covers the actual method of manufacture or use of such Product (or a component thereof) as practiced by Insmed in the manufacture of such Product in such Sale Country or such other country that is
subsequently sold for use in such Opt-In Indication in such Sale Country; 
  

 46 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 (4) Tercica (a) shall become, if not already, the Booking Party for such Opt-In
Indication; (b) shall have the final decision making authority in the commercialization of such Product for such Opt-In Indication; (c) shall make payments to GNE from the proceeds received from such future sales of a Product for such
Opt-In Indication to cover both the royalties otherwise due for such future sales and the unpaid royalties from sales booked prior to such termination; and (d) shall reserve all rights to seek recovery from Insmed for such royalty payments made
to GNE by Tercica that account for the unpaid royalties from sales booked prior to such termination and Insmed shall have the obligation to reimburse Tercica for all such payments, together with all costs and expenses incurred by Tercica in seeking
such recovery from Insmed. 
 (c) Additional Rights to Terminate for Insmed’s Material Breach Where Such Material Breach is with
Respect to a Permitted Indication other than an Opt-In Indication. 
 (i) Tercica’s and GNE’s Right to Terminate. If
Insmed commits a Material Breach with respect to a Permitted Indication other than an Opt-In Indication, then each of Tercica and GNE shall have the right to terminate this Agreement with respect to such Permitted Indication pursuant to
Section 12.2 above, provided that, if at the time of such proposed termination, the Opt-In rights of Tercica and GNE with respect to such Permitted Indication under Section 4.2 have not expired or lapsed, then the Party seeking to
terminate this Agreement with respect to such Permitted Indication shall obtain the written consent of the other non-breaching Party prior to such termination. 
 (ii) Consequences of Termination by Tercica or GNE. If Tercica or GNE terminates this Agreement with respect to a particular Permitted Indication pursuant to Section 12.3(c)(i) above, then: 
 (1) such Permitted Indication shall thereafter be deemed, for all purposes under this Agreement to be a Non-Permitted Indication; and 

(2) the remaining provisions set forth in this Agreement shall otherwise remain in full force and effect. 
 12.4 Termination by Insmed for GNE’s and/or Tercica’s Material Breach. 
 (a) Termination of the Agreement in its Entirety by Insmed for Tercica’s and/or GNE’s Material Breach of More Than One Permitted
Indication. 
 (i) Insmed’s Right to Terminate. Insmed shall have the right to terminate this Agreement in its entirety
pursuant to Section 12.2 above only in the event of an uncured Material Breach by Tercica and/or GNE with respect to more than one (1) Permitted Indications. 
  

 47 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 (ii) Consequences of Termination by Insmed. If Insmed terminates this Agreement in its
entirety pursuant to Section 12.4(a)(i), then: 
 (1) the licenses granted to Insmed in Section 3.1 shall immediately
terminate; 
 (2) the Permanent Injunction and the UK Proceedings Settlement Agreement shall each remain in full force and effect;

 (3) Insmed shall immediately cease to make, have made, use, sell, offer for sale or import any Product, either by itself or
through an Affiliate, Sublicensee or subcontractor, in any country in the Other Territory to the extent any unexpired Licensed Patents existing in such country would be infringed by such manufacture, having manufactured, use, sale, offer for sale or
importation of such Product in such country; 
 (4) within five (5) business days after the effective date of such termination,
in the event and to the extent of any Infringing Activity, Insmed shall be automatically enjoined from engaging in and from inducing any Third Party to engage in any such Infringing Activity, such injunction to remain and continue in full force and
effect until the expiration of the last to expire of such GNE Patents covering such Infringing Activity; and 
 (5) all rights and
obligations under this Agreement shall terminate except for the Parties’ rights and obligations under Sections 3.2(a), 3.4, 3.5, 3.6, 7.8 and 12.6, and Articles 1, 2, 9, 11 (to the extent the Claims arise from actions or omissions under this
Agreement), 13 and 14. 
 (b) Termination of the Agreement for a Permitted Indication by Insmed. 
 (i) Insmed’s Right to Terminate. Insmed shall have the right to terminate this Agreement pursuant to Section 12.2 only with respect to a
given Permitted Indication upon an uncured Material Breach by Tercica and/or GNE with respect to such Permitted Indication. 
 (ii)
Consequences of Termination by Insmed. If Insmed terminates this Agreement with respect to a particular Permitted Indication pursuant to Section 12.4(b)(i), then: 
 (1) the Permanent Injunction and the UK Proceedings Settlement Agreement shall each remain in full force and effect; and 
 (2) this Agreement shall continue in full force and effect except as follows (as applicable): 
 (a) if the Opt-In right for such Permitted Indication has not been exercised by the breaching Party, then it shall be cancelled and shall be of no force or effect with respect to such Party; or 
 (b) where an Opt-In Party has exercised the Opt-In right with respect to such Permitted Indication, Insmed 

  

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TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
shall have the right to take over development of such Opt-In Indication in its entirety, in accordance with the financial consequences as described in
remainder of this Section 12.4(b)(ii)(2)(b). If Insmed elects to take over development of such Opt-In Indication in entirety, then the Percentage Interest of such Opt-In Party in such Opt-In Indication shall be reduced to a portion equal to the
result of the following formula: 
  

							
	50% x	 	[	 	 Total Development Costs actually funded by Opt-In Party prior to the date of the Material Breach
 50% x (Total Development Costs incurred by the Opt-In Party and Insmed to obtain regulatory approval
 of such Product in the given country at issue)
	 	]

 The profit-sharing arrangement (as adjusted pursuant to the formula in this Section 12.3(b)(ii)(2)(b)) shall
continue only until the payments so received by the Opt-In Party equal the Development Costs actually incurred by the Opt-In Party for a Product for such Opt-In Indication. The formula provided in this Section 12.4(b)(ii)(2)(b) shall be
interpreted based on the same principle set forth in the illustration in Section 12.3(b)(ii)(3). Thereafter the profit share arrangement for such Opt-In Indication shall terminate and Insmed shall pay to the Opt-In Party royalties on the Net
Sales for such Opt-In Indication at a rate of [***], and such royalty payment obligation shall expire in a given Sale Country on a Sale Country-by-Sale Country basis, upon the later of (A) the expiration of the last to expire Licensed Patents
existing in such Sale Country that would be infringed by the use, sale, offer for sale, or importation of such Product for use in such Opt-In Indication in such Sale Country but for the license grant in Section 3.1(c), and (B) the
expiration of the last to expire Licensed Patents existing in such Sale Country or other country that would, but for the license grant in Section 3.1(c), be infringed by the actual method of manufacture or use of such Product (or a component
thereof) as practiced by Insmed in the manufacture of such Product in such Sale Country or such other country that is subsequently sold for use in such Opt-In Indication in such Sale Country. 
 (c) all Committees relating to such Permitted Indication shall be disbanded and Insmed shall have the full authority over all subsequent
development and commercialization activities relating to such Product for such Permitted Indication; and 
 (d) the breaching Party
shall transfer to Insmed all materials obtained or developed in connection with the commercialization of a Product in such Permitted Indication, including without limitation, all Product (including samples), Product Labeling and Promotional
Materials. 
 12.5 Election to Keep Agreement or Indication in Effect Despite Right to Terminate and Consequences Thereof. If a
non-breaching Party has the right to terminate this Agreement in its entirety pursuant to this Article 12 due to an uncured Material Breach with respect to more than one (1) Permitted Indications by a breaching Party, such non-breaching Party
may nonetheless elect not to terminate the Agreement in its entirety, in which event: 
 (a) the Permanent Injunction shall remain in
full force and effect; and 
 (b) the Agreement shall continue in full force and effect except that to the extent the breaching Party
is an Opt-In Party who has materially breached the Agreement by failing to co-fund the Development Costs of a Product for a particular Opt-In Indication, 

  

 49 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
such Opt-In Party shall no longer have such right to continue to co-fund such Development Costs, and the Percentage Interest of such Opt-In Party in such
Opt-In Indication shall be reduced to a portion equal to the result of the following formula: 
  

							
	50% x	 	[	 	 Development Costs actually funded by Opt-In Party prior to the
date of the Material Breach
 50% x (Total Development Costs incurred by the Opt-In Party and Insmed to obtain regulatory
 approval of such Product in the given country at issue)
	 	]

 The profit-sharing arrangement (as adjusted pursuant to the formula in this Section 12.5(b) shall continue
only until the payments so received by the Opt-In Party equal the Development Costs actually incurred by such breaching Opt-In Party for a Product for such Opt-In Indication (the formula provided in this Section 12.5(b) shall be interpreted
based on the same principle set forth in the illustration in Section 12.3(b)(ii)(3)), and thereafter the profit share arrangement for such Opt-In Indication shall terminate and the sales for such Opt-In Indication shall be subject to the
royalty payments set forth in Section 7.1(a)(ii) as if such Opt-In Indication was not an Opt-In Indication. 
 In addition, such election not to so
terminate the Agreement shall not constitute a waiver or release of, or otherwise be deemed to prejudice or adversely affect, any rights, remedies or claims, whether for damages or otherwise, that the non-breaching Party may have hereunder or that
may arise out of or in connection with such Material Breach by the breaching Party. 
 12.6 Other Remedies. Termination or expiration
of this Agreement for any reason shall not release any Party from any liability or obligation that already has accrued prior to such expiration or termination, nor affect the survival of any provision hereof to the extent it is expressly stated to
survive such termination. Termination or expiration of this Agreement for any reason shall not constitute a waiver or release of, or otherwise be deemed to prejudice or adversely affect, any rights, remedies or claims, whether for damages or
otherwise, that a Party may have hereunder or that may arise out of or in connection with such termination or expiration. 
 ARTICLE 13

 DISPUTE RESOLUTION 
 Any dispute, controversy or claim arising out of or relating to this Agreement, or the breach or termination thereof, shall be settled as follows: 
 13.1 Reference to Executives. Except as set forth in Section 5.5(d) with respect to disputes involving sales tracking, in the event of a significant controversy, claim, or dispute arising out of or
relating to this Agreement or any significant breach thereof (hereinafter collectively referred to as a “Dispute”), the Parties agree that the Dispute shall be described in writing by one or all of the Parties and copies of the
description(s) shall be sent to the General Counsel of Insmed, the General Counsel of Tercica, and the General Counsel of GNE. These General Counsels (or their designees or equivalents who have decision-making authority) will then have thirty (30)

  

 50 

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TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
days from receipt of such Dispute description to attempt in good faith to resolve the Dispute. In the event that the Dispute is not resolved within this
thirty (30) day time period, then any Party can proceed to arbitration of the Dispute, as described in Section 13.2, or to litigation, as described in Section 13.3. 
 13.2 Arbitration. Subject to Section 13.3, the Parties agree that any Dispute shall be resolved through negotiation. If a Dispute arises
between the Parties, and if said Dispute cannot be resolved pursuant to Section 13.1 (and such Dispute does not relate to a patent) then any such Dispute, including, without limitation, the interpretation, enforceability, performance, breach,
termination or validity hereof, including, without limitation, this arbitration clause, shall be solely and finally settled by arbitration in the manner specified in this Section 13.2. All arbitration proceedings shall be conducted in the San
Francisco Bay Area or such other location as is mutually agreed to by the Parties. The arbitration proceedings shall be conducted under the procedural rules of the American Arbitration Association or such other forum as is mutually agreed to by the
Parties. The Party requesting arbitration shall serve upon the other Party a written demand for arbitration stating the substance of the Dispute, and the contention of the Party requesting arbitration. Within sixty (60) days after the demand,
the Parties shall select three (3) arbitrators as follows: each Party shall designate one arbitrator, and those two arbitrators shall designate a third. The decision of the arbitrators shall be in writing setting forth the basis therefor. The
arbitrators shall have the authority to award such remedies as they believe are appropriate in the circumstances, including, but not limited to, compensatory damages, interest, tort damages (but not consequential and incidental damages or punitive
or similar damages) and specific performance and other equitable relief. The Parties shall abide by the award rendered in such arbitration proceeding, and such award may be entered, enforced and executed upon in the United States District Court for
the Northern District of California. The Parties shall divide equally the administrative charges, arbitrators’ fees and related expenses of arbitration, but each Party shall pay its own attorney’s fees incurred in connection with such
arbitration; provided however, if the arbitrators specifically determine that one Party prevailed clearly and substantially over the other Party, then the arbitrators may require that the non-prevailing Party shall also pay the prevailing
Party’s reasonable attorney’s fees and expert witness costs and arbitration costs. 
 13.3 Patent Dispute Resolution. Any
dispute, controversy or claim relating to the scope, validity, enforceability or infringement of any Licensed Patents or Insmed Patents covering the manufacture, use or sale of any Product shall be submitted to a court of competent jurisdiction.

 13.4 Governing Law. In the event that a Dispute is not resolved though discussion of the executives pursuant to Section 13.1,
as provided above, the laws of California shall apply to any arbitration or litigation under this Agreement (regardless of its or any other jurisdiction’s choice of law principles), provided that matters of intellectual property law
shall be determined in accordance with the national intellectual property laws relevant to the intellectual property in question. For any disputes, arbitrations or litigation under this Agreement, each Party hereby consents to personal jurisdiction
and venue in the United States District Court for the Northern District of California, and agrees to service of process issued or authorized by such Court. 
  

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 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 13.5 Restraining Order. The dispute resolution procedures set forth herein shall not limit a
court from granting a temporary restraining order or a preliminary injunction in order to preserve the status quo of the Parties’ pending arbitration or to protect a Party’s trademark or confidential or proprietary information. Further,
the arbitrator shall have power to enter such orders by way of interim award, and such orders shall be enforceable in court. 
 ARTICLE 14

 MISCELLANEOUS 
 14.1 Entire Agreement; Amendment. This Agreement, including the Exhibits hereto, sets forth the complete, final and exclusive agreement and all the covenants, promises, agreements, warranties, representations, conditions and
understandings between the Parties hereto with respect to the subject matter hereof and supersedes, as of the Effective Date, all prior agreements and understandings between the Parties with respect to the subject matter hereof. There are no
covenants, promises, agreements, warranties, representations, conditions or understandings, either oral or written, between the Parties other than as are set forth herein and therein. Notwithstanding the foregoing, and for the avoidance of doubt,
the Permanent Injunction and the UK Proceedings Settlement shall remain in full force and effect and shall not be superseded by this Agreement. No subsequent alteration, amendment, change or addition to this Agreement shall be binding upon the
Parties unless reduced to writing and signed by an authorized officer of each Party. 
 14.2 Notices. Any notice required or permitted
to be given under this Agreement shall be in writing, shall specifically refer to this Agreement, and shall be addressed to the appropriate Party at the address specified below or such other address as may be specified by such Party in writing in
accordance with this Section 14.2, and shall be deemed to have been given for all purposes (a) when received, if hand-delivered or sent by a reputable overnight delivery service, or (b) five (5) business days after mailing, if
mailed by first class certified or registered mail, postage prepaid, return receipt requested. 
  

			
	If to Tercica:	  	Tercica, Inc.
		  	2000 Sierra Point Parkway
		  	Suite 400
		  	Brisbane, CA 94005
		  	Attention: General Counsel
		
	With a copy to:	  	Cooley Godward Kronish LLP
		  	Five Palo Alto Square
		  	3000 El Camino Real
		  	Palo Alto, CA 94306
		  	Attention: Barbara A. Kosacz, Esq.
		
	With a copy to:	  	McDermott Will & Emery LLP
		  	3150 Porter Drive
		  	Palo Alto, CA 94304-1212
		  	Attention: William G. Gaede III, Esq.

  

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 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

			
		
	If to Insmed:	  	Insmed Incorporated
		  	8720 Stony Point Parkway
		  	Suite 200
		  	Richmond, VA 23235
		  	Attention: Chief Executive Officer
		
	With a copy to:	  	Goodwin Procter LLP
		  	Exchange Place
		  	53 State Street
		  	Boston, MA 02109
		  	Attention: Mitchell Bloom, Esq.
		
	If to GNE:	  	Genentech, Inc.
		  	1 DNA Way
		  	South San Francisco, CA 94080
		  	Attention: General Counsel
		
	With a copy to:	  	Heller Ehrman LLP
		  	333 Bush Street
		  	San Francisco, CA 94104
		  	Attention: M. Patricia Thayer, Esq.

 14.3 No Strict Construction; Headings. This Agreement has been prepared jointly and shall
not be strictly construed against any Party. Ambiguities, if any, in this Agreement shall not be construed against any Party, irrespective of which Party may be deemed to have authored the ambiguous provision. Wherever used herein, the terms
“includes” and “including” mean includes without limitation and including without limitation, respectively. The headings of each Article and Section in this Agreement have been inserted for convenience of reference only and are
not intended to limit or expand on the meaning of the language contained in the particular Article or Section. 
 14.4 Assignment.
None of the Parties may assign or transfer this Agreement or any rights or obligations hereunder without the prior written consent of the other Parties, except that a Party may make such an assignment without the other Parties’ consent to
Affiliates or to a successor to substantially all of the business of such Party in the field to which this Agreement relates, whether in a merger, sale of stock, sale of assets or other transaction. Any permitted successor or assignee of rights
and/or obligations hereunder shall, in a writing to each of the other Parties, expressly assume performance of such rights and/or obligations. Any permitted assignment shall be binding on the successors of the assigning Party. Any assignment or
attempted assignment by any Party in violation of the terms of this Section 14.4 shall be null, void and of no legal effect. Notwithstanding the aforesaid, to the extent such assignment of rights is permitted in any section of this Agreement
other than this Section 14.4, Ipsen shall be considered a permitted assignee of Tercica. 
  

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 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 14.5 Performance by Affiliates. Each Party may discharge any obligations and exercise any
right hereunder through any of its Affiliates. Each Party hereby guarantees the performance by its Affiliates of such Party’s obligations under this Agreement, and shall cause its Affiliates to comply with the provisions of this Agreement in
connection with such performance. Any breach by a Party’s Affiliate of any of such Party’s obligations under this Agreement shall be deemed a breach by such Party, and the other Party may proceed directly against such Party without any
obligation to first proceed against such Party’s Affiliate. 
 14.6 Further Actions. Each Party agrees to execute, acknowledge
and deliver such further instruments, and to do all such other acts, as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement. 
 14.7 Severability. If any one or more of the provisions of this Agreement is held to be invalid or unenforceable by any court of competent jurisdiction from which no appeal can be or is taken, the provision
shall be considered severed from this Agreement and shall not serve to invalidate any remaining provisions hereof. The Parties shall make a good faith effort to replace any invalid or unenforceable provision with a valid and enforceable one such
that the objectives contemplated by the Parties when entering this Agreement may be realized. 
 14.8 No Waiver. Any delay in
enforcing a Party’s rights under this Agreement or any waiver as to a particular default or other matter shall not constitute a waiver of such Party’s rights to the future enforcement of its rights under this Agreement, except with respect
to an express written and signed waiver relating to a particular matter for a particular period of time. 
 14.9 Independent
Contractors. Each Party shall act solely as an independent contractor, and nothing in this Agreement shall be construed to give any Party the power or authority to act for, bind, or commit any other Party in any way. Nothing herein shall be
construed to create the relationship of partners, principal and agent, or joint-venture partners between the Parties. 
 14.10
Counterparts. This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 
 Signature Page To Follow 
  

 54 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 IN WITNESS WHEREOF, the Parties have executed
this Settlement, License and Development Agreement in duplicate originals by their duly authorized officers as of the Effective Date. 
  

							
	TERCICA, INC.	 	INSMED INCORPORATED
				
	By:	 	 /s/ Stephen N. Rosenfeld
	 	By:	 	 /s/ Geoffrey Allan

	Name:	 	Stephen N. Rosenfeld	 	Name:	 	Geoffrey Allan
	Title:	 	Executive Vice President, Legal Affairs	 	Title:	 	President and CEO
		 	General Counsel and Secretary	 		 	
		
	GENENTECH, INC.	 	INSMED THERAPEUTIC PROTEINS, INC.
				
	By:	 	 /s/ Joseph S. McCracken
	 	By:	 	 /s/ Geoffrey Allan

	Name:	 	Joseph S. McCracken	 	Name:	 	Geoffrey Allan
	Title:	 	VP Business Development	 	Title:	 	President and CEO
			
	CELTRIX PHARMACEUTICALS, INC.	 		 	
				
	By:	 	 /s/ Geoffrey Allan
	 		 	
	Name:	 	Geoffrey Allan	 		 	
	Title:	 	President and CEO	 		 	

 Signature Page to Settlement, License and Development Agreement 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 EXHIBITS 
 Exhibit A – Financial Appendix 
 Exhibit B – Form of Consent Judgment and Permanent Injunction 
 Exhibit C – Form of UK Proceedings Settlement Agreement 
 Exhibit D – Joint Letter to Physicians 
 Exhibit E – Co-Promotion Agreement Terms and Conditions 
 Exhibit F – Joint Press Release 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 EXHIBIT A 
 FINANCIAL APPENDIX 
 This Exhibit A to the Agreement sets forth
financial planning, accounting policies and procedures to be followed in determining Operating Profit (Loss) and related sharing of revenue and expenses for a Product for an Opt-In Indication and for calculating Net Sales for purposes of
Section 7.1. Except as required for calculating Net Sales for purposes of Section 7.1, the terms and conditions set forth in this Exhibit A shall apply following the exercise of a Party’s Opt-In rights until the exercise by the Opt-In
Party of the Opt-In Party’s Opt-Out rights, if any, to the sales of a Product for the Opt-In Indication in the Territory. 
 The contents of this
Exhibit A are hereby incorporated into the Agreement and are governed by the terms and conditions of the Agreement, including the confidentiality provisions set forth therein. 
 A.1 Principles of Reporting. 
 The presentation of budgets and results of operations of Insmed and the Opt-In Party in
the Territory will be based on each Party’s respective financial information presented separately and on a consolidated basis using the following schema (financial terms are defined further below): 
 Gross Sales 
 less Sales Returns & Allowances 
 = Actual Sales 
 less Cost of Sales (which includes FBMC) 
 less Distribution Costs (which includes Allocable Overhead) 
 less G&A Costs 
 less Other Operating Income/Expense 
 less Development Costs (which includes Allocable Overhead) 
 less Selling and Marketing Costs (which includes
Allocable Overhead) 
 = Operating Profit (Loss) 
 The types of costs in this schema are to be grouped together as follows: 
  

					
	 DIRECT COSTS
	  	 NON-DIRECT COSTS
	  	 TERMS FOR CALCULATING

	Cost of Sales	  	Allocable Overhead	  	Operating Profit (Loss)
	Development Costs	  	G&A Costs	  	Gross Sales
	Distribution Costs	  		  	Sales Returns & Allowances
	FBMC	  		  	
	Other Operating Income/Expense	  		  	
	Selling and Marketing Costs	  		  	

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 If necessary, a Party will make the appropriate adjustments to the financial information it supplies under the
Agreement to conform to the above format of reporting results of operations. 
 Accounting and Cost Categories. Definitions of the various categories
of revenues, costs and expenses included in Operating Profit (Loss) shall be interpreted in accordance with GAAP. Any costs included in the calculation under one cost category may not be included in the calculation of another cost category. Where
the terms of this Financial Appendix would permit inclusion of a cost within more than one cost category, that cost will be allocated to a single cost category consistent with GAAP and the other provisions of this Agreement. Any cost included in
this calculation shall only include costs directly or indirectly (to the extent allowed and consistent with the definitions for this Financial Appendix) allocable to a Product for the Opt-In Indication in accordance with GAAP. 
 References to “Collaboration.” References in this Financial Appendix to the “Collaboration” are references to those activities related
to a Product that would form the basis for Operating Profit (Loss) under this Agreement. The Parties may consolidate accounting of operations related to Product for the specific Opt-In Indication, and the activities subject to that consolidated
accounting also will be referred to as the “Collaboration.” Where the same Parties are Collaborating on more than one Opt-In Indication, the accounting of operations related to a Product for all such Opt-In Indications may be consolidated.
However, the Collaboration is not a legal entity for financial accounting, income tax reporting or any other purposes 
 A.2 Frequency of
Reporting. 
 The fiscal year for the Collaboration will be a calendar year. 
 Each of Insmed and the Opt-In Party is responsible for providing the other Party reports as set forth in the table below, for activities for which it is
responsible and costs it incurred and revenue obtained that forms a component of Operating Profit (Loss) for Product for the Opt-In Indication(s). 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 Reporting will be at the times set forth in the following Report Table, with submissions due on the date indicated or
the next business day if such date is a weekend or U.S. holiday: 
  

							
	 Report
	  	 Frequency
	  	 Responsible
Party
	  	 Timing of Submission

	 Non-Booking Party monthly Actual Sales
 (actual numbers)
	  	Monthly	  	 Non-
 Booking
 Party
	  	+ 5 days after the end of such month
	 Non-Booking Party quarterly Operating Profit (Loss)
  
 •     For the first three
quarters in the calendar year: report to include actual numbers for the first two months of the then current calendar quarter, and forecasted numbers for the last month of the then current calendar quarter for planning.
  
 •     For the last quarter of
the calendar year, the report should include the actual numbers for the first 11 months of such calendar year and the forecasted numbers for the last month of such calendar year for planning
	  	Quarterly	  	 Non-
 Booking
 Party
	  	Q1-Q4: + 75 days after the beginning of such calendar quarter
	 Consolidated quarterly Operating Profit (Loss)
  
 •     For the first three
quarters in the calendar year: report to include actual numbers for the first two months of the then current calendar quarter, and forecasted numbers for the last month of the then current calendar quarter for planning.
  
 •     For the last quarter of
the calendar year, the report should include the actual numbers for the first 11 months of such calendar year and the forecasted numbers for the last month of such calendar year for planning
	  	Quarterly	  	Booking Party	  	Q1-Q4: + 85 days after the beginning of such calendar quarter (for the last quarter, the report should reflect the actual numbers for the first 11 months
of such calendar year and the forecasted numbers for the last month of such calendar year)
	Non-Booking Party quarterly Operating Profit (Loss) (actual numbers)	  	Quarterly	  	 Non-
 Booking
 Party
	  	Q1-Q4: + 15 days after the end of such calendar quarter
	Draft of consolidated Operating Profit (Loss) (based on actual numbers)	  	Quarterly	  	Booking Party	  	Quarter end +30 days
	Final of consolidated Operating Profit (Loss) (based on actual numbers)	  	Quarterly	  	Booking Party	  	Quarter end +60 days

 The Parties may agree to modify the foregoing reporting cycles and deadlines. In the event that a Party
substantially or materially changes its internal reporting cycles and deadlines generally, then the Parties shall discuss, in good faith, appropriate revisions to the foregoing reporting cycles and deadlines to reasonably accommodate such change.

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 The Party responsible for booking sales (the “Booking Party”) for the Opt-In Indications(s) at issue in
accordance with Section 7.2(d) shall be responsible for the consolidated accounting of Operating Profit (Loss) for the Collaboration. Without limiting the Parties’ reporting obligations as set forth in the Report Table above, on a calendar
quarterly basis, the Party that is not responsible for booking sales (the “Non-Booking Party”) in accordance with Section 7.2(d) will supply the Booking Party with a statement setting forth that quarter’s Operating Profit (Loss)
obtained by the Non-Booking Party for the applicable Product for the Opt-In Indication, including the basis for calculation of such amounts. The Booking Party shall consolidate any Operating Profit (Loss) reported by the Non-Booking Party with those
obtained directly by the Booking Party. Each such report shall be provided as early as possible, on the schedule in the chart above. 
 Each Party will make
available a financial representative to coordinate regarding financial aspects of planning, reporting and information sharing, at the request of the other Party. Upon the reasonable request of either Party, the other Party shall answer any question
and address any comment from the other Party pertaining to such financial planning and reporting. 
 A.3 Budgets. 
 The Booking Party, through the JDC, will prepare a consolidated budget for Operating Profit (Loss) for the Collaboration on an annual basis; the
Non-Booking Party, through the JDC, shall provide input for that budget regarding its sales force activities. 
 Budgets are provided for information and
planning purposes, including establishing the initial profit share ratio for the forthcoming calendar year; final sharing of Operating Profit (Loss) on a calendar year basis are based on actual amounts. The Party that is the Non-Booking Party shall
not be required to fund an amount which is more than half of 110% of the budgeted amount for such expenditure without its prior written consent to such variance from budget. 
 A.4 Financial Appendix Definitions. 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 
 [***] 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 EXHIBIT B 
 FORM OF CONSENT JUDGMENT AND PERMANENT INJUNCTION 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

			
	MCDERMOTT WILL & EMERY LLP
	WILLIAM G. GAEDE, III (136184)
	wgaede@mwe.com
	TERRENCE P. McMAHON (71910)
	tmcmahon@mwe.com
	ANDREW A. KUMAMOTO (178541)
	akumamoto@mwe.com
	DAVID L. LARSON (112342)
	dlarson@mwe.com
	3150 Porter Drive
	Palo Alto, CA 94304-1212
	Telephone:	  	(650) 813-5000
	Facsimile:	  	(650) 813-5100

 Attorneys for Tercica, Inc. 
  

			
	HELLER EHRMAN LLP
	M. PATRICIA THAYER (90818)
	patricia.thayer@hellerehrman.com
	ETHAN C. GLASS (216159)
	ethan.glass@hellerehrman.com
	333 Bush Street
	San Francisco, CA 94104-2878
	Telephone:	  	(415) 772-6794
	Facsimile:	  	(415) 772-6268

 Attorneys for Genentech, Inc. 
 UNITED STATES DISTRICT COURT 
 NORTHERN DISTRICT OF CALIFORNIA 
 OAKLAND DIVISION 
  

			
	GENENTECH, INC., a Delaware corporation,	 	No. C-04-5429 CW (EMC)
	 and TERCICA, INC., a Delaware corporation,
	 	
		
	 Plaintiffs,
	 	 CONSENT JUDGMENT AND
 PERMANENT
INJUNCTION

	 v.
	 	
		
	 INSMED INCORPORATED, a Virginia
 corporation, CELTRIX
PHARMACEUTICALS,
 INC., a Delaware corporation, and INSMED
 THERAPEUTIC PROTEINS, a Colorado corporation,
	 	
		
	 Defendants.
	 	
		
	AND RELATED COUNTERCLAIMS.	 	

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 RECITALS 
 Whereas, Plaintiff Tercica, Inc. is the exclusive licensee of U.S. Patent No. 6,331,414 entitled “Preparation of Human IGF via Recombinant DNA Technology,” which issued to Plaintiff Genentech,
Inc. as assignee of the inventors on December 18, 2001; 
 Whereas, Plaintiff Tercica, Inc. is the exclusive licensee of U.S.
Patent No. 5,187,151 entitled “Use of Binding Protein with IGF-1 as an Anabolic Growth Promoting Agent,” which issued to Plaintiff Genentech, Inc. as assignee of the inventors on February 16, 1993; 
 Whereas, Plaintiff Tercica, Inc. is the exclusive licensee of U.S. Patent No. 5,258,287 entitled “DNA Encoding and Methods of Production
of Insulin Like Growth Factor Binding Protein BP53,” which issued to, inter alia, Plaintiff Genentech, Inc., as assignee of the inventors on November 2, 1993; 
 Whereas, on December 23, 2004, Plaintiffs Genentech, Inc. (GNE) and Tercica, Inc. (Tercica) filed this action against Insmed Incorporated
Genentech Inc., et al. v. Insmed Incorporated, et al., United States District Court for the Northern District of California, Case No. 04-CV-05429-CW (EMC) (the “Lawsuit”). By operation of the Second Amended Complaint, Defendant
Celtrix Pharmaceuticals, Inc. was added as a named defendant in the lawsuit. By operation of the Third Amended Complaint, Defendant Insmed Therapeutic Proteins was added as a named defendant to the Lawsuit. Plaintiffs alleged that Defendants’
making, using, selling, offering to sell, import or export of the product known as IPLEXTM, infringed or will infringe under 35 U.S.C. § 271(a) – (c) and (g) certain asserted claims of United States Patent Nos. 5,187,151 (the
“‘151 Patent”), 5,258,287 (the “‘287 Patent”) and 6,331,414 (the “‘414 Patent”) (collectively, the “Asserted Patents”). 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 Whereas, Defendants denied such allegations and further alleged, among other defenses, that
the asserted claims of the Asserted Patents were invalid under various theories, including those arising under 35 U.S.C. §§ 102, 103, 112 and 135. Defendants further asserted that the ‘151 Patent was unenforceable for alleged
inequitable conduct. 
 Whereas, the parties had a full and fair opportunity to litigate the case, including full fact and expert
discovery, and motion process, including claim construction, motions for summary judgment and other pretrial motions as reflected in the docket sheet. 
 Whereas, the Court adjudicated as a matter of law on June 30, 2006 that Defendants’ method of making the rhIGF-I component of IPLEXTM literally infringed Claims 1 and 9 of the ‘414 Patent
(Docket No. 510), and Defendants subsequently stipulated, subject to an appeal of the Court’s claim construction, that their method also literally infringed Claims 2, 3, 4 and 10 of the ‘414 Patent. 
 Whereas, a jury trial commenced on November 6, 2006, that resulted in the Verdict Form (Docket No. 1006), filed December 6, 2006.
The Jury found that Defendants Insmed and Insmed Therapeutic Proteins (“Insmed”) induced infringement of Claims 1, 4 and 5 of the ‘151 Patent, contributorily infringed Claims 1, 4 and 5 of the ‘151 Patent, and literally infringed
Claims 1, 6-8 and 17 of the ‘287 Patent through the manufacture, distribution, sale, and/or offering to sell IPLEXTM in the United States as approved by the Food and Drug Administration. The Jury further found that Insmed had not proven
that Claims 1-4, 9-10 of the ‘414 Patent were invalid under the enablement or written description requirement. The Jury further found that Insmed’s infringement of the ‘151 Patent was willful, and awarded damages to Tercica and GNE of
$7.5 million plus the royalty rates assessed in the Verdict Form on sales of IPLEXTM through December 6, 2006 (the “Awarded Damages”). 
 Whereas, following the verdict, Plaintiffs and Defendants made various post-trial motions, including Plaintiffs’ motion for a permanent injunction. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 Whereas, Plaintiffs and Defendants (the “Parties”) have entered into a Settlement,
License and Development Agreement (“Settlement Agreement”), which is incorporated herein by reference, have withdrawn all pending motions, and have agreed to entry of this Consent Judgment and Permanent Injunction, subject to the
Court’s approval. 
 IT IS HEREBY FOUND, ADJUDICATED AND ORDERED: 
 I. STIPULATED FINDINGS OF FACT/CONCLUSIONS OF LAW 
 1. The Parties stipulate this is an action
for patent infringement arising under the patent laws of the United States. 
 2. The Parties stipulate jurisdiction of this Court is proper
pursuant to 28 U.S.C. §§ 1331, 1332, and 1338(a). 
 3. The Parties stipulate this Court has personal jurisdiction over
Defendants, and each of them, and that venue is proper in this district. 
 4. The Parties stipulate that all claims of the ‘414 Patent,
the ‘151 Patent, and the ‘287 Patent are valid and enforceable. 
 5. The Parties stipulate Defendants have infringed the
above-recited asserted claims of the Asserted Patents. 
 6. Defendants forever waive the right to assert and agree that they shall not ever
assert in any court or administrative tribunal that any claim of the Asserted Patents is invalid and/or not enforceable. Defendants further agree that they will not voluntarily directly or indirectly aid, assert or participate in any action
contesting the validity or enforceability of any of the Asserted Patents. 
 7. The Parties stipulate that the ‘414 Patent is
enforceable until December 18, 2018; that the ‘151 Patent is enforceable until February 12, 2011; and that the ‘287 Patent is enforceable until November 2, 2010. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 8. The Parties stipulate that Plaintiffs are irreparably harmed by, and have no adequate remedy at
law for, Defendants’ infringement, and are entitled to a permanent injunction. 
 9. The Parties stipulate that the balance of hardships
regarding an injunction weighs in Plaintiffs’ favor. 
 10. The Parties stipulate that the public interest does not preclude entry of a
permanent injunction in this case. 
 11. The Parties stipulate to waive any right to appeal from this Consent Judgment and Permanent
Injunction and agree to the exclusive and continuing jurisdiction of this Court to enforce this Consent Judgment and Permanent Injunction. 
 12. The Parties stipulate that the Stipulated Protective Order (Docket No. 169) shall remain in force and effect with the exception of Paragraph 18(f), which is no longer effective. 
 13. The Parties have voluntarily entered into the Settlement Agreement dated March 5, 2007 (which is incorporated herein by reference), subject to
this Court’s approval. 
 II. STIPULATED ORDER FOR PERMANENT INJUNCTION 
 1. Except as expressly permitted below, and as set forth in the Settlement Agreement, Defendants INSMED INCORPORATED, CELTRIX PHARMACEUTICALS, INC., and
INSMED THERAPEUTIC PROTEINS (collectively, “Defendants”), as well as each of their employees, agents, other representatives, officers, directors, stockholders, partners, members, subsidiaries, predecessors, successors, licensees,
distributors, resellers, and assigns, and any persons acting in concert with any of them, are permanently enjoined, as of the date of this Order, from: 
  

	 	(a)	making, using, selling, offering to sell, importing into, or exporting from, the United States, during the patent term of the ‘414 Patent, any product containing rhIGF-1 that
is made using any of the methods claimed in the ‘414 Patent, including without limitation, the current manufacturing method for the rhIGF-I component of the product known as IPLEXTM (mecasermin rinfabate) that employs the plasmid identified
as pPoP/tr41UQ-3c-rhIGF-I; 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

	 	(b)	making, using, selling, offering to sell, importing into, or exporting from, the United States, during the patent term of the ‘287 Patent, any product containing rhIGFBP-3 that
is made using any of the compositions and methods claimed in the ‘287 Patent, including without limitation, the DNA sequence Defendants currently use to manufacture the rhIGFBP-3 component of the product known as IPLEXTM (mecasermin
rinfabate) found in the plasmid identified as pPop/met-rhIGFBP3; and 

  

	 	(c)	using, or otherwise selling, offering to sell, distributing, inducing or otherwise contributing to the use of, in the United States during the term of the ‘151 Patent, any
product or formulation that is administered in accordance with any of the claims of the ‘151 Patent, including, without limitation, IPLEXTM (mecasermin rinfabate), as currently approved by the Food and Drug Administration for commercial
sale in the United States to treat severe primary IGFD. 

 2. Notwithstanding the foregoing, Defendants may: 
  

	 	(a)	conduct research and development or other activity involving mecasermin rinfabate, or any other product, that is protected from claims of patent infringement under 35 U.S.C. §
271(e)(1), unless otherwise prohibited in the Settlement Agreement; 

  

	 	(b)	make, use, sell, offer to sell, import into, or export from, the United States, mecasermin rinfabate to the extent expressly permitted pursuant to (and in accordance with the
requirements of) the grants in Article 3 of the Settlement Agreement. 

 3. Any violation of this Order for Permanent
Injunction may be punishable by civil contempt or other appropriate proceedings, and the Court retains jurisdiction over this matter and over the Parties with the power to adjudicate any such alleged violation. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 III. STIPULATED FINAL JUDGMENT 
 1. Based on the Parties’ stipulated findings above, the Court finds as fact and/or conclusions of law the statements in Paragraphs 1 through 13 of
Section I above. 
 2. Judgment is hereby entered for Plaintiffs and against Defendants. 
 3. Defendants are permanently enjoined in accordance with Section II above. 
 4. In accordance with the terms of the Settlement Agreement, none of the Parties shall recover any damages, including the Awarded Damages, costs, or
attorney’s fees, and each side shall bear its own costs and attorney’s fees. Any further costs associated with obtaining this Judgment shall be assumed by the side incurring them. 
 5. This Judgment constitutes a final judgment that fully concludes and disposes of the claims and defenses in this litigation, and Plaintiffs and
Defendants shall be subject to the full legal effects of issue preclusion, claim preclusion, res judicata, and collateral estoppel. The Parties and this Court explicitly intend such issue preclusion, claim preclusion, res judicata, and
collateral estoppel to extend and apply to any issues of infringement, validity, inventorship, and enforceability regarding any of the claims of the ‘414 Patent, the ‘151 Patent and the ‘287 Patent raised in any subsequent court or
administrative proceeding and regardless of the product or process at issue. 
 6. This Court retains exclusive jurisdiction over the parties
and over this action for purposes of ensuring compliance with this Consent Judgment and Permanent Injunction, and to enforce the Settlement Agreement. The Settlement Agreement, incorporated herein by reference, shall be filed with the Court under
seal. 
 7. No appeal shall be taken by any party from this Consent Judgment and Permanent Injunction, the right to appeal having been
expressly waived by all parties. 
 8. This Consent Judgment and Permanent Injunction may be modified by written agreement of the parties,
subject to Court approval. 
 The Clerk is directed to enter this Consent Judgment and Permanent Injunction forthwith. 
 IT IS SO ORDERED. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

					
	 DATED:                 , 2007.
	 		 	  

		 		 	HONORABLE CLAUDIA WILKEN
		 		 	United States District Court Judge

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

									
	 Consented to on behalf of Plaintiffs:
	 		 		 	
				
	 DATED:
	 	March 5, 2007	 		 	MCDERMOTT WILL & EMERY LLP
					
		 		 		 	By:	 	  

		 		 		 		 	William G. Gaede, III
		 		 		 		 	Attorneys for Tercica, Inc.
				
		 		 		 	HELLER EHRMAN LLP
					
		 		 		 	By:	 	  

		 		 		 		 	M. Patricia Thayer
		 		 		 		 	Attorneys for Genentech, Inc
				
	 Consented to on behalf of Defendants:
	 		 		 	
				
	 DATED:
	 	March 5, 2007	 		 	FOLEY & LARDNER LLP
					
		 		 		 	By:	 	  

		 		 		 		 	Larry L. Shatzer
				
		 		 		 	HOWREY LLP
					
		 		 		 	By:	 	  

		 		 		 		 	Henry Bunsow
		 		 		 		 	Attorneys for Insmed Incorporated, Celtrix Pharmaceuticals, Inc., and Insmed Therapeutic Proteins, Inc

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 EXHIBIT C 
 FORM OF UK PROCEEDINGS SETTLEMENT AGREEMENT 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 SETTLEMENT AGREEMENT 
 THIS AGREEMENT is made on the      day of March 2007 
 BETWEEN: 
  

	(1)	Tercica, Inc., a company incorporated under the laws of Delaware with offices at 2000 Sierra Point Parkway, Suite 400, Brisbane, CA 94005, United States of America
(“Tercica”); 

  

	(2)	Genentech, Inc., a company incorporated under the laws of Delaware with offices at 1 DNA Way, South San Francisco, California 94080 (“Genentech”);

  

	(3)	Insmed Incorporated, a company incorporated under the laws of Virginia with offices at 8720 Stony Point Parkway, Suite 200, Richmond, VA 23235 (“Insmed”);

  

	(4)	Avecia Limited, a company incorporated under the laws of England and Wales, whose registered office is at PO Box 42, Hexagon Tower, Blackley, Manchester M9 8ZS, United Kingdom
(“Avecia”); and 

  

	(5)	Avecia Biologics Limited, a company incorporated under the laws of England and Wales, whose registered office is at PO Box 42, Hexagon Tower, Blackley, Manchester M9 8ZS, United
Kingdom (“Avecia Biologics”). 

 RECITALS 
 (A) Legal proceedings have been commenced in England between the parties relating to European Patent (UK) No. 0 571 417 in the High Court of Justice under action numbers HC 04 C 03940 and HC 05 C 00415 (the
“UK Proceedings”). 
 (B) Related legal proceedings in the United States between Tercica, Genentech and Insmed have been
settled by an agreement of even date, pursuant to which Tercica, Genentech and Insmed have agreed to discontinue the UK Proceedings and Insmed has agreed to procure on the part of Avecia such acts as may be necessary or desirable to achieve this.

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 (C) The parties have determined that it is in their mutual interest to avoid the expense,
distraction, and uncertainty of further litigation and have therefore agreed to conclude and resolve all of their disputes under the UK Proceedings pursuant to the terms and conditions of this Agreement. 
 (D) Avecia undertook a re-organisation of its group corporate structure in the UK, effective on
1st January 2007, which resulted in the transfer of the group’s biologics business (to which the UK
Proceedings relate) from Avecia to Avecia Biologics. 
 In consideration of the mutual covenants and promises set forth in this Agreement the parties AGREE
as follows: 
  

	1.	Discontinuance of the UK Proceedings 

  

	1.1	The parties agree to discontinue the UK Proceedings with no order as to costs. The parties shall forthwith instruct their respective solicitors to approve, sign and then apply to
the Court for a consent order in the form of the draft order attached as the Schedule to this Agreement (the “Consent Order”). 

  

	1.2	For the avoidance of doubt the Consent Order is without prejudice to costs which have already been paid by one party to another pursuant to any Order of the Court made prior to the
date of this Agreement. 

  

	1.3	The parties shall do all such acts as may be necessary or desirable to obtain and give effect to the Consent Order. 

  

	2.	Settlement 

  

	2.1	This Agreement is in full and final settlement of the claims and counterclaims in the UK Proceedings. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

	2.2	Each party to this Agreement warrants to the others that it has not before the date of this Agreement assigned or transferred or purported to assign or transfer any claim or
counterclaim (or any part thereof) relating to the UK Proceedings save in respect of the transfer from Avecia to Avecia Biologics referred to in Recital D. 

  

	2.3	Without prejudice to the provisions of clause 2.1, Tercica and Genentech undertake to Avecia and Avecia Biologics that, in the event that Tercica and/or Genentech issues proceedings
in respect of facts or matters not pleaded in the Particulars of Infringement in the UK Proceedings against Avecia and/or Avecia Biologics alleging infringement of European Patent (UK) No. 0 571 417, neither Tercica nor Genentech shall
object, by reason of Avecia and Avecia Biologics having entered into this Agreement, to Avecia or Avecia Biologics alleging that European Patent (UK) No. 0 571 417 is invalid as a defence to or counterclaim for revocation in such
infringement proceedings, or to Avecia or Avecia Biologics relying in any such defence or counterclaim on any of the objections raised in the Grounds of Invalidity served in the UK Proceedings. 

  

	2.4	Without prejudice to the provisions of clause 2.1, Avecia and Avecia Biologics undertake to Tercica and Genentech that they shall not object, by reason of Tercica and Genentech
having entered into this Agreement, to Tercica and/or Genentech bringing proceedings in respect of facts or matters not pleaded in the Particulars of Infringement in the UK Proceedings against Avecia and/or Avecia Biologics alleging infringement of
European Patent (UK) No. 0 571 417. 

  

	2.5	For the avoidance of doubt, neither Avecia nor Avecia Biologics shall commence revocation proceedings in respect of European Patent (UK) No. 0 571 417 other than as a
defence to or counterclaim for revocation in the infringement proceedings described in clause 2.3. 

  

	3.	Confidentiality 

 The terms of this Agreement and
the discussions, correspondence and negotiations leading to the making of this Agreement shall remain confidential to the parties who, save as expressly permitted by the terms of this Agreement, shall not disclose the terms of settlement to any
other person except: 
  

	 	(a)	to the auditors and to the legal and other professional advisers of that party; 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

	 	(b)	to the Court in connection with any future legal proceedings between the parties (or any of them); 

  

	 	(c)	where that party is under a legal or regulatory obligation to make such disclosure, but limited to the extent of that obligation; 

  

	 	(d)	with the prior written consent of the other parties to this Agreement; 

  

	 	(e)	by a party to its employees or agents provided that the party making such disclosure ensures that the employees/agents (as the case may be) are made aware of and required to observe
the provisions of this clause. 

  

	4.	General Provisions 

  

	4.1	The headings in this Agreement are solely for reference and shall not affect its interpretation. 

  

	4.2	This Agreement sets out the entire agreement and understanding between the parties in relation to its subject matter. Each of the parties acknowledges that no representation has
been relied upon by that party in connection with or in relation to the settlement to which this Agreement gives effect. 

  

	4.3	This Agreement shall be binding on the parties, their successors and assigns and the name of a party appearing herein shall be deemed to include the names of any such successor or
assign. 

  

	4.4	This Agreement may be executed in any number of counterparts, all of which, taken together, shall constitute one and the same agreement and any party may enter into this Agreement
by executing a counterpart. 

  

	4.5	This Agreement shall be governed by and shall be construed in accordance with English law and the courts of England shall have exclusive jurisdiction to determine any dispute
between the parties regarding the construction and application of this Agreement. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 IN WITNESS of which this Agreement has been signed by and on behalf of the parties effective as of the date
first written above. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 SCHEDULE 
 DRAFT CONSENT ORDER 
  

					
	 (i)
	 		 	IN
	 THE HIGH COURT OF JUSTICE
	 		 	HC 04 C 03940
	 CHANCERY DIVISION
	 		 	
	 PATENTS COURT
	 		 	
			
	 [The Honourable Mr Justice]
	 		 	
	 [Date]
	 		 	
			
	 B E T W E E N:-
	 		 	
			
		 	TERCICA, INC	 	
			
		 		 	Claimant
			
		 	-and-	 	
			
		 	            (1) AVECIA LIMITED	 	
			
		 	            (2) INSMED, INC	 	
			
		 	            (3) GENENTECH, INC	 	
			
		 		 	Defendants
			
	 (ii)
	 		 	A
	 ND
	 		 	HC 05 C 00415
			
	 B E T W E E N:-
	 		 	
			
		 	            (1) AVECIA LIMITED	 	
			
		 	            (2) INSMED, INC	 	
			
		 		 	Claimants
			
		 	-and-	 	
			
		 	GENENTECH, INC	 	
			
		 		 	1.2 Defendant
			
		 	  
	 	
			
		 	 draft/ CONSENT ORDER
	 	

  

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 UPON THE APPLICATION of the parties 
 AND UPON reading the documents recorded in the court file as having been read 
 IT IS BY CONSENT ORDERED THAT
the claims and counterclaims in these proceedings be hereby discontinued and that upon the discontinuance of such claims and counterclaims there shall be no order as to costs. 
  

			
	Marks & Clerk Solicitors	 	 Howrey LLP
 Solicitors for Insmed
Incorporated and Avecia Limited
 22 Tudor Street
 London
 EC4Y 0AY

	Solicitors for Tercica, Inc	 
	 90 Long Acre
 London
 WC2E 9RA
	 
	 	
		
	Ref: MG/GBH/L2297	 	Ref: RW/CPS/04378.0002
		
	Date:     March 2007	 	Date:     March 2007
		
	 Wragge & Co LLP
 Solicitors for Genentech,
Inc
	 	
		
	 3 Waterhouse Square
 142 Holborn
 London EC1N 2SW
	 	
		
	Ref: ANC/YMA	 	
		
	Date:     March 2007	 	

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

									
	 SIGNED for and on behalf of
	  	)	  		    		    	
					
	TERCICA, INC	  	)	  		    		    	
					
	By Stephen N. Rosenfield, its	  	)	  		    		    	
					
	 General Counsel and Executive
  
 Vice-President of Legal Affairs
	  	)
)	  		    	  
	    	
					
		  		  		    	Director	    	
					
	SIGNED for and on behalf of	  	)	  		    		    	
					
	GENENTECH, INC	  	)	  		    	  
	    	
					
	by	  		  	)	    	Director	    	
					
	SIGNED for and on behalf of	  	)	  		    		    	
					
	INSMED INCORPORATED	  	)	  		    	  
	    	
					
	by	  		  	)	    	Director	    	
					
	SIGNED for and on behalf of	  	)	  		    		    	
					
	AVECIA LIMITED	  	)	  		    	  
	    	
					
	by	  		  	)	    	Director	    	
					
	SIGNED for and on behalf of	  	)	  		    		    	
					
	AVECIA BIOLOGICS LIMITED	  	)	  		    	  
	    	
					
	by	  		  	)	    	Director	    	

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN
APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
 EXHIBIT D

 JOINT LETTER TO PHYSICIANS 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 

 
 February 20, 2007 
 Dear ____________, 
 Today, Insmed, Tercica and Genentech concluded a Settlement, Development and Licensing Agreement which lays out the future
development and commercialization of IPLEX. As part of the agreement, the companies settled the outstanding patent infringement suit filed with the Federal Court of the Northern District of California pertaining to IPLEX. As a consequence of the
court’s finding of Tercica’s patents having been infringed, Insmed will no longer be able to provide IPLEX commercially to patients with severe primary IGF-1 deficiency and other short stature indications. It has been agreed that all
patients will be transitioned off IPLEX as soon as the patient’s current supply of IPLEX is exhausted. 
 Insmed and Tercica are fully committed to
assisting you during this transition period. For children currently treated with IPLEX whom you consider suitable for INCRELEX therapy, Tercica will supply INCRELEX free of charge while working with your office to secure reimbursement. 

Tercica’s pediatric endocrinologists, Dr. George Bright and Dr. Sandra Blethen, would be pleased to discuss this transition and any medical questions
you may have. You can reach them at (650) 624-4900 or 1-866-TERCICA. 
 Best regards, 
  

			
	

	  	

		
	 Ronald D. Gunn, M.S., M.B.A.
 Executive Vice President and
 Chief Operating Officer
 Insmed Incorporated
	  	 Thorsten von Stein, MD, PhD
 Senior Vice President
and
 Chief Medical Officer
 Tercica, Inc.

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN
APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
 EXHIBIT E

 CO-PROMOTION AGREEMENT TERMS AND
CONDITIONS 
 If Tercica or GNE (as the case may be) exercises its Co-Promotion Option pursuant to Section 5.3 of the Agreement, the
following terms and conditions shall be incorporated into a definitive Co-Promotion Agreement for the co-promotion of Product for the treatment of the Permitted Indication by Insmed and the Opt-In Party. 
  

			
	 Provision
	  	 Details

	 General:
	  	The Opt-In Party shall the right to provide up to fifty percent (50%) of the selling effort of a Product for the treatment of such Permitted Indication.
		
	Oversight of Co-Promotion:	  	The JCC shall oversee the co-promotion effort and shall allocate all co-promotion responsibilities between the Parties in accordance with a Commercialization Plan that shall be prepared by the
JCC.
		
	Sales Contribution by Tercica and Insmed:	  	TBD
		
	Compensation to Tercica:	  	TBD
		
	 Product Sales:
	  	 The Opt-In Party shall be responsible for receiving and filling orders, controlling invoicing, collection of payments, returns, charge-backs and
rebates on sales of a Product for such Permitted Indication for a Product that it markets.
  
 Insmed shall be responsible for receiving and filling orders, controlling invoicing, collection of payments, returns, charge-backs and rebates on sales of a Product for such Permitted Indication for a Product that it markets.
  
 Insmed shall have sole control over pricing strategies and distribution of a Product for such
Permitted Indication.

		
	Use and Distribution of Promotional Materials:	  	Insmed shall have responsibility for preparing and producing all Promotional Materials for a Product for such Permitted Indication, provided, however, that the JCC shall approve all such
Promotional Materials to ensure consistency across the entire field of effort of both Parties.
		
		  	Insmed shall provide such JCC-approved Promotional Materials to Tercica in accordance with the Commercialization Plan. Each Party’s sales force shall use, and if applicable, distribute
Promotional Materials to physicians to whom it details a Product. Promotional Materials shall not be used unless approved by the JCC.

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN
APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

			
	 Provision
	  	 Details

		  	The Parties shall share equally the cost of developing and producing such Promotional Materials.
		
	 Samples:
	  	The Parties shall use and distribute any samples of a Product in accordance with the Commercialization Plan and all applicable laws.
		
	 Sales Force Training:
	  	Insmed shall develop and provide training programs and materials for a Product for such Permitted Indication to ensure a consistent, focused promotional strategy. Insmed shall treat the Opt-In
Party and Insmed sales representatives as a combined sales force and shall provide the Opt-In Party representatives with the same support and assistance it provides its own representatives. The Opt-In Party shall reimburse Insmed for all training,
support and assistance it shall provide for such Opt-In Party’s representatives.
		
	 Termination:
	  	The Opt-In Party may terminate its co-promotion of a Product for the treatment of the Permitted Indication upon not less than one hundred eighty (180) days prior written notice to Insmed. Insmed
and the Opt-In Party shall reasonably cooperate to transition to Insmed the Opt-In Party’s co-promotion activities with respect to a Product so as to minimize disruption to sales activity and the Opt-In Party shall withdraw its sales
representatives from such co-promotion activities in a professional manner.
		
	Compliance and Performance:	  	Each Party shall be responsible for its own compliance with all applicable laws and Regulatory Authority policies and guidelines relating to the co-promotion of a Product for the treatment of
the Permitted Indication. Each Party’s sales representatives shall be held to the same standards of performance. The Co-Promotion Agreement shall include an audit provision for purposes of measuring each Party’s sales force effectiveness
and performance.
		
	 Regulatory:
	  	Insmed shall be solely responsible for communicating with the applicable regulatory authorities, including any adverse event reporting, recall notifications and safety updates. The Opt-In Party
shall reasonably cooperate with Insmed regarding co-promotion activities so that Insmed can meet its regulatory obligations.

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT TO AN
APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
 EXHIBIT F

 Joint Press Release 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

					
	Tercica Logo	 		 	INSM Logo

 Investor & Media Contacts for Tercica and Insmed: 
 Litigation Settlement Reached between Tercica, Genentech and Insmed 
 Companies Partner through License and Development Agreement 
 Brisbane, California and Richmond, Virginia. –
March 6, 2007 – Tercica, Inc., (Nasdaq: TRCA) and Insmed Incorporated (Nasdaq: INSM) today announced that Tercica, Insmed and Genentech, Inc. (NYSE: DNA) have entered a Settlement, License and Development Agreement that resolves all
outstanding litigation between the companies, including the patent infringement suits brought by Tercica and Genentech against Insmed in the United States (N.D. Cal.) and United Kingdom, and the unfair business practices suit (E.D. Virginia). The
key elements of this settlement are: 
  

	 	•	 	 Insmed will no longer provide IPLEX to patients with severe Primary IGF-1 Deficiency and other short stature indications and will withdraw its IPLEX marketing
authorization application for severe Primary IGF-1 Deficiency in the European Union 

  

	 	•	 	 Through licensing and development rights granted by Tercica and Genentech, Insmed will have freedom to operate regarding the manufacture, development and
commercialization of IPLEX for certain non short stature indications including severe insulin resistance, myotonic muscular dystrophy and HIV associated adipose redistribution syndrome (HARS), subject to opt-in rights and royalty provisions for
Tercica and Genentech 

  

	 	•	 	 Tercica and Genentech have waived the damages award by the jury in the U.S. patent infringement litigation. 

 In a joint statement, Dr. John A. Scarlett, Tercica’s President and Chief Executive Officer, and Dr. Geoffrey Allan, Insmed’s President,
Chief Executive Officer and Chairman of the Board of Directors stated, “We are very pleased with our new licensing and development relationship. It allows Tercica to focus its efforts in the short stature market and allows Insmed, in
cooperation with Tercica and Genentech, to focus its IPLEX development efforts in valuable non-short stature indications.” 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 U.S./Canada IPLEX Sales for Tercica/Genentech Indications 
 As a consequence of the court’s finding that Tercica’s patents were infringed, Insmed will no longer be able to provide IPLEX in the U.S. for severe Primary
IGF-1 Deficiency and the following indications: Primary IGF-1 Deficiency, Noonan’s Syndrome, Laron Syndrome, Growth Hormone Deficiency, and all other short stature indications; and Adult Growth Hormone Deficiency. These indications are
collectively referred to as “the TRCA/Genentech Indications.” Insmed and Tercica will work closely together with pediatric endocrinologists to identify therapeutic alternatives for children currently receiving IPLEX, and where appropriate,
to transition patients to Increlex. 
 IPLEX Worldwide License and Development Agreement 
 The parties will form a joint development (and subsequently, a joint commercialization) committee to guide the development and commercialization of IPLEX in non-Tercica/Genentech Indications. Tercica (along with
Ipsen, for Ipsen’s Increlex territory) and Genentech will have the right to opt into Insmed’s development and commercialization of each non-Tercica/Genentech Indication up to 90 days after Insmed provides “Phase III-enabling”
clinical data. Tercica will have the first right to opt into orphan indications, and Genentech will have the first right to opt into non-orphan indications. If Tercica does not opt into an orphan indication, Genentech will have the right to opt-in.
Similarly, if Genentech does not opt into a non-orphan indication, Tercica will have the right to opt-in. In the case of an opt-in, Insmed will retain development control prior to approval, and Tercica or Genentech would gain commercial control
after approval. 
 If the opt-in is exercised by Tercica, Insmed would be reimbursed 50% of its incurred development costs for the indication and further
development costs would be shared 50:50. Upon subsequent commercialization, Insmed and Tercica will split profits 50:50 after accounting for relevant expenses including sales-based tiered royalties of 6%-15% to Genentech. 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 If the opt-in is exercised by Genentech, Insmed would be reimbursed 50% of its incurred development costs for the
indication. Subsequent development costs and profits will be split 50:50, but no royalty will be owed to Tercica. 
 If neither Tercica nor Genentech opts
in, Insmed will pay a 4% royalty on all commercial sales of the approved drug to Genentech. 
 Worldwide pre-Approval IPLEX Sales 
 Outside the U.S. and Canada, Insmed will be permitted to continue to provide IPLEX to physicians through its Expanded Access Program for non Tercica/Genentech indications
(excluding severe insulin resistance) and ALS in Italy. Any cost reimbursement obtained from this program would be subject to a tiered royalty of 4% to 15% shared between Tercica, Genentech and Ipsen. 
 The Settlement, License and Development Agreement is in effect until the later of 2018 or the expiration of any subsequent Tercica/Genentech issued patents that cover
IPLEX or its indications. 
 About Tercica 
 Tercica is a biopharmaceutical company committed to improving endocrine health by partnering with the endocrine community to develop and commercialize new therapeutics for short stature and other metabolic disorders. For further information
on Tercica, please visit www.tercica.com. 
 Tercica Safe Harbor Statement 
 Except for the historical statements
contained herein, this press release contains forward-looking statements concerning prospects and results, including statements concerning a worldwide partnership with opt-in rights for Tercica on non-Tercica/Genentech Indications and settlement of
all outstanding litigation between Tercica, Genentech and Insmed. Because Tercica’s forward-looking statements are subject to risks and uncertainties, there are important factors that could cause actual results to differ materially from those
in the 

 PORTIONS OF THIS EXHIBIT WERE OMITTED AND HAVE BEEN FILED SEPARATELY WITH THE SECRETARY OF THE COMMISSION PURSUANT
TO AN APPLICATION FOR CONFIDENTIAL TREATMENT UNDER RULE 24b-2 OF THE EXCHANGE ACT; [***] DENOTES OMISSIONS. 
  

 
forward-looking statements. These factors include, without limitation, the risk that none of the non-Tercica/Genentech Indications demonstrate clinically
meaningful efficacy and safety, and the risks and uncertainties disclosed from time to time in reports filed by Tercica with the SEC, including most recently Tercica’s Form 10-Q for the quarter ended September 30, 2006 filed with the SEC
on November 3, 2006

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