Document:

Change in Control Agreement

 Exhibit 10.6 
  
 CHANGE IN CONTROL AGREEMENT 
  
 (Executive Officers) 
  
 AGREEMENT made as of this      day of
                    , 2005 by and between Citrix Systems, Inc. (the “Company”), and
                             (the “Executive”). 
  
 1. Purpose. The Company considers it essential to the best interests
of its stockholders to promote and preserve the continuous employment of key management personnel. The Board of Directors of the Company (the “Board”), therefore, has determined that appropriate steps should be taken to provide the
Executive with competitive compensation and benefits arrangements upon a Change in Control (as defined in Section 2 hereof). Nothing in this Agreement shall be construed as creating an express or implied contract of employment; and, except as
otherwise agreed in writing between the Executive and the Company, the Executive shall not have any right to be retained in the employ of the Company. 
  
 2. Change in Control. A “Change in Control” shall be deemed to have occurred upon the occurrence of any one of the following events:

  
 (a) any “Person,” as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended and in effect from time to time (the “Exchange Act”) (other than the Company, any of its subsidiaries, or any trustee, fiduciary or other person or entity holding
securities under any employee benefit plan or trust of the Company or any of its subsidiaries), together with all “affiliates” and “associates” (as such terms are defined in Rule 12b-2 under the Exchange Act) of such person,
shall become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 30 percent or more of the combined voting power of the Company’s
then outstanding securities having the right to vote in an election of the Company’s Board of Directors (“Voting Securities”) (in such case other than as a result of an acquisition of securities directly from the Company); or

  
 (b) the consummation of a consolidation, merger or
consolidation or sale or other disposition of all or substantially all of the assets of the Company in a single transaction or series of related transactions (a “Corporate Transaction”); excluding, however, a Corporate Transaction in which
the stockholders of the Company immediately prior to the Corporate Transaction, would, immediately after the Corporate Transaction, beneficially own (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, shares
representing in the aggregate more than 50 percent of the voting shares of the corporation issuing cash or securities in the Corporate Transaction (or of its ultimate parent corporation, if any); or 
  
 (c) persons who, as of the date hereof, constitute the Company’s Board
of Directors (the “Incumbent Directors”) cease for any reason, including, without limitation, as a result of a tender offer, proxy contest, merger or similar transaction, to constitute at least a 

 majority of the Board, provided that any person becoming a director of the Company subsequent to the date hereof shall be
considered an Incumbent Director if such person’s election was approved by or such person was nominated for election by either (A) a vote of at least a majority of the Incumbent Directors or (B) a vote of at least a majority of the Incumbent
Directors who are members of a nominating committee comprised, in the majority, of Incumbent Directors; but provided further, that any such person whose initial assumption of office is in connection with an actual or threatened election contest
relating to the election of members of the Board of Directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board, including by reason of agreement intended to avoid or settle any such
actual or threatened contest or solicitation, shall not be considered an Incumbent Director; or 
  
 (d) any other acquisition of the business of the Company in which a majority of the Board votes in favor of a decision that a Change in Control has
occurred within the meaning of this Agreement; or 
  
 (e) the
approval by the Company’s stockholders of any plan or proposal for the liquidation or dissolution of the Company. 
  
 Notwithstanding the foregoing, a “Change in Control” shall not be deemed to have occurred for purposes of the foregoing clause (a) solely as the
result of an acquisition of securities by the Company that, by reducing the number of shares of Voting Securities outstanding, increases the proportionate number of shares of Voting Securities beneficially owned by any person to 30 percent or more
of the combined voting power of all then outstanding Voting Securities; provided, however, that if any person referred to in this sentence shall thereafter become the beneficial owner of any additional shares of Voting Securities
(other than pursuant to a stock split, stock dividend, or similar transaction or as a result of an acquisition of securities directly from the Company) and immediately thereafter beneficially owns 30 percent or more of the combined voting power of
all then outstanding Voting Securities, then a “Change in Control” shall be deemed to have occurred for purposes of the foregoing clause (a). 
  

3. Terminating Event. A “Terminating Event” shall mean any of the events provided in this Section 3: 
  
 (a) Termination by the Company. Termination by the Company of the
employment of the Executive with the Company for any reason other than for Cause. For purposes of this Agreement, “Cause” shall mean a termination of the Executive’s employment which is a result of: 
  
 (i) a felony conviction; or 
  
 (ii) willful disclosure of material trade secrets or other material
confidential information related to the business of the Company and its subsidiaries or affiliates; or 
  

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 (iii) willful and continued failure substantially to perform the Executive’s same duties with the
Company as in existence prior to the Change in Control (other than any such failure resulting from the Executive’s incapacity due to physical or mental illness) after a written demand for substantial performance is delivered to the Executive by
the Board, which demand identifies the specific actions which the Board believes constitute willful and continued failure substantially to perform the Executive’s duties, and which performance is not substantially corrected by the Executive
within ten (10) days of receipt of such demand; or 
  
 (iv)
willful and knowing participation in releasing false or materially misleading financial statements or submission of a false certification to the Securities and Exchange Commission. 
  
 A Terminating Event shall not be deemed to have occurred pursuant to this Section 3(a) solely as a result of the Executive
being an employee of any direct or indirect successor to the business or assets of the Company. For purposes of clauses (ii), (iii) and (iv) hereof, no act, or failure to act, on the Executive’s part shall be deemed “willful” unless
done, or omitted to be done, by the Executive without reasonable belief that the Executive’s act, or failure to act, was in the best interests of the Company and its subsidiaries and affiliates. Notwithstanding the foregoing, the Executive
shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to the Executive a copy of a resolution duly adopted by the affirmative vote of a majority of the entire membership of the Board at a meeting of
the Board called and held for such purpose (after reasonable notice to the Executive and an opportunity for the Executive, together with his or her counsel, to be heard before the Board), finding that in the good faith opinion of the Board the
Executive was guilty of conduct set forth above in clause (i), (ii), (iii) or (iv) of this section and specifying the particulars thereof in detail. 
  
 For purposes hereof, the Executive will be considered to have a “Disability” if, as a result of Executive’s incapacity due to physical or
mental illness, Executive shall have been absent from his duties to the Company on a full-time basis for 180 calendar days in the aggregate in any 12 month period. For purposes of clarification only, a termination by the Company of the employment of
the Executive with the Company for Cause shall not be deemed to be a Terminating Event. 
  
 (b) Termination by the Executive for Good Reason. Termination by the Executive of the Executive’s employment with the Company for Good Reason. For purposes of this Agreement, “Good Reason” shall
mean the occurrence of any of the following events: 
  
 (i) an
adverse change, not consented to by the Executive, in the nature or scope of the Executive’s responsibilities, authorities, powers, functions or duties from the responsibilities, authorities, powers, functions or duties exercised by the
Executive immediately prior to the Change in Control; or 
  
 (ii)
a reduction in the Executive’s annual base salary or Target Bonus, each as in effect on the date hereof or as the same may be increased from time to time hereafter, except for across-the-board reductions of annual base salary similarly
affecting all executive officers of the Company; or 
  

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 (iii) the relocation of the Company’s offices at which the Executive is principally employed
immediately prior to the date of a Change in Control (the “Current Offices”) to any other location more than 35 miles from the Current Offices, or the requirement by the Company for the Executive to be based more than 35 miles away from
the Current Offices, except for required travel on the Company’s business to an extent substantially consistent with the Executive’s business travel obligations immediately prior to the Change in Control; or 
  
 (iv) the failure by the Company to obtain an effective agreement from any
successor to assume and agree to perform this Agreement, as required by Section 19; or 
  
 (v) the failure by the Company to provide benefits reasonably comparable to those in effect immediately prior to the Change in Control. 
  
 For purposes of this Agreement, “Target Bonus” shall mean the Executive’s cash incentive compensation target
for the applicable fiscal period, calculated as though the Company and the Executive achieved, as of the applicable measurement date, the Company’s financial targets and the Executive’s financial targets and individual goals, each at the
100 percent level. 
  
 4. Change in Control Payment. In the
event a Terminating Event occurs within 12 months after a Change in Control, the following shall occur: 
  
 (a) the Company shall pay to the Executive an amount equal to one times the sum of (i) the Executive’s annual base salary in effect on the date of
the Terminating Event (or the Executive’s annual base salary in effect immediately prior to the Change in Control, if higher) and (ii) the Executive’s Target Bonus as in effect on the date of the Terminating Event (or the Executive’s
Target Bonus in effect immediately prior to the Change in Control, if higher), payable in one lump-sum payment no later than three days following the Date of Termination; 
  
 (b) the Company shall continue to provide to the Executive certain benefits, including without limitation health, dental and
life insurance benefits, on the same terms and conditions as though the Executive had remained an active employee for 18 months, except that all costs and insurance premiums shall be paid by the Company; 
  
 (c) the Company shall provide COBRA benefits to the Executive following the
end of the period referred to in Section 4(b), such benefits to be determined as though the Executive’s employment had terminated at the end of such period; 
  
 (d) the Company shall pay to the Executive all reasonable legal and arbitration fees and expenses incurred by the Executive
in obtaining or enforcing any right or benefit provided by this Agreement, except in cases involving frivolous or bad faith litigation initiated by the Executive; and 
  

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 (e) Notwithstanding anything to the contrary in any applicable option agreement or stock-based award
agreement, upon a Change in Control, all stock options and other stock-based awards granted to Executive by the Company shall immediately accelerate and become exercisable or non-forfeitable as of the effective date of such Change in Control.
Executive shall also be entitled to any other rights and benefits with respect to stock-related awards, to the extent and upon the terms provided in the employee stock option or incentive plan or any agreement or other instrument attendant thereto
pursuant to which such options or awards were granted. 
  
 5. Tax Gross-Up for Excise Taxes. 
  
 (a)
Gross Up Payment. 
  
 (i) Anything in this Agreement to
the contrary notwithstanding, in the event it shall be determined that any compensation, payment or distribution by the Company to or for the benefit of Executive, whether paid or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise (the “Severance Payments”), would be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), or any interest or penalties are incurred by Executive
with respect to such excise tax (such excise tax, together with any such interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), then Executive shall be entitled to receive an additional payment (a
“Gross-Up Payment”) such that the net amount retained by Executive, after deduction of any Excise Tax on the Severance Payments, any Federal, state, and local income tax, employment tax and Excise Tax upon the payment provided by this
subsection, and any interest and/or penalties assessed with respect to such Excise Tax, shall be equal to the Severance Payments. 
  
 (ii) Subject to the provisions of Subparagraph (iii) below, all determinations required to be made under this clause (ii), including whether a Gross-Up
Payment is required and the amount of such Gross-Up Payment, shall be made by a nationally recognized accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations both to the Company
and Executive within 15 business days of the Date of Termination, if applicable, or at such earlier time as is reasonably requested by the Company or Executive. For purposes of determining the amount of the Gross-Up Payment, Executive shall be
deemed to pay Federal income taxes at the highest marginal rate of Federal income taxation applicable to individuals for the calendar year in which the Gross-Up Payment is to be made, and state and local income taxes at the highest marginal rates of
individual taxation in the state and locality of Executive’s residence on the Date of Termination, net of the maximum reduction in Federal income taxes which could be obtained from deduction of such state and local taxes. The initial Gross-Up
Payment, if any, as determined pursuant to this clause (ii), shall be paid to Executive within five days of the receipt of the Accounting Firm’s determination. If the Accounting Firm determines that no Excise Tax is payable by Executive, the
Company shall furnish Executive with an opinion of counsel that failure to report the Excise Tax on Executive’s applicable Federal income tax return would not result in the imposition of a negligence or similar penalty. Any determination
by the Accounting Firm shall be binding upon the Company and 
  

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 Executive. As a result of the uncertainty in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up Payments which will not have been made by the Company should have been made (an “Underpayment”). In the event that the Company exhausts its remedies pursuant to
Subparagraph (iii) below and Executive thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Underpayment that has occurred, consistent with the calculations required to be made hereunder,
and any such Underpayment, and any interest and penalties imposed on the Underpayment and required to be paid by Executive in connection with the proceedings described in Subparagraph (iii) below, shall be promptly paid by the Company to or for the
benefit of Executive. 
  
 (iii) Executive shall notify the
Company in writing of any claim by the Internal Revenue Service that, if successful, would require the payment by the Company of the Gross-up Payment. Such notification shall be given as soon as practicable but no later than 10 business days after
Executive knows of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. Executive shall not pay such claim prior to the expiration of the 30-day period following the date on
which he gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies Executive in writing prior to the expiration of such period that it desires to
contest such claim, provided that the Company has set aside adequate reserves to cover the Underpayment and any interest and penalties thereon that may accrue, Executive shall: 
  
 (A) give the Company any information reasonably requested by the Company relating to such claim, 

 
 (B) take such action in connection with contesting such
claim as the Company shall reasonably request in writing from time to time, including, without limitation, accepting legal representation with respect to such claim by an attorney selected by the Company, 
  
 (C) cooperate with the Company in good faith in order to
effectively contest such claim, and 
  
 (D)
permit the Company to participate in any proceedings relating to such claim; provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties) incurred in connection with such
contest and shall indemnify and hold Executive harmless, on an after-tax basis, for any Excise Tax or income tax, including interest and penalties with respect thereto, imposed as a result of such representation and payment of costs and expenses.
Without limitation on the foregoing provisions of this Subparagraph (iii), the Company shall control all proceedings taken in connection with such contest and, at its sole option, may pursue or forego any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim and may, at its sole option, either direct Executive to pay the tax claimed and sue for a refund or contest the claim in any 
  

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 permissible manner, and Executive agrees to prosecute such contest to a determination before any
administrative tribunal, in a court of initial jurisdiction and in one or more appellate courts, as the Company shall determine; provided, however, that if the Company directs Executive to pay such claim and sue for a refund, the Company shall
advance the amount of such payment to Executive on an interest-free basis (to the extent not prohibited by applicable law) and shall indemnify and hold Executive harmless, on an after-tax basis, from any Excise Tax or income tax, including interest
or penalties with respect thereto, imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to payment of taxes for the
taxable year of Executive with respect to which such contested amount is claimed to be due is limited solely to such contested amount. Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up
Payment would be payable hereunder and Executive shall be entitled to settle or contest, as the case may be, any other issues raised by the Internal Revenue Service or any other taxing authority. 
  
 (iv) If, after the receipt by Executive of an amount advanced by the Company
pursuant to Subparagraph (iii) above, Executive becomes entitled to receive any refund with respect to such claim, Executive shall (subject to the Company’s complying with the requirements of Subparagraph (iii) above) promptly pay to the
Company the amount of such refund (together with any interest paid or credited thereon after taxes applicable thereto). If, after the receipt by Executive of an amount advanced by the Company pursuant to Subparagraph (iii) above, a determination is
made that Executive shall not be entitled to any refund with respect to such claim and the Company does not notify Executive in writing of its intent to contest such denial of refund prior to the expiration of 30 days after such determination, then
such advance shall be forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the extent thereof, the amount of Gross-Up Payment required to be paid. 
  
 6. Executive’s Covenant. The Executive has entered into a
Non-Solicitation, Non-Compete and Confidentiality and Employee Non-Disclosure Agreement with the Company dated as of                      (the
“Non-Compete Agreement”), which is incorporated herein by reference and survives the termination or expiration of this Agreement. In consideration of the benefits received under this Agreement, the Executive hereby reconfirms his
obligations under the Non-Compete Agreement in all respects. 
  
 7. Term. This Agreement shall take effect on the date first set forth above and shall terminate upon the earlier of (a) the termination by the Company of the employment of the Executive for Cause or the failure by the Executive to
perform his full-time duties with the Company by reason of his death or Disability, (b) the resignation or termination of the Executive’s employment for any reason prior to a Change in Control, (c) the termination of the Executive’s
employment with the Company after a Change in Control for any reason other than the occurrence of a Terminating Event, or (d) the date which is 18 months after a Change in Control if the Executive is still employed by the Company. 
  

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 8. Withholding. All payments made by the Company under this Agreement shall be net of any tax or
other amounts required to be withheld by the Company under applicable law. 
  
 9. Notice and Date of Termination; Disputes; Etc. 
  
 (a) Notice of Termination. After a Change in Control and during the term of this Agreement, any purported termination of the Executive’s employment (other than by reason of death) shall be communicated by
written Notice of Termination from one party hereto to the other party hereto in accordance with this Section 9. For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination
provision in this Agreement relied upon and the Date of Termination. 
  
 (b) Date of Termination. “Date of Termination,” with respect to any purported termination of the Executive’s employment after a Change in Control and during the term of this Agreement, shall mean the date specified in
the Notice of Termination. In the case of a termination by the Company other than a termination for Cause (which may be effective immediately), the Date of Termination shall not be less than 30 days after the Notice of Termination is given. In the
case of a termination by the Executive, the Date of Termination shall not be less than 15 days from the date such Notice of Termination is given. Notwithstanding the foregoing, in the event that the Executive gives a Notice of Termination to the
Company, the Company may unilaterally accelerate the Date of Termination and such acceleration shall not result in a “Termination by the Company” for purposes of this Agreement. 
  
 (c) No Mitigation. The Company agrees that, if the Executive’s employment by the Company is terminated during
the term of this Agreement, the Executive is not required to seek other employment or to attempt in any way to reduce any amounts payable to the Executive by the Company pursuant to Section 4 hereof. Further, the amount of any payment provided for
in this Agreement shall not be reduced by any compensation earned by the Executive as the result of employment by another employer, by retirement benefits, by offset against any amount claimed to be owed by the Executive to the Company or otherwise.

  
 (d) Settlement and Arbitration of Disputes. Any
controversy or claim arising out of or relating to this Agreement or the breach thereof shall be settled exclusively by arbitration in accordance with the laws of the State of Delaware by three arbitrators, one of whom shall be appointed by the
Company, one by the Executive and the third by the first two arbitrators. If the first two arbitrators cannot agree on the appointment of a third arbitrator, then the third arbitrator shall be appointed by the American Arbitration Association in the
City of Fort Lauderdale. Such arbitration shall be conducted in the City of Fort Lauderdale in accordance with the rules of the American Arbitration Association for commercial arbitrations, except with respect to the selection of arbitrators which
shall be as provided in this Section 9(d). Judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. 
  

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 10. Successor to Executive. This Agreement shall inure to the benefit of and be enforceable by the
Executive’s personal representatives, executors, administrators, heirs, distributees, devisees and legatees. In the event of the Executive’s death after a Terminating Event but prior to the completion by the Company of all payments due him
under Section 4 of this Agreement, the Company shall continue such payments to the Executive’s beneficiary designated in writing to the Company prior to his death (or to his estate, if the Executive fails to make such designation). 

 
 11. Enforceability. If any portion or provision of this Agreement
shall to any extent be declared illegal or unenforceable by a court of competent jurisdiction, then the remainder of this Agreement, or the application of such portion or provision in circumstances other than those as to which it is so declared
illegal or unenforceable, shall not be affected thereby, and each portion and provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. 
  
 12. Waiver. No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving
party. The failure of any party to require the performance of any term or obligation of this Agreement, or the waiver by any party of any breach of this Agreement, shall not prevent any subsequent enforcement of such term or obligation or be deemed
a waiver of any subsequent breach. 
  
 13. Notices. Any
notices, requests, demands and other communications provided for by this Agreement shall be sufficient if in writing and delivered in person or sent by registered or certified mail, postage prepaid, to the Executive at the last address the Executive
has filed in writing with the Company, or to the Company at its main office, attention of the Board of Directors. 
  
 14. Effect on Other Plans. An election by the Executive to resign after a Change in Control under the provisions of this Agreement shall not be
deemed a voluntary termination of employment by the Executive for the purpose of interpreting the provisions of any of the Company’s benefit plans, programs or policies. Nothing in this Agreement shall be construed to limit the rights of the
Executive under the Company’s benefit plans, programs or policies except that the Executive shall have no rights to any severance benefits under any Company severance pay plan. 
  
 15. No Offset. The Company’s obligation to make the payments provided for in this Agreement and otherwise
perform its obligations hereunder shall not be affected by any circumstances, including, without limitation, any set-off, counterclaim, recoupment, defense or 
  

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 other right which the Company or any of its Affiliates may have against the Executive or others whether by reason of the
Executive’s breach of this Agreement, subsequent employment of the Executive, or otherwise. 
  
 16. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes
in all respects all prior agreements between the parties concerning such subject matter. 
  
 17. Amendment. This Agreement may be amended or modified only by a written instrument signed by the Executive and by a duly authorized representative of the Company. 
  
 18. Governing Law. This contract shall be construed under and be
governed in all respects by the laws of the State of Delaware, without giving effect to such state’s conflicts of laws principles. 
  
 19. Obligations of Successors. The Company shall require any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had
taken place. 
  
 [remainder of page intentionally left blank]

  
  

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 IN WITNESS WHEREOF, this Agreement has been executed as a sealed instrument by the Company by its duly
authorized officer, and by the Executive, as of the date first above written. 
  

			
	CITRIX SYSTEMS, INC.
		
	By:	 	  

	Name:	 	 
	Title:	 	 
	  

 [Executive]

	[Title]

  

 11License Agreement

 Exhibit 10.1 
  
 LICENSE AGREEMENT 
  
 This License Agreement (the “Agreement”) is entered into as of this 12th day of April 2005 (the “Effective Date”) by and
between Seattle Genetics, Inc., a Delaware corporation with its principal office at 21823 30th Drive SE, Bothell, WA
98021 (“SG”), and Protein Design Labs, Inc., a Delaware corporation with its principal office at 34801 Campus Drive, Fremont, CA 94555 (“PDL”). PDL and SG are sometimes referred to herein individually as a
“Party” and together as the “Parties”. 
  
 RECITALS 
  
 WHEREAS, PDL has certain rights to a
humanized antibody directed against the CD33 antigen and has developed a CD33 Antibody Program (as defined below); 
  
 WHEREAS, PDL owns certain intellectual property rights related to humanized antibodies and antibody humanization technology; 
  
 WHEREAS, PDL wishes to license certain components of the CD33 Antibody
Program to SG, along with associated nonexclusive rights under certain of PDL’s intellectual property rights relating to humanized antibodies and antibody humanization technology, and SG wishes to continue development of anti-CD33 antibodies
and antibody-drug conjugates under the terms and conditions of this Agreement; and 
  
 WHEREAS, the Parties now wish to enter into a license and technology transfer with respect to the CD33 Antibody Program, including certain related intellectual property, to SG in accordance with the terms and
conditions set forth in this Agreement. 
  
 AGREEMENT

  
 NOW, THEREFORE, in exchange for the mutual promises
contained herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows: 
  

1. Definitions 
  
 “Abandoned Product” has the meaning set forth in Section 5.2. 
  
 “[***]” has the meaning set forth in Section 6.3. 
  
 “[***]” has the meaning set forth in Section 6.3.

  
 “ADC” means a CD33 Antibody linked to,
conjugated or chemically fused with, or otherwise combined together in a single solution with, a drug, toxin, label or any other moiety. Notwithstanding the foregoing, an ADC shall not include any CD33 Antibodies (or products containing CD33
Antibodies) bound to, linked to or conjugated with a radioisotope or radiolabel. 
  
 “ADC Licensed Product” means a Licensed Product that consists of or contains an ADC. 
  
 “ADC Collaboration Agreement” means the Collaboration Agreement dated as of June 4, 2001 by and between SG and Eos Biotechnology, Inc.
(“Eos”) as assumed by PDL pursuant to PDL’s 

  

	[***]    	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 
acquisition of Eos and subsequently amended on August 8, 2001 and January 9, 2004, and as such may be amended from time to time. 
  
 “Affiliate(s)” of a Party means any corporation or other
business entity that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with a Party. As used solely in this definition, the term “control” means the direct or indirect
ownership of fifty percent (50%) or more of the stock having the right to vote for directors thereof or the ability to otherwise control the management thereof. 
  

“Agreement” has the meaning set forth in the introductory paragraph hereof. 
  
 “Antibody” or “Antibodies” means any
molecule comprising or containing one or more immunoglobulin variable domains or parts of such domains, or fragments, variants, modifications or derivatives thereof, including any antibody monospecific and bispecific antibodies, less than
full-length antibody forms (such as Fv, Fab, and F(ab’)2), single-chain antibodies, and antibodies linked to a
drug, toxin, label or any other moiety. 
  
 “Associated
Diagnostic Product” means a diagnostic Licensed Product. 
  
 “[***]” has the meaning set forth in Section 2.3. 
  
 “[***]” means certain [***]. 
  
 “CD33 Antibody” means any Antibody that binds to the CD33 Antigen. 
  
 “CD33 Antigen” means the CD33 antigen, which antigen is also known as Myeloid Differentiation Antigen CD33, gp67, SIGLEC-3, Sialic
Acid–Binding Immunoglobulin-like Lectin 3, and FLJ00391. 
  
 “CD33 Antibody Program” means all research and development of CD33 Antibodies, [***] conducted by PDL prior to the Effective Date. 
  
 “CD33 Improvement” means any CD33 Antibody that differs from each PDL CD33 Antibody by [***],
whether or not incorporated into an ADC. 
  
 “CD33
IND” has the meaning set forth in Section 6.3. 
  
 “CD33 Inventions” has the meaning set forth in Section 8.4. 
  
 “CD33 Know-How” means any and all materials, data, results, formulae, designs, specifications, methods, processes, techniques, ideas, discoveries, technical information, process information,
pharmacological data, toxicological data, analytical and quality control data, manufacturing data, clinical information, regulatory information and submissions, and any other information, developed by PDL in the course of its efforts under the CD33
Antibody Program and as to which PDL has the right to disclose or provide and grant licenses or sublicenses (as provided for herein), to the extent that any of the foregoing pertains specifically to and is necessary or useful for SG to develop and
commercialize Licensed Products. For the avoidance of doubt, [***]. 
  
 “CD33 Patents” means (a) those existing patents and patent applications listed on Exhibit B, (b) 

  

	[***]    	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 -2- 

 
any future patents or patent applications owned or Controlled by PDL directed to CD33 Antibodies or uses thereof and (c) any reissues, reexaminations,
confirmations, renewals, registrations, substitutions, extensions, counterparts, divisions, continuations, or continuations-in-part of or claiming priority back to any of the foregoing patents which are owned or Controlled by PDL. For the avoidance
of doubt [***]. 
  
 “CD33 Technology”
means the Cell Lines, PDL CD33 Antibodies, CD33 Patents, CD33 Know-How and CD33 Inventions. 
  
 “Cell Lines” means all cell lines developed as of the Effective Date by PDL to produce anti-CD33 Antibodies and anti-IDs to anti-CD33 Antibodies and identified in Exhibit A. 
  
 “cGMP” means the FDA’s current good manufacturing
practices, as first published in the Federal Register and then specified in the Code of Federal Regulations and FDA’s published guidance documents, and all successor regulations and guidance documents thereto, as well as the comparable
practices, regulations and documents of any other comparable regulatory authorities in countries outside the United States, as in effect from time to time. 
  
 “cGMP Materials” has the meaning set forth in Section 7.1(k). 
  
 “Combination Product” means any Licensed Product that
contains one or more other ingredients (other than a CD33 Antibody, ADC or any Antibody-drug conjugate technology) that have independent biologic or chemical activity as a therapeutic agent when present alone. 
  
 “Confidential Information” has the meaning set forth in
Section 10.1. 
  
 “Control” means possession of
the right and ability to grant access to and/or a license or sublicense as provided for herein without violating the terms of any agreement or other arrangement with a Third Party and without having to pay royalties, license fees or other payments
to such Third Party on account of the grant of access, license or sublicense (or the exercise thereof by the grantee). 
  
 “Developing Party” has the meaning set forth in Section 5. 
  
 “Documentation” means the documents set forth in Exhibit A. For clarity, [***]. 

 
 “Effective Date” has the meaning set forth in the
introductory paragraph of this Agreement. 
  
 “FDA” means the United States Food and Drug Administration, or any successor agency(ies). 
  
 “Field” means the prevention, treatment and/or diagnosis of conditions and diseases in humans, excluding any of the following: (a)
Antibody-radionuclide conjugates or any CD33 Antibodies (or products containing CD33 Antibodies) bound to, linked to or conjugated with a radioisotope or radiolabel; and (b) human in vitro diagnostics. 
  
 “First Commercial Sale” means the first commercial sale of a
Licensed Product in any country after all Regulatory Approvals required for such sale have been granted, or otherwise permitted, by the governing health authority of such country (or in the case of permitted commercial pre-approval sales in certain
jurisdictions, upon the initiation of such commercial pre-approval sales. “First Commercial Sale” shall not include the sale of any Licensed Product for use in clinical trials. 
  
 [***] is the antigen that is also known as [***] and referenced as the [***] antigen in Schedule C

  

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to the ADC Collaboration Agreement, as may be updated from time to time. 
  
 “IND” means an Investigational New Drug Application filed or to be filed with the FDA. 
  
 “Indemnified Party” has the meaning set forth in Section
9.3. 
  
 “Indemnifying Party” has the meaning set
forth in Section 9.3. 
  
 “Indemnitees” has the
meaning set forth in Section 9.1. 
  
 “Initiation” means, with respect to a human clinical trial, the treatment of the first patient with a Licensed Product pursuant to the clinical protocol for a specified clinical trial. 
  
 “Inventions” means patentable or unpatentable inventions,
original works of authorship, developments, concepts, know-how, improvements or trade secrets. 
  
 “[***]” has the meaning set forth in Section 4.5.1. 
  
 “[***]” has the meaning set forth in Section 4.5.1. 
  
 “Joint Inventions” has the meaning set forth in Section 8.1. 
  
 “Licensed Patents” means the CD33 Patents and the Queen
Patents. 
  
 “Licensed Product” means any
product, including any Combination Product, incorporating or utilizing a PDL CD33 Antibody or CD33 Improvement, excluding, however, [***], any products comprising, incorporating or utilizing: (a) [***]; or (b) [***]. Except to
the extent expressly provided otherwise herein, Licensed Products shall include Associated Diagnostic Products. For clarity, Licensed Products do not include any products incorporating or utilizing CD33 Antibodies in-licensed by SG from a Third
Party or independently developed by or for SG that are not covered by CD33 Technology, and SG shall have no rights or license hereunder nor owe PDL any fees, milestones or royalties hereunder with respect to such products. 
  
 “Licensed Technology” means the CD33 Technology and the
Queen Patents. 
  
 “[***]” is the antigen
that is also known as [***] and referenced as the [***] antigen in Schedule C to the ADC Collaboration Agreement, as may be updated from time to time. 
  
 “Losses” has the meaning set forth in Section 9.1. 
  
 “Materials” means the Cell Lines, supplies of CD33
Antibodies and other materials, in all such cases as set forth on Exhibit A. 
  
 “[***]” means the [***]. 
  
 “[***]” means [***] as each is defined in the [***]. 
  
 “Net Sales” means, as to each calendar quarter, the gross invoiced sales prices (or, in the absence of such invoices, the amount) charged
for all Licensed Products sold or otherwise disposed of by or for 

  

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SG, its Affiliates and/or sublicensees to independent Third Parties in arm’s length transactions exclusively for money or, where the transaction is not
at arm’s length or not exclusively for money, the price that would have been so invoiced if it had been at arm’s length, during such calendar quarter, after deduction (if not already deducted in the amount invoiced) of the following items
paid by SG, its Affiliates and sublicensees during such calendar quarter with respect to sales of Licensed Products regardless of the calendar quarter in which such sales were made, provided and to the extent that such items are incurred:

  
 (a) reasonable and customary [***];

  
 (b) reasonable and customary [***];

  
 (c) any [***] and borne by the seller
thereof without reimbursement from any Third Party; and 
  
 (d) any [***] and to the extent borne by the seller without reimbursement from any Third Party. 
  
 All of the foregoing deductions from the gross invoiced sales prices of Licensed Products shall be determined in accordance with GAAP. In the event that
SG, its Affiliates or sublicensees make any adjustments to such deductions after the associated Net Sales have been reported pursuant to this Agreement, the adjustments shall be reported and reconciled with the next report and payment of any
royalties due. Net Sales shall not include transfer of Licensed Products by or on behalf of SG, its Affiliates or sublicensees in connection with clinical trials at or below the costs of goods thereof. 
  
 In the event a Licensed Product is sold as part of a Combination Product, the
Net Sales from the Combination Product, for the purposes of determining royalty payments, shall be determined by multiplying the Net Sales of the Combination Product (as defined in the standard Net Sales definition above), during the applicable
royalty reporting period, by the fraction, A/A+B, where A is the average per unit sale price of the CD33 Antibody contained in the Licensed Product, when sold separately in finished form in the country in which the Combination Product is sold and B
is the average per unit sale price of the other active ingredient(s) included in the Combination Product when sold separately in finished form in the country in which the Combination Product is sold, in each case during the applicable royalty
reporting period or, if sales of the CD33 Antibody contained in the Licensed Product alone did not occur in such period or country, then in the most recent royalty reporting period in which arms length fair market sales of such CD33 Antibody
contained in the Licensed Product occurred in such country or if no such sales have occurred in such country, the average per unit sale price in all countries the CD33 Antibody contained in the Licensed Product is sold alone during the applicable
royalty period. In the event that such average sale price cannot be determined for the CD33 Antibody contained in the Licensed Product, on the one hand, and all other active ingredients included in the Combination Product, on the other, Net Sales
for the purposes of determining royalty payments shall be mutually agreed upon by the Parties based on the relative value contributed by each component, such agreement to be negotiated in good faith. 
  
 “Opt-In Right” has the meaning set forth in Section 5.

  
 “Opt-In Notice” has the meaning set forth in
Section 5. 
  
 “Party” or
“Parties” have the meanings set forth in the introductory paragraph of this Agreement. 
  

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 “PDL CD33 Antibody(ies)” means the CD33 Antibodies owned or Controlled by PDL and
specifically known as Zamyl (also known as HuM195) and M195. 
  
 “PDL Inventions” has the meaning set forth in Section 8.1. 
  
 “Phase I Clinical Trial” means a clinical trial designed to evaluate the pharmacokinetic and pharmacodynamic properties, maximum tolerated dose, dosing interval, and absorption, distribution,
metabolism and excretion of a candidate drug, generally consistent with 21 CFR §312.21(a) or the comparable applicable rules and regulations of the jurisdiction in which the clinical trial is conducted. 
  
 “Phase II Clinical Trial” means a controlled dose clinical
trial prospectively designed to evaluate the efficacy and safety of a candidate drug in the targeted patient population generally consistent with 21 CFR §312.21(b) or the comparable, applicable rules and regulations of the jurisdiction in which
the clinical trial is conducted. 
  
 “Phase III Clinical
Trial” means a controlled, multi-center, clinical trial, involving patients with the disease or condition of interest to obtain sufficient efficacy and safety data to support regulatory submissions and labeling of a candidate drug generally
consistent with 21 CFR §312.21(c) or the comparable, applicable rules and regulations of the jurisdiction in which the clinical trial is conducted. 
  
 [***] is the antigen referred to as [***] referenced in Schedule C to the ADC Collaboration Agreement, as may be updated from time to
time. 
  
 “Queen Patents” means all patents or
patent applications owned or Controlled by PDL to the extent directly related to the humanization of antibodies and identified on Exhibit C, which are filed prior to or during the Term of this Agreement, and any addition, continuation,
continuation-in-part or division thereof or any substitute application therefor, any patent issued with respect to such patent application, any reissue, extension or patent term extension of any such patent, and any confirmation patent or
registration patent or patent of addition based on any such patent, including any supplementary protection certificates. Upon request, PDL shall provide SG with an updated Exhibit C from time to time during the Term but not more frequently
than once per quarter to reflect the current status of the Queen Patents. 
  
 “Receiving Party” has the meaning set forth in Section 5. 
  
 “Regulatory Approval” means regulatory approval (including, where applicable, supplements, pre-or post-approvals or pricing approval in
the event that actual sales do not take place before such approval(s) are obtained) required to market a Licensed Product for a disease or condition in accordance with the applicable laws and regulations of a given country. In the United States, its
territories and possessions, Regulatory Approval means approval of a Biologics License Application, New Drug Application or the equivalent by the FDA. 
  
 “Royalty Term” means the period beginning upon First Commercial Sale of the first Licensed Product in each country and ending upon the
later of: (a) the expiration of the last of the Valid Claims under the Licensed Patents in such country; or (b) [***] years after the First Commercial Sale of such Licensed Product in such country. 
  
 “Second Generation CD33 Products” means any product
incorporating or utilizing a Second Generation CD33 Improvement (which such product, for the avoidance of doubt, could be an Unconjugated Antibody Licensed Product, an ADC Licensed Product, an Associated Diagnostic Product or not a Licensed Product
at all). 
  

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 “Second Generation CD33 Improvement” means any CD33 Improvement that results in either:
[***]; provided that Second Generation CD33 Improvements shall not include any CD33 Improvements necessary or useful to (a) [***] or (b) [***]. For clarity, a [***] may not be [***] after the [***].

  
 “[***]” means the [***],
beginning as of the Effective Date, during which [***]. 
  
 “SG Inventions” has the meaning set forth in Section 8.1. 
  
 “SG Patents” means (a) any patents or patent applications anywhere in the world directed to SG Inventions; and (b) any reissues, reexaminations, confirmations, renewals, registrations, substitutions,
extensions, counterparts, divisions, continuations, or continuations-in-part of or claiming priority back to any of the foregoing patents. 
  
 “SG CD33 Patents” means: (a) any patents or patent applications anywhere in the world owned or controlled by SG directed to inventions
made solely by employees, agents or consultants of SG during the Term of this Agreement relating specifically to SG’s research or development of Licensed Products hereunder; and (b) any reissues, reexaminations, confirmations, renewals,
registrations, substitutions, extensions, counterparts, divisions, continuations, or continuations-in-part of or claiming priority back to any of the foregoing patents or patent applications. For the sake of clarity, SG CD33 Patents do not include
any patents or patent applications specifically covering SG’s ADC technology or other platform or enabling technologies not specifically related to CD33 Antibodies, or reissues, reexaminations, confirmations, renewals, registrations,
substitutions, extensions, counterparts, divisions, continuations, or continuations-in-part of or claiming priority back to any of the foregoing patents or patent applications. 
  
 “Term” has the meaning set forth in Section 11.1. 
  
 “Territory” means worldwide. 
  
 “Third Party” means any person, corporation or entity other
than PDL or SG. 
  
 “Unconjugated Antibody” means
a CD33 Antibody that is not an ADC or otherwise linked to or conjugated or combined with a drug, toxin, label or any other moiety. 
  
 “Unconjugated Antibody Licensed Product” means a Licensed Product that consists of, contains or uses an Unconjugated Antibody (and no
ADC), but in any event excluding Associated Diagnostic Products. 
  
 “Valid Claim” means: (i) a claim of an issued and unexpired patent that (a) has not been held permanently revoked, unenforceable or invalid by a decision of a court or other governmental agency of competent jurisdiction,
unappealable or unappealed within the time allowed for appeal and (b) has not been admitted to be invalid or unenforceable through reissue or disclaimer or similar binding and official action; and/or (ii) a claim of a patent application that has
been pending for less than [***] or (but not until) that is allowed after such [***] period. 
  
 2. License Grants. 
  
 2.1 Exclusive License Grant. Subject to the terms and conditions of this Agreement, 

  

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 -7- 

 
PDL hereby grants to SG an exclusive license, with right to sublicense (solely in accordance with Section 2.7), under the CD33 Technology to research,
develop, make, have made, use, import, export, sell or offer for sale ADC Licensed Products and Unconjugated Antibody Licensed Products [***] in the Field in the Territory. The license grant under this Section 2.1 excludes any rights for
[***]. 
  
 2.2 Exclusive Sublicense
under [***]. Subject to the terms of this Agreement and the [***], PDL hereby grants to SG an exclusive (except with respect to Associated Diagnostics for which the sublicense shall be nonexclusive and except with respect to
Licensed Products that are Second Generation CD33 Products for which the sublicense shall be co-exclusive to the same extent as provided for in Section 2.4) sublicense, with right to sublicense (to the extent authorized under the [***] and
otherwise solely in accordance with Section 2.7), under the [***] to the [***] to research, develop, make, have made, use, import, export, sell or offer for sale Licensed Products in the Field in the Territory, with such sublicense
further limited to the field of human therapy and human in vivo diagnostics (excluding any human in vitro diagnostics). SG, its Affiliates and/or sublicensees agree to comply with all applicable obligations, covenants and conditions of
the [***], and any amendments thereto (including, without limitation, those relating to record keeping, reporting and audits, indemnification, publications, and use of [***]). PDL will not [***] without the prior written consent
of SG. 
  
 2.3 [***]. Subject to
the terms of this Agreement and [***], PDL hereby grants to SG a worldwide, nonexclusive sublicense to the [***] to make, use, sell and otherwise distribute Licensed Products in the Field in the Territory. SG agrees to [***]. To
the extent permissible [***], SG shall have the right to [***] solely in connection with [***]. 
  
 2.4 Co-Exclusive License Grant. Subject to the terms of this Agreement, including, but not limited to, Section 5, and [***],
PDL hereby grants to SG and its Affiliates a co-exclusive license with PDL, with right to sublicense solely as provided in this Section 2.4 and otherwise in accordance with Section 2.7, to the CD33 Technology to research, develop, make, have made,
use, import, export, sell or offer for sale Licensed Products that are Second Generation CD33 Products in the Field in the Territory. Each Party shall have the right to sublicense its rights pursuant to this Section 2.3 solely with respect to
[***] for which the other Party has failed to exercise its Opt-In Right pursuant to the terms of Section 5 following the full opportunity of such other Party to exercise such Opt-In Right in accordance with Section 5. 
  
 2.5 Associated Diagnostic Products License Grant.
Subject to the terms and conditions of this Agreement, PDL hereby grants to SG a worldwide, nonexclusive license, with right to sublicense (solely in accordance with Section 2.7), under the CD33 Technology to research, develop, make, have made, use,
import, export, sell or offer for sale Associated Diagnostic Products together with Licensed Products in the Field in the Territory. 
  
 2.6 Nonexclusive License Grant under Queen Patents. Subject to the terms of this Agreement, PDL hereby grants to SG a nonexclusive,
worldwide license, with right of sublicense (solely in accordance with Section 2.7), under the Queen Patents to research, develop, make (or have made), use, import, export, sell or offer for sale Licensed Products in the Field in the Territory.

  
 2.7 Sublicensing. SG shall have the
right to grant sublicenses of its rights under this Agreement, provided, however, that: (a) SG shall be responsible for the operations of any sublicensee relevant to this Agreement as if such operations were carried out by SG itself, including,
without limitation, the payment of any royalties or other payments provided for hereunder, regardless of whether the terms of any sublicense provides for such amount to be paid by the sublicensee directly to PDL, (b) 

  

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 -8- 

 
any such sublicense shall bind the sublicensee in writing to all the applicable terms and conditions of this Agreement for the benefit of PDL, including,
without limitation Articles 9 and 10 and a provision granting to SG audit rights similar to PDL’s audit rights under Section 4.9 of this Agreement, which rights SG agrees to exercise for PDL at PDL’s request and expense, (c) SG shall
remain primarily responsible for all acts and obligations hereunder, including transferring CD33 Technology and associated materials to sublicensees, (d) SG shall notify PDL in writing promptly after the grant of any such sublicense including in
such notice the name and address of the sublicensee and the identity of the Licensed Product(s) and field(s) that are covered by the sublicense and SG shall provide PDL with a copy of such sublicense together with such notice, and (e) [***];
provided, that SG shall not be required to pay PDL any [***]. SG shall [***] within [***] after SG [***] together with a written report specifying the [***] thereof. SG further agrees to contractually
obligate [***] to comply with [***] (as the case may be) applicable to SG. 
  
 2.8 Reservation of Rights. For the avoidance of doubt, all exclusive (but not co-exclusive) licenses granted by PDL to SG hereunder
are exclusive even as to PDL (to the extent of the license grant); provided, however, that, for the avoidance of doubt, PDL retains the right to research, develop, manufacture and commercialize (including the rights to make, have made,
use, sell, offer to sell, import and export) Second Generation CD33 Products, subject to Article 5. PDL and its licensors shall retain ownership of the Licensed Technology and [***], subject to the rights and licenses expressly granted
herein. Except as expressly provided for herein, no right, license, title, or interest is granted by PDL to SG, implied or otherwise, in, to or under the Licensed Technology or the [***]. 
  
 2.9 Expiration of Royalty Term. Upon expiration of
the Royalty Term in each country, the licenses granted in this Section 2 with respect to the Licensed Technology in such country shall become nonexclusive, royalty-free, fully paid-up and perpetual, subject to termination, if any, under Article 11.

  
 2.10 [***] 
  
 3. Materials, Documentation and Technology Transfer. Promptly
following the Effective Date, PDL shall make available to SG the Materials and Documentation as set forth in Exhibit A and shall, for a period not to exceed [***] after the Effective Date make appropriate PDL personnel and consultants
reasonably available to address questions associated with the transferred material and documentation set forth in Exhibit A. The Materials, to be transferred within [***] of the Effective Date, shall be deemed “delivered” hereunder
upon PDL’s tender of the Materials to a carrier reasonably designated by SG [***]. Subject to reasonable availability, PDL will make its employees and relevant consultants reasonably available during [***] to consult with
qualified SG personnel on issues and questions related to development and manufacturing of Licensed Products, provided that in no event shall PDL be obligated to provide more than [***] during the [***] and more than [***]
thereafter in performing such activities. SG shall pay PDL at an annual rate of [***], for up to [***], for research, development, manufacturing, technology transfer or other assistance to SG hereunder, in [***] from the
Effective Date, and as reasonably requested by SG for PDL time allocated to such activities beyond [***], provided that such PDL resources are available. For technology transfer purposes, SG will make any and all requests through
[***] who will coordinate all access to PDL personnel and consultants (the latter within [***] of the Effective Date only). After [***] from the Effective Date, SG shall coordinate the activities of consultants and shall pay
associated consulting fees. 
  

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 -9- 

 4. Compensation to PDL. 
  
 4.1 Upfront Credits. As of the Effective Date, SG agrees to provide [***] of non-cancelable,
non-refundable credits to PDL against payments otherwise owed by PDL to SG pursuant to the ADC Collaboration Agreement to be applied as follows: 
  
 (a) [***] for a [***] extension of the Option Period (as defined in the ADC Collaboration Agreement) with respect to the
[***], such that the Option Period expires on [***]; and 
  
 (b) [***] for the annual maintenance fee due [***] pursuant to Section 7.1 of the ADC Collaboration Agreement with respect to the [***]; and 
  
 (c) [***] to be applied to any future payments owed
by PDL to SG pursuant to the ADC Collaboration Agreement. 
  
 4.2 Material Supply Fee. SG agrees to pay PDL [***] within ten (10) days after PDL’s delivery of the Materials pursuant to Section 3. The foregoing payment shall be non-cancelable and
non-refundable. 
  
 4.3 ADC Royalty
Reduction. As of the Effective Date, the ADC Collaboration Agreement is hereby amended such that the royalty rate payable by PDL to SG pursuant to Section 7 thereof is reduced to [***] solely with respect to Licensed Products (as defined
in the ADC Collaboration Agreement) targeting: [***] (as such term is defined in the ADC Collaboration Agreement) to be [***] by PDL (in its sole discretion) by written notice to SG [***]. Such reduced royalty rate shall
not be subject to [***] of the ADC Collaboration Agreement and shall not [***] of the ADC Collaboration Agreement (but shall not, in any event, be subject to [***] in the event of [***] with respect to [***]).

  
 4.4 Royalties. 
  
 4.4.1 During the Royalty Term, SG shall pay PDL royalties on
Net Sales of Licensed Products as follows: 
  
 (a) For [***]): 
  
 (i) a
royalty of [***] of [***] of aggregate Net Sales in each calendar year; and 
  
 (ii) a royalty of [***] of Net Sales [***] in each calendar year. 
  
 (b) For [***], a royalty of [***] of Net
Sales. 
  
 (c) For [***], a royalty equal
to the [***] of: (i) [***] of Net Sales; or (ii) [***] of the [***] that SG receives from a Third Party sublicensee that is developing, manufacturing and/or selling Associates Diagnostic Products pursuant to a license
agreement with SG. 
  
 4.4.2 For purposes of
clarity, SG shall not be required to pay any royalties to PDL hereunder for [***] for which: (a) [***]; or (b) [***] and for which an agreement between the Parties therefore (as provided in [***]) has been entered
into. 
  

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 4.5 Third Party Royalties; Adjustments to Royalties. 
  
 4.5.1 SG shall be responsible for paying all license fees,
milestones, royalties and other payments owed to Third Parties on account of the research, development, manufacture, use or sale of Licensed Products by or for SG, its Affiliates and/or sublicensees (or any customers), including fees, milestones and
royalties owed pursuant to the [***] (but excluding [***]. For royalties owed under license agreements, including the [***], SG shall pay all amounts due to the applicable Third Party (such as [***] and/or [***])
to the extent provided in the previous sentence at least [***] before such amounts are due under the [***] or other applicable agreement, indicating in a notice sent with such payment (and without limiting any other reporting
obligations hereunder or thereunder) that such payment is being made on PDL’s behalf (and referencing this Agreement and the [***]). SG shall provide a copy of all such notices (and any other notices or reports sent to such Third
Parties, including [***]) to PDL at the same time such notices are sent by SG to such Third Parties. SG shall be entitled to any royalty offsets, credits, most favored nation clauses or other reductions in royalties to which PDL would be
entitled pursuant to the [***]. SG shall be responsible for [***]. 
  
 4.5.2 For [***], if the sum of the royalties payable by SG, its Affiliates and/or sublicensees to PDL under Section 4.4.1(b) plus
any other royalties SG is required to pay to any Third Party for a license to patent rights covering such [***] exceeds [***] of Net Sales of such [***] in any calendar year, then for each [***] by which the total
royalties otherwise due and payable by SG with respect to such [***] to PDL and the Third Parties described above exceeds [***] of Net Sales, the rate of royalties due to PDL under Section 4.4.1(b) shall be reduced by [***];
provided, however, that in no event shall any adjustment pursuant to this Section 4.5.2 reduce the royalty payments due and payable by SG to PDL pursuant to Section 4.4.1(b) with respect to a Licensed Product in any country to less
than [***] of Net Sales, exclusive of royalties payable to Third Parties or payable (directly or on behalf of PDL) to [***]. 
  
 4.6 Mode of Payments. For purposes of determining when a sale of any Licensed Product occurs under this Agreement, the sale shall
be deemed to occur on the earlier of: (i) the date of the invoice to the purchaser of the Licensed Product; or (ii) the date the applicable Net Sales are received or recognized on the books of the applicable entity. After the First Commercial Sale,
all royalty payments shall be made within [***] after the end of each calendar quarter in which such sales were deemed to occur. Such royalty payments shall be accompanied by a detailed statement for each country in which sales of Licensed
Products occurred in the calendar quarter covered by such statement, specifying: the gross sales (if available) and Net Sales in each country’s currency; the type and number of units of Licensed Product sold in each country, the applicable
royalty rate under this Agreement; the royalties payable in each country’s currency, including an accounting of deductions taken in the calculation of Net Sales; the applicable exchange rate to convert from each country’s currency to U.S.
Dollars under Section 4.7; and the royalties payable in U.S. Dollars. All payments hereunder shall be made free and clear of any taxes, duties, levies, fees or charges, except for withholding taxes (to the extent required under applicable law). SG
shall make any withholding payments required under applicable law and due on behalf of PDL and shall promptly provide PDL with written documentation of any such payment sufficient to satisfy the requirements of the United States Internal Revenue
Service related to an application by PDL for a foreign tax credit for such payment. SG shall reasonably cooperate with PDL in connection with seeking any reduction or exemption from withholding available under applicable law. All royalty payments
hereunder shall be made to PDL in U.S. Dollars by bank wire transfer in immediately available funds to the account designated by PDL in writing to SG from time to time. 
  
 4.7 Foreign Currency Conversion. For sales of any Licensed Product that occur in a 

  

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 -11- 

 
currency other than U.S. Dollars, the quarterly royalty payment shall be calculated as follows: 
  

					
	 	 	(A/B) x C = U.S. Dollars royalty payment on foreign currency sales, where
			
	 	 	A =	 	foreign currency “Net Sales” per quarter;
			
	 	 	B =	 	foreign exchange conversion rate, expressed in local currency per U.S. Dollar (using as the applicable foreign exchange conversion rate published in the western edition of the Wall Street
Journal, or any other mutually agreed-upon source, for the last business day of the applicable calendar quarter); and
			
	 	 	C =	 	the royalty rate applicable to such Net Sales under this Agreement.

  
 4.8
Restrictions on Payment. If by law, regulations or fiscal policy of a particular country, remittance of royalties in U.S. Dollars is restricted or forbidden, written notice thereof shall promptly be given to PDL, and payment of the royalty
shall be made by the deposit thereof in local currency to the credit of PDL in a recognized banking institution designated by PDL in writing. When the laws or regulations of any country prohibit both the transmittal and deposit of royalties on sales
in such country, royalty payments shall be suspended for as long as such prohibition is in effect and as soon as such prohibition ceases to be in effect, all royalties that SG would have been under an obligation to transmit or deposit but for the
prohibition shall forthwith be deposited or transmitted to the extent allowable. 
  
 4.9 Financial Record Keeping and Review. 
  

(a) SG Records. After the First Commercial Sale, SG shall retain (and shall obligate all sublicensees to retain) for at least
[***] following the end of the calendar year to which they pertain (including following expiration or termination of this Agreement) records of all sales of Licensed Products and related information, in reasonably sufficient detail to permit
PDL to confirm the accuracy of SG’s royalty calculations, reports and payments hereunder. 
  
 (b) Review. Subject to the other terms of this Section 4.9(b), at the request of PDL, upon at least [***] prior written
notice from PDL to SG, and at the expense of PDL (except as otherwise provided below), SG shall permit an independent certified public accountant selected by PDL and reasonably acceptable to SG to inspect (during regular business hours) the records
required to be maintained by SG under this Section 4.9 as provided herein. At PDL’s request hereunder (which shall not be made more frequently than [***] per year during the Royalty Term after First Commercial Sale and for [***]
following expiration or termination of the Royalty Term), the accountant shall be entitled to review, the then-preceding [***] of SG’s records for purposes of verifying SG’s royalty calculations, payments and reports hereunder. In
every case the accountant must have previously entered into a confidentiality agreement with both Parties substantially similar to the confidentiality provisions of Section 10 and limiting the disclosure and use of such information to authorized
representatives of the Parties and the purposes germane to this Section 4.9. Results of any such review shall be made available to both Parties. If any review reveals a deficiency in the calculation of royalties resulting in any underpayment by SG,
SG shall promptly pay PDL the amount remaining to be paid (plus interest thereon as provided in Section 4.12), and if such underpayment is by [***] or more, SG shall pay all costs and expenses of the review. 
  

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 4.10 Milestones. 
  
 4.10.1 [***] Licensed Products. As additional consideration for the licenses and rights
granted to it hereunder, SG shall pay to PDL the following milestone payments within [***] days of the first occurrence of each event set forth below with respect to the first [***] (regardless of how many of such [***] are
developed), whether such events are achieved by SG, its Affiliates or sublicensees, as follows: 
  
 (a) Upon [***]; 
  
 (b) Upon [***]; 
  
 (c) Upon [***]; and 
  
 (d) Upon [***]. 
  
 If any of (a) through (d) above is achieved before one or more preceding milestone payments has become due, then such preceding milestone payments shall be deemed to
become due within [***] of the achievement of the subsequent milestone. For example, if the first [***] directly, then both the [***] milestones will also become due at the [***]. 
  
 4.10.2 [***] Licensed Products. As
additional consideration for the licenses and rights granted to it hereunder, SG shall pay to PDL the following milestone payments within [***] of the first occurrence of each event set forth below with respect to the first [***]
(regardless of how many [***] are developed), whether such events are achieved by SG, its Affiliates or sublicensees, as follows: 
  
 (a) Upon [***]; 
  
 (b) Upon [***]; 
  
 (c) Upon [***]; and 
  
 (d) Upon [***]. 
  
 If any of (a) through (d) above is achieved before one or more preceding milestone payments has become due, then such preceding milestone payments shall be deemed to
become due within [***] of the achievement of the subsequent milestone. For example, if the first [***] directly, then both the [***] milestones will also become due at the [***]. 
  
 4.10.3 [***] Products. As additional
consideration for the licenses and rights granted to it hereunder, SG shall pay to PDL the following milestone payments within [***] of the first occurrence of each event set forth below with respect to the first [***], including any
[***] or [***] that [***] (regardless of how many such [***] are developed), whether such events are achieved by SG, its Affiliates or sublicensees, as follows; provided that the following milestone payments shall
not be applicable to [***] for which: (a) [***] and [***]; or (b) [***] and [***] hereof and for which an agreement between the Parties (as provided in [***]) has been entered into: 
  
 (a) Upon [***]; 
  
 (b) Upon [***]; 
  

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 (c) Upon [***]; and 
  
 (d) Upon [***]. 
  
 If any of (a) through (d) above is achieved before one or more preceding milestone payments
has become due, then such preceding milestone payments shall be deemed to become due within [***] of the achievement of the subsequent milestone. For example, if the first [***] directly, then both the [***] milestones will also
become due at the [***]. 
  
 For purposes of clarification, if a
[***] or an [***], SG shall be obligated to pay milestones with respect to such [***] solely pursuant to this Section 4.10.3 and not Section 4.10.1 or 4.10.2. 
  
 4.10.4 No Associated Diagnostic Product Milestones. SG shall not be obligated to make any milestone
payments to PDL with respect to any Associated Diagnostic Product. 
  
 4.11 Annual License Maintenance Fees. Commencing on [***] and continuing until the date of [***] for a Licensed Product and subject to the terms and conditions of the Agreement, SG shall pay to
PDL an annual license maintenance fee, in the amount of [***]. Such amount is [***]. The first payment of the annual license maintenance fee is due on [***] and each subsequent payment shall be made on each anniversary
thereafter. 
  
 4.12 Interest. If SG fails
to pay any amount specified under this Agreement after the date such payment is due, the amount owed shall bear interest, calculated from the due date until actually received by PDL, at the lesser of: (a) a rate equal to [***] from time to
time on each date such payment was due; or (b) the maximum rate permitted by applicable law. 
  
 5. Second Generation CD33 Products. 
  
 5.1 Co-Development Option. In accordance with Section 2.4, [***]. Following the [***], each Party shall have a
co-exclusive right during the Term hereof [***]. Within [***], and upon each anniversary thereafter, each Party shall provide the other Party with a written report describing the status, total costs incurred to date and any patent
applications filed with respect to such Party’s [***]. In addition, each Party shall provide the other Party at least [***] prior written notice of any [***] for each [***], which notice shall include [***]
(an “Opt-In Notice”). The Party receiving the Opt-In Notice (the “Receiving Party”) shall have a right exercisable upon written notice to the Party sending such Opt-In Notice (the “Developing
Party”) within [***] following receipt of such Opt-In Notice to opt into a [***] co-development and co-funding program for such [***] (an “Opt-In Right”). If the Receiving Party elects to exercise the
Opt-In Right, the Parties shall negotiate in good faith a Co-Development Agreement on commercially reasonable, industry standard terms. Such Co-Development Agreement shall include: (a) a requirement that the Receiving Party reimburse the Developing
Party for fifty percent [***] of the Developing Party’s costs incurred for such [***]; (b) provisions stipulating that the Developing Party shall have [***]; and (c) a decision-making mechanism that includes (i) a joint
steering committee made up of equal numbers of representatives from each Party, (ii) a dispute resolution process providing for escalation of disputes to each Party’s Chief Executive Officer, with the Chief Executive Officer of the Developing
Party with third party alternative dispute resolution having the final decision to resolve any deadlocks. If the Receiving Party does not exercise its Opt-In Right within the [***] period, then the Opt-in Right shall expire and the Developing
Party shall have the sole right to [***] without any involvement from the Receiving Party; provided that if the Developing Party does not [***] within [***] after the Opt-In Right expires, then the Opt-in Right shall be
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date that the Developing Party does [***] for [***]; and provided further that if [***] and [***], then SG shall
[***] and the [***]. Notwithstanding anything to the contrary in this Agreement, [***]. 
  
 5.2 Right of First Refusal. If, at any time during the [***] period following the Effective Date, PDL ceases to develop a
[***] (an “Abandoned Product”) that it had commenced developing (excluding [***]), PDL shall provide written notice thereof to SG and SG shall have a right of first refusal to license such Abandoned Product as follows.
PDL shall notify SG at least [***]: (a) before licensing such Abandoned Product to Third Parties or (b) after PDL makes a final determination to cease development of such Abandoned Product. Upon delivery of either such notice, the parties
shall meet and discuss in good faith the negotiation of a license agreement for such Abandoned Product under mutually agreeable terms and conditions. If the Parties fail to reach agreement on such a license within [***] after the first notice
described above or SG gives written notice that it is not interested in licensing such Abandoned Product during the [***] period, PDL shall have the right to license such Abandoned Product to a Third Party; provided that if the terms of such
license are more favorable to the Third Party than the terms last offered to SG, PDL shall notify SG in writing and SG shall have a period of [***] to exercise the right to enter into a license agreement with PDL on such terms for such
Abandoned Product. 
  
 6. Development and
Commercialization. 
  
 6.1
Manufacturing. SG, its Affiliates and/or sublicensees shall be solely responsible for all aspects of development and manufacturing of Licensed Products; provided that upon SG’s request, PDL will consider (without obligation hereunder),
subject to availability of manufacturing capacity and other considerations in PDL’s sole discretion, to manufacture additional quantities of cGMP CD33 Antibody to supply additional clinical trials [***]. In addition, if SG requests that
PDL manufacture commercial CD33 Antibody, and at that time PDL has the ability, available capacity and desire to do so (in its sole discretion), then the parties agree to negotiate in good faith towards a commercial manufacturing agreement (provided
that PDL shall have no obligation hereunder to so manufacture CD33 Antibody). 
  
 6.2 Clinical Trials and Clinical Trial Data. PDL shall transfer all available clinical documents for the Licensed Product, including but not limited to, the clinical documents listed in Exhibit
A. SG, its Affiliates and/or sublicensees shall be responsible for conducting all clinical trials of Licensed Products, subject, to the extent applicable, to [***]. All data produced as a result of clinical trials on Licensed Products
conducted by SG or its Affiliates and/or sublicensees under this Agreement shall be owned by SG, its Affiliates and/or sublicensees, and all such data shall be considered Confidential Information of SG, its Affiliates and/or sublicensees.

  
 6.3 Regulatory. PDL is transferring to
SG all IND responsibility and regulatory oversight and reporting for safety and other regulatory matters. PDL shall take all actions specified in Exhibit A with respect to regulatory matters for Licensed Products, including without limitation
transferring to SG ownership of the existing IND for PDL CD33 Antibodies (the “CD33 IND”). SG, its Affiliates and/or sublicensees shall be responsible for obtaining all necessary governmental applications and approvals for the
development, testing, production, distribution, sale and use of Licensed Products, as applicable, in any country where Licensed Products shall be manufactured or sold or otherwise distributed. SG or any Affiliate and/or sublicensee it shall
designate shall be named as the sponsor in any filing for any regulatory approval made for Licensed Products hereunder, and shall be the holder of all such regulatory approvals and shall be compliant per mandated laws and regulations. SG shall
itself, and shall require its Affiliates and any sublicensees and transferees who obtain any rights or interests in (or control over) the CD33 IND, to agree in writing to, [***] 
  

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 6.4 Commercialization. SG, its Affiliates and/or sublicensees shall
have the sole responsibility for, and right to make all decisions regarding, all commercialization activities, including without limitation sales, marketing and product launch activities and tactical execution of marketing and sales promotional
programs for all Licensed Products. All marketing and promotional materials related shall be prepared by SG, its Affiliates or sublicensees for all Licensed Products. SG, its Affiliates or sublicensees shall bear all costs related to the
commercialization of Licensed Products. 
  
 6.5
Diligence. SG agrees to use commercially reasonable efforts to research, develop and commercialize Licensed Products and to obtain such approvals as may be necessary in connection therewith. Upon request by PDL [***], at year end, SG
shall deliver to PDL a written report setting forth in reasonable detail (a) [***], (b) [***], and (c) [***]. 
  
 6.6 Compliance With Laws. SG agrees (and shall cause its sublicensees, Affiliates and contractors to agree) to comply with all
applicable laws, rules and regulations in the research, development, manufacture, commercialization and use of Licensed Products. 
  
 6.7 Opt-In Development and Commercialization. The rights and obligations set forth in this Article 6 with respect to [***]
shall be subject to Section 5.1 and any agreements entered into between the parties if either Party exercises its Opt-In Right pursuant to Article 5. For the avoidance of doubt, [***]. 
  
 7. Representations and Warranties. 
  
 7.1 Representations and Warranties of PDL. PDL hereby
represents and warrants that: 
  
 (a) the
execution and delivery of this Agreement and the performance of the transactions contemplated hereby have been duly authorized by all appropriate PDL corporate action; 
  
 (b) this Agreement is a legal and valid obligation, binding upon PDL and enforceable in accordance with its
terms, except to the extent that enforcement of rights and remedies are subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general application related to creditors’ rights and to general
equity principles; 
  
 (c) the execution,
delivery and performance of the Agreement by PDL does not conflict with any agreement, instrument or binding understanding, oral or written, to which it is a party or by which it is bound, nor violate in any material respect any law or regulation of
any court, governmental body or administrative or other agency having jurisdiction over it; 
  
 (d) [***]; 
  
 (e) PDL has the right to grant the licenses granted herein; 
  
 (f) as of the Effective Date, there are no claims, judgments or settlements against PDL pending or to
PDL’s knowledge, threatened in writing, seeking to invalidate any CD33 Patents; 
  
 (g) PDL has provided SG with accurate and complete copies of the [***] as of the Effective Date; 
  

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 (h) as of the Effective Date, the [***] are in full force and effect and PDL has
not received notice regarding any actual or alleged breach of, or issued any notice of breach with respect to, the [***]; 
  
 (i) PDL’s licenses to the [***], the [***] and the [***] are the [***]; 
  
 (j) as of the Effective Date, the Queen Patents include all
Patents owned or Controlled by PDL relating directly to the humanization of antibodies; and 
  
 (k) as of the date delivered by PDL to SG, PDL warrants that the [***] specified on Exhibit A (the “cGMP
Materials”) were manufactured in accordance with cGMP and conformed to release specifications set forth in Exhibit D and were released by PDL’s Quality Assurance as clinical-grade drug product. Furthermore, PDL warrants as of
the date delivered by PDL that the cGMP Materials have continued to conform to the stability specifications set forth in Exhibit D as demonstrated by the [***] time-point set forth in Exhibit D. Conformance with the release
specifications and stability specifications shall be measured solely by the conformance tests specified therefore in Exhibit D as applied to retained samples (thus excluding any failures to conform caused by actions or inactions of SG).
SG’s sole and exclusive remedy and PDL’s sole liability for any breach of this representation and warranty shall be, at PDL’s option, the [***]. 
  
 (l) PDL has provided SG with accurate and complete copies of all material transfer agreements and sponsored
research agreements entered into by PDL with Third Parties relating to PDL CD33 Antibodies. Other than [***], no Third Party has any [***] with respect to the [***] or any other [***] for PDL CD33 Antibodies. 

 
 7.2 Representations and Warranties of SG. SG
hereby represents and warrants that: 
  
 (a) the
execution and delivery of this Agreement and the performance of the transactions contemplated hereby have been duly authorized by all appropriate SG corporate action; and 
  
 (b) this Agreement is a legal and valid obligation binding upon SG and enforceable in accordance with its
terms, except to the extent that enforcement of rights and remedies are subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general application related to creditors’ rights and to general
equity principles; 
  
 (c) The execution,
delivery and performance of the Agreement by SG does not conflict with any agreement, instrument or binding understanding, oral or written, to which it is a party or by which it is bound, nor violate in any material respect any law or regulation of
any court, governmental body or administrative or other agency having jurisdiction over it. 
  
 7.3 Disclaimer. EXCEPT AS EXPRESSLY PROVIDED FOR IN THIS AGREEMENT, NEITHER PARTY MAKES, AND EACH PARTY HEREBY DISCLAIMS, ANY AND
ALL REPRESENTATIONS AND WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT AND ANY
WARRANTY ARISING OUT OF PRIOR COURSE OF DEALING AND USAGE OF TRADE. 
  

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 8. Intellectual Property Rights. 
  
 8.1 Ownership of Inventions. SG shall own all
Inventions made solely by employees of or agents of or others obligated to assign Inventions to SG (collectively, “SG Inventions”). PDL shall own all Inventions made solely by employees of or agents of or others obligated to assign
Inventions to PDL (collectively, “PDL Inventions”). Any Inventions made during the course of and pursuant to activities carried out under this Agreement jointly by, on the one hand, employees of or agents of or others obligated to
assign Inventions to PDL and, on the other hand, employees of or agents of or others obligated to assign Inventions to SG (collectively, “Joint Inventions”) shall be jointly owned by PDL and SG in accordance with U.S. laws of
inventorship. 
  
 8.2 Prosecution of CD33
Patents. PDL shall have the first right at its sole expense, using counsel selected at PDL’s sole discretion, to prepare, file, prosecute, maintain and obtain extensions of the CD33 Patents in countries of PDL’s choice. PDL shall
solicit SG’s prior advice and review of material prosecution matters related to the preparation, filing, prosecution and maintenance of the CD33 Patents with reasonable advance notice to allow SG to comment thereon, and PDL shall consider in
good faith SG’s reasonable comments related thereto. If PDL elects not to prosecute or maintain any patent or patent application within the CD33 Patents for any reason, PDL shall give SG notice thereof at least [***] prior to allowing
such patent or patent application to lapse or become abandoned or unenforceable, and SG shall thereafter have the right, at its sole expense, to prosecute and maintain such patent or patent application, provided that, with respect to any CD33
Patents in-licensed from third parties, if any, PDL has the authority to allow SG to prosecute and maintain such patents and, if so, subject to the applicable terms and conditions of the applicable in-license agreement. 
  
 8.3 Prosecution of [***] Patents. The
[***] Patents shall be filed, prosecuted and maintained in a manner consistent with the terms and conditions of the [***]. PDL will use reasonable efforts to provide to SG the following under the [***] as they are
received from [***]: (i) [***]; (ii) [***]; and (iii) [***]. SG will pay PDL on a quarterly basis [***] and subject to SG’s receipt of appropriate documentation supporting such expenses. 

  
 8.4 New CD33 Patents. PDL shall
disclose to SG all inventions conceived and reduced to practice by PDL prior to, on or after the Effective Date that relate specifically to CD33 Antibodies and which do not constitute Second Generation CD33 Improvements (collectively, “CD33
Inventions”) and as to which PDL intends to file patent applications that would meet the definition of CD33 Patents. Any such patent applications shall be included in the CD33 Patents (to the extent they meet the definition thereof),
subject to the terms of this Agreement, and shall be listed in Exhibit B hereof, which shall be updated by PDL from time to time during the Term. 
  
 8.5 Infringement of CD33 Patents. 
  
 (a) Notice. If either Party learns that a Third Party is infringing or allegedly infringing any CD33 Patents within the Field, it
shall promptly notify the other Party thereof and shall include in such notice the details of the infringement and any available evidence pertaining thereto. The Parties shall cooperate and use reasonable efforts to stop such alleged infringement
without litigation. 
  
 (b) Enforcement
Actions. PDL shall have the first right (but not the obligation), at its sole expense, to enforce CD33 Patents within the Field. If PDL fails to bring an action or proceeding within [***] of the later of (i) notifying SG of the alleged
infringement pursuant to Section 8.5(a), (ii) being notified by SG of the alleged infringement pursuant to Section 8.5(a) or (iii) receiving a written request from SG requesting that PDL take such an action, SG shall have the right (but not the
obligation) to bring any such action or proceeding relating to CD33 Patents. Each Party shall assist the 

  

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other Party, upon request and at the enforcing Party’s sole expense, and to the extent commercially reasonable, in taking any action to enforce the CD33
Patents. Neither Party shall settle a suit to enforce any CD33 Patents without the consent of the other Party, which consent shall not be unreasonably withheld, except that neither party shall be restricted in granting any licenses or sublicenses
under the CD33 Patents to third parties that it otherwise has the right to grant. All monies recovered upon the final judgment or settlement of any suit to enforce any CD33 Patents shall be allocated first to the Party taking the enforcement action
to the extent necessary to compensate it for its expenses incurred in its enforcement, second to the other Party to the extent necessary to compensate it for its expenses in cooperating with the Party taking the enforcement action, and finally
prorated in accordance with the damages for which such judgment or settlement is reasonably intended to compensate (taking into account the royalties and other payments that would have been payable to PDL hereunder in the absence of such
infringement). 
  
 8.6 Prosecution and
Enforcement of Queen Patents. PDL shall be solely responsible, at its sole discretion and expense, for the prosecution, defense, and maintenance of the Queen Patents, and for enforcing Queen Patents against actual or suspected Third Party
infringers. 
  
 8.7 Prosecution and
Enforcement of SG Patents. SG shall be solely responsible, at its sole discretion and expense, for the prosecution, defense, and maintenance of any SG Patents, and for enforcing SG Patents against actual or suspected Third Party infringers.

  
 8.8 Prosecution and Enforcement of Joint
Patents. The Parties shall cooperate and jointly agree on the prosecution, defense, and maintenance of any Joint Patents, and for enforcing Joint Patents against actual or suspected Third Party infringers. 
  
 8.9 Trademarks. All Licensed Products shall be sold
under trademarks selected and owned or controlled by SG or its Affiliates and/or sublicensees worldwide. SG or its Affiliates and/or sublicensees shall control the preparation, prosecution and maintenance of applications related to such trademarks,
and shall be responsible for the costs of the foregoing. SG or its Affiliates and/or sublicensees shall also be responsible for all costs, expenses, legal fees and recoveries associated with bringing, maintaining and prosecuting any action to
maintain, protect or defend any trademark applicable to a Licensed Product, including claims for actual, alleged or threatened infringement, unfair trade practices, trade dress imitation, passing off of counterfeit goods, or like offenses.

  
 8.10 USAN Name. Promptly after the
Effective Date, PDL shall transfer ownership of the USAN name “lintuzumab” to SG for use with respect to Licensed Products developed hereunder. 
  
 9. Indemnification. 
  

9.1 Indemnification by SG. SG and its Affiliates hereby agrees (and SG shall cause its sublicensees to agree) to indemnify,
defend and hold PDL, its licensors (including [***]), directors, trustees, officers, employees, agents and their respective successors, heirs and assigns (the “Indemnitees”) harmless from and against all suits, claims,
actions, demands, liabilities, damages, expenses and/or loss, including reasonable legal expense and attorneys’ fees (“Losses”) resulting from: (a) SG’s or its Affiliates’ or sublicensees’ research, development,
manufacturing, testing, labeling, marketing or sale of Licensed Products; or (b) SG’s breach of any of its representations or warranties set forth in Section 7.2 or breach of its other obligations under this Agreement. 
  
 9.2 Indemnification by PDL. PDL hereby agrees to
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and its Indemnitees harmless from and against all Losses resulting from PDL’s breach of any of its representations or warranties set forth in Section
7.1 or breach of its other obligations under this Agreement. 
  
 9.3 Notice. In the event that one Party is seeking indemnification under this Section 9 (the “Indemnified Party”), it shall inform the other Party (the “Indemnifying Party”) of
a claim giving rise to a right of indemnification hereunder as soon as reasonably practicable after the Indemnified Party receives notice of the claim, shall permit the Indemnifying Party to assume direction and control of the defense of the claim
(including the right to settle the claim solely for monetary consideration), and shall cooperate as requested (at the expense of the Indemnifying Party) in the defense of the claim. 
  
 9.4 Insurance. Beginning at the time any Licensed Product is being clinically tested in human
subjects by SG, its Affiliates and/or sublicensees and continuing throughout the Term (and for a period of [***] thereafter), SG shall have and maintain such type and amounts of liability insurance covering the development, manufacture, use,
and sale of Licensed Products as is normal and customary in the pharmaceutical industry generally for parties similarly situated, including without limitation products liability insurance with a minimum combined single limit per occurrence of
[***]. This insurance shall also include contractual liability, and shall be carried with insurance companies with a Best rating of [***] or better. If carried under a claims made form, this insurance shall be carried by SG for a
minimum of [***] following the termination of this Agreement. Upon request, SG shall provide PDL with a copy of its policies of insurance, or a certificate of insurance in that regard, along with any material amendments and revisions thereto.
SG shall [***] discussed in this Section 9.4. 
  
 10.
Confidentiality. 
  
 10.1
Confidential Information. In the course of performance of this Agreement, one Party may disclose to the other or receive written information from the other relating to the subject matter of this Agreement which information, if so identified
in writing either pursuant to this Section 10.1 or otherwise upon disclosure, shall be considered to be the disclosing Party’s “Confidential Information”. In any event, all Licensed Technology and Materials shall be deemed
Confidential Information of PDL for purposes of this Agreement (subject to the exceptions listed below and Section 10.2). Each Party agrees that it shall take the same steps to protect the confidentiality of the other Party’s Confidential
Information as it takes to protect its own proprietary and confidential information. Each Party shall protect and keep confidential and shall not use, publish or otherwise disclose to any Third Party, except as contemplated by this Agreement or with
the other Party’s prior written consent, the other Party’s Confidential Information for a period of [***] from the date of termination or expiration of this Agreement. For purposes of this Agreement, Confidential Information shall
not include such information that: 
  
 (a) was
known to the receiving Party at the time of first disclosure of it to the receiving Party by the disclosing Party hereunder; 
  
 (b) was generally available to the public or was otherwise part of the public domain at the time of disclosure or became generally
available to the public or otherwise part of the public domain after disclosure other than through any act or omission of the receiving Party in breach of this Agreement; 
  
 (c) became known to the receiving Party after disclosure from a source that had a lawful right to disclose
such information to others without restrictions on confidentiality; or 
  

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 (d) was independently developed by the receiving Party without use of or reference to the
other Party’s Confidential Information where such independent development can be established by written documentation. 
  
 10.2 Permitted Disclosure. Each Party shall be entitled (i) to disclose Confidential Information of the other Party to consultants,
sublicensees and contractors for any purpose provided for in this Agreement and, (ii) to disclose Confidential Information (including the terms of this Agreement) to Third Parties in connection with financing or M&A discussions or with corporate
partnering opportunities limited to CD33; provided in all cases that any such Third Party has first agreed in writing to confidentiality restrictions and obligations at least as protective as this Section 10. Either Party shall consult with the
other Party prior to the submission of any manuscript for publication if the publication shall contain any Confidential Information of the other Party. Such consultation shall include providing a copy of the proposed manuscript to the other Party at
least [***] prior to the proposed date of submission to a publisher, incorporating appropriate changes proposed by the other Party as to its Confidential Information into the manuscript submission and limiting disclosure of Confidential
Information of the other Party as it may reasonably request. Notwithstanding the foregoing, Confidential Information of a Party may be disclosed by the other Party (i) as a part of a patent application filed on inventions made under this Agreement,
(ii) to the extent reasonably required to comply with any applicable governmental law or regulation, including the rules or regulations of any relevant stock exchange, and (iii) to its accountants, attorneys, and other professional advisors,
provided that such persons referred to in this subparagraph (iii) are obligated to keep such terms confidential to the same extent as such other Party. With respect to (i) and (ii) above, the disclosing Party shall first notify the other Party of
the proposed disclosure (and provide copies thereof) reasonably in advance of the disclosure so as to provide the other Party with a reasonable opportunity to comment upon such disclosure and suggest ways to minimize the disclosure of Confidential
Information. 
  
 11. Term and Termination.

  
 11.1 Term. This Agreement shall
commence as of the Effective Date and shall continue in effect until terminated in accordance with Section 11.2, 11.3 or 11.4 (the “Term”). 
  
 11.2 Termination by SG. SG may terminate this Agreement at any time upon [***] prior written notice. 
  
 11.3 Termination for Breach. Either Party may
terminate this Agreement in the event of a material breach of the Agreement by the other Party upon [***] written notice to the other Party. The termination shall become effective at the end of the [***] period unless the other Party
cures such breach within such period; provided that such [***] period will be extended for up to an additional [***] if the nature of the material breach is such that it is not curable within [***] and the breaching Party
is diligently pursuing cure thereof; and provided further that if the breaching Party reasonably disputes the basis for any termination of this Agreement, such Party shall have the right to institute dispute resolution proceedings to determine
whether there exists a material, uncured breach justifying such termination, and the termination shall not become effective until there is a final, binding determination thereof. by the arbitrator under Section 12.12. Each Party’s right to so
terminate shall be in addition to any remedies available for breach of contract. 
  
 11.4 Termination Upon Insolvency. Either Party may terminate this Agreement if, at any time, (a) the other Party shall file in any
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state, country or jurisdiction, a petition in bankruptcy or insolvency or for reorganization or for an arrangement or for the appointment of a receiver or
trustee of that Party or of its assets, (b) such other Party proposes a written agreement of composition or extension of all of its debts, (c) such other Party shall be served with an involuntary petition against it, filed in any insolvency
proceeding, and such petition shall not be dismissed within [***] after the filing thereof, (d) such other Party shall propose or be a party to any dissolution or liquidation, or (e) such other Party shall make an assignment for the benefit
of its creditors. 
  
 11.5 Effect of
Expiration or Termination. 
  
 (a)
Termination or expiration of this Agreement for any reason shall be without prejudice to any rights which shall have accrued to the benefit of either Party prior to such termination or expiration and shall not release either party from any
obligation that has accrued prior to such expiration or termination, including without limitation any obligation to pay any amount which accrued or became due and payable under the terms and conditions of this Agreement prior to such expiration or
termination. Sections 1, 2.10, 4.1, 4.2, 4.3, 4.9 (to extent provided therein), 7.3, 8.1, 9, 10 (to the extent provided therein), 11.5 and 12 of this Agreement shall survive any expiration or termination of this Agreement. 
  
 (b) Upon any termination of this Agreement by any party for
any reason, the licenses granted by PDL to SG in Section 2 shall terminate and SG shall discontinue all further research and development of Licensed Products. Furthermore, SG shall promptly return to PDL (or at PDL’s request destroy) all
Confidential Information of PDL and all Cell Lines, PDL CD33 Antibodies and Materials in SG’s possession or control. 
  
 (c) Any sublicense permitted under this Agreement, to the extent it is consistent with the rights and obligations due PDL hereunder,
shall, at such sublicensee’s option in its sole discretion, survive termination of this Agreement and be deemed a direct license from PDL provided that: (i) the sublicensee is not in material breach of the terms of its sublicense at the time of
such termination; (ii) upon termination of this Agreement, such sublicensee agrees in writing to be bound by all terms of this Agreement applicable to SG, and can reasonably show the capacity to comply with such terms to the same extent as if such
sublicensee were an original Party hereto; (iii) the obligations of PDL under such direct license shall not be greater than the obligations of PDL under this Agreement; and (iv) the scope of such direct license shall not be broader than the rights
sublicensed by SG to such sublicense. 
  
 (d) In
the event of any termination of this Agreement, other than termination by SG pursuant to Section 11.3 or 11.4, at PDL’s option, in its sole discretion upon written notice to SG within [***] after the effective date of termination, SG
shall negotiate in good faith with PDL for an exclusive license (solely for the purpose of developing, manufacturing and commercializing Licensed Products) to any SG CD33 Patents and related know-how and intellectual property owned and controlled by
SG that covers or is used in Licensed Products (or their development, manufacture or commercialization) under reasonable terms and conditions. If the Parties mutually agree on such terms and enter into such an exclusive license agreement, then SG
shall transfer to PDL all of SG’s research, development, manufacturing and commercialization program for all Licensed Products (including all Second Generation CD33 Products and Second Generation CD33 Improvements). Subject to reasonable
availability, SG shall also make its employees and relevant consultants reasonably available during the first year following termination to consult with qualified PDL personnel on issues and questions related to development and manufacturing of
Licensed Products, provided that in no event shall SG be obligated to provide more than [***] and [***] per week thereafter in performing such activities. PDL shall pay SG at an annual rate of [***], for research, development,
manufacturing, technology transfer or other 

  

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assistance to PDL hereunder, in [***] from the date of termination, and as reasonably requested by PDL for SG time allocated to such activities beyond
[***], provided that such SG resources are available. Such FTE rate shall be increased by [***] of the Effective Date and upon every [***] thereafter during the Term. Such cooperation and assistance, as reasonably
requested by PDL (or its designee), shall continue with as little disruption and delay as reasonably possible to the development, manufacture, and commercialization of Licensed Products (including, if applicable, by providing technology (including
know-how) transfer, training and consultation and by transferring manufacturing processes and related technology). SG shall also transfer to PDL all applicable regulatory filings and approvals for Licensed Products together with all clinical data
and similar information for Licensed Products. SG shall use commercially reasonable efforts to effect a transfer substantially in accordance with the foregoing from all of its applicable sublicensees, affiliates and contractors. 
  
 12. General Provisions. 
  
 12.1 No Partnership. Nothing in this Agreement is
intended or shall be deemed to constitute a partnership, agency, fiduciary, distributorship, employer-employee or joint venture relationship between the Parties. Neither Party shall have the authority to incur any debts or make any commitments for
the other, except to the extent, if at all, specifically provided herein. 
  
 12.2 Assignments. Neither Party shall (nor have the right to) assign this Agreement or any of its rights or obligations hereunder except: (a) as incident to the merger, consolidation, reorganization or
acquisition of stock or assets affecting substantially all of the assets or voting control of the assigning Party; (b) to any wholly owned subsidiary if the assigning Party remains liable and responsible for the performance and observance of all of
the subsidiary’s duties and obligations hereunder; or (c) with the prior written consent of the other Party, which consent shall not be unreasonably delayed or withheld, provided, however, that assignment in the context of insolvency or
bankruptcy of SG shall require prior written consent of PDL. This Agreement shall be binding upon the successors and permitted assigns of the Parties, and the name of a Party appearing herein shall be deemed to include the names of such Party’s
successor’s and permitted assigns to the extent necessary to carry out the intent of this Agreement. Any assignment not in accordance with this Section 12.2 shall be null and void. 
  
 12.3 Further Actions. Each Party agrees to execute, acknowledge and deliver such further instruments,
and to do all such other acts, as may be necessary in order to carry out the purposes and intent of this Agreement. 
  
 12.4 Use of Names. Except as otherwise provided herein, no right, express or implied, is granted by this Agreement to use in any
manner the names “Seattle Genetics” or “Protein Design Labs” or any other trade name or trademark of SG or PDL in connection with the performance of this Agreement. 
  
 12.5 Public Announcements. Except as may otherwise be required by law or regulation, neither Party
shall make any public announcement concerning this Agreement or the subject matter hereof without the prior consent of the other Party unless the nature of the information has been previously approved for disclosure. If the nature of the information
has been approved, this Section 12.5 shall no longer apply to that information. 
  
 12.6 Entire Agreement; Amendments. This Agreement constitutes and contains the entire understanding and agreement of the Parties
and cancels and supersedes all prior negotiations, 

  

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 -23- 

 
correspondence, understandings and agreements, whether verbal or written, between the Parties respecting the subject matter hereof, including, without
limitation, the MTA (without limiting the effectiveness or enforceability of the MTA with respect to the period prior to the Effective Date). No waiver, modification or amendment of any provision of this Agreement shall be valid or effective unless
made in writing and signed by a duly authorized representative of each of the Parties. 
  
 12.7 Severability. In the event any one or more of the provisions of this Agreement should for any reason be held by any court or
authority having jurisdiction over this Agreement or either of the parties to be invalid, illegal or unenforceable, such provision or provisions shall be validly reformed to as nearly as possible approximate the intent of the Parties and, if
unreformable, shall be divisible and deleted in such jurisdiction; elsewhere, this Agreement shall not be affected so long as the Parties are still able to realize the principal benefits bargained for in this Agreement. 
  
 12.8 Captions. The captions to this Agreement are for
convenience only, and are to be of no force or effect in construing or interpreting any of the provisions of this Agreement. 
  
 12.9 Applicable Law. This Agreement shall be governed by and interpreted in accordance with the laws of the State of California
applicable to contracts entered into and to be performed entirely within the State of California, without giving effect to principles of conflicts of law. 
  
 12.10 Notices and Deliveries. Any notice, requests, delivery, approval or consent required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been sufficiently given if delivered in person, overnight courier or transmitted by telecopy with a confirming copy sent by overnight courier or registered mail to the Party to whom it is
directed at its address shown below or such other address as such Party shall have last given by notice to the other Party. Any such notice, requests, delivery, approval or consent shall be deemed received on the date of telecopy or hand delivery,
one business day after deposit with an overnight courier, or three (3) days after deposit of the registered mail with the U. S. postal service. 
  

			
	 If to SG:
	  	 SEATTLE GENETICS, INC.

	 	  	 21823 30th Drive
SE

	 	  	 Bothell, Washington 98021

	 	  	 Attention: Chief Executive Officer

	 	  	 Telephone: (425) 527-4000

	 	  	 Telecopy: (425) 527-4109

	 	  	 With a copy to: General Counsel

		
	 If to PDL:
	  	 PROTEIN DESIGN LABS, INC.

	 	  	 34801 Campus Drive

	 	  	 Fremont, CA 94555

	 	  	 Attention: Chief Executive Officer

	 	  	 Telephone: (510) 574-1677

	 	  	 Telecopy: (510) 574-1666

	 	  	 With a copy to: General Counsel

  
 12.11
Force Majeure. Neither Party shall be in breach of this Agreement on account of failure of performance by the defaulting Party (excluding any failure to pay amounts owed hereunder) to the extent the failure is occasioned by government action,
war, earthquake, fire, explosion, flood, strike, lockout, embargo, act of God, or any other cause beyond the control of the defaulting Party, provided that the Party claiming force majeure has notified the other Party thereof and has exerted all
reasonable 

  

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 -24- 

 
efforts to avoid or remedy such force majeure; provided, however, that in no event shall a Party be required to settle any labor dispute or
disturbance. 
  
 12.12 Dispute Resolution.
Any dispute or claim arising out of or in connection with this Agreement shall be resolved as follows: (a) for a period of [***] after notice of a dispute is given by one Party to the other Party the respective appropriate officers of the
parties shall negotiate in good faith in an effort to resolve the dispute; and (b) if the dispute has not been resolved at the close of such [***] period, the matter shall be finally settled by binding arbitration under the Commercial
Arbitration Rules of the American Arbitration Association, by one arbitrator appointed in accordance with said rules; provided, that if the parties cannot agree on the arbitrator, the dispute shall be resolved by a panel of three arbitrators,
wherein each Party shall appoint one arbitrator and those arbitrators shall in turn jointly appoint the third arbitrator. Judgment on an award rendered by an arbitrator or arbitrators may be entered in any court having jurisdiction. Notwithstanding
the foregoing, the parties may apply to any court of competent jurisdiction for preliminary or interim equitable relief without breach of this arbitration provision. Such arbitration shall be held in San Francisco, California. 
  
 12.13 Counterparts. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 
  

12.14 Waiver and Delay. 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 a Party’s right to the future enforcement of its rights under this Agreement. 
  
 12.15 Limitation of Liability. EXCEPT WITH RESPECT TO EACH PARTY’S INDEMNITY OBLIGATIONS UNDER ARTICLE 9 AND CONFIDENTIALITY
OBLIGATIONS UNDER ARTICLE 10, IN NO EVENT SHALL EITHER PARTY BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL, INDIRECT, PUNITIVE OR SPECIAL DAMAGES OF THE OTHER PARTY ARISING OUT OF OR RELATED TO THIS AGREEMENT, HOWEVER CAUSED, UNDER ANY THEORY OF LIABILITY
EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. 
  
 [Signature page follows] 
  

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 -25- 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written.

  

									
	 SEATTLE GENETICS, INC.
	 	 	 	 PROTEIN DESIGN LABS, INC.

					
	 By:
	 	 /s/ Clay B. Siegall
	 	 	 	 By:
	 	 /s/ Mark McDade

					
	 Name:
	 	 Clay B. Siegall
	 	 	 	 Name:
	 	 Mark McDade

					
	 Title:
	 	 President and Chief Executive Officer
	 	 	 	 Title:
	 	 Chief Executive Officer

  

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 -26- 

 EXHIBIT A 
  

Material Supplies, Technology Transfer and Technology Transfer Responsibilities 
  
 Except where otherwise noted, all Technology Transfer will be completed within
[***] of the Effective Date. 
  
 I. [***]

  

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omitted portions. 

 EXHIBIT B 
  

CD33 Patents 
  
 [***] 
  

	[***]    	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 EXHIBIT C 
  

Queen Patents 
  
 [***] 
  

	[***]    	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions. 

 EXHIBIT D 
  

[***] 
  

	[***]    	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the
omitted portions.

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