Document:

Exhibit

NRG ENERGY, INC. 
AMENDED AND RESTATED EMPLOYEE STOCK PURCHASE PLAN
ARTICLE I 
PURPOSE AND SCOPE OF THE PLAN
1.1    Purpose
The NRG Energy, Inc. Amended and Restated Employee Stock Purchase Plan is intended to encourage employee participation in the ownership of the Company.
1.2    Definitions
Unless the context clearly indicates otherwise, the following terms have the meaning set forth below:
Board of Directors or Board means the Board of Directors of the Company.
Code means the Internal Revenue Code of 1986, as amended from time to time, together with any applicable regulations issued thereunder.
Committee means the committee of one or more officers established by the Board to administer the Plan, which Committee shall administer the Plan as provided in Section 1.3 hereof.
Common Stock means shares of the common stock, par value $0.01 per share, of the Company.
Company means NRG Energy, Inc., a corporation organized under the laws of the State of Delaware, or any successor corporation.
Compensation means (a) the fixed salary or base wage paid by the Employer to an Employee as reported by the Employer to the United States government (or other applicable government) for income tax purposes, including an Employee’s portion of salary deferral contributions pursuant to Section 401(k) of the Code and any amount excludable pursuant to Section 125 of the Code, and (b) to the extent authorized by the Committee for any Plan Year or Plan Years, any cash bonus payment received under a cash bonus plan or program established by the Employer, but excluding from both (a) and (b) any fee, overtime pay, severance pay, expenses, stock option or other equity-based incentive income, or other special emolument or any credit or benefit under any employee plan maintained by the Company.
Continuous Service means the period of time, uninterrupted by a termination of employment (other than a termination as a result of a transfer of employment among the Parent, the Company or a Designated Subsidiary), that an Employee has been employed by the Company, a Designated Subsidiary or the Parent (or any combination of the foregoing) immediately preceding an Offering Date.  Such period of time shall include any approved leave of absence.
Designated Subsidiary means any Subsidiary that has been designated by the Committee to participate in the Plan. 
Employee means any full-time or part-time employee of the Company, any Parent or a Designated Subsidiary who customarily works for the Company, any Parent or Designated Subsidiary, as the case may be, for a minimum of seventeen and one-half hours per week.
Employer means the Company, any Parent or a Designated Subsidiary employing an Employee.
Exercise Date means September 30 and March 31 of each Plan Year, or such other date(s) as determined by the Committee.
Fair Market Value of a share of Common Stock means the last price of the Common Stock on the applicable date as reported by the exchange on which the Common Stock is then listed, or, if not so reported for that day, on the last preceding day for which such price is reported, or such other reasonable method of determining fair market value as the Committee shall adopt.
Offering Date means April 1 and October 1 of each Plan Year, or such other date(s) as determined by the Committee.
Option Period or Period means the period beginning on an Offering Date and ending on the next succeeding Exercise Date, or such other period as determined by the Committee.
Option Price means the purchase price of a share of Common Stock hereunder as provided in Section 3.1 hereof.
Parent means any corporation or other entity in an unbroken chain of entities ending with the Company, if each of the entities other than the Company owns equity interests possessing 50% or more of the total combined voting power of all classes of equity of one of the other entities in such chain, as determined pursuant to the requirements of Section 424(e) of the Code, and shall include entities that may become a parent after adoption of this Plan, as determined by the Committee.
Participant means any Employee who (i) is eligible to participate in the Plan under Section 2.1 hereof and (ii) elects to participate.
Participant Election means the form prescribed by the Committee which must be completed and executed by an Employee who elects to participate in the Plan for any Offering Period(s).
Plan means this NRG Energy, Inc. Amended and Restated Employee Stock Purchase Plan, as amended from time to time.
Plan Account or Account means an account established and maintained in the name of each participant.
Plan Manager means any Employee appointed pursuant to Section 1.3 hereof.
Plan Year means the twelve (12) month period beginning April 1 and ending on the following March 31 during any calendar year in which the Plan is effective.
Subsidiary means any corporation or other entity in an unbroken chain of entities beginning with the Company if, each of the entities (other than the last entity in the unbroken chain) owns equity interests possessing 50% or more of the total combined voting power of all classes of equity in one of the other entities in the chain, as determined pursuant to the requirement of Section 424(f) of the Code, and may include entities that become subsidiaries after adoption of this Plan, as determined by the Committee.
1.3    Administration of Plan
Subject to oversight by the Board of Directors or the Board’s Compensation Committee, the Committee shall have the authority to administer the Plan and to make and adopt rules and regulations not inconsistent with the provisions of the Plan or the Code.  The Committee shall adopt the form of Participant Election and all notices required hereunder.  Its interpretations and decisions in respect to the Plan shall, subject as aforesaid, be final and conclusive.  The Committee shall have the authority to appoint an Employee as Plan Manager and to delegate to the Plan Manager such authority with respect to the administration of the Plan as the Committee, in its sole discretion, deems advisable from time to time.
1.4    Effective Date of Plan
The Plan was originally effective July 1, 2008, was restated effective January 1, 2012, was amended and restated effective July 1, 2014 and was amended and restated effective April 28, 2017. This amended Plan shall become effective on April 1, 2019.
1.5    Extension or Termination of Plan
The Plan shall continue in effect through, and including December 31, 2026 unless terminated prior thereto pursuant to Section 4.3 hereof, or by the Board of Directors or the Compensation Committee of the Board, each of which shall have the right to extend the term of or terminate the Plan at any time under Section 6.4.  Upon any such termination, the balance, if any, in each Participant’s Account shall be refunded to him or her, or otherwise distributed in accordance with policies and procedures prescribed by the Committee in cases where such a refund may not be possible.
ARTICLE II     
PARTICIPATION
2.1    Eligibility
Each Employee who on an Offering Date has at least sixty days of Continuous Service may become a Participant by executing and filing a Participant Election with the Company prior to said Offering Date.  No Employee may participate in the Plan if said Employee, immediately after an Offering Date, would be deemed for purposes of Section 423(b)(3) of the Code to possess 5% or more of the total combined voting power or value of all classes of stock of the Company, its Parent or any Subsidiary, as determined pursuant to the requirements of Section 423(b)(3) of the Code.
2.2    Payroll Deductions
Payment for shares of Common Stock purchased hereunder shall be made by authorized payroll deductions from each payment of Compensation in accordance with instructions received from a Participant.  For base Compensation, said deductions shall be expressed as a whole number percentage of such Compensation which shall be at least 1% but not more than 10%, subject to the aggregate maximum described in Section 3.3.  A Participant may not increase or decrease the deduction during an Option Period.  However, a Participant may change the percentage deduction for any subsequent Option Period by filing notice thereof with the Company prior to the Offering Date on which such Period commences.  During an Option Period, a Participant may discontinue payroll deductions but have the payroll deductions previously made during that Option Period remain in the Participant’s Account to purchase Common Stock on the next Exercise Date, provided that he or she is an Employee as of that Exercise Date.  Any Participant who discontinues payroll deductions during an Option Period may again become a Participant for a subsequent Option Period by executing and filing another Participant Election in accordance with Section 2.1.  Any amount remaining in the Participant’s Account after the purchase of Common Stock on an Exercise Date shall be carried forward to the next succeeding Option Period, as provided in Section 3.2, unless the Participant requests, in writing, that any excess be refunded to the Participant.
If authorized by the Committee, bonus compensation will be included in Compensation subject to payroll deductions in a given Plan Year.  The Committee will provide a written notice to Participants if bonus compensation is to be included in Compensation for a given Plan Year.  A Participant may select a different percentage for base salary or fixed wage compensation than such percentage selected for cash bonus Compensation; provided, however any such deductions shall be subject to the aggregate maximum described in Section 3.3.
ARTICLE III     
PURCHASE OF SHARES
3.1    Option Price
The Option Price per share of the Common Stock sold to Participants hereunder shall be equal to the lesser of: (a) 95% of the Fair Market Value of such share on the Exercise Date of an Option Period, or (b) 95% of the Fair Market Value of such share on the Offering Date of an Option Period. Notwithstanding the foregoing, in no event shall the Option Price per share be less than the par value of the Common Stock.
3.2    Purchase of Shares
On each Exercise Date, the amount in a Participant’s Account shall be charged with the aggregate Option Price of the largest number of whole shares of Common Stock which can be purchased with said amount.  The balance, if any, in such account shall be carried forward to the next succeeding Option Period, subject to Section 2.2.
3.3    Limitations on Purchase
Notwithstanding any provisions of the Plan to the contrary, no Employee shall be granted an option under the Plan if, immediately after the grant, such Employee’s right to purchase shares under all employee stock purchase plans (as described in Section 423 of the Code) of the Company and any Subsidiary or Parent of the Company would accrue at a rate per Offering Period which exceeds the lesser of: (a) twenty-five thousand dollars ($25,000) or (b) an amount equal to ten percent (10%) of the Employee’s annualized base salary in effect at the start of such Offering Period, in each case of Fair Market Value of such shares (determined at the time such option is granted); provided, however, that for any calendar year Employee’s right to purchase shares under all employee stock purchase plans (as described in Section 423 of the Code) of the Company and any Subsidiary or Parent of the Company may not accrue at a rate which exceeds twenty-five thousand dollars ($25,000) in the aggregate (as determined at the time such option is granted).
To the extent necessary to comply with Section 423(b)(8) of the Code and the limitations on purchase in this Section 3.3, a Participant’s payroll deductions may be decreased to 0% during any Option Period which is scheduled to end during any calendar year, such that the aggregate of all payroll deductions accumulated with respect to such Option Period and any other Option Period ending within the same calendar year is no greater than twenty-five thousand dollars ($25,000).  A Participant’s payroll deductions shall re-commence at the rate provided in his or her Participant Election at the beginning of the first Option Period which is scheduled to end in the following calendar year, unless suspended by the Participant pursuant to Section 2.2 of the Plan.
The maximum number of shares of Common Stock that each Employee may purchase during an Offering Period is 20,000. 
3.4    Transferability of Rights
Rights to purchase shares hereunder shall be exercisable only by the Participant.  Such rights shall not be transferable. 
ARTICLE IV     
PROVISIONS RELATING TO COMMON STOCK
4.1    Common Stock Reserved
There shall be 5,300,000 shares of Common Stock reserved for the Plan, subject to adjustment in accordance with Section 4.2 hereof.  Such shares can be authorized and unissued shares or treasury shares.  The aggregate number of shares which may be purchased under the Plan shall not exceed the number of shares reserved for the Plan.
4.2    Adjustment for Changes in Common Stock
In the event that adjustments are made in the number of outstanding shares of Common Stock or said shares are exchanged for a different class of stock of the Company or for shares of stock of any other entity by reason of merger, consolidation, stock dividend, stock split or otherwise, the Board shall make appropriate adjustments in (i) the number and class of shares or other securities that may be reserved for purchase, or purchased, hereunder, and (ii) the Option Price.  All such adjustments shall be made approved by the Board, and its decision shall be binding and conclusive.
4.3    Insufficient Reserved Shares
If the aggregate funds available for purchase of Common Stock on any Exercise Date would cause an issuance of shares in excess of the number provided for in Section 4.1 hereof, (i) the Committee shall proportionately reduce the number of shares which would otherwise be purchased by each Participant in order to eliminate such excess and (ii) the Plan shall automatically terminate immediately after such Exercise Date.
4.4    Confirmation
Confirmation of each purchase of Common Stock hereunder shall be made available to the Participant in either written or electronic format.  A record of purchases shall be maintained by appropriate entries on the books of the Company.  Participants may obtain a certificate or certificates for all or part of the shares of Common Stock purchased hereunder upon making a written request.  Once shares of Common Stock are delivered hereunder, Participants may sell such shares.  If a Participant does not sell shares delivered hereunder, such shares must remain in the Participant’s account with the Company’s designated brokerage until eighteen (18) months following the delivery of such shares.  
4.5    Rights as Shareholders
The shares of Common Stock purchased by a Participant on an Exercise Date shall, for all purposes, be deemed to have been issued and sold as of the close of business on such Exercise Date.  Prior to that time, none of the rights or privileges of a shareholder of the Company shall exist with respect to such shares. 
ARTICLE V     
TERMINATION OF PARTICIPATION
5.1    Voluntary Withdrawal
A Participant may withdraw from the Plan at any time by filing notice of withdrawal prior to the close of business on an Exercise Date.  Upon withdrawal, the entire amount, if any, in a Participant’s Account shall be refunded to him or her without interest.  Any Participant who withdraws from the Plan may again become a Participant in accordance with Section 2.1 hereof. 
5.2    Termination of Eligibility
If a Participant ceases to be eligible under Section 2.1 hereof for any reason, the dollar amount in such Participant’s Account will be refunded to the Participant, or in the case of death, the Participant’s designated beneficiary or estate, or otherwise distributed in accordance with policies and procedures prescribed by the Committee in cases where such a refund may not be possible.
ARTICLE VI     
GENERAL PROVISIONS
6.1    Notices
Any notice which a Participant files pursuant to the Plan shall be made on forms prescribed by the Committee and shall be effective only when received by the Company.
6.2    Condition of Employment
Neither the creation of the Plan nor participation therein shall be deemed to alter the at-will nature of a Participant’s employment, create any right of continued employment or in any way affect the right of the Employer to terminate an Employee.
6.3    Withholding of Taxes 
Each Participant shall, no later than the date as of which the value of an option under the Plan and/or shares of Common Stock first becomes includible in the income of the Participant for income tax purposes, pay to the Company, or make arrangements satisfactory to the Committee regarding payment of, any taxes of any kind required by law to be withheld with respect to such option or shares of Common Stock.  The obligations of the Company under the Plan shall be conditional on the making of such payments or arrangements, and the Company shall, to the extent permitted by law, have the right to deduct any such taxes from any payment of any kind otherwise due to the Participant.
In particular, to the extent a Participant is subject to taxation under U.S. Federal income tax law, if the Participant makes a disposition, within the meaning of Section 424(c) of the Code of any share or shares of Common Stock issued to Participant pursuant to Participant’s exercise of an option, and such disposition occurs within the two-year period commencing on the day after the Offering Date or within the one-year period commencing on the day after the Exercise Date, Participant shall, within ten (10) days of such disposition, notify the Company thereof and thereafter immediately deliver to the Company any amount of federal, state or local income taxes and other amounts which the Company informs the Participant the Company may be required to withhold.
6.4    Amendment of the Plan
The Board of Directors or the Board’s Compensation Committee may at any time, or from time to time, amend, modify, or terminate the Plan in any respect, except that, without approval of the shareholders, no amendment may increase the aggregate number of shares reserved under the Plan other than as provided in Section 4.2 hereof, materially increase the benefits accruing to Participants or materially modify the requirements as to eligibility for participation in the Plan.  Any amendment of the Plan must be made in accordance with applicable provisions of the Code and/or any regulations issued thereunder, any other applicable law or regulations, and the requirements of the principal exchange upon which the Common Stock is listed.
6.5    Application of Funds
All funds received by the Company by reason of purchases of Common Stock hereunder shall constitute general funds of the Company and may be used for any corporate purpose.
6.6    Legal Restrictions
The Company shall not be obligated to sell shares of Common Stock hereunder if counsel to the Company determines that such sale would violate any applicable law or regulation.
6.7    Gender
Whenever used herein, use of any gender shall be applicable to all genders.
6.8    Governing Law
The Plan and all rights and obligations thereunder shall be constructed and enforced in accordance with the laws of the State of Delaware and any applicable provisions of the Code and the related regulations.
6.9    Indemnification
To the extent allowable under applicable law, the Committee and the Plan Manager and any delegate thereof shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action or failure to act under the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her, provided he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf.  The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s articles of incorporation or bylaws, as a matter of law, under any indemnification agreement or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
6.10    Expenses
The expenses of administering the Plan shall be borne by the Company.
6.11    Titles and Headings
The titles and headings of the sections in this Plan are for convenience of reference only, and in the event of any conflict, the text of this Plan, rather than such titles or headings, shall control.
6.12    Arbitration
In the event of any dispute between the Employer and a Participant with respect to this Plan, either may require that the dispute be determined by binding arbitration by written notice to the other.  In such case, the arbitration shall be conducted in accordance with the rules of the American Arbitration Association then in effect before a panel of three arbitrators, and the decision of the arbitrators shall be final and binding on the parties.  In any such arbitration, the non-prevailing party shall pay all expenses, including the costs of the arbitrators and the costs and expenses, including reasonable attorneys’ fees, incurred by the prevailing party in the arbitration.Exhibit 4.16

 

THE SYMBOL “[**]” DENOTES PLACES WHERE CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THE EXHIBIT BECAUSE IT IS BOTH (i) NOT MATERIAL AND (ii) WOULD LIKELY CAUSE COMPETITIVE HARM TO THE COMPANY IF PUBLICLY DISCLOSED

 

CONFIDENTIAL

 

FIRST AMENDMENT TO

THE AMENDED AND RESTATED EXCLUSIVE LICENSE AND COLLABORATION AGREEMENT

 

This First Amendment (this “Amendment”) to the Amended and Restated Exclusive License and Collaboration Agreement, effective as of October 8, 2013 and made by and between

 

(1)                       Lilly (Shanghai) Management Company Limited (formerly Eli Lilly Trading (Shanghai) Company Limited), a limited liability company duly organized and existing under the laws of People’s Republic of China, with its registered address at Room 1903A, 19 Floor, International Commercial & Trade Building, Xinling Road 118, Waigaoqiao Free Trade Zone, Shanghai, PRC (“Lilly”);

 

(2)                       Hutchison MediPharma Limited, a company organized under the laws of the People’s Republic of China, having a place of business at Building 4, 720 Cai Lun Road, ZJ Hi-Tech Park, Shanghai, PRC (“Hutchison”); and

 

(3)                       Hutchison China MediTech Limited,  a company organized under the laws of the Cayman Islands, with its principal offices at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands (the “Hutchison Guarantor”)

 

(the “Agreement”)  is made effective as of December 18, 2018 (the “Amendment Effective Date”).

 

Recitals

 

WHEREAS, the Parties have entered into the Agreement, pursuant to which Hutchison has granted an exclusive license to Lilly under the Hutchison Know-How, Hutchison Patents and Regulatory Approvals that are necessary or useful to Commercialize the Products in the Field in the Territory and the Parties have implemented a Development Plan.

 

WHEREAS, the Parties have agreed that Hutchison will be responsible for all Development costs for Products being Developed for any Life Cycle Planning Indication, and that Hutchison will take on responsibility for P&D Services of Products in a subset of the Territory subject to terms below in the Amendment.

 

WHEREAS, the Parties have agreed that Lilly shall receive exclusive license to Commercialize the Life Cycle Planning Indications.

 

WHEREAS, in consideration for Hutchison’s increased share of Development costs and new detailing responsibilities, Lilly shall pay to Hutchison an increased royalty and approval milestones under the Agreement subject to the terms below in the Amendment.

 

WHEREAS, the Parties wish to memorialize in this Amendment a new division of responsibilities and payment obligations under the Agreement.

 

 

Agreement

 

NOW,  THEREFORE, in consideration of the mutual covenants contained in this Amendment, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

 

1                               Definitions

 

Any capitalized term not separately defined in this Amendment shall have the meaning ascribed to it in the Agreement.

 

2                               Modifications to the Agreement

 

2.1                     Article 1.53 of the Agreement- the definition of “Life Cycle Planning Indications” shall be deleted and replaced by the following:

 

1.53 “Life Cycle Planning Indication” means any indication that requires registration study with greater than or equal to 200 patients for a non-orphan, meaningful indication and that is not an Initial Indication for which one or more Parties elect to Develop a Product pursuant to this Agreement. For the avoidance of doubt, orphan drug indications would not qualify as Life Cycle Planning Indications.

 

2.2                     Article 1.79 of the Agreement — the definition of “Subsequent Development” shall be deleted and replaced by the following:

 

1.79 “Subsequent Development” means (a) any Development of a Product for an Initial Indication after such Product has achieved Positive POC for such Initial Indication or Lilly has elected to conduct Subsequent Development of a Product for such Initial Indication pursuant to Article 3.4(a)(iii), including the conduct of post-proof of concept studies for such Product for such Initial Indication and (b) all Development of any Product for a Life Cycle Planning Indication that the Parties may approve for Development pursuant to this Agreement or that Hutchison may approve pursuant to Article 2.3(d)(i).

 

2.3                     Article 1.80 of the Agreement — the definition of “Subsequent Development Costs” shall be deleted and replaced by the following:

 

1.80 “Subsequent Development Costs” means any Development Costs specifically identifiable or allocable to the Subsequent Development of a Product, other than Development Costs associated with Development of a Life Cycle Product in the Life Cycle Planning Indication that Hutchison decides to pursue in accordance with Articles 3.4(f)(A) and 3.4(g)(X).

 

2.3                     The following additional definitions shall be added as Article 1.86 of the Agreement:

 

1.86    Additional Definitions.

 

(i)            [**] shall have the meaning set forth in Article 4.1(b)(i).

 

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(ii)          “Service Territory” shall mean those provinces of mainland People’s Republic of China for which Hutchison shall be responsible for P&D Services for Products pursuant to Article 4.1(b).

 

(iii)         “Hutchison Territorial Extension A” and “Hutchison Territorial Extension B” (collectively, the “Hutchison Territorial Extensions”) shall have the meanings set forth in Article 4.1(b)(i).

 

(iv)     “Initial Commercialization Period” shall mean that period of time after the First Commercial Sale of a Product in the Territory ending upon the receipt of the first Regulatory Approval for a Life Cycle Product in Life Cycle Planning Indication in the Territory.

 

(v)     “Life Cycle Product” shall mean a Product Developed by or on behalf of Hutchison for a Life Cycle Planning Indication in accordance with Articles 3.4(f)(A) and 3.4(g)(X) and for which Regulatory Approval has been obtained for such Product in such Life Cycle Planning Indication.

 

(vi)        “Lilly Territory” shall mean Hong Kong and the provinces of mainland People’s Republic of China that are not designated for Hutchison’s P&D Services pursuant to Article 4.1(b).

 

(vii)       “P&D Services” shall mean activities for local marketing subject to the overall Commercialization strategy for Products in the Territory in accordance with Article 4.1(b)(iv), which includes organizing standalone or support with third party local or regional educational or academic events or best practice sharing sessions for hospitals, detailing activities, patient and healthcare personnel education, hospital listing, providing recommendations of key opinion leaders and/or physicians to attend any national marketing/medical related events organized by Lilly, providing demand forecast to Lilly for distributor management, providing list of targeted hospitals, providing local distributor recommendations if existing distributors cannot meet business needs, and assisting Lilly in communications with hospitals, within the Service Territory. For the purposes of this definition, any recommendations provided by Hutchison shall be considered by Lilly and addressed consistent with the Commercialization strategy set by Lilly.

 

For the avoidance of doubt, “P&D Services” does not include selling and booking sales, invoicing and collecting payments, determining pricing strategy or decision, bidding, distribution, including distribution strategy, distributor selection, daily distribution management (such as inventory, accounts receivable, contract, etc.), Products shipment to distributors, overall Commercialization strategy and promotional materials (design, production and field force training).

 

(viii)      “2018 Services and Demand Realization Agreement” shall mean the agreement relating to sales in the SOTC Areas (as defined therein) entered into between Lilly Trading Company Limited, Lilly, Hutchison and the Hutchison Guarantor on December 18, 2018.

 

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2.4                     Article 2.1(a) of the Agreement — Scope shall be deleted and replaced by the following:

 

(a)      Scope.

 

Pursuant to and subject to the terms of this Agreement, the Parties agree to collaborate with respect to the Development of the Product in the Field with the goal of obtaining Regulatory Approval for Product(s) in the Field in the Territory for Manufacturing and Commercialization. Lilly will have rights to Commercialize the Products in the Field in the Territory pursuant to this Agreement, as further set forth in Article 4 and subject to P&D Services for the Products Hutchison performs, in exchange for fees, royalties and milestone payments to be made to Hutchison as described in Article 7. Responsibility for Manufacture of Clinical Materials and commercial quantities of Product shall be as detailed in Article 5.

 

2.5                     Article 2.2(d) of the Agreement — Dispute Resolution shall be deleted and replaced by the following:

 

(d)      Dispute Resolution.

 

Subject to the terms and conditions of this Agreement, if the JSC is unable to decide or resolve unanimously any matter properly presented to it for action within ten (10) Business Days, including as referred to the JSC by a subcommittee, at the written request of either Party, the issue shall be referred to senior management of each Party for resolution, who shall promptly meet and attempt in good faith to resolve such issue within thirty (30) days. If senior management cannot resolve such matter within the above-mentioned thirty (30) day period, then except for those matters set forth below, the matter shall be decided by mutual agreement of the then co-chairs of the JSC (such matters within the JSC’s jurisdiction and not subject to clause (i) or (ii) of this Article 2.2(d), “Mutual JSC Matters”).  For clarity, any decision to develop a product that is not an Initial Product or to develop a Product for an indication that is not an Initial Indication shall not be a decision subject to one Party’s final decision-making authority pursuant to clause (i) or (ii) of this Article 2.2(d) and shall require the mutual consent of the Parties, except for Hutchison’s sole decision-making authority with respect to Development of a Product for a Life Cycle Planning Indication.

 

(i)           Hutchison shall have final decision-making authority for [**].

 

(ii)          Except as expressly set forth in this Agreement, Lilly will have the final decision-making authority for all other material Development decisions with respect to a Product if Lilly [**].

 

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2.6       Article 3.4(f) of the Agreement shall be deleted and replaced with the following:

 

(f)          In addition to Hutchison’s right to pursue Development of a Product that has not achieved Positive POC pursuant to Article 3.4(b), (A) in the event Hutchison wishes to pursue a Life Cycle Planning Indication for a Product, it shall notify Lilly of this intention and may thereafter proceed with such development under this Agreement and (B) in the event Lilly wishes to pursue a Life Cycle Planning Indication for a Product, it shall notify Hutchison and submit to Hutchison an outline for a development plan (including a high-level budget) for such Life Cycle Planning Indication and all relevant information it believes, in good faith, to be reasonably necessary for Hutchison to elect whether or not to pursue such Life Cycle Planning Indication for such Product under this Agreement. In the event of clause (B) of this Article 3.4(f), Hutchison must elect, in writing to Lilly, within sixty (60) days of receiving this information, whether or not to proceed with such development under this Agreement.

 

2.7       Article 3.4(g) of the Agreement shall be deleted and replaced with the following:

 

(g)          If (X) Hutchison decides to pursue a Life Cycle Planning Indication for a Product pursuant to Article 3.4(f)(A), then (A) milestones will be paid pursuant to this Agreement for such Product for such Life Cycle Planning Indication pursuant to Article 7.2 (as described in Milestone Event #4), (B) Hutchison shall be responsible for all Development Costs for such Life Cycle Planning Indication, (C) Hutchison shall provide to the JSC an amendment to the Development Plan to include such Life Cycle Planning Indication and (D) Hutchison shall be responsible for all Development activities for such Life Cycle Planning Indication and (Y) if Hutchison decides to pursue a Life Cycle Planning Indication for a Product proposed by Lilly pursuant to Section 3.4(f)(B), (A) milestones will be paid pursuant to this Agreement for such Product for such Life Cycle Planning Indication pursuant to Article 7.2 (as described in Milestone Event #4), (B) all Development Costs for a Product for a Life Cycle Planning Indication shall be deemed Subsequent Development Costs, (C) the JSC shall, as a Mutual JSC Matter, generate and approve an amended Development Plan to include such Life Cycle Planning Indication and (D) Hutchison shall be responsible for all Development activities for such Product for such Life Cycle Planning Indication.

 

2.8       Article 4.1 of the Agreement — Overview shall be deleted and replaced with the following:

 

4.1 (a)        Initial Commercialization. Lilly shall have full responsibility and authority for all aspects of the Commercialization of Products in the Field in the Territory at its sole expense until a Triggering Event occurs. [**]

 

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4.1 (b)         Commercialization Post [**]

 

(i)        Service Territory

 

Beginning upon [**]  in the People’s Republic of China (but no later than [**]), the JSC shall, as a Mutual JSC Matter, designate a section in the People’s Republic of China to Hutchison where Hutchison shall be responsible for P&D Services for Products at Hutchison’s sole expense (“Service Territory”),  and the Service Territory shall initially comprise, in terms of Net Sales of Products in the then-most recent four Calendar Quarters approximately 30% of the Net Sales of Products in all provinces of mainland People’s Republic of China in such Calendar Quarters, with all provinces being contiguous and containing at least one of Shanghai, Beijing and/or Guangzhou (“Baseline Service Territory”). The JSC shall further designate two sub-sections of the Lilly Territory, each contiguous with the Baseline Service Territory and each comprising, in terms of Net Sales of Products in the then-most recently ended Calendar Year, approximately 5% of the Net Sales of Products in all provinces of mainland People’s Republic of China in such Calendar Quarters (totalling 35% and 40%, respectively, when combined to the Service Territory), which may be added to the Service Territory pursuant to Article 4.1(b)(iii) below (one such sub-section to be designated “Hutchison Territorial Extension A”,  and one sub-section to be designated “Hutchison Territorial Extension B”).

 

If the JSC is unable to decide or resolve unanimously the division and allocation of provinces of mainland People’s Republic of China as provided for in this Article 4.1(b)(i) within sixty (60) Business Days, then Article 14 shall apply.

 

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(ii)       Transition Preparation

 

Starting three (3) months after [**] (“Transition Period”),  Lilly shall begin to plan the transition of P&D Services for Products in the Service Territory to Hutchison, in the Field in the Service Territory, at each party’s sole expense; however, Hutchison will not provide P&D Services until the Triggering Event (as defined below). Notwithstanding the above both Lilly and Hutchison agree to use Commercially Reasonable Efforts to work together to ensure the Transition Period is as short as reasonably possible and no longer than three (3) months post Triggering Event.

 

(iii)      Triggering Events for the P&D Services

 

Only if and after [**] (“Triggering Event”),  Hutchison shall provide P&D Services for Products in the Service Territory at its sole cost in exchange for the fee defined hereunder.

 

(A)  Upon the occurrence of the Triggering Event, Lilly shall transition activities under the P&D Services to Hutchison. Hutchison shall start to provide P&D Services on the Product in the Baseline Service Territory and shall take over the entire P&D Services entirely upon the expiration of the Transition Period.

 

(B)  Upon the occurrence of both the Triggering Event and the earlier of (i) [**] or (ii) [**], Lilly shall transition control of P&D Services for Products in Hutchison Territorial Extension A to Hutchison, such that Hutchison Territorial Extension A shall be included as part of the Service Territory no later than the date of the earlier of clause (i) and (ii) of this Section 4.1(b)(iii)(B).

 

(C)  Upon the occurrence of both the Triggering Event and the later of (i) [**] and (ii) [**], Lilly shall transition control of P&D Services for Products in Hutchison Territorial Extension B to Hutchison, such that Hutchison Territorial Extension B shall be included as part of the Service Territory no later than the date of the later of clause (i) and (ii) of this Section 4.1(b)(iii)(C).

 

7

 

(iv)      Service requirements

 

Hutchison shall use Commercially Reasonable Efforts to provide P&D Services for Products in the Service Territory, in compliance with the terms and conditions of the Agreement. The Parties will enter into a Compliance Agreement as referred to in Article 4.3(d) prior to Hutchison providing P&D Services for Products in the Service Territory. The Parties will begin good faith negotiations three (3) months after [**]. The Parties shall have executed the Compliance Agreement at least three months prior to the launch of the Life Cycle Planning Indication. Lilly shall retain full responsibility and authority for all Commercializaton activities that do not constitute P&D Services in the Service Territory, at its sole expense, and shall retain full responsibility and authority for all aspects of the Commercialization of Products in the Field (whether existing prior to or after [**], in the Territory but outside of the Service Territory, at its sole expense. For the avoidance of doubt, Lilly shall retain final decision-making authority for overall Commercialization strategy for Products in the Territory after consultation with Hutchison, and Hutchison’s performance of P&D Services for Products in the Service Territory shall be consistent with such Commercialization strategy and the decisions by Lilly relating to such Commercialization strategy.

 

In the Service Territory, Lilly shall be responsible for making decisions on the tenders to the hospitals and will work in good faith with Hutchison in the joint preparation and execution of such tenders to ensure a successful outcome. Hutchison shall submit tenders in its own name if Lilly so requests.

 

Lilly shall be responsible for preparing the promotional materials (design, production and field force training) and will provide reasonable quantities of such promotional materials to Hutchison for the purposes of performing the P&D Services.

 

2.7       Article 5.2 (a) General Product Responsibilities of Lilly. Article 5.2 (a) of the Agreement shall remain unchanged and the following shall be inserted at the end of the paragraph:

 

Notwithstanding anything to the contrary in the above, following the Triggering Event, Hutchison shall be responsible for the P&D Services to the extent that such activities have been transitioned to Hutchison by Lilly.

 

2.9       Article 5.2 (b) General Product Responsibilities of Hutchison. Article 5.2 (b) of the Agreement shall remain unchanged and the following shall be inserted at the end of the paragraph:

 

In addition to the responsibilities of the preceding sentence, following the Triggering Event, Hutchison shall be, as between the Parties, further responsible for the performance of P&D Services for Products in the Service Territory to the extent that such activities have been transitioned to Hutchison by Lilly.

 

2.10     Article 5.7(d) of the Agreement shall be added as the following:

 

5.7(d)    Hutchison covenants and undertakes to provide P&D Services for the Products in the Service Territory as follows:

 

1)      provide the P&D Services in compliance with the Applicable Laws and this Agreement;

 

8

 

2)      provide the P&D Services efficiently with the optimum use of all resources which does not prejudice the lawful and professional provision of the P&D Services;

3)      use commercially reasonable efforts to ensure that the P&D Services are performed by personnel who possess the relevant qualifications, skills, knowledge and experience to undertake their tasks in a professional and competent manner;

4)      allocate commercially reasonable resources to provide the P&D Services;

5)      comply with any reasonable instruction in relation to the P&D Services issued by Lilly;

6)      provide such reasonable co-operation and information in relation to the P&D Services to such of the other suppliers of Lilly as Lilly may reasonably require for the purposes of enabling any such suppliers to perform services in relation to the Product for Hutchison; and

7)      undertake to take such other lawful actions as agreed by the Parties under this Agreement.

 

2.11     Article 6.1 of the Agreement — Hutchison Responsibilities shall be deleted and replaced with the following:

 

6.1    Hutchison Responsibilities.

 

Hutchison will be responsible for all regulatory activities [**]. Following [**] in the People’s Republic of China, Hutchison will be responsible for all P&D Services for the Products in the Service Territory. [**]

 

2.12     Article 6.2 of the Agreement — Lilly Responsibilities shall be deleted and replaced with the following:

 

6.2    Lilly Responsibilities.

 

Prior to [**] in the People’s Republic of China, Lilly will be responsible for all Commercialization activities for the Products [**] except for the activities which Hutchison shall be responsible for in the SOTC Areas as set forth in the 2018 Services and Demand Realization Agreement. Following [**] in the People’s Republic of China, Lilly will be responsible for all Commercialization activities for the Products in the Lilly Territory, and will be responsible for all Commercialization activities that do not constitute P&D Services for the Products in the Service Territory, except for the activities which Hutchison shall be responsible for in the SOTC Areas as set forth in the 2018 Services and Demand Realization Agreement. [**] Hutchison shall ensure its P&D Services are carried out in accordance with and in compliance with this Agreement and Regulatory Approvals and Applicable Laws. [**]

 

9

 

2.13     Article 6.6 of the Agreement — Regulatory Obligations shall be deleted and replaced with the following:

 

6.6    Regulatory Obligations.

 

Except as otherwise provided in Article 2.2, above, and this Article 6, Hutchison shall be responsible for the regulatory strategy, including strategy for filings and label content, in consultation with Lilly, including commercial input. Hutchison shall be solely responsible for all regulatory activities in connection with seeking Regulatory Approvals in the Territory, including communicating and preparing and filing all reports with the Regulatory Authorities. [**]

 

2.14     Article 7.2 of the Agreement — Development Milestone Payments shall be deleted and replaced with the following:

 

7.2    Development Milestone Payments.

 

Lilly shall pay to Hutchison the Development milestone payments listed below as follows: (i) within thirty (30) days of the earlier of the date of FTO Submission and Lilly’s election not to terminate this Agreement pursuant to Article 7.1(c) if the relevant milestone event occurs before such earliest date; or (ii) within thirty (30) days of the milestone event if the relevant milestone event occurs after the date of FTO Submission or Lilly’s election not to terminate this Agreement pursuant to Article 7.1(c). Each milestone shall be payable only once upon the first occurrence of the described event for any Product.

 

10

 

	
Milestone Event
    	
 
    	
Milestone Payment
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
{**]
    
	
4.   Regulatory Approval by the CFDA of Products for a Life Cycle Planning   Indication
    	
 
    	
For the first Life   Cycle Planning Indication: Twenty Million U.S. Dollars ($20,000,000) For the   second Life Cycle Planning Indication: Twenty Million U.S. Dollars   ($20,000,000) For the third Life Cycle Planning Indication: Twenty Million   U.S. Dollars ($20,000,000) (no additional milestones for subsequent Life   Cycle Planning Indications)
    

 

2.15     Article 7.3 of the Agreement — Product Earned Royalties shall be deleted and replaced with the following:

 

7.3    Product Earned Royalties.

 

(a)   Tiered Royalties for Initial Commercialization Period. During the Initial Commercialization Period, Lilly shall pay to Hutchison royalties on the annual Net Sales of all Products in the Territory in the amounts set forth below (all amounts are in U.S. Dollars).

 

11

 

	
Annual Product Net
   Sales (for all
   Products in the
   aggregate in the
   Territory)
    	
 
    	
Royalty Rate
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    

 

The above tiered royalties are calculated such that the higher tiered royalties are only paid after the annual Net Sales exceed the top threshold of the previous tier. Attached as Exhibit F is an example of an annual Product royalty payment calculation.

 

(b)   Tiered Royalties following Initial Commercialization Period. Following the Initial Commercialization Period, Lilly shall pay to Hutchison royalties on the annual Net Sales of all Products in the Territory in the amounts set forth below (all amounts are in U.S. Dollars).

 

	
Annual Product Net
   Sales (for all
   Products in the
   aggregate in the
   Territory)
    	
 
    	
Royalty Rate
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    

 

The above tiered royalties are calculated such that the higher tiered royalties are only paid after the annual Net Sales exceed the top threshold of the previous tier. Attached as Exhibit G is an example of an annual Product royalty payment calculation after the Initial Commercialization Period.

 

12

 

(c)   Fees for Hutchison’s P&D Services in the Service Territory. Following the Triggering Event, with respect to sales of Products made in the Service Territory, Lilly shall pay to Hutchison, on a Calendar Quarter basis as described below, the applicable fee based on the Net Sales of all Products in the Service Territory set forth below in consideration for Hutchison’s performance of P&D Services subject to Article 7.3 (d):

 

	
 
    	
 
    	
Percentage of
   Net Sales
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    

 

During the Term, following the First Commercial Sale of a Product in the Service Territory, Lilly shall furnish to Hutchison a quarterly written report for the Calendar Quarter showing the number and description of Products sold in the Service Territory, Net Sales of Products sold during the reporting period and the applicable service fee payable to Hutchison under this Agreement. Reports shall be due on the sixtieth (60th) day following the close of each Calendar Quarter. Payments shown to have accrued by each report shall be due and payable on the date such report is due. Lilly shall keep complete and accurate records in sufficient detail to enable the fees payable under this Article 7.3(c) to be determined. For the avoidance of doubt, royalties shall be payable by Lilly to Hutchison pursuant to Article 7.3(a) or 7.3(b) in addition to any service fees payable to Hutchison under this Article 7.3(c).

 

(d)   Royalty Term. The earned royalties set forth in Articles 7.3(a), (b) and (c) shall be payable on a Product-by-Product and country-by-country basis for the longer of: (i) the life of any Hutchison Patent having a Valid Claim infringed by the Manufacture, use, sale or importation of such Product in such country; (ii) the Data Exclusivity Period that covers such Product in such country; and (iii) fifteen (15) years from the First Commercial Sale of such Product in such country (the “Royalty Term”); except that, after the start of Generic Competition with respect to such Product in such country, the royalty compensation thereafter payable to Hutchison in Articles 7.3(a) and 7.3(b) for such Product in such country shall be reduced by [**] for the remainder of the Royalty Term or, if shorter, for so long as Generic Competition for such Product in such country remains.

 

13

 

2.16     Article 8.1(b) of the Agreement — Hutchison Retained Rights shall be deleted and replaced with the following:

 

(b) Hutchison Retained Rights.

 

Notwithstanding the rights granted to Lilly in Article 8.1(a), Hutchison retains the right to conduct Development activities assigned to Hutchison under the Development Plan and to Develop Life Cycle Products in Life Cycle Planning Indications in accordance with this Agreement.

 

2.17     Appendix 1 of this Amendment shall be added to the Agreement immediately following Exhibit F — Product Royalty Payment Example,  and shall be titled Exhibit G — Product Royalty Payment Example (Post-Initial Commercialization Period).

 

2.18     Appendix 2 of this Amendment shall be added to the Agreement immediately following Exhibit G — Product Royalty Payment Example (Post-Initial Commercialization Period),  and shall be titled Exhibit H — Service Fee Payment Example.

 

3          Counterparts

 

This Amendment may be executed in two or more counterparts, each of which shall be deemed an original and all of which shall together be deemed to constitute one agreement. The Parties agree that execution of this Amendment by industry standard electronic signature software or by exchanging PDF signatures shall have the same legal force and effect as the exchange of original signatures, and that in any proceeding arising under or relating to this Amendment, each Party hereby waives any right to raise any defense or waiver based upon execution of this Amendment by means of such electronic signatures or maintenance of the executed Amendment electronically.

 

4.         Entire Agreement

 

This Amendment, together with the Agreement, as amended, constitutes the entire agreement between the Parties with respect to the subject matter of the Agreement. Unless otherwise expressly agreed by the Parties, the Agreement together with this Amendment supersedes all prior agreements, whether written or oral, with respect to the subject matter of the Agreement, as amended. The Parties hereby agree that subject to the modifications specifically stated in this Amendment, all terms and conditions of the Agreement, as amended, shall remain in full force and effect.

 

5.         Applicable Law and Litigation

 

It is hereby agreed by the Parties that the Article 15.5 of the Agreement shall apply to this Amendment mutatis mutandis.

 

[signature pages follow]

 

14

 

Each Party is signing this Amendment on the date stated below that Party’s signature.

 

	
 
    	
HUTCHISON MEDIPHARMA LIMITED
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Christian Hogg
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Christian Hogg
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
Director
    
	
 
    	
 
    
	
 
    	
LILLY (SHANGHAI) MANAGEMENT COMPANY LIMITED
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Eder Carlos   Mattioli
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Eder Carlos   Mattioli
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
CFO, DEC 19,   2018
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Solely for the purposes of Articles 7.11(a), 7.11(b) and   7.11(c) of the Agreement:
    
	
 
    	
 
    
	
 
    	
HUTCHISON CHINA MEDITECH LIMITED
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Christian Hogg
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Christian Hogg
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
CEO
    

 

[Signature Page to Amendment to License Agreement]

 

 

APPENDIX 1

 

Exhibit G
 Product Royalty Payment Example (Post-Initial Commercialization Period)

 

Example for illustration purposes only:

 

During the Term, following the Initial Commercialization Period, if Net Sales of Products in the prior Calendar Year in the Territory [**]:

 

Lilly shall pay, or cause to be paid, to Hutchison the following royalty payment for that Calendar Year based upon the agreed incremental sales tiers for Net Sales of Products in the Territory:

 

	
Incremental Sales Tiers
    	
 
    	
[**]
    	
 
    
	
[**]
    	
 
    	
[**]
    	
 
    
	
[**]
    	
 
    	
[**]
    	
 
    
	
[**]
    	
 
    	
[**]
    	
 
    
	
[**]
    	
 
    	
[**]
    	
 
    
	
[**]
    	
 
    	
[**]
    	
 
    

 

[**]

[**]

[**]

[**]

[**]

 

[**]

 

 

APPENDIX 2

 

Exhibit H
 Service Fee Payment Example

 

Example for illustration purposes only:

 

During the Term, two years following [**], if Net Sales of Products in the prior Calendar Year in the Service Territory [**]:

 

Lilly shall pay, or cause to be paid, to Hutchison the applicable service fee, based on the Net Sales of Products in the Service Territory, for Hutchison’s P&D Services:

 

	
Timing
    	
 
    	
Service Fee
    
	
[**]
    	
 
    	
[**]
    
	
[**]
    	
 
    	
[**]
    

 

[**]

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