Document:

ttph-ex101_69.htm

Master Manufacturing Services Agreement

 

		
	
Confidential Materials omitted and filed separately with the

Securities and Exchange Commission.  Double asterisks denote omission.
	
Exhibit 10.1

 

 

 

Master Manufacturing Services Agreement

14 JUNE 2017

 

Master Manufacturing Services Agreement

Table of Contents

	
ARTICLE 1
	
1

	
 
	
 

	
STRUCTURE OF AGREEMENT AND INTERPRETATION
	
1

	
 
	
 
	
 
	
 

	
 
	
1.1
	
MASTER AGREEMENT.
	
1

	
 
	
1.2
	
PRODUCT AGREEMENTS.
	
1

	
 
	
1.3
	
DEFINITIONS.
	
1

	
 
	
1.4
	
CURRENCY.
	
7

	
 
	
1.5
	
SECTIONS AND HEADINGS.
	
7

	
 
	
1.6
	
SINGULAR TERMS.
	
7

	
 
	
1.7
	
APPENDIX 1, SCHEDULES AND EXHIBITS.
	
7

	
 
	
 

	
ARTICLE 2
	
8

	
 
	
 

	
PATHEON'S MANUFACTURING SERVICES
	
8

	
 
	
 
	
 
	
 

	
 
	
2.1
	
MANUFACTURING SERVICES.
	
8

	
 
	
2.2
	
ACTIVE MATERIAL YIELD.
	
10

	
 
	
 

	
ARTICLE 3
	
11

	
 
	
 

	
CLIENT'S OBLIGATIONS
	
11

	
 
	
 

	
 
	
3.1
	
PAYMENT.
	
11

	
 
	
3.2
	
ACTIVE MATERIALS AND QUALIFICATION OF ADDITIONAL SOURCES OF SUPPLY.
	
12

	
 
	
 

	
ARTICLE 4
	
12

	
 
	
 

	
CONVERSION FEES AND COMPONENT COSTS
	
12

	
 
	
 

	
 
	
4.1
	
FIRST YEAR PRICING.
	
12

	
 
	
4.2
	
PRICE ADJUSTMENTS – SUBSEQUENT YEARS’ PRICING.
	
13

	
 
	
4.3
	
PRICE ADJUSTMENTS – CURRENT YEAR PRICING.
	
14

	
 
	
4.4
	
ADJUSTMENTS DUE TO TECHNICAL CHANGES OR REGULATORY AUTHORITY REQUIREMENTS.
	
15

	
 
	
4.5
	
MULTI-COUNTRY PACKAGING REQUIREMENTS.
	
15

	
 
	
 

	
ARTICLE 5
	
15

	
 
	
 

	
ORDERS, SHIPMENT, INVOICING, PAYMENT
	
15

	
 
	
 

	
 
	
5.1
	
ORDERS AND FORECASTS.
	
15

	
 
	
5.2
	
RELIANCE BY PATHEON.
	
16

	
 
	
5.3
	
MINIMUM ORDERS.
	
17

	
 
	
5.4
	
DELIVERY AND SHIPPING.
	
17

	
 
	
5.5
	
INVOICES AND PAYMENT.
	
17

	
 
	
 

	
ARTICLE 6
	
17

	
 
	
 

	
PRODUCT CLAIMS AND RECALLS
	
17

	
 
	
 

	
 
	
6.1
	
PRODUCT CLAIMS.
	
17

	
 
	
6.2
	
PRODUCT RECALLS AND RETURNS.
	
18

	
 
	
6.3
	
PATHEON’S RESPONSIBILITY FOR DEFECTIVE AND RECALLED PRODUCTS.
	
19

	
 
	
6.4
	
DISPOSITION OF DEFECTIVE OR RECALLED PRODUCTS.
	
20

	
 
	
6.5
	
HEALTHCARE PROVIDER OR PATIENT QUESTIONS AND COMPLAINTS.
	
20

	
 
	
6.6
	
SOLE REMEDY.
	
20

	
 
	
 

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Master Manufacturing Services Agreement

	
ARTICLE 7
	
22

	
 
	
 

	
CO-OPERATION
	
22

	
 
	
 

	
 
	
7.1
	
QUARTERLY REVIEW.
	
22

	
 
	
7.2
	
GOVERNMENTAL AGENCIES.
	
22

	
 
	
7.3
	
RECORDS AND ACCOUNTING BY PATHEON.
	
22

	
 
	
7.4
	
INSPECTION.
	
22

	
 
	
7.5
	
ACCESS.
	
22

	
 
	
7.6
	
NOTIFICATION OF REGULATORY INSPECTIONS.
	
23

	
 
	
7.7
	
REPORTS.
	
23

	
 
	
7.8
	
REGULATORY FILINGS.
	
23

	
 
	
 
	
 
	
 

	
ARTICLE 8
	
24

	
 
	
 

	
TERM AND TERMINATION
	
24

	
 
	
 

	
 
	
8.1
	
INITIAL TERM.
	
24

	
 
	
8.2
	
TERMINATION FOR CAUSE.
	
25

	
 
	
8.3
	
PRODUCT DISCONTINUATION.
	
25

	
 
	
8.4
	
OBLIGATIONS ON TERMINATION.
	
25

	
 
	
 
	
 
	
 

	
ARTICLE 9
	
26

	
 
	
 

	
REPRESENTATIONS, WARRANTIES AND COVENANTS
	
26

	
 
	
 

	
 
	
9.1
	
AUTHORITY.
	
26

	
 
	
9.2
	
CLIENT WARRANTIES.
	
27

	
 
	
9.3
	
PATHEON WARRANTIES.
	
27

	
 
	
9.4
	
PERMITS.
	
28

	
 
	
9.5
	
NO WARRANTY.
	
29

	
 
	
 
	
 
	
 

	
ARTICLE 10
	
29

	
 
	
 

	
REMEDIES AND INDEMNITIES
	
29

	
 
	
 

	
 
	
10.1
	
CONSEQUENTIAL AND OTHER DAMAGES.
	
29

	
 
	
10.2
	
LIMITATION OF LIABILITY.
	
29

	
 
	
10.3
	
PATHEON INDEMNITY.
	
29

	
 
	
10.4
	
CLIENT INDEMNITY.
	
30

	
 
	
10.5
	
REASONABLE ALLOCATION OF RISK.
	
30

	
 
	
 
	
 
	
 

	
ARTICLE 11
	
31

	
 
	
 

	
CONFIDENTIALITY
	
31

	
 
	
 

	
 
	
11.1
	
CONFIDENTIAL INFORMATION.
	
31

	
 
	
11.2
	
USE OF CONFIDENTIAL INFORMATION.
	
31

	
 
	
11.3
	
EXCLUSIONS.
	
31

	
 
	
11.4
	
PHOTOGRAPHS AND RECORDINGS.
	
32

	
 
	
11.5
	
PERMITTED DISCLOSURE.
	
32

	
 
	
11.6
	
MARKING.
	
33

	
 
	
11.7
	
RETURN OF CONFIDENTIAL INFORMATION.
	
33

	
 
	
11.8
	
REMEDIES.
	
33

	
 
	
 
	
 
	
 

	
ARTICLE 12
	
33

	
 
	
 

	
DISPUTE RESOLUTION
	
33

	
 
	
 

	
 
	
12.1
	
COMMERCIAL DISPUTES.
	
33

	
 
	
12.2
	
TECHNICAL DISPUTE RESOLUTION.
	
34

	
 
	
 
	
 
	
 

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Master Manufacturing Services Agreement

	
ARTICLE 13
	
34

	
 
	
 

	
MISCELLANEOUS
	
34

	
 
	
 

	
 
	
13.1
	
INVENTIONS.
	
34

	
 
	
13.2
	
INTELLECTUAL PROPERTY.
	
34

	
 
	
13.3
	
INSURANCE.
	
35

	
 
	
13.4
	
INDEPENDENT CONTRACTORS.
	
35

	
 
	
13.5
	
NO WAIVER.
	
35

	
 
	
13.6
	
ASSIGNMENT.
	
35

	
 
	
13.7
	
FORCE MAJEURE.
	
36

	
 
	
13.8
	
ADDITIONAL PRODUCT.
	
36

	
 
	
13.9
	
NOTICES.
	
36

	
 
	
13.10
	
SEVERABILITY.
	
37

	
 
	
13.11
	
ENTIRE AGREEMENT.
	
37

	
 
	
13.12
	
OTHER TERMS.
	
37

	
 
	
13.13
	
NO THIRD PARTY BENEFIT OR RIGHT.
	
37

	
 
	
13.14
	
EXECUTION IN COUNTERPARTS.
	
37

	
 
	
13.15
	
USE OF CLIENT NAME.
	
37

	
 
	
13.16
	
TAXES.
	
38

	
 
	
13.17
	
GOVERNING LAW.
	
39

 

 

 

 

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Master Manufacturing Services Agreement

MASTER MANUFACTURING SERVICES AGREEMENT

THIS MASTER MANUFACTURING SERVICES AGREEMENT (the "Agreement") is made as of 14 June 2017 (the “Effective Date”)

B E T W E E N:

PATHEON UK LIMITED, a corporation existing under the laws of England of Kingfisher Drive, Covingham, Swindon, SN3 5BZ

("Patheon"),

- and –

TETRAPHASE PHARMACEUTICALS, INC.,
a corporation existing under the laws of Delaware

of 480 Arsenal Street, Suite 100, Watertown, Massachusetts 02472, USA

("Client").

 

THIS AGREEMENT WITNESSES THAT in consideration of the rights conferred and the obligations assumed herein, and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged by each party), and intending to be legally bound the parties agree as follows:

 

ARTICLE 1 

Structure of Agreement and Interpretation

	
1.1
	
Master Agreement. 

This Agreement establishes the general terms and conditions under which Patheon or any Affiliate of Patheon may perform Manufacturing Services for Client or any Affiliate of Client, at the manufacturing site where Patheon or the Affiliate of Patheon resides. This “master” form of agreement is intended to allow the parties, or any of their Affiliates, to contract for the manufacture of multiple Products through Patheon’s global network of manufacturing sites through the issuance of site specific Product Agreements without having to re-negotiate the basic terms and conditions contained herein.

	
1.2
	
Product Agreements.

This Agreement is structured so that a Product Agreement may be entered into by the parties for the manufacture of a particular Product or multiple Products at a Patheon manufacturing site. Each Product Agreement will be governed by the terms and conditions of this Agreement unless the parties to the Product Agreement expressly modify the terms and conditions of this Agreement in the Product Agreement.   Unless otherwise agreed by the parties, each Product Agreement will be in the general form and contain the information set forth in Appendix 1 hereto.       

	
1.3
	
Definitions.

The following terms will, unless the context otherwise requires, have the respective meanings set out below and grammatical variations of these terms will have corresponding meanings:

"Active Materials", “Active Pharmaceutical Ingredients” or “API” means the materials listed in a Product Agreement on Schedule D;

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Master Manufacturing Services Agreement

"Active Materials Credit Value" means the value of the Active Materials for certain purposes of this Agreement, as set forth in a Product Agreement on Schedule D;

“Actual Annual Yield” or “AAY” has the meaning specified in Section 2.2(a);

“Actual Yearly Volume” or “AYV” has the meaning specified in Section 4.2.1; 

"Affiliate" means:

	
 
	
(a)
	
a business entity which owns, directly or indirectly, a controlling interest in a party to this Agreement, by stock ownership or otherwise; or

	
 
	
(b)
	
a business entity which is controlled by a party to this Agreement, either directly or indirectly, by stock ownership or otherwise; or

	
 
	
(c)
	
a business entity, the controlling interest of which is directly or indirectly common to the majority ownership of a party to this Agreement;

For this definition, "control" means the ownership of shares carrying at least a majority of the votes for the election of the directors;

“Annual Product Review Report” means the annual product review report prepared by Patheon or an Affiliate of Patheon as described in Title 21 of the United States Code of Federal Regulations, Section 211.180(e); 

"Annual Report" means the annual report to the FDA prepared by Client regarding the Product as described in Title 21 of the United States Code of Federal Regulations, Section 314.81(b)(2);

"Annual Volume" means the minimum volume of Product to be manufactured in any Year of this Agreement as set forth in Schedule B of the applicable Product Agreement;

"Applicable Laws" means (i) for Patheon, the Laws of the jurisdiction where the Manufacturing Site is located and all other Laws applicable to the Manufacturing Services; and (ii) for Client and the Products, the Laws of all jurisdictions where the Products are manufactured, distributed, and marketed by or on behalf of Client as these are agreed and understood by the parties in this Agreement;

"Authority" means any governmental or regulatory authority, department, body or agency or any court, tribunal, bureau, commission or other similar body, whether federal, state, provincial, county or municipal;

“Breach Notice” has the meaning specified in Section 8.2(a);

"Business Day" means a day other than a Saturday, Sunday or a day that is a statutory holiday in the United Kingdom or a federal or state holiday in Boston, Massachusetts, USA or the jurisdiction where the Manufacturing Site is located;  

“Capital Equipment Agreement” means a separate agreement that the parties may enter into that will address responsibility for the purchase of capital equipment and facility modifications that may be required to perform the Manufacturing Services under a particular Product Agreement;

“Certificate of Analysis” means a document prepared by Patheon, signed by an authorized representative of Patheon, describing Specifications for, and testing methods applied to each 

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Master Manufacturing Services Agreement

batch of Product, and the results thereof and (a) listing the manufacturing date, unique batch number, and quantity of Product in such Batch, and (b) certifying that such batch was manufactured in accordance with Applicable Laws, including, without limitation cGMP. 

“Certificate of Compliance” means a document, signed by an authorized representative of Patheon, attesting that a particular batch of Product was manufactured, filled, packaged and held in accordance with Applicable Laws, including, without limitation cGMP, and the Specifications.

"cGMPs" means, as applicable, current good manufacturing practices, including as described in:

	
 
	
(a)
	
Parts 210 and 211 of Title 21 of the United States' Code of Federal Regulations; 

	
 
	
(b)
	
EC Directive 2003/94/EC; 

	
 
	
(c)
	
ICH Q7A “ICH Good Manufacturing Practices Guide for Active Pharmaceutical Ingredients”; and

	
 
	
(d)
	
Division 2 of Part C of the Food and Drug Regulations (Canada);

together with the latest Health Canada, Japanese PMDA (to the extent applicable), FDA and EMA guidance documents pertaining to manufacturing and quality control practice, all as updated, amended and revised from time to time;

“Client Intellectual Property” means Intellectual Property (a) generated or derived by or on behalf of Client (i) before entering into this Agreement or (ii) during the Term and outside the performance of this Agreement, or (b) by Patheon while performing any Manufacturing Services or otherwise generated or derived by Patheon in its business which Intellectual Property is specific to, or is dependent upon, Client’s Active Material or Product;

“Client Property” has the meaning specified in Section 8.4(a)(v); 

“Client-Supplied Components” means those Components to be supplied by Client as set forth in a Product Agreement or that have been supplied by Client;

"Components" means, collectively, all packaging components, raw materials, ingredients, and other materials (including labels, product inserts and other labelling for the Products) required to manufacture the Products in accordance with the Specifications, other than the Active Materials;

“Confidential Information” has the meaning specified in Section 11.1;

“CTD” has the meaning specified in Section 7.8(c); 

“Deficiencies” have the meaning specified in Section 7.8(d);

"Deficiency Notice" has the meaning specified in Section 6.1(a);

“Delivery Date” means the date scheduled for shipment of Product under a Firm Order as set forth in Section 5.1(d);

“Disclosing Party” has the meaning specified in Section 11.1;

"EMA" means the European Medicines Agency, or any successor agency thereto; 

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Master Manufacturing Services Agreement

"FDA" means the United States Food and Drug Administration, or any successor agency thereto; 

"Firm Orders" have the meaning specified in Section 5.1(c);

“Force Majeure Event” has the meaning specified in Section 13.7;

"GST" has the meaning specified in Section 13.16(a)(iii);

"Health Canada" means the section of the Canadian Government known as Health Canada, or any successor agency thereto, and includes, among other departments, the Therapeutic Products Directorate and the Health Products and Food Branch Inspectorate;

“Importer of Record” has the meaning specified in Section 3.2(a);

“Initial Product Term” has the meaning specified in Section 8.1;

“Initial Term” has the meaning specified in Section 8.1;

"Intellectual Property" means (a) ideas, concepts, discoveries, inventions, developments, know-how, trade secrets, techniques, methodologies, formulae, processing parameters, designs, modifications, innovations, improvements, writings, documentation, electronic code, data and rights (whether or not protectable under state, federal or foreign patent, trademark, copyright or similar laws) or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which contained and whether or not patentable or copyrightable and (b) any and all rights in any of the foregoing, including without limitation, patents, trademarks, copyrights and trade secrets; 

"Invention" means any innovation, improvement, modification, development, discovery, computer program, device, trade secret, method, know-how, process, technique or the like, whether or not written or otherwise fixed in any form or medium, regardless of the media on which it is contained and whether or not patentable or copyrightable; 

"Inventory" means all inventories of Components and work-in-process produced or held by Patheon for the manufacture of the Products but, for greater certainty, does not include the Active Materials;

“Japanese PMDA” means the Japan Pharmaceuticals and Medical Devices Agency or any successor agency thereto;

"Laws" means all laws, statutes, ordinances, regulations, rules, by-laws, judgments, decrees or orders of any Authority;

“Long Term Forecast” has the meaning specified in Section 5.1(a); 

"Manufacturing Services" means the manufacturing, quality control, quality assurance, stability testing, packaging, and related services, as set forth in this Agreement, required to manufacture and supply Product or Products using the Active Materials and Components;

"Manufacturing Site" means the facility owned and operated by Patheon or an Affiliate of Patheon where the Manufacturing Services will be performed as identified in a Product Agreement; 

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Master Manufacturing Services Agreement

“Master Batch Record” or “MBR” shall mean the document containing the complete process for manufacturing the Product, including process parameters and process specifications.

“Materials” means all Components required to manufacture the Products in accordance with the Specifications, other than the Active Materials; 

"Minimum Order Quantity" means the minimum number of batches of a Product to be produced during the same cycle of manufacturing as set forth in a Product Agreement on Schedule B;

"Maximum Credit Value" means the maximum value of Active Materials that may be credited by Patheon under this Agreement, as set forth in a Product Agreement on Schedule D; 

“Obsolete Stock” has the meaning specified in Section 5.2(b); 

“Patheon Competitor” means an entity that derives greater than [**] percent ([**]%) of its revenues from performing contract pharmaceutical development or commercial manufacturing services pursuant to agreements with unrelated third party entities;  

“Patheon Intellectual Property” means Intellectual Property generated or derived by Patheon before performing any Manufacturing Services, developed by Patheon while performing the Manufacturing Services, or otherwise generated or derived by Patheon in its business which Intellectual Property is not specific to, or dependent upon, Client’s Active Material or Product including, without limitation, Inventions and Intellectual Property which may apply to manufacturing processes or the formulation or development of drug products, drug product dosage forms or drug delivery systems unrelated to the specific requirements of the Product(s);

 “Price” means the price set forth in the applicable Product Agreement, measured in U.S. dollars (if the Manufacturing Site is located in North America) or Euros (if the Manufacturing Site is located outside North America) unless agreed otherwise in a Product Agreement, to be charged by Patheon for performing the Manufacturing Services, and includes the cost of Components (other than Client-Supplied Components), certain cost items as set forth in a Product Agreement on Schedule B, and annual stability testing costs as set forth in a Product Agreement on Schedule C;

"Product(s)" means the product(s) listed in a Product Agreement on Schedule A;

“Product Agreement” means the agreement between Patheon and Client issued under this Agreement in the form set forth in Appendix 1 (including Schedules A to D) under which Patheon will perform Manufacturing Services at a particular Manufacturing Site;

“Product Claims” have the meaning specified in Section 6.3(c);  

"Quality Agreement" means the agreement (the general form of which is set forth in Exhibit B) between the parties entering a Product Agreement, or between the applicable Affiliate of Patheon and Client if the Manufacturing Services are subcontracted to such Affiliate by Patheon, that sets out the quality assurance standards for the Manufacturing Services to be performed by Patheon for Client;

“Recall” has the meaning specified in Section 6.2(a);

“Recipient” has the meaning specified in Section 11.1;

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Master Manufacturing Services Agreement

"Regulatory Authority" means the FDA, EMA, Health Canada, Japanese PMDA (to the extent applicable) and any other foreign regulatory agencies competent to grant marketing approvals for pharmaceutical products including the Products in the Territory;

“Regulatory Approval” has the meaning specified in Section 7.8(a);

“Remediation Period” has the meaning specified in Section 8.2(a);

“Representatives” means a party’s directors, officers, employees, advisers, agents, consultants, subcontractors (only to the extent approved by Client with respect to Patheon subcontractors),  professional advisors, or other representatives;

“Resident Jurisdiction" has the meaning specified in Section 13.16(a)(i); 

“Shortfall Credit” has the meaning specified in Section 2.2(b);

"Specifications" means the file, for each Product, which is given by Client to Patheon in accordance with the procedures listed in a Product Agreement on Schedule A and which contains documents relating to each Product, including, without limitation:

	
 
	
(a)
	
specifications for Active Materials and Components;

	
 
	
(b)
	
manufacturing specifications, directions, and processes;

	
 
	
(c)
	
storage requirements; 

	
 
	
(d)
	
all environmental, health and safety information for each Product including material safety data sheets; and

	
 
	
(e)
	
the finished Product specifications, packaging specifications and shipping requirements for each Product; 

all as updated, amended and revised from time to time by Client in accordance with the terms of this Agreement;

“Target Yield” has the meaning specified in Section 2.2(a); 

“Target Yield Determination Batches” has the meaning specified in Section 2.2(a);

"Tax" or "Taxes" have the meaning specified in Section 13.16(a);

"Technical Dispute" has the meaning specified in Section 12.2;

"Territory" means the geographic area described in a Product Agreement where Products manufactured by Patheon will be distributed by Client; 

“Third Party” means a party other than Patheon or its Affiliates or Client or its Affiliates.

"Third Party Rights" means the Intellectual Property of any Third Party; 

"VAT" has the meaning specified in Section 13.16(d); 

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Master Manufacturing Services Agreement

"Year" means in the first year of this Agreement or in the first year of a Product Agreement, the period from the Effective Date up to and including December 31 of the same calendar year, and thereafter will mean a calendar year; 

“Yearly Forecast Volume” or “YFV” has the meaning specified in Section 4.2.1; 

“Zero Forecast Period” has the meaning specified in Section 5.1(f).

	
1.4
	
Currency.  

Unless otherwise agreed in a Product Agreement, all monetary amounts expressed in this Agreement are in United States dollars (USD) (if the Manufacturing Site is located in North America) or Euros (if the Manufacturing Site is located outside North America). 

	
1.5
	
Sections and Headings.  

The division of this Agreement into Articles, Sections, Subsections, an Appendix, Schedules and Exhibits and the insertion of headings are for convenience of reference only and will not affect the interpretation of this Agreement.  Unless otherwise indicated, any reference in this Agreement to a Section, Appendix, Schedule or Exhibit refers to the specified Section, Appendix, Schedule or Exhibit to this Agreement.  In this Agreement, the terms "this Agreement", "hereof", "herein", "hereunder" and similar expressions refer to this Agreement as a whole and not to any particular part, Section, Appendix, Schedule or Exhibit of this Agreement.

	
1.6
	
Singular Terms.

Except as otherwise expressly stated or unless the context otherwise requires, all references to the singular will include the plural and vice versa.

	
1.7
	
Appendix 1, Schedules and Exhibits.

Appendix 1 (including the Schedules thereto) and the following Exhibits are attached to, incorporated in, and form part of this Agreement:

Appendix 1  -  Form of Product Agreement (Including Schedules A to D)  

Exhibit A  -  Technical Dispute Resolution

Exhibit B  -  Commercial Quality Agreement

Exhibit C  -  Quarterly Active Materials Inventory Report

Exhibit D  -  Report of Annual Active Materials Inventory Reconciliation and Calculation of Actual Annual Yield

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Master Manufacturing Services Agreement

ARTICLE 2 

PATHEON'S MANUFACTURING services

	
2.1
	
Manufacturing Services.

Patheon will perform the Manufacturing Services for the Territory for the fees specified in a Product Agreement in Schedules B and C to manufacture Products for Client or its Affiliate (which shall mean that either Client or its Affiliate would enter into a Product Agreement with Patheon).  Schedule B to a Product Agreement sets forth a list of cost items that are included in the Price for Products; all cost items that are not included in the Price are subject to additional fees to be paid by the Client.  Amendments to the fees set out in Schedules B and C to a Product Agreement will be performed in accordance with the price adjustment mechanisms as set forth in Article 4. Patheon may change the Manufacturing Site for the Products only with the prior written consent of Client. In performing the Manufacturing Services, Patheon and Client agree that:

	
 
	
(a)
	
Conversion of Active Materials and Components.  Patheon will convert Active Materials and Components into Products.

	
 
	
(b)
	
Master Batch Record.  The Master Batch Record shall be reviewed and approved in writing by Patheon and by Client prior to commencement of Manufacturing Services. Any material change to an approved Master Batch Record shall be reviewed and approved in writing by Patheon and by Client prior to said change being implemented.  Each batch of Product shall be manufactured by using a copy of the Master Batch Record. Each copy of the Master Batch Record for such batch of Product shall be assigned a unique batch number. Any deviation from the manufacturing process specified in the Master Batch Record must be documented in the batch record for that batch.  

	
 
	
(c)
	
Quality Control and Quality Assurance.  Patheon will perform the quality control and quality assurance testing specified in the Quality Agreement and otherwise as required to comply with cGMP.  Batch review and release to Client will be the responsibility of Patheon’s quality assurance group.  Patheon will perform its batch review and release responsibilities in accordance with Patheon’s standard operating procedures.  Each time Patheon ships Products to Client, it will give Client a Certificate of Analysis and Certificate of Compliance, BSE/BTE and melamine statement, and a statement that the batch has been manufactured and tested in accordance with Specifications and cGMPs.  Client will have sole responsibility for the release of Products to the market.  The form and style of batch documents, including, but not limited to, batch production records, lot packaging records, equipment set up control, operating parameters, and data printouts, raw material data, and laboratory notebooks are the exclusive property of Patheon. Specific Product related information contained in those batch documents is the exclusive property of Client. 

	
 
	
(d)
	
Components.  Patheon will purchase and test all Components (with the exception of Client-Supplied Components) at Patheon's expense and as required by the Specifications.    

	
 
	
(e)
	
Stability Testing.  Patheon will conduct stability testing on the Products in accordance with the protocols set out in the Specifications for the separate fees and during the time periods set out in Schedule C to a Product Agreement.  Patheon will not make any changes to these testing protocols without prior written approval from Client.  If a confirmed stability test failure occurs, Patheon will notify Client within [**], after which Patheon and Client will jointly determine the proceedings and methods to be undertaken 

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Master Manufacturing Services Agreement

	
 
		
to investigate the cause of the failure, including which party will bear the cost of the investigation.  Patheon will not be liable for these costs unless it has failed to perform the Manufacturing Services or testing in accordance with the Specifications and cGMPs.  Client shall own all stability test data and results and Patheon will give Client all stability test data and results at Client’s request.  

	
 
	
(f)
	
Packaging and Artwork.  Patheon will package the Products in accordance with the Specifications.  Client will own all artwork and shall be responsible for the cost of artwork development.  Specifically, Client will be responsible for supplying Patheon with digital artwork necessary to enable Patheon to supply Products fully finished ready for sale by the Client, incorporating Client’s trademark(s), livery and text.  The Client will also be responsible for the cost of proofing and of production of the printing plates required by Patheon to assemble, package and supply the Products and for the approval of final proofs generated by the printer.  All such artwork, trademarks, livery and text shall be the property of Client and Patheon shall obtain no rights therein.  Patheon will determine and imprint the batch numbers and expiration dates for each Product shipped.  The batch numbers and expiration dates will be affixed on the Products and on the shipping carton of each Product as outlined in the Specifications and as required by cGMPs.  Client may, in its sole discretion, make changes to labels, product inserts, and other packaging for the Products.  Those changes will be submitted by Client to all applicable Regulatory Authorities and other third parties responsible for the approval of the Products to the extent required by Applicable Law.  Client will be responsible for the cost of labelling obsolescence when changes occur, as contemplated in Section 4.4.  Patheon's name will not appear on the label or anywhere else on the Products unless: (i) required by any Laws; or (ii) Patheon consents in writing to the use of its name. If necessary, at least [**] days prior to the Delivery Date of Product for which new or modified artwork is required, Client will provide at no cost to Patheon, final artwork for all packaging Components to be used in the manufacture of the Product that meet the Specifications.  For the avoidance of doubt, the parties acknowledge and agree that Client will be responsible for complying with any and all regulatory requirements for the labeling of the Product.

	
 
	
(g)
	
Active Materials and Client-Supplied Components.  At least [**] days before the scheduled production date, Client will deliver the Active Materials and any Client-Supplied Components to the Manufacturing Site DDP (Incoterms 2010), at no cost to Patheon, with any VAT paid by Client, to enable Patheon to manufacture the desired quantities of Product and to ship Product on the Delivery Date.  If the Active Materials and/or Client-Supplied Components are not received [**] days before the scheduled production date, Patheon may delay the shipment of Product by the same number of days as the delay in receipt of the Active Materials and/or Client-Supplied Components.  But if Patheon is unable to manufacture Product to meet this new shipment date due to prior third party production commitments, Patheon may delay the shipment until a later date as agreed to by the parties.  All shipments of Active Material will be accompanied by certificate(s) of analysis from the Active Material manufacturer and the Client, confirming the identity and purity of the Active Materials and its compliance with the Active Material specifications. For Active Materials or Client-Supplied Components which may be subject to import or export, Client agrees that it shall use commercially reasonable efforts to cause its vendors and carriers to comply with applicable requirements of the U.S. Customs and Border Protection Service and the Customs Trade Partnership Against Terrorism.

	
 
	
(h)
	
Validation Activities (if applicable).  Patheon may assist in the development and approval of the validation protocols for analytical methods and manufacturing procedures (including packaging procedures) for the Products.  The fees for this service are not included in the Price and will be set out separately in Schedule C to a Product Agreement.

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Master Manufacturing Services Agreement

	
 
	
(i)
	
Storage and Handling.  Patheon shall store and handle Components under appropriate GMP conditions for temperature, humidity, light and cleanliness and in accordance with any storage specifications agreed between the parties.  Patheon shall store and handle the Active Material Product in accordance with the Specifications and under appropriate GMP conditions for temperature, humidity, light and cleanliness.  In addition to the foregoing, Patheon shall store and handle the Active Materials and Products so as to prevent the commingling of same with Patheon’s own inventories and supplies, or those held by Patheon for Third Parties.

	
 
	
(j)
	
Subcontracting.  Patheon shall not subcontract or otherwise delegate any portion of its obligations under this Agreement without Client’s prior written approval other than to its Affiliates as provided for in Section 13.6(a).

	
 
	
(k)
	
Additional Services.  If Client requests services other than those expressly set forth herein or in any Product Agreement (such as qualification of a new packaging configuration or shipping studies, or validation of alternative batch sizes), Patheon will provide a good faith and reasonable written quote of the fee for the additional services and Client will advise Patheon whether it wishes to have the additional services performed by Patheon. The scope of work and fees will be set forth in a separate agreement signed by the parties.  The terms and conditions of this Agreement will apply to these services.

	
2.2
	
Active Material Yield.  

	
 
	
(a)
	
Reporting.  Patheon will give Client a quarterly inventory report of the Active Materials held by Patheon using the inventory report form set out in Exhibit C, which will contain the following information for the quarter:

Quantity Received:  The total quantity of Active Materials that complies with the Specifications and is received at the Manufacturing Site during the applicable period. 

Quantity Dispensed:  The total quantity of Active Materials dispensed at the Manufacturing Site during the applicable period.  The Quantity Dispensed is calculated by adding the Quantity Received to the inventory of Active Materials that complies with the Specifications held at the beginning of the applicable period, less the inventory of Active Materials that complies with the Specifications held at the end of the period.  The Quantity Dispensed will only include Active Materials received and dispensed in commercial manufacturing of Products and, for certainty, will not include any (i) Active Materials that must be retained by Patheon as samples, (ii) Active Materials contained in Product that must be retained as samples, (iii) Active Materials used in testing as required under this Agreement (if applicable), and (iv) Active Materials received or dispensed in technical transfer activities or development activities under this Agreement during the applicable period, including without limitation, any regulatory, stability, validation or test batches manufactured during the applicable period.

Quantity Converted:  The total amount of Active Materials contained in the Products manufactured with the Quantity Dispensed (including any additional Products produced in accordance with Section 6.3(a) or 6.3(b)), delivered by Patheon, and not rejected, recalled or returned in accordance with Section 6.1or 6.2 because of Patheon’s failure to perform the Manufacturing Services and supply Product in accordance with Specifications, cGMPs, and Applicable Laws.  

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Master Manufacturing Services Agreement

Within [**] days after the end of each Year, Patheon will prepare an annual reconciliation of Active Materials on the reconciliation report form set forth in Exhibit D including the calculation of the "Actual Annual Yield" or "AAY" for the Product at the Manufacturing Site during the Year.  AAY is the percentage of the Quantity Dispensed that was converted to Products and is calculated as follows:

	
 
	

	
Quantity Converted during the Yearx   100%

Quantity Dispensed during the Year

After Patheon has produced a minimum of [**] successful commercial production batches if the Manufacturing Site is outside of North America or [**] successful commercial production batches if the Manufacturing Site is in North America of Product and has produced commercial production batches for at least [**] months at the Manufacturing Site (collectively, the "Target Yield Determination Batches"), the parties will agree on the target yield for the Product at the Manufacturing Site (each, a "Target Yield"). The Target Yield will be revised annually to reflect the actual manufacturing experience as agreed to by the parties, such agreement not to be unreasonably withheld.

	
 
	
(b)
	
Shortfall Credit Calculation.  If the Actual Annual Yield falls more than [**] percent ([**]%) below the respective Target Yield in a Year, then the shortfall for the Year (the "Shortfall") will be calculated as follows:

Shortfall Credit = [**]

	
 
	
(c)
	
Credit for Shortfall.  If there is a Shortfall for a Product in a Year, then Patheon will credit Client’s account for the amount of the Shortfall not later than [**] days after the end of the Year. Each credit under this Section 2.2(c) will be summarized on the reconciliation report form set forth in Exhibit D.  Upon expiration or termination of a Product Agreement, any remaining credit owing under this Section will be paid to Client.  The Annual Shortfall, if any, will be disclosed by Patheon on the reconciliation report form.

	
 
	
(d)
	
Maximum Credit.  Patheon's liability for Active Materials calculated in accordance with this Section 2.2 for any Product in a Year will not exceed, in the aggregate, the Maximum Credit Value set forth in Schedule D to a Product Agreement.

	
 
	
 (e)
	
No Material Breach.  It will not be a material breach of this Agreement by Patheon under Section 8.2(a) if the Actual Annual Yield is less than the Target Yield.

ARTICLE 3 

CLIENT'S OBLIGATIONS

	
3.1
	
Payment.

Client will pay Patheon for performing the Manufacturing Services according to the Prices specified in Schedules B and C in a Product Agreement. These Prices may be subject to adjustment under other parts of this Agreement.  

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Master Manufacturing Services Agreement

	
3.2
	
Active Materials and Qualification of Additional Sources of Supply.

	
 
	
(a)
	
Client will at its sole cost and expense deliver the Active Materials to Patheon in accordance with Section 2.1(g). If applicable, Patheon and the Client will reasonably cooperate to permit the import of the Active Materials to the Manufacturing Site. Client’s obligation will include obtaining the proper release of the Active Materials from the applicable Customs Agency and Regulatory Authority. Client or Client’s designated broker will be the “Importer of Record” for Active Materials imported to the Manufacturing Site. The Active Materials will be held by Patheon on behalf of Client as set forth in this Agreement.  Title to the Active Materials will at all times remain the property of Client.  Any Active Materials received by Patheon will only be used by Patheon to perform the Manufacturing Services for Client hereunder. Client will be responsible for paying for all rejected Product that arises from defects in the Active Materials which (i) could not be reasonably discoverable by Patheon using the test methods set forth in the Specifications; and (ii) are not due to the failure by Patheon to perform the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws or the wilful misconduct of Patheon. 

	
 
	
(b)
	
If Client asks Patheon to qualify an additional source for the Active Material or any Component, Patheon shall evaluate the Active Material or Component to be supplied by the additional source to determine if it is suitable for use in the Product. The parties will agree on the scope of work to be performed by Patheon at Client’s cost. For an Active Material, this work at a minimum will include: (i) laboratory testing to confirm the Active Material meets existing specifications; (ii) manufacture of an experimental batch of Product that will be placed on [**] months accelerated stability; and (iii) manufacture of [**] full-scale validation batches that will be placed on concurrent stability (one batch may be the registration batch if manufactured at full scale). 

	
 
	
(c)
	
Patheon will promptly advise Client if it encounters supply problems, including delays and/or delivery of non-conforming Active Material or Components from a Client designated additional source; and Patheon and Client will cooperate to reduce or eliminate any supply problems from these additional sources of supply. Client will be obligated to certify all Client designated sources of supply on an annual basis at its expense and will provide Patheon with copies of these annual certifications. If Patheon agrees to certify a Client designated additional sources of supply on behalf of Client, it will do so at Client’s expense.      

ARTICLE 4 

CONVERSION fees AND COMPONENT COSTS

	
4.1
	
First Year Pricing.

The Price for the first Year will be listed in Schedules B and C in a Product Agreement and will be subject to the adjustments set forth in Sections 4.2 and 4.3. Either party may, upon written notice to the other party, request that the Price be increased or decreased if there are changes to the underlying manufacturing, packaging or testing assumptions set forth in Schedule B of the Product Agreement that result in an increase or decrease in the cost of performing the Manufacturing Services.  Within [**] days after receipt of such notice, the parties shall meet and negotiate in good faith an adjustment to the Price to reflect such increase or decrease due to the change in assumptions.  The party requesting such adjustment shall provide the other party supporting documentation to substantiate the requested adjustment to Price.

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Master Manufacturing Services Agreement

	
4.2
	
Price Adjustments – Subsequent Years’ Pricing.

After the first Year of the Product Agreement, Patheon may adjust the Price effective January 1st of each Year as follows:

	
 
	
(a)
	
Manufacturing and Stability Testing Costs. Patheon may adjust the conversion component of the Price and the annual stability testing costs for inflation, based upon the preliminary number for any increase in the inflation index stated in the Product Agreement in August of the preceding Year compared to the final number for the same month of the Year prior to that, unless the parties otherwise agree in writing.  On or before [**] of each Year, Patheon will give Client a statement setting forth the calculation for the inflation adjustment to be applied in calculating the Price for the next Year. In no event shall any increase over the preceding Year pursuant to this Section 4.2(a) exceed [**] percent ([**]%) during the first [**] Years of a Product Agreement.  Thereafter, this restriction shall not apply.

	
 
	
(b)
	
Component Costs.  If Patheon incurs an increase in Component costs during the Year, it may increase the Price for the next Year to pass through the additional Component costs at Patheon’s cost.  On or before [**] of each Year, Patheon will give Client information about the increase in Component costs which will be applied to the calculation of the Price for the next Year to reasonably demonstrate that the Price increase is justified.  But Patheon will not be required to give information to Client that is subject to obligations of confidentiality between Patheon and its suppliers.

	
 
	
(c)
	
Pricing Basis.  Client acknowledges that the Price in any Year is quoted based upon the Minimum Order Quantity and the Annual Volume specified in Schedule B to a Product Agreement.  The Price is subject to change if the specified Minimum Order Quantity changes or if the Annual Volume is not ordered in a Year.  For greater certainty, if Patheon and Client agree that the Minimum Order Quantity will be reduced or the Annual Volume in the lowest tier will not be ordered in a Year whether as a result of a decrease in estimated Annual Volume or otherwise and, as a result of the reduction, Patheon demonstrates to Client that its costs to perform the Manufacturing Services or to acquire the Components for the Product will increase on a per unit basis (including the amount of the increase), then Patheon may increase the Price by an amount sufficient to absorb the documented increased costs.  On or before [**] of each Year, Patheon will give Client a statement setting forth the information to be applied in calculating those cost increases for the next Year.  But Patheon will not be required to give information to Client that is subject to obligations of confidentiality between Patheon and its suppliers.  

	
 
	
(d)
	
Tier Pricing (if applicable). The pricing in Schedule B of a Product Agreement is set forth in Annual Volume tiers based upon the Client’s volume forecasts under Section 5.1.  The Client will be invoiced during the Year for the unit price set forth in the Annual Volume tier based on the [**] month forecast provided in September of the previous Year.  Within [**] days after the end of each Year or of the termination of the Agreement, Patheon will send Client a reconciliation of the actual volume of Product ordered by the Client during the Year with the pricing tiers.  If Client has overpaid during the Year, Patheon will issue a credit to the Client for the amount of the overpayment within [**] days after the end of the Year or will issue payment to the Client for the overpayment within [**] days after the termination of the Agreement.  If Client has underpaid during the Year, Patheon will issue an invoice to the Client under Section 5.5 for the amount of the underpayment within [**] days after the end of the Year or termination of the Agreement.  If Client disagrees with the reconciliation, the parties will work in good faith to resolve the disagreement amicably. If the parties are unable to resolve the disagreement within [**] days, the matter will be handled under Section 12.1.        

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Master Manufacturing Services Agreement

	
 
	
(e)
	
For all Price adjustments under this Section 4.2, Patheon will deliver to Client on or before [**] of each Year a revised Schedule B to the Product Agreement to be effective for Product delivered on or after the first day of the next Year. If in any Year Patheon would have been entitled to increase the Price based on any of the provisions of this Section 4.2 but Patheon did not exercise its right to do so, then at the expiry of any subsequent Year, Patheon will be entitled to make cumulative adjustments as set out in Section 4.2 based on changes during all of the preceding Years since Patheon last adjusted the Price.

	
 
	
4.2.1
	
Price Adjustment due to Volume Changes from Yearly Forecast Volumes for Sterile Products.

On the execution of a Product Agreement, Client will give to Patheon a forecast of the volume of Product required for the first [**] Years of the Product Agreement (the “Yearly Forecast Volume” or “YFV”) that will become part of the Product Agreement.  If at the end of the first Year the aggregate actual volume of Product ordered by Client and invoiced by Patheon under Section 5.5 (“Actual Yearly Volume” or “AYV”) during the Year is less than the YFV as set out in the Product Agreement, then Client will pay Patheon for its non-absorbed fixed manufacturing costs incurred during the Year in an amount to be determined as follows:

Amount due to Patheon  =    [**].

On or before [**] of each Year, the parties will agree on the YFV for the next [**] Years of the Product Agreement on a rolling forward basis.  The forecast of the volume of Product for the [**] Year may not vary by more than [**]% from the original YFV for the [**] Year.  Once agreed, the YFV for the next Year will become binding on the parties and any amount due to Patheon will be determined as set forth above.

	
4.3
	
Price Adjustments – Current Year Pricing.

During any Year, the Prices set out in Schedule B of a Product Agreement will be adjusted as follows:

Extraordinary Increases in Component Costs.  If, at any time, market conditions result in Patheon's cost of Components being materially greater than normal forecasted increases, then Patheon will be entitled to adjust the Price for any affected Product to compensate it for the increased Component costs.  Changes materially greater than normal forecasted increases will have occurred if: (i) the cost of a Component increases by [**]% of the cost for that Component upon which the most recent Price or fee quote was based; or (ii) the aggregate cost for all Components required to manufacture a Product increases by [**]% of the total Component costs for the Product upon which the most recent fee quote was based.  If Component costs have been previously adjusted to reflect an increase in the cost of one or more Components, the adjustments set out in (i) and (ii) above will operate based on the last cost adjustment for the Components.

For a Price adjustment under this Section 4.3, Patheon will deliver to Client a revised Schedule B to the Product Agreement and budgetary pricing information, adjusted Component costs or other documents reasonably sufficient to demonstrate that a Price adjustment is justified.  Patheon will have no obligation to deliver any supporting documents that are subject to obligations of confidentiality between Patheon and its suppliers.  The revised Price will be effective for any Product delivered on or after the first day of the month following Client’s receipt of the revised Schedule B to the Product Agreement.

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Master Manufacturing Services Agreement

	
4.4
	
Adjustments Due to Technical Changes or Regulatory Authority Requirements.

Amendments to the Specifications or the Quality Agreement requested by Client will be implemented only following a technical and cost review that Patheon will perform at Client’s cost and are subject to Client and Patheon reaching agreement on Price changes required because of the amendment.  Amendments to the Specifications, the Quality Agreement, or the Manufacturing Site requested by Patheon will only be implemented following the written approval of Client, the approval not to be unreasonably withheld, conditioned or delayed.  If Client accepts a proposed Price change, the proposed change in the Specifications or the Quality Agreement and the associated scope of work will be implemented with the costs to be allocated between the parties as mutually agreed in writing, and the Price change will become effective, only for those orders of Product that are manufactured under the revised Specifications; provided that the parties agree that if such changes are implemented due to a regulatory requirement that applies generally to the Product as well as to other products manufactured by Patheon for itself or for third parties, then Client shall pay a pro rata amount of the reasonable cost of such regulatory changes.  In addition, Client agrees to purchase, at the price paid by Patheon (including all costs incurred by Patheon for the purchase, handling and transport of the Inventory), all Inventory held under the "old" Specifications and purchased or maintained by Patheon in order to fill Firm Orders or under Section 5.2, if the Inventory can no longer be used under the revised Specifications; provided that Patheon shall use reasonable efforts to mitigate such costs.  Patheon shall, where possible, cancel open purchase orders for Components no longer required under any revised Specifications that were placed by Patheon with suppliers in order to fill Firm Orders or under Section 5.2, but if the orders may not be cancelled without penalty, Client shall pay the lesser of the price for such order or such penalty. Additional payments or price increases may also be agreed to by the parties to compensate Patheon for fees and other expenses incurred by Patheon to comply with Regulatory Authority requirements which apply to the Manufacturing Services.

	
4.5
	
Multi-Country Packaging Requirements.  

If Client decides to have Patheon perform Manufacturing Services for the Product for countries outside the Territory, then Client will inform Patheon of the packaging requirements for each new country and Patheon will prepare a quotation for consideration by Client of any additional costs for Components (other than Client-Supplied Components) and the change over fees for the Product destined for each new country.  The agreed additional packaging requirements and related packaging costs and change over fees will be set out in a written amendment to this Agreement.

ARTICLE 5 

ORDERS, SHIPMENT, INVOICING, PAYMENT

	
5.1
	
Orders and Forecasts.  

	
 
	
(a)
	
Long Term Forecast.  When each Product Agreement is executed, Client will give Patheon a non-binding [**] year forecast of Client’s estimated volume requirements for the Product for each Year during the term of the Product Agreement (the “Long Term Forecast”).  The Long Term Forecast will thereafter be updated every [**] during the Initial Product Term.  If Patheon is unable to accommodate any portion of the Long Term Forecast, it will notify Client and the parties will agree on any revisions to the forecast.

	
 
	
(b)
	
Rolling [**] Forecast.  When each Product Agreement is executed, Client will give Patheon a non-binding [**] forecast of the estimated volume of Product that Client expects to order in the first [**] of commercial manufacture of the Product (“Rolling Forecast”).  The Rolling Forecast will then be updated by Client on or before the [**] on a rolling forward basis.  Client will update the Rolling Forecast if it determines that the volumes estimated in the most recent Rolling Forecast have changed by more than [**] percent ([**]%). The most recent [**] forecast will prevail.

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Master Manufacturing Services Agreement

	
 
	
(c)
	
Firm Orders. Unless otherwise agreed in the Product Agreement, the first [**] of the Rolling Forecast will be considered binding firm orders.  The remaining [**] of each Rolling Forecast submitted by Client shall be for planning purposes only, and thus shall not be binding.  Concurrent with the [**] forecast, Client will issue a new firm written order in the form of a purchase order or otherwise (“Firm Order”) by Client to purchase and, when accepted by Patheon, for Patheon to manufacture and deliver the agreed quantity of the Products. The Delivery Date will not be less than [**] days following the date that the Firm Order is submitted. Firm Orders submitted to Patheon will specify Client's purchase order number, quantities by Product type, monthly delivery schedule, and any other elements necessary to ensure the timely manufacture and shipment of the Products.  The quantities of Products ordered in those written orders will be firm and binding on Client and may not be reduced by Client.  Expedited Firm Orders will be subject to additional fees.  

	
 
	
(d)
	
Acceptance of Firm Order. Patheon will accept Firm Orders by sending an acknowledgement to Client within [**] Business Days of its receipt of the Firm Order; provided that Patheon may only reject a Firm Order which fails to comply with the requirements of this Article 5 or that is not consistent with the Long Term Forecast.  The acknowledgement will include, subject to confirmation from the Client, the Delivery Date for the Product ordered. The Delivery Date may be amended by agreement of the parties. If Patheon fails to acknowledge receipt of a Firm Order within the [**] Business Day period, the Firm Order will be deemed to have been accepted by Patheon.

	
 
	
(e)
	
Cancellation of a Firm Order.  If Client cancels a Firm Order, Client, as its sole liability for such cancellation, will pay Patheon 100% of the Price for the Firm Order.    

	
 
	
(f)
	
Zero Volume Forecast. Once Client has commenced issuing Firm Orders for Product, if Client subsequently forecasts zero volume for [**] period during the term of a Product Agreement (the “Zero Forecast Period”), then Patheon will have the option, at its sole discretion, to provide a [**] day notice to Client of Patheon’s intention to terminate the Product Agreement on a stated day within the Zero Forecast Period.  Client thereafter will have [**] days to either (i) withdraw the zero forecast and re-submit a reasonable volume forecast, or (ii) negotiate other terms and conditions on which the Product Agreement will remain in effect. Otherwise, Patheon will have the right to terminate the Product Agreement at the end of the [**] day notice period.

	
5.2
	
Reliance by Patheon.

(a)Client understands and acknowledges that Patheon will rely on the Firm Orders and Rolling Forecasts submitted under Section 5.1(b) in ordering the Components (other than Client-Supplied Components) required to meet the Firm Orders.  In addition, Client understands that to ensure an orderly supply of the Components, Patheon may want to purchase the Components in sufficient volumes to meet the production requirements for Products during part or all of the Rolling Forecast or to meet the production requirements of any longer period agreed to by Patheon and Client in writing.  Accordingly, Client authorizes Patheon to, and Patheon shall purchase Components to satisfy the Manufacturing Services requirements for Products for the first [**] contemplated in the most recent Rolling Forecast.  Patheon may make other purchases of Components to meet Manufacturing Services requirements for longer periods if agreed to in writing by the parties.  Client will give Patheon written authorization to order Components for any launch quantities of Product requested by Client which will be considered a Firm Order when accepted by Patheon.  

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Master Manufacturing Services Agreement

(b)Client will reimburse Patheon for the cost of Components that have expired or that are rendered obsolete due to changes in artwork or applicable regulations during the period (collectively, “Obsolete Stock”). This reimbursement will include Patheon’s cost to purchase (plus a [**]% handling fee) and destroy the Obsolete Stock. 

(c)If Client fails to take delivery of conforming finished Product within [**] of manufacture and release testing, Client will pay Patheon $[**] / EURO [**] per pallet, per month thereafter for storing the finished Product.  Storage fees for Product which contain controlled substances or require refrigeration will be charged at $[**] / EURO [**] per pallet per month.  Storage fees are subject to a one pallet minimum charge per month.  

	
5.3
	
Minimum Orders.

Client may order Manufacturing Services for batches of Products only in multiples of the Minimum Order Quantities as set out in Schedule B to a Product Agreement.

	
5.4
	
Delivery and Shipping.

The Product will be delivered to Client after it has been manufactured and released to the Client by Patheon. Delivery of Products will be made EXW (Incoterms 2010) Patheon’s shipping point unless otherwise agreed in a Product Agreement.  Risk of loss or of damage to Products will remain with Patheon until Patheon loads the Products onto the carrier’s vehicle for shipment at the shipping point at which time risk of loss or damage will transfer to Client. Patheon will, in accordance with Client’s instructions and as agent for Client, at Client’s risk, arrange for shipping to be paid by Client. Client will arrange for insurance and will select the freight carrier used by Patheon to ship Products and may monitor Patheon’s shipping and freight practices as they pertain to this Agreement.  Products will be transported in accordance with the Specifications. 

	
5.5
	
Invoices and Payment.

Invoices will be sent by email to the email address given by Client to Patheon in writing.  Invoices will be issued when the Product is manufactured and released by Patheon to the Client.  Patheon will also submit to Client, with each shipment of Products, a duplicate copy of the invoice covering the shipment.  Patheon will also give Client an invoice covering any Inventory or Components which are to be purchased by Client under Section 5.2 of this Agreement.  Each invoice will, to the extent applicable, identify Client’s Manufacturing Services purchase order number, Product numbers, names and quantities, unit price, freight charges, and the total amount to be paid by Client.  Client will pay all undisputed invoices within [**] days after electronic receipt thereof.  If any portion of an invoice is disputed, the Client will pay Patheon for the undisputed amount and the parties will use good faith efforts to reconcile the disputed amount as soon as practicable.  Interest on undisputed past due accounts will accrue at [**] percent ([**]%) per month which is equal to an annual rate of [**] percent ([**]%).  

ARTICLE 6 

PRODUCT CLAIMS AND RECALLS

	
6.1
	
Product Claims.

(a)Product Claims.  Client has the right to reject any portion of any shipment of Products that deviate from the Specifications, cGMPs, or Applicable Laws, without invalidating any remainder of the shipment.  Client will inspect the Products manufactured by Patheon promptly upon receipt and will give Patheon written notice (a "Deficiency Notice") of all claims for Products that deviate from the Specifications, cGMPs, or Applicable Laws, within [**] days after Client’s receipt thereof (or, in the case of 

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Master Manufacturing Services Agreement

any defects not reasonably susceptible to discovery upon receipt of the Product, within [**] days after discovery by Client, but not after [**] months following the expiration date of the Product, provided that any notification after the expiration date relates to an underlying event giving rise to a claim that occurred on or before the expiration date).  Should Client fail to give Patheon the Deficiency Notice within the applicable [**] day period, then the delivery will be deemed to have been accepted by Client on the [**] day after delivery or discovery, as applicable.  

(b)Determination of Deficiency.  Upon receipt of a Deficiency Notice, Patheon will have [**] days to advise Client by notice in writing that it disagrees with the contents of the Deficiency Notice.  If Client and Patheon fail to agree within [**] days after Patheon's notice to Client as to whether any Products identified in the Deficiency Notice deviate from the Specifications, cGMPs, or Applicable Laws, then the parties will mutually select an independent laboratory to evaluate if the Products deviate from the Specifications, cGMPs, or Applicable Laws.  This evaluation will be binding on the parties. If the evaluation certifies that any Products deviate from the Specifications, cGMPs, or Applicable Laws, Client may reject those Products in the manner contemplated in this Section 6.1 and Patheon will be responsible for the cost of the evaluation.  If the evaluation does not so certify for any of the Products, then Client will be deemed to have accepted delivery of the Products and Client will be responsible for the cost of the evaluation.

(c)Shortages.  Claims for shortages in the amount of Products shipped by Patheon will be dealt with by reasonable agreement of the parties. 

(d)Product Rejection for Finished Product Specification Failure. Internal process specifications will be defined and agreed upon.  If Patheon manufactures Product in accordance with the agreed upon process specifications, the batch production record, and Patheon’s standard operating procedures for manufacturing, and a batch or portion of batch of Product does not meet a finished Product specification, Client will pay Patheon the applicable fee per unit for the non-conforming Product. The API in the non-conforming Product will be included in the “Quantity Converted” for purposes of calculating the “Actual Annual Yield” under Section 2.2(a).

	
6.2
	
Product Recalls and Returns.

(a)Records and Notice.  Client shall be solely responsible for determining that a Recall of any Product is appropriate. Patheon and Client will each maintain records necessary to permit a Recall of any Products delivered to Client or customers of Client.  Patheon will promptly notify Client by telephone (to be confirmed in writing) of any information which might affect the marketability, safety, quality or effectiveness of the Products or which might result in the Recall or seizure of the Products.  Client will promptly notify Patheon by telephone (to be confirmed in writing) of any information Client receives which Client reasonably believes may result in the Recall or seizure of the Products. Upon receiving this notice from Client, Patheon will stop making any further shipments of any Products in its possession or control until a decision has been made whether a Recall or some other corrective action is necessary.  The decision to initiate a Recall or to take some other corrective action, if any, will be made and implemented by Client.  "Recall" will mean any action (i) by Client to recover title to or possession of quantities of the Products sold or shipped to Third Parties (including, without limitation, the voluntary withdrawal of Products from the market); or (ii) by any regulatory authorities to detain or destroy any of the Products.  Recall will also include any action by either party to refrain from selling or shipping quantities of the Products to Third Parties which would be subject to a Recall if sold or shipped.

(b)Recalls.  If (i) any Regulatory Authority issues a directive, order or, following the issuance of a safety warning or alert about a Product, a written request that any Product be Recalled, (ii) a court of competent jurisdiction orders a Recall, or (iii) Client determines that any Product should be Recalled or that a "Dear Doctor" letter is required relating to restrictions on the use of any Product, Patheon will co-operate as reasonably required by Client, having regard to all applicable laws and regulations. 

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Master Manufacturing Services Agreement

(c)Product Returns.  Client will have the responsibility for handling customer returns of the Products.  Patheon will give Client any assistance that Client may reasonably require to handle the returns.

	
6.3
	
Patheon’s Responsibility for Defective and Recalled Products.

(a)Defective Product.  If Client rejects Products under Section 6.1 and the deviation is determined to have arisen from Patheon’s failure to provide the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws, Patheon will credit Client’s account for Patheon’s invoice price for the defective Products.  If Client previously paid for the defective Products, Patheon will promptly, at Client’s election, either: (i) refund the invoice price for the defective Products; (ii) offset the amount paid against other amounts due to Patheon hereunder; or (iii) replace the Products with conforming Products, (provided that Patheon is able to manufacture replacement Product at the same Manufacturing Site as that of the rejected Products), without Client being liable for payment therefor under Section 3.1, contingent upon the receipt from Client of all Active Materials and Client-Supplied Components required for the manufacture of the replacement Products.  For greater certainty, Patheon’s responsibility for any loss of Active Materials in defective Product will be captured and calculated in the Active Materials Yield under Section 2.2. 

(b)Recalled Product.  If a Recall or return results from, or arises out of, a failure by Patheon to perform the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws, Patheon will be responsible for the documented out-of-pocket expenses of the Recall or return and will replace the Recalled or returned Products with new Products, contingent upon the receipt from Client of all Active Materials and Client-Supplied Components required for the manufacture of the replacement Products.  For greater certainty, Patheon’s responsibility for any loss of Active Materials in Recalled Product will be captured and calculated in the Active Materials Yield under Section 2.2.  If Patheon is unable to replace the Recalled or returned Products (except where this inability results from a failure to receive the required Active Materials and Client-Supplied Components), then Client may request Patheon to reimburse Client for the price that Client paid to Patheon for Manufacturing Services for the affected Products.  In all other circumstances, Recalls, returns, or other corrective actions will be made at Client's cost and expense.

(c)Except as set forth in Sections 6.3(a) and (b) above and Sections 6.4 and 6.5 below, Patheon will not be liable to Client nor have any responsibility to Client for any deficiencies in, or other liabilities associated with, any Product manufactured by it, (collectively, "Product Claims").  For greater certainty but not limitation, Patheon will have no obligation for any Product Claims to the extent the Product Claim solely (i) is caused by deficiencies in the Specifications, the safety, efficacy, or marketability of the Products or any distribution thereof, (ii) results from a defect in a Component that is not reasonably discoverable by Patheon using the test methods set forth in the Specifications and not otherwise due to Patheon’s failure to perform the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws or wilful misconduct prior to use of the applicable Component in the performance of the Manufacturing Services, (iii) results from a defect in the Active Materials, Client-Supplied  Components or Components supplied by a Client designated additional source that is not reasonably discoverable by Patheon using the test methods set forth in the Specifications and not otherwise due to Patheon’s failure to perform the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws or wilful misconduct, (iv) is caused by actions of Client or Third Parties occurring after the Product is shipped by Patheon under Section 5.4, (v) is due to packaging design or labelling defects or omissions for which Patheon has no responsibility, or (vi) is due to any other breach by Client of its obligations under this Agreement.  

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Master Manufacturing Services Agreement

	
6.4
	
Disposition of Defective or Recalled Products.

Client will not dispose of any damaged, defective, returned, or Recalled Products for which it intends to assert a claim against Patheon without Patheon’s prior written authorization to do so.  Alternatively, Patheon may instruct Client to return the Products to Patheon.  Patheon will bear the cost of disposition for any damaged, defective, returned or Recalled Products for which it bears responsibility under Section 6.3.  In all other circumstances, Client will bear the cost of disposition, including all applicable fees for Manufacturing Services, for any damaged, defective, returned, or Recalled Products.

	
6.5
	
Healthcare Provider or Patient Questions and Complaints.

Client will have the sole responsibility for responding to questions and complaints from its customers.  Questions or complaints received by Patheon from Client's customers, healthcare providers or patients will be promptly referred to Client.  Patheon will co-operate as reasonably required to allow Client to determine the cause of and resolve any questions and complaints.  This assistance will include follow-up investigations, including testing.  In addition, Patheon will give Client all agreed upon information that will enable Client to respond properly to questions or complaints about the Products as set forth in the Quality Agreement.  Unless it is determined that the cause of the complaint resulted from a failure by Patheon to perform the Manufacturing Services and supply Product in accordance with the Specifications, cGMPs, and Applicable Laws, all costs incurred under this Section 6.5 will be borne by Client.

	
6.6
	
Shortage of Supply; Supply Failure.

(a) Patheon shall notify Client immediately upon becoming aware of an event that would render Patheon unable to supply any quantity of the Product required to be supplied hereunder.  If the event is caused by a breach of this Agreement by Patheon, Patheon shall use commercially reasonable efforts to remedy such shortage, including allocating a pro-rata portion of any available materials or capacity based on the production of the Product for Client and Patheon’s other uses according to the relative quantities used by each during the immediately preceding [**] prior to such shortage without regard to price; provided, however, that Client shall receive treatment proportionately no less favorable than any of Patheon’s other supply arrangements with respect to allocation of such materials or capacity.

(b) If there is a Supply Deficiency, then, if requested by Client, Patheon shall promptly take one (1) or more of the following steps to remedy the Supply Deficiency, in the following order of preference whenever practicable (i.e., with highest preference given to the remedy in paragraph (i) and the lowest preference given to the remedy in paragraph (iv)): (i) increase the length of a manufacturing campaign at the Manufacturing Site in order to manufacture for Client additional batches that are manufactured in accordance with the Specifications, cGMPs and Applicable Laws to remedy the Supply Deficiency (each such Batch, a “Deficiency Cure Batch”); (ii) utilize any appropriately qualified capacity at the Manufacturing Site which is not then contractually committed to the performance of services for Third Party customers during the applicable quarter to manufacture for Client Deficiency Cure Batches; (iii) coordinate and cooperate with Client to re-schedule manufacture batches of Product ordered hereunder in order to maximize Patheon’s ability to manufacture for Client Deficiency Cure Batches while minimizing the disruption of manufacture at the Manufacturing Site then in force and any contractual commitments to Third Party customers; and (iv) use commercially reasonable efforts to remedy the Supply Deficiency in subsequent quarters, if any, by utilizing and dedicating excess capacity not contractually committed to Third Party customers to manufacture Deficiency Cure Batches and to reserve such capacity for Client’s requirements until the issues surrounding the Supply Deficiency have been remedied.  For purposes of this Section 6.6(b), “Supply Deficiency” shall mean the difference between the Product manufactured under Firm Order(s) accepted by Patheon that meet the requirements under this Agreement and the number specified in such Firm Order(s) in the event that Patheon has failed to manufacture the quantities specified in the relevant Firm Order(s) solely as a result of a breach of this Agreement by Patheon (but excluding any failure that relates to a Shortfall provided that Patheon complies with its obligations in Section 2.2(c)).

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Master Manufacturing Services Agreement

(c)If Patheon delivers less than [**] percent ([**]%) of the Product ordered by Client pursuant to a Firm Order within [**] days of the agreed-upon Delivery Date(s) in any Rolling Forecast in any [**] periods (calculated on the basis of the aggregate quantity of Product delivered during [**] periods) solely as a result of a breach of this Agreement by Patheon but excluding any failure that relates to a Shortfall provided that Patheon complies with its obligations in Section 2.2(c) (“Supply Failure”), then (x) obligations relating to the minimum purchase and binding portion of such forecast will cease to apply with respect to the current Rolling Forecast and any subsequent Rolling Forecast  and (y) Client shall have the right to purchase all of its requirements of the Product from an alternative supplier, in each case until Patheon has satisfied the requirements of sub-section (i), below. For purposes of this definition, any Product that is non-conforming Product at the time of delivery as a result of a failure by Patheon to perform the Manufacturing Services in accordance with the Specifications, cGMPs, or Applicable Laws shall be considered not delivered.

(i) If, after a Supply Failure, Patheon delivers [**]% of the aggregate quantity of Product ordered by Client under Firm Orders within [**] days of the agreed-upon delivery date(s) during a consecutive [**] period as determined by the Firm Order date (the “Cure Period”), the minimum purchase and binding portion obligations will be re-instated, beginning with the first Rolling Forecast delivered by Client after the Cure Period.

(ii) Should Patheon fail to remedy any Supply Failure during the Cure Period, Client may in its sole discretion, transfer any and all volume of the Product previously reflected in the binding portion of its forecast to an alternate supplier.

(d)Section 6.6 shall not apply if the Supply Deficiency, Supply Failure or any other Product shortage is caused by a Force Majeure Event or is attributable in whole or in part to Client or its contractors or to a breach of this Agreement by Client.

	
6.7
	
Alternative Supplier.

(a) Subject to the provisions of Section 2.1, nothing in this Agreement shall preclude Client, at anytime during this Agreement, from qualifying an alternate supplier to provide manufacturing services for Product(s); provided, however, that Client otherwise complies all of its obligations under this Agreement.

(b) If Client exercises its option to transfer the manufacture of the Product to an alternate supplier in accordance with Section 6.6(c) Patheon shall reasonably assist Client for a reasonable period of time in such transfer, including providing all Product data and any non-Confidential Information regarding the manufacturing process provided that Client will reimburse Patheon for its fees and all documented costs and out-of-pocket expenses incurred in connection with such assistance (Patheon would provide a quotation for the services that Client requires pursuant to this Section 6.7 and on acceptance by Client of the same and signature by the parties, Patheon will provide the services stated therein).

	
6.8
	
Sole Remedy.

Except for the indemnity set forth in Section 10.3 and subject to the limitations set forth in Sections 10.1 and 10.2, the remedies described in this Article 6 will be Client’s sole remedy for any failure by Patheon to provide the Manufacturing Services in accordance with the Specifications, cGMPs, and Applicable Laws.

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Master Manufacturing Services Agreement

ARTICLE 7 

CO-OPERATION

	
7.1
	
Quarterly Review.

Each party will forthwith upon execution of this Agreement appoint one of its employees to be a relationship manager responsible for liaison between the parties.  The relationship managers will meet not less than quarterly to review the current status of the business relationship and manage any issues that have arisen.

	
7.2
	
Governmental Agencies.

Subject to Section 7.8, each party may communicate with any governmental agency, including but not limited to governmental agencies responsible for granting Regulatory Approval for the Products, regarding the Products if, in the opinion of that party's counsel, the communication is necessary to comply with the requirements of any law, governmental order or regulation; provided that, to the extent reasonably practicable, Patheon shall provide Client prompt notice upon its determination and discuss with Client such proposed communication.  Unless, in the reasonable opinion of its counsel, there is a legal prohibition against doing so, Patheon will permit Client to accompany and take part in any communications with the agency, and to receive copies of all communications from the agency.

	
7.3
	
Records and Accounting by Patheon.

Patheon will keep records of the Manufacturing Services, including the manufacture, testing, and shipping of the Products, and retain samples of the Products as are necessary to comply with cGMP and other manufacturing regulatory requirements applicable to Patheon, as well as to assist with resolving Product complaints and other similar investigations.  Unless otherwise agreed to in the Quality Agreement, copies of the records and samples will be retained for one year following the date of Product expiry, or longer if required by law or regulation, following which time Client will be contacted in writing concerning the delivery and destruction of the documents and/or samples of Products.  Patheon reserves the right to destroy or return to Client, at Client’s sole expense, any document or samples for which the retention period has expired if Client fails to arrange for destruction or return within [**] days of receipt of written notice from Patheon.  Client is responsible for retaining samples of the Products necessary to comply with the legal/regulatory requirements applicable to Client.

	
7.4
	
Inspection.

Client may inspect Patheon reports and records relating to the Product(s) and this Agreement during normal business hours and with reasonable advance notice, but a Patheon representative must be present during the inspection.

	
7.5
	
Access.

Patheon will give Client reasonable access at agreed times to the areas of the Manufacturing Site in which the Products are manufactured, stored, handled, or shipped to permit Client to verify that the Manufacturing Services are being performed in accordance with this Agreement, the Specifications, cGMPs, and Applicable Laws.  But, with the exception of “for-cause” audits, Client or designee will be limited each Year to [**], each audit lasting no more than [**] days, and involving no more than [**].  Client may request additional cGMP-type audits, additional audit days, or the participation of additional auditors subject to payment to Patheon of a fee of $[**] / EUR [**] for each additional audit day and $[**] / EUR [**] per audit day for each additional auditor.  The right of access set forth in Sections 7.4 and 7.5 will not include a right to access or inspect Patheon’s financial records.  For each Product, 

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Master Manufacturing Services Agreement

Patheon will support the first pre- Approval Inspection by the FDA (“PAI”) and all subsequent routine non-PAI FDA inspections or equivalent routine non-PAI regulatory inspection for other jurisdictions (where applicable) and provide a copy of the resulting report at no cost.  Additional PAIs or equivalent support will be subject to additional fees.  

	
7.6
	
Notification of Regulatory Inspections.

Patheon will notify Client within [**] of any inspections by any Authority or other governmental agency involving the Products.  Patheon will also notify Client of receipt of any form 483’s or warning letters or any other significant regulatory action which Patheon’s quality assurance group determines could impact the regulatory status of the Products and shall promptly provide Client with Patheon’s plan to correct any deficiencies identified by such Authority (which may be redacted to protect any confidential information of Patheon or any Third Party) and diligently pursue such corrections. 

	
7.7
	
Reports.

Upon Client’s reasonable request, Patheon will supply all Product data in its control, including release test results, complaint test results, and all investigations (in manufacturing, testing, and storage), that Client reasonably requires in order to complete any filing under any applicable regulatory regime, including any Annual Report that Client is required to file with the FDA.  Any additional data or report requested by Client beyond the scope of cGMPs and customary FDA, EMA or Japanese PMDA requirements will be subject to an additional fee to be agreed upon between Patheon and the Client.

	
7.8
	
Regulatory Filings.

(a)Regulatory Authority.  Client will have the sole responsibility at Client’s expense for filing all documents with all Regulatory Authorities and taking any other actions that may be required for the receipt and/or maintenance of Regulatory Authority approval for the commercial manufacture, distribution and sale of the Products (“Regulatory Approval”).  Patheon will assist Client, to the extent consistent with Patheon’s obligations under this Agreement, to obtain Regulatory Authority approval for the commercial manufacture, distribution and sale of all Products as quickly as reasonably possible. 

 

(b)Verification of Data.  Prior to filing any documents with any Regulatory Authority that incorporate data generated by Patheon, Client will give Patheon a copy of the documents incorporating this data to give Patheon the opportunity to verify the accuracy and regulatory validity of those documents as they relate to Patheon generated data. Patheon requires [**] days to perform this review but the parties may agree to a shorter time for the review as needed.

 

(c)Verification of CTD.  Prior to filing with any Regulatory Authority any documentation which is or is equivalent to the Quality Module (Drug Product Section) of the Common Technical Document (all such documentation herein referred to as “CTD”) related to any Marketing Authorization, such as a US New Drug Application, US Abbreviated New Drug Application, US Biologics Licence Application, or EU Marketing Authorisation Application, Client will give Patheon a copy of the CTD as well as all supporting documents which have been relied upon to prepare the CTD.  This disclosure will permit Patheon to verify that the CTD accurately describes the validation or scale-up work that Patheon has performed and the manufacturing processes that Patheon will perform under this Agreement.  Patheon requires [**] days to perform this review but the parties may agree to a shorter time for the review as needed. Client will give Patheon copies of all relevant filings which contain CTD information regarding the Product.

 

(d)Deficiencies.  If, in Patheon’s sole discretion, acting reasonably, Patheon determines that any of the information given by Client under clauses (b) and (c) above is inaccurate or deficient in any 

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Master Manufacturing Services Agreement

manner whatsoever (the "Deficiencies"), Patheon will promptly (within [**] business days of discovery) notify Client in writing of the Deficiencies.  The parties will work together to have the Deficiencies resolved prior to the date of filing of the relevant application and in any event before any pre-approval inspection or before the Product is placed on the market if a pre-approval inspection is not performed.

 

(e)Client Responsibility.  For clarity, the parties agree that in reviewing the documents referred to in clause (b) above, Patheon’s role will be limited to verifying the accuracy of the description of the work undertaken or to be undertaken by Patheon.  Subject to the foregoing, Patheon will not assume any responsibility for the accuracy of any application for receipt of an approval by a Regulatory Authority.  The Client is solely responsible for the preparation and filing of the application for approval by the Regulatory Authority and any relevant costs will be borne by the Client.

 

(f)Inspection by Regulatory Authorities.  If Client does not give Patheon the documents requested under subsections (b) and (c) above within the time specified and if Patheon reasonably believes that Patheon’s standing with a Regulatory Authority may be jeopardized, Patheon (i) shall so notify Client in writing and (ii) may, in its sole discretion, upon written notice to Client, delay or postpone any inspection by the Regulatory Authority with respect to the Product that is the subject of such documents until Patheon has reviewed the requested documents and is satisfied with their contents.

 

(g)Pharmacovigilance.  Client will be responsible, at its expense, for all pharmacovigilance obligations for the Products pursuant to Applicable Laws; Patheon shall provide Client any safety information it receives related to the Product on a prompt basis.  Unless required by Applicable Law, Client will not be obliged to exchange with the other party any information or data which it compiles pursuant to pharmacovigilance obligations or activities.

 

(h)No Patheon Responsibility.  Patheon will not assume any responsibility for the accuracy or cost of any application for Regulatory Approval. If a Regulatory Authority, or other governmental body, requires Patheon to incur fees, costs or activities in relation to the Products which Patheon considers unexpected and extraordinary, then Patheon will notify Client in writing and the parties will discuss in good faith appropriate mutually acceptable actions, including fee/cost sharing, or termination of all or any part of this Agreement.  

ARTICLE 8 

TERM AND TERMINATION

	
8.1
	
Initial Term.

This Agreement will become effective as of the Effective Date and will continue until December 31, 2022 (the "Initial Term"), unless terminated earlier by one of the parties in accordance herewith.  This Agreement will automatically renew after the Initial Term for successive terms of two Years each if there is a Product Agreement in effect, unless either party gives written notice to the other party of its intention to terminate this Agreement at least eighteen (18) months prior to the end of the then current term. In any event, the legal terms and conditions of this Agreement will continue to govern any Product Agreement in effect as provided in Section 1.2. Each Product Agreement will have an initial term of two (2)  Years from the start of commercial manufacture at the Manufacturing Site for the Product unless the parties agree to a different number of Years in the applicable Product Agreement (each, an “Initial Product Term”). Product Agreements will automatically renew after the Initial Product Term for successive terms of two Years each unless either party gives written notice to the other party of its intention to terminate the Product Agreement at least eighteen (18) months prior to the end of the then current term.   

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Master Manufacturing Services Agreement

	
8.2
	
Termination for Cause.

(a)Either party at its sole option may terminate this Agreement or a Product Agreement upon written notice where the other party has failed to remedy a material breach of any of its representations, warranties, or other obligations under this Agreement or the Product Agreement within [**] days following receipt of a written notice (the "Remediation Period") of the breach from the aggrieved party that expressly states that it is a notice under this Section 8.2(a) (a "Breach Notice").  The aggrieved party's right to terminate this Agreement or a Product Agreement under this Section 8.2(a) may only be exercised for a period of [**] days following the expiry of the Remediation Period (where the breach has not been remedied). The termination of a Product Agreement under this Section 8.2(a) will not affect this Agreement or any other Product Agreements where there has been no material breach of the other Product Agreements.  

(b)Either party at its sole option may immediately terminate this Agreement or a Product Agreement upon written notice, but without prior advance notice, to the other party if: (i) the other party is declared insolvent or bankrupt by a court of competent jurisdiction; (ii) a voluntary petition of bankruptcy is filed in any court of competent jurisdiction by the other party; or (iii) this Agreement or a Product Agreement is assigned by the other party for the benefit of creditors.

(c)Client may terminate a Product Agreement upon thirty (30) days' prior written notice if any Authority takes any action, or raises any objection, that prevents Client from importing, exporting, purchasing, or selling the Product.  But if this occurs, Client must still fulfill all of its obligations under Section 8.4 below and under any Capital Equipment Agreement regarding the Product.

(d)Patheon may terminate this Agreement or a Product Agreement upon six months' prior written notice if Client assigns under Section 13.6 any of its rights under this Agreement or a Product Agreement to an assignee that, in the opinion of Patheon acting reasonably, is a Patheon Competitor or is not a creditworthy substitute for Client.

	
8.3
	
Product Discontinuation.

Client will use reasonable efforts to give Patheon at least [**] advance written notice if it intends to no longer order Manufacturing Services for a Product due to the Product's discontinuance in the market.

	
8.4
	
Obligations on Termination.

	
 
	
(a)
	
If a Product Agreement is completed, expires, or is terminated in whole or in part for any reason, then:

	
 
	
(i)
	
Subject to Article 6, Client will take delivery of and pay for all undelivered Products that are manufactured and/or packaged under a Firm Order in accordance with this Agreement, at the Price in effect at the time the Firm Order was placed;

	
 
	
(ii)
	
Client will purchase, at Patheon's cost (including all costs incurred by Patheon for the purchase and handling of the Inventory), the Inventory applicable to the Products which was purchased, produced or maintained by Patheon as reasonably necessary to fill Firm Orders or in accordance with Section 5.2;

	
 
	
(iii)
	
Client will satisfy the purchase price payable under Patheon's orders with suppliers of Components, if the orders were made by Patheon in reliance on Firm Orders or in accordance with Section 5.2; 

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Master Manufacturing Services Agreement

	
 
	
(iv)
	
Client acknowledges that no Patheon Competitor will be permitted access to the Manufacturing Site; and 

	
 
	
(v)
	
Client will make commercially reasonable efforts, at its own expense, to remove from Patheon site(s), within [**] days, all unused Active Material and Client-Supplied Components, all applicable Inventory and Materials (whether current or obsolete), supplies, undelivered Product, chattels, equipment or other moveable property owned by Client, related to the Agreement and located at a Patheon site or that is otherwise under Patheon’s care and control (“Client Property”).  If Client fails to remove the Client Property within [**] days following the completion, termination, or expiration of the Product Agreement, Client will pay Patheon $[**] / EUR [**] per pallet, per month, one pallet minimum (except that Client will pay $[**] / EUR [**] per pallet, per month, one pallet minimum, for any of the Client Property that contains controlled substances, requires refrigeration or other special storage requirements) thereafter for storing the Client Property and will assume any third party storage charges invoiced to Patheon regarding the Client Property.  Patheon will invoice Client for the storage charges as set forth in Section 5.5 of this Agreement.

	
 
	
(b)
	
Upon Client’s request Patheon shall reasonably assist Client for a reasonable period of time in the transfer of the manufacture to a Third Party, including providing all Product data and any non-Confidential Information regarding the manufacturing process provided that Client will reimburse Patheon for its fees and all documented costs and out-of-pocket expenses incurred in connection with such assistance (Patheon would provide a quotation for the services that Client requires pursuant to this Section 8.4(b) and on acceptance by Client of the same and signature by the parties, Patheon will provide the services stated therein.  

	
 
	
(c)
	
Any completion, termination or expiration of this Agreement or a Product Agreement will not affect any accrued rights or outstanding obligations or payments due prior to the completion, termination or expiration, nor will it prejudice any other remedies that the parties may have under this Agreement or a Product Agreement or any related Capital Equipment Agreement.  For greater certainty, completion, termination or expiration of this Agreement or of a Product Agreement for any reason will not affect the obligations and responsibilities of the parties under Articles 10 and 11 and Sections 5.4, 5.5, 8.4, 13.1, 13.2, 13.3, 13.16 and 13.17, all of which survive any completion, termination or expiration. 

ARTICLE 9 

REPRESENTATIONS, WARRANTIES AND COVENANTS

	
9.1
	
Authority.

Each party covenants, represents, and warrants that it has the full right and authority to enter into this Agreement and that it is not aware of any impediment that would inhibit its ability to perform its obligations hereunder.

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Master Manufacturing Services Agreement

	
9.2
	
Client Warranties.

Client covenants, represents, and warrants that:

	
 
	
(a)
	
Non-Infringement.

	
 
	
(i)
	
the Specifications for each of the Products are its or its Affiliate's property and that Client may lawfully disclose the Specifications to Patheon;

	
 
	
(ii)
	
any Client Intellectual Property, used by Patheon in performing the Manufacturing Services according to the Specifications (A) is Client’s or its Affiliate's property or Client or its Affiliate otherwise has a right to use such Client Intellectual Property, and (B) to the knowledge of Client, does not infringe any Third Party Rights;

	
 
	
(iii)
	
the performance of the Manufacturing Services by Patheon for any Product under this Agreement or any Product Agreement or the use or other disposition of any Product by Patheon as may be required to perform its obligations under this Agreement or under any Product Agreement does not knowingly infringe any Third Party Rights;

	
 
	
(iv)
	
there are no actions or other legal proceedings involving the Client that concerns the infringement of Third Party Rights related to any of the Specifications, or any of the Active Materials and the Components, or the sale, use, or other disposition of any Product made in accordance with the Specifications;

	
 
	
(b)
	
Quality and Compliance.

	
 
	
(i)
	
the Specifications for all Products conform to all applicable cGMPs and Applicable Laws; 

	
 
	
(ii)
	
the Products, after approval, and if labelled and manufactured in accordance with the Specifications and in compliance with applicable cGMPs and Applicable Laws may be lawfully sold and distributed in every jurisdiction in which Client markets the Products;

	
 
	
(iii)
	
on the date of shipment, the API will conform to the specifications for the API that Client has given to Patheon and that the API will be adequately contained, packaged, and labelled and will conform to the affirmations of fact on the container. 

	
9.3
	
Patheon Warranties.

Patheon covenants, represents, and warrants that:

	
 
	
(a)
	
it will perform the Manufacturing Services in accordance with this Agreement, the Specifications, Master Batch Record, cGMPs, and Applicable Laws; 

	
 
	
(b)
	
all Product Patheon delivers to Client pursuant to this Agreement shall be transferred to Client free and clear of any liens or encumbrances of any kind provided that Client pays all invoices in accordance with Section 5.5;

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Master Manufacturing Services Agreement

	
 
	
(c)
	
all Product Patheon delivers to Client pursuant to this Agreement shall, at the time of delivery, not be adulterated or misbranded as a result of a failure by Patheon to perform the Manufacturing Services in accordance with this Agreement, the Specifications, cGMPs and Applicable Laws within the meaning of adulterated or misbranded as set out in the United States Federal Food, Drug, and Cosmetic Act or within the meaning of all Applicable Law in which the definitions of adulteration and misbranding are substantially the same as those contained in United States Federal Food, Drug, and Cosmetic Act, as such act and such laws are constituted and effective at the time of delivery, and will not be an article which may not under the provisions of Sections 404 and 505 of the United States Federal Food, Drug, and Cosmetic Act be introduced into interstate commerce as a result of a failure by Patheon to perform the Manufacturing Services in accordance with this Agreement, the Specifications, cGMPs and Applicable Laws;

	
 
	
(d)
	
it has obtained and will remain in compliance with during the term of this Agreement, all permits, licenses and other authorizations which are required under federal, state and local laws, rules and regulations applicable to the Manufacturing Services at the Manufacturing Site;

	
 
	
(e)
	
any Patheon Intellectual Property used by Patheon to perform the Manufacturing Services (i) is Patheon’s or its Affiliate's property or Patheon or its Affiliate otherwise has a right to use such Patheon Intellectual Property, and (ii) to the knowledge of Patheon does not infringe any Third Party Rights.  In its performance of its obligations under this Agreement, Patheon will not knowingly incorporate into the manufacturing process any Third Party Rights for which it does not have a license that permits it to do so and/or to be able to grant to Client the licenses and other rights otherwise required to be granted to Client hereunder;

	
 
	
(f)
	
Patheon’s performance of its obligations under this Agreement will not result in a material violation or breach of any agreement, contract, commitment or obligation to which Patheon is a party or by which it is bound and will not conflict with or constitute a default under its corporate charter or bylaws;

	
 
	
(g)
	
it will not in the performance of its obligations under this Agreement use the services of any person it knows is debarred or suspended under 21 U.S.C. §335(a) or (b); and

	
 
	
(h)
	
it does not currently have, and it will not hire, as an officer or an employee any person whom it knows has been convicted of a felony under the laws of the United States for conduct relating to the regulation of any drug product under the United States Federal Food, Drug, and Cosmetic Act.

	
9.4
	
Permits.

	
 
	
(a)
	
Client will be solely responsible for obtaining or maintaining, on a timely basis, any permits or other regulatory approvals for the Products or the Specifications, including, without limitation, all marketing and post-marketing approvals.

	
 
	
(b)
	
Patheon will be solely responsible for and will maintain at all relevant times all governmental permits, licenses, approval, and authorities required to enable it to lawfully and properly perform the Manufacturing Services and operate the Manufacturing Site.

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Master Manufacturing Services Agreement

	
9.5
	
No Warranty.

NEITHER PARTY MAKES ANY WARRANTY OR CONDITION OF ANY KIND, EITHER EXPRESSED OR IMPLIED, BY FACT OR LAW, OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS AGREEMENT.  NEITHER PARTY MAKES ANY WARRANTY OR CONDITION OF FITNESS FOR A PARTICULAR PURPOSE NOR ANY WARRANTY OR CONDITION OF MERCHANTABILITY FOR THE PRODUCTS.

ARTICLE 10 

REMEDIES AND INDEMNITIES

	
10.1
	
Consequential and Other Damages.

Except with respect to a breach of the confidentiality and non-use obligations of Article 11, under no circumstances whatsoever will either party be liable to the other in contract, tort, negligence, breach of statutory duty, or otherwise for (i) any (direct or indirect) loss of profits, of production, of anticipated savings, of business, or goodwill or (ii) any reliance damages, including but not limited to costs or expenditures incurred to evaluate the viability of entering into this Agreement or to prepare for performance under this Agreement, or (iii) for any other liability, damage, costs, or expense of any kind incurred by the other party of an indirect or consequential nature, including regardless of any notice of the possibility of these damages.

	
10.2
	
Limitation of Liability.

(a)Active Materials.  Except as expressly set forth in Section 2.2, under no circumstances will Patheon be responsible for any loss or damage to the Active Materials.  Patheon’s maximum responsibility for loss or damage to the Active Materials will not exceed the Maximum Credit Value set forth in Schedule D of a Product Agreement.

(b)Defective or Recalled Product. Patheon’s maximum aggregate liability to Client for any obligation to (i) refund, offset or replace any defective Product under Section 6.3(a) or (ii) replace any recalled Products under Section 6.3(b), will not exceed [**]% of the Price for the defective or recalled Product as applicable.  This Section 10.2(b) will not be subject to Section 10.2(c).

(c)Maximum Liability.  Except as stated in Section 10.2(b), Patheon’s maximum aggregate liability to Client in any Year under this Agreement or any Product Agreement for any reason whatsoever, including, without limitation, any liability arising under Section 6.3(b) relating to the expenses of a Recall or Product return, Section 2.2 or Section 10.3 hereof or resulting from any and all breaches of its representations, warranties, or any other obligations under this Agreement or any Product Agreement (but excluding Patheon’s obligations described in Section 10.2(b)) will not exceed on a per Product basis [**]% of the revenue paid by Client to Patheon (and its Affiliates) per Year under the applicable Product Agreement during the Year in which the underlying event occurred that gave rise to the liability (e.g. the date of the incident or manufacture). 

(d)Death, Personal Injury and Fraudulent Misrepresentation.  Nothing contained in this Agreement shall act to exclude or limit either party’s liability for personal injury or death caused by the negligence of either party or fraudulent misrepresentation.

	
10.3
	
Patheon Indemnity.

Patheon agrees to defend, indemnify and hold harmless Client, its Affiliates and each of their officers, employees, and agents (“Client Indemnitees”) against all losses, damages, costs, claims, 

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Master Manufacturing Services Agreement

demands, judgments and liability to, from and in favour of Third Parties resulting from or arising out of: (i) any claim of personal injury or property damage to the extent that the injury or damage is the result of the negligence or wilful misconduct of any Patheon Indemnitee; or (ii) any claim of personal injury or property damage to the extent that the injury or damage is the result of a breach of this Agreement by Patheon, including a failure by Patheon to perform the Manufacturing Services in accordance with the Specifications, cGMPs, and Applicable Laws , except to the extent that the losses, damages, costs, claims, demands, judgments, and liability are due to the negligence or wrongful act(s) of any Client Indemnitee. 

	
10.4
	
Client Indemnity.

Client agrees to defend, indemnify and hold harmless Patheon, its Affiliates and each of their officers, employees, and agents (“Patheon Indemnitees”) against all losses, damages, costs, claims, demands, judgments and liability to, from and in favour of Third Parties  resulting from, or relating to (i) any claim of infringement or alleged infringement of any Third Party Rights arising from the manufacture, storage, promotion, labeling, marketing, distribution, use or sale of Product, or (ii) any claim of personal injury or property damage to the extent that the injury or damage arises other than from a breach of the relevant agreement by Patheon, including, without limitation, any representation or warranty contained herein, except to the extent that the losses, damages, costs, claims, demands, judgments, and liability are due to the negligence or wrongful act(s) of any Patheon Indemnitee. 

	
10.5
	
Indemnification Procedure.

A party that makes a claim for indemnification under this Article 10 shall promptly notify the other party (the “Indemnitor”) in writing of any action, claim or other matter in respect of which such party, intends to claim such indemnification; provided, however, that failure to provide such notice within a reasonable period of time shall not relieve the Indemnitor of any of its obligations hereunder except to the extent the Indemnitor is prejudiced by such failure.  The indemnified party shall permit the Indemnitor, at its discretion, to settle any such action, claim or other matter, and the indemnified party agrees to the complete control of such defense or settlement by the Indemnitor.  Notwithstanding the foregoing, the Indemnitor shall not enter into any settlement that would adversely affect the indemnified party’s rights hereunder, or impose any obligations on the indemnified party in addition to those set forth herein, in order for it to exercise such rights, without the indemnified party’s prior written consent, which shall not be unreasonably withheld or delayed. No such action, claim or other matter shall be settled without the prior written consent of the Indemnitor, which shall not be unreasonably withheld or delayed.  The indemnified party shall fully cooperate with the Indemnitor and its legal representatives in the investigation and defense of any action, claim or other matter covered by the indemnification obligations of this Article 10. The indemnified party shall have the right, but not the obligation, to be represented in such defense by counsel of its own selection and at its own expense.

	
10.6
	
Reasonable Allocation of Risk.

This Agreement (including, without limitation, this Article 10) is reasonable and creates a reasonable allocation of risk for the relative profits the parties each expect to derive from the Products.  Patheon assumes only a limited degree of risk arising from the manufacture, distribution, and use of the Products because Client has developed and holds the marketing approval for the Products, Client requires Patheon to manufacture and label the Products strictly in accordance with the Specifications, and Client, not Patheon, is best positioned to inform and advise potential users about the circumstances and manner of use of the Products.  

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Master Manufacturing Services Agreement

ARTICLE 11 

CONFIDENTIALITY

	
11.1
	
Confidential Information.

“Confidential Information” means any non-public information disclosed by the Disclosing Party to the Recipient (whether disclosed in oral, written, electronic or visual form) that is confidential or proprietary including, without limitation, information relating to the Disclosing Party’s patent and trademark applications, process designs, process models, drawings, plans, designs, data, databases and extracts therefrom, formulae, methods, know-how and other intellectual property, its clients or client confidential information, finances, marketing, products and processes and all price quotations, manufacturing or professional services proposals, information relating to composition, proprietary technology, and all other information relating to manufacturing capabilities and operations.  In addition, all analyses, compilations, studies, reports or other documents prepared by any party's Representatives containing the Confidential Information will be considered Confidential Information. Samples or materials provided hereunder as well as any and all information derived from the approved analysis of the samples or materials will also constitute Confidential Information. The terms of this Agreement shall be deemed the Confidential Information of both parties. For the purposes of this ARTICLE 11, a party or its Representative receiving Confidential Information under this Agreement is a “Recipient,” and a party or its Representative disclosing Confidential Information under this Agreement is the “Disclosing Party.”

	
11.2
	
Use of Confidential Information. 

The Recipient will use the Confidential Information of the Disclosing Party solely for the purpose of meeting its obligations under this Agreement or exercising its rights under this Agreement.  The Recipient will keep the Confidential Information of the Disclosing Party confidential and will not disclose such Confidential Information to any Third Party in any manner whatsoever, in whole or in part, other than to those of its Representatives who (i) have a need to know the Confidential Information for the purpose of this Agreement; (ii) have been advised of the confidential nature of the Confidential Information and (iii) have obligations of confidentiality and non-use to the Recipient no less restrictive than those of this Agreement.  Recipient will protect the Confidential Information of the Disclosing Party disclosed to it hereunder by using reasonable precautions to prevent the unauthorized disclosure, dissemination or use of such Confidential Information, which precautions will in no event be less than those exercised by Recipient with respect to its own confidential or proprietary information of a similar nature.

	
11.3
	
Exclusions.

The obligations of confidentiality and non-use will not apply to the extent that the Recipient can establish that the information:  

(a)is or becomes publicly known through no breach of this Agreement or fault of the Recipient or its Representatives;

(b)is in the Recipient's possession at the time of disclosure by the Disclosing Party other than as a result of the Recipient's breach of any legal obligation;

(c)is or becomes known to the Recipient on a non-confidential basis through disclosure by sources, other than the Disclosing Party, having the legal right to disclose the Confidential Information, provided that the other source is not known by the Recipient to be bound by any obligations (contractual, legal, fiduciary, or otherwise) of confidentiality to the Disclosing Party with respect to the Confidential Information;

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Master Manufacturing Services Agreement

(d)is independently developed by the Recipient without use of or reference to the Disclosing Party's Confidential Information as evidenced by Recipient’s contemporaneous written records; or

(e)is expressly authorized for release by the written authorization of the Disclosing Party.

Any combination of information which comprises part of the Confidential Information is not exempt from the obligations of confidentiality merely because individual parts of that Confidential Information were publicly known, in the Recipient’s possession, or received by the Recipient, unless the combination itself was publicly known, in the Recipient’s possession, or received by the Recipient.

	
11.4
	
Photographs and Recordings.

Neither party will take any photographs or videos of the other party’s facilities, equipment or processes, nor use any other audio or visual recording equipment (such as camera phones) while at the other party’s facilities, without that party’s express written consent; provided, however, that Client may photograph or video the Product at any Patheon facility provided that any photograph or video is treated as Confidential Information of Patheon.

	
11.5
	
Permitted Disclosure; Publicity.

(a)Notwithstanding any other provision of this Agreement, the Recipient may disclose Confidential Information of the Disclosing Party to the extent required, as advised by counsel, in response to a valid order of a court or other governmental body or as required by law, regulation or stock exchange rule; provided that (i) the Recipient will advise the Disclosing Party in advance of the disclosure to the extent practicable and permissible by the order, law, regulation or stock exchange rule and any other applicable law, (ii) will reasonably cooperate with the Disclosing Party, at the Disclosing Party’s expense, if required, in seeking an appropriate protective order or other remedy, and (iii) will otherwise continue to perform its obligations of confidentiality set out herein.  If any public disclosure is required by law, the parties will consult concerning the form of announcement prior to the public disclosure being made.

(b)All publicity, press releases and other announcements relating to this Agreement shall be reviewed in advance by, and subject to the approval of, both parties (which approval shall not be unreasonably withheld); provided, however, that either party may, to the extent required (i) disclose the terms of this Agreement (with appropriate redactions as described below) insofar as required to comply with applicable securities laws, provided that in the case of such disclosures the Party proposing to make such disclosure notifies the other Party reasonably in advance of such disclosure and cooperates to minimize the scope and content of such disclosure, and (ii) disclose the terms of this Agreement to such party’s professional advisors or existing or potential licensees, investors, acquirers, or merger candidates who are bound by obligations of confidentiality and non-use consistent with those set forth herein.  The failure of a Party to respond in writing to a publication proposal from the other party within [**] working days of such party’s receipt of such publication shall be deemed as such party’s approval of such publication as received by such party.  Each party agrees that it shall cooperate fully and in a timely manner with the other with respect to any disclosures to the Securities and Exchange Commission and any other governmental or regulatory agencies, including requests for confidential treatment of Confidential Information of either party included in any such disclosure.  For each such disclosure, (a) the filing party will provide the other party at least [**] business days to review a draft redacted version of this Agreement, and (b) both Parties shall work together in good faith to agree on the disclosure to be made, having due and proper regard to their legal obligations; provided that the filing party shall ultimately retain control over what information to disclose to any securities authority or stock exchange. Each filing party shall use reasonable efforts to seek confidential treatment for terms proposed to be redacted.

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Master Manufacturing Services Agreement

	
11.6
	
Marking.

The Disclosing Party agrees to use reasonable efforts to summarize in writing the content of any oral disclosure or other non-tangible disclosure of its Confidential Information within [**] days of the disclosure, but failure to provide this summary will not affect the nature of the Confidential Information disclosed if the Confidential Information was identified as confidential or proprietary when disclosed orally or in any other non-tangible form. 

	
11.7
	
Return of Confidential Information.

Upon the written request of the Disclosing Party, the Recipient will promptly return the Confidential Information to the Disclosing Party or, if the Disclosing Party directs, destroy all Confidential Information disclosed in or reduced to tangible form including any copies thereof and any summaries, compilations, analyses or other notes derived from the Confidential Information except for one copy which may be maintained by the Recipient for its records.  The retained copy will remain subject to all confidentiality provisions contained in this Agreement.

	
11.8
	
Remedies.

The parties acknowledge that monetary damages may not be sufficient to remedy a breach by either party of this Agreement and agree that the non-breaching party will be entitled to seek specific performance, injunctive and/or other equitable relief to prevent breaches of this Agreement and to specifically enforce the provisions hereof in addition to any other remedies available at law or in equity. These remedies will not be the exclusive remedies for breach of this Agreement but will be in addition to any and all other remedies available at law or in equity.

	
11.9
	
Confidentiality Term.  

All obligations of confidentiality and non-use imposed upon the parties under this Agreement shall expire [**] years after the expiration or earlier termination of this Agreement; provided, however, that Confidential Information which constitutes the trade secrets of a party (and is labelled as a trade secret or is otherwise identified in writing as being a trade secret at the time of disclosure or within [**] days thereafter) shall be kept confidential indefinitely, subject to the limitations set forth in Sections 11.3 and 11.5.

ARTICLE 12 

DISPUTE RESOLUTION

	
12.1
	
Commercial Disputes.

(a)If any dispute arises out of this Agreement or any Product Agreement (other than a dispute under Section 6.1(b) or a Technical Dispute, as defined herein), the parties will first try to resolve it amicably.  In that regard, any party may send a notice of dispute to the other, and each party will appoint, within [**] Business Days from receipt of the notice of dispute, a single representative having full power and authority to resolve the dispute.  The representatives will meet as necessary in order to resolve the dispute.  If the representatives fail to resolve the matter within [**] from their appointment, or if a party fails to appoint a representative within the [**] Business Day period set forth above, the dispute will immediately be referred to the Chief Operating Officer (or another officer as he/she may designate) of each party who will meet and discuss as necessary to try to resolve the dispute amicably within [**] days of referral of the matter to the Chief Operating Officer or his/her designee.  Should the parties fail to reach a resolution under this Section 12.1(a), the dispute will be referred to a court of competent jurisdiction in accordance with Section 13.17.

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Master Manufacturing Services Agreement

	
12.2
	
Technical Dispute Resolution.

If a dispute arises (other than disputes under Sections 6.1(b) or 12.1) between the parties that is exclusively related to technical aspects of the manufacturing, packaging, labelling, quality control testing, handling, storage, or other activities under this Agreement (a "Technical Dispute"), the parties will make reasonable efforts to resolve the dispute by amicable negotiations.  In that regard, senior representatives of each party will, as soon as possible and in any event no later than [**] Business Days after a written request from either party to the other, meet in good faith to resolve any Technical Dispute.  If, despite this meeting, the parties are unable to resolve a Technical Dispute within a reasonable time, and in any event within [**] Business Days of the written request, the Technical Dispute will, at the request of either party, be referred for determination to an expert in accordance with Exhibit A.  If the parties cannot agree that a dispute is a Technical Dispute, Section 12.1 will prevail.  For greater certainty, the parties agree that the release of the Products for sale or distribution under the applicable marketing approval for the Products will not by itself indicate compliance by Patheon with its obligations for the Manufacturing Services and further that nothing in this Agreement (including Exhibit A) will remove or limit the authority of the relevant qualified person (as specified by the Quality Agreement) to determine whether the Products are to be released for sale or distribution.

ARTICLE 13 

MISCELLANEOUS

	
13.1
	
Inventions.

(a)For the term of this Agreement, Client hereby grants to Patheon a non-exclusive, paid-up, royalty-free, non-transferable license of Client’s Intellectual Property which Patheon must use in order to perform the Manufacturing Services for Client in accordance with this Agreement.

(b)All Client Intellectual Property will be the exclusive property of Client.  Patheon hereby assigns, and to the extent it cannot presently assign, will assign, to Client all of Patheon’s and its Affiliates’ worldwide right, title and interest, if any, in Client Intellectual Property.  Patheon shall provide reasonable assistance to Client in securing for Client any patents, copyrights or other proprietary rights in such Client Intellectual Property, and shall take such reasonable actions and execute such documents as Client may reasonably request in connection with providing such assistance or otherwise to vest in Client all right, title and interest in such Inventions, including without limitation any and all applications, assignments or other instruments each of the foregoing at the cost of Client.

(c)All Patheon Intellectual Property will be the exclusive property of Patheon. Patheon hereby grants to Client a perpetual, irrevocable, non-exclusive, paid-up, royalty-free, transferable license to use the Patheon Intellectual Property used by Patheon to perform the Manufacturing Services to enable Client to manufacture the Product(s). 

(d)Each party will be solely responsible for the costs of filing, prosecution, and maintenance of patents and patent applications on its own Inventions.

(e)Patheon will give the Client written notice, as promptly as practicable, of all Inventions which can reasonably be deemed to constitute improvements or other modifications of the Products or processes or technology owned or otherwise controlled by Client  .   

	
13.2
	
Intellectual Property.

Neither party has, nor will it acquire, any interest in any of the other party’s Intellectual Property unless otherwise expressly agreed to in writing.  Neither party will use any Intellectual Property of the other party, except as specifically authorized by the other party or as required for the performance of its obligations under this Agreement.

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Master Manufacturing Services Agreement

	
13.3
	
Insurance.

Each party will maintain commercial general liability insurance, including blanket contractual liability insurance covering the obligations of that party under this Agreement through the term of this Agreement and for a period of [**] thereafter.  This insurance will have policy limits of not less than (i) EUR [**] for each occurrence for personal injury or property damage liability; and (ii) EUR [**] in the aggregate per annum for product and completed operations liability.  If requested, each party will give the other a certificate of insurance evidencing the above and showing the name of the issuing company, the policy number, the effective date, the expiration date, and the limits of liability. If a party is unable to maintain the insurance policies required under this Agreement through no fault of its own, then the party will forthwith notify the other party in writing and the parties will in good faith negotiate appropriate amendments to the insurance provision of this Agreement in order to provide adequate assurances.

	
13.4
	
Independent Contractors.

The parties are independent contractors and this Agreement and any Product Agreement will not be construed to create between Patheon and Client any other relationship such as, by way of example only, that of employer-employee, principal agent, joint-venturer, co-partners, or any similar relationship, the existence of which is expressly denied by the parties.

	
13.5
	
No Waiver.

Either party's failure to require the other party to comply with any provision of this Agreement or any Product Agreement will not be deemed a waiver of the provision or any other provision of this Agreement or any Product Agreement.

	
13.6
	
Assignment.

	
 
	
(a)
	
Patheon may not assign this Agreement or any Product Agreement or any of its associated rights or obligations without the written consent of Client. Further it is specifically agreed that Patheon may subcontract any part of the Manufacturing Services under a Product Agreement to any of its Affiliates; provided that such Affiliate is identified in the applicable Product Agreement.  Patheon will remain solely liable to Client for its obligations under this Agreement, and for the obligations of the applicable Affiliate of Patheon under the Quality Agreement, if the Manufacturing Services are subcontracted.

	
 
	
(b)
	
Subject to Section 8.2(d), Client may assign this Agreement or any Product Agreement or any of its associated rights or obligations without approval from Patheon.  But Client will give Patheon prior written notice of any assignment, any assignee will covenant in writing with Patheon to be bound by the terms of this Agreement or the Product Agreement.  Client may not perform any partial assignment of this Agreement or any Product Agreement or any of its associated rights or obligations to more than [**] assignees without the consent of Patheon (with assignment to the first [**] assignees not requiring the consent of Patheon).

	
 
	
(c)
	
Despite the foregoing provisions of this Section 13.6, either party may assign this Agreement or any Product Agreement to any of its Affiliates or to a successor to or purchaser of all or substantially all of its business; provided that the assignee agrees to be bound by the terms of this Agreement, the Quality and the Product Agreement, as applicable.

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Master Manufacturing Services Agreement

	
13.7
	
Force Majeure.

Neither party will be liable for the failure to perform its obligations under this Agreement or any Product Agreement if the failure is caused by an event beyond that party's reasonable control, including, but not limited to, strikes or other labor disturbances, lockouts, riots, quarantines, communicable disease outbreaks, wars, acts of terrorism, fires, floods, storms, interruption of or delay in transportation, defective equipment, lack of or inability to obtain fuel, power or components, or compliance with any order or regulation of any government entity acting within colour of right (a "Force Majeure Event").  A party claiming a right to excused performance under this Section 13.7 will immediately notify the other party in writing of the extent of its inability to perform, which notice will specify the event beyond its reasonable control that prevents the performance.  Neither party will be entitled to rely on a Force Majeure Event to relieve it from an obligation to pay money (including any interest for delayed payment) which would otherwise be due and payable under this Agreement or any Product Agreement.  If Patheon becomes subject to a Force Majeure Event which interferes with production of the Product at the Manufacturing Site for more than 30 days, the parties shall mutually agree on implementation of an agreed-upon action plan to transfer production of the Product to another Patheon plant or location at Client’s cost. The parties shall, after the execution of this Agreement and at the request of either party, meet to discuss and define such an action plan.

	
13.8
	
Additional Product.

Additional Products may be added to, or existing Products deleted from, any Product Agreement by amendments to the Product Agreement including Schedules A, B, C, and D as applicable.

	
13.9
	
Notices.

Unless otherwise agreed in a Product Agreement, any notice, approval, instruction or other written communication required or permitted hereunder will be sufficient if made or given to the other party by personal delivery, by telecopy, facsimile communication, or confirmed receipt email or by sending the same by first class mail, postage prepaid to the respective addresses, telecopy or facsimile numbers or electronic mail addresses set forth below:

If to Client:

Tetraphase Pharmaceuticals, Inc.

480 Arsenal Way

Watertown

Massachusetts 02472

USA

 

Attention: General Counsel

Facsimile No.: [**]

Email address: [**]

If to Patheon:

Patheon UK Limited

Kingfisher Drive

Covingham

Swindon Wiltshire SN3 5BZ

England

 

Attention: Legal Director

Email address: [**] 

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Master Manufacturing Services Agreement

 

or to any other addresses, telecopy or facsimile numbers or electronic mail addresses given to the other party in accordance with the terms of this Section 13.9.  Notices or written communications made or given by personal delivery, telecopy, facsimile, or electronic mail will be deemed to have been sufficiently made or given when sent (receipt acknowledged), or if mailed, five days after being deposited in the United States, Canada, or European Union mail, postage prepaid or upon receipt, whichever is sooner.

	
13.10
	
Severability.

If any provision of this Agreement or any Product Agreement is determined by a court of competent jurisdiction to be invalid, illegal, or unenforceable in any respect, that determination will not impair or affect the validity, legality, or enforceability of the remaining provisions, because each provision is separate, severable, and distinct.  With respect to any such invalid, illegal, or unenforceable provision, the parties shall consult and use their best efforts to agree upon a valid and enforceable provision which shall be a reasonable substitute for such invalid, illegal, or unenforceable provision in light of the intent of this Agreement.  

	
13.11
	
Entire Agreement.

This Agreement, together with the applicable Product Agreement and the Quality Agreement, constitutes the full, complete, final and integrated agreement between the parties relating to the subject matter hereof and supersedes all previous written or oral negotiations, commitments, agreements, transactions, or understandings concerning the subject matter hereof.  Any modification, amendment, or supplement to this Agreement or any Product Agreement must be in writing and signed by authorized representatives of both parties.  In case of conflict, the prevailing order of documents will be this Agreement, the Product Agreement, and the Quality Agreement.  

	
13.12
	
Other Terms.

No terms, provisions or conditions of any purchase order or other business form or written authorization used by Client or Patheon will have any effect on the rights, duties, or obligations of the parties under or otherwise modify this Agreement or any Product Agreement, regardless of any failure of Client or Patheon to object to the terms, provisions, or conditions unless the document specifically refers to this Agreement or the applicable Product Agreement and is signed by both parties.

	
13.13
	
No Third Party Benefit or Right.

For greater certainty, nothing in this Agreement or any Product Agreement will confer or be construed as conferring on any Third Party any benefit or the right to enforce any express or implied term of this Agreement or any Product Agreement.

	
13.14
	
Execution in Counterparts.

This Agreement and any Product Agreement may be executed in two or more counterparts, by original, facsimile or “pdf” signature, each of which will be deemed an original, but all of which together will constitute one and the same instrument.

	
13.15
	
Use of Client Name.

Patheon will not make any use of Client’s name, trademarks or logo or any variations thereof, alone or with any other word or words, without the prior written consent of Client.  

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Master Manufacturing Services Agreement

	
13.16
	
Taxes. 

(a)The Client will bear all taxes, duties, levies and similar charges (and any related interest and penalties) ("Tax" or "Taxes"), however designated, imposed as a result of the provision by the Patheon of Services under this Agreement, except:

	
 
	
(i)
	
any Tax based on net income or gross income that is imposed on Patheon by its jurisdiction of formation or incorporation ("Resident Jurisdiction");

	
 
	
(ii)
	
any Tax based on net income or gross income that is imposed on Patheon by jurisdictions other than its Resident Jurisdiction; and

	
 
	
(iii)
	
any Tax that is recoverable by Patheon in the ordinary course of business for purchases made by Patheon in the course of providing its Services, such as Value Added Tax (as more fully defined in subparagraph (d) below), Goods & Services Tax ("GST") and similar taxes. 

(b)If the Client is required to bear a tax, duty, levy or similar charge under this Agreement by any state, federal, provincial or foreign government, including, but not limited to, Value Added Tax, the Client will pay the tax, duty, levy or similar charge and any additional amounts to the appropriate taxing authority as are necessary to ensure that the net amounts received by Patheon hereunder after all such payments or withholdings equal the amounts to which Patheon is otherwise entitled under this Agreement as if the tax, duty, levy or similar charge did not exist.  The parties will cooperate reasonably in completing and filing documents required under the provisions of any applicable tax laws or under any other applicable law, in connection with the making of any required tax payment or withholding payment, or in connection with any claim to a refund of or credit for any such payment. The parties will cooperate to minimize such taxes in accordance with applicable laws.

(c)Patheon will not collect an otherwise applicable tax if the Client's purchase is exempt from Patheon's collection of the tax and a valid tax exemption certificate is furnished by the Client to Patheon. 

(d)If Section 13.16 (a)(iii) does not apply, any payment due under this Agreement for the provision of Services to the Client by Patheon is exclusive of value added taxes, turnover taxes, sales taxes or similar taxes, including any related interest and penalties (hereinafter all referred to as "VAT"). If any VAT is payable on a Service supplied by Patheon to the Client under this Agreement, this VAT will be added to the invoice amount and will be for the account of (and reimbursable to Patheon by) the Client. If VAT on the supplies of Patheon is payable by the Client under a reverse charge procedure (i.e., shifting of liability, accounting or payment requirement to recipient of supplies), the Client will ensure that Patheon will not effectively be held liable for this VAT by the relevant taxing authorities or other parties. Where applicable, Patheon will ensure that its invoices to the Client are issued in such a way that these invoices meet the requirements for deduction of input VAT by the Client, if the Client is permitted by law to do so.

(e)Any Tax that Client pays, or is required to pay, but which Client believes should properly be paid by Patheon pursuant hereto may not be offset against sums due by Client to Patheon whether due pursuant to this Agreement or otherwise.

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Master Manufacturing Services Agreement

	
13.17
	
Governing Law.

This Agreement and any Product Agreement, unless otherwise agreed by the parties in the Product Agreement and then only for the purposes of that Product Agreement, will be construed and enforced in accordance with the laws of the State of Delaware and subject to the exclusive jurisdiction of the courts thereof.  The parties expressly waive their respective rights to a jury trial in respect of any matter relating to this Agreement or its formation.  The UN Convention on Contracts for the International Sale of Goods will not apply to this Agreement. 

[Signature page to follow]

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Master Manufacturing Services Agreement

IN WITNESS WHEREOF, the duly authorized representatives of the parties have executed this Agreement as of the Effective Date.

 

	
 
	
PATHEON UK LIMITED

	
 
	
 
	
 

	
 
	
By:
	
/s/ Nick Plummer

	
 
	
Name:
	
Nick Plummer

	
 
	
Title:
	
Director & Company Secretary

	
 
	
 
	
 

	
 
	
TETRAPHASE PHARMACEUTICALS, INC.

	
 
	
 
	
 

	
 
	
By:
	
/s/ Guy Macdonald

	
 
	
Name:
	
Guy Macdonald

	
 
	
Title:
	
CEO

 

 

 

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Master Manufacturing Services Agreement

APPENDIX 1

FORM OF PRODUCT AGREEMENT

(Includes Schedules A to D)

PRODUCT AGREEMENT

This Product Agreement (this “Product Agreement”) is issued under the Master Manufacturing Services Agreement dated 9 June 2017 between Patheon UK Limited and Tetraphase Pharmaceuticals, Inc. (the “Master Agreement”), and is entered into [insert effective date] (the “Effective Date”), between Patheon UK Limited [or applicable Patheon Affiliate], a corporation existing under the laws of England [or applicable founding jurisdiction for Patheon Affiliate], having a principal place of business at Kingfisher Drive, Covingham, Swindon, Wiltshire SN3 5BZ, England [or Patheon Affiliate address] (“Patheon”) and [insert Client name, legal entity, founding jurisdiction and address] (“Client”).

The terms and conditions of the Master Agreement are incorporated herein except to the extent this Product Agreement expressly references the specific provision in the Master Agreement to be modified by this Product Agreement.  All capitalized terms that are used but not defined in this Product Agreement will have the respective meanings given to them in the Master Agreement.

The Schedules to this Product Agreement are incorporated into and will be construed in accordance with the terms of this Product Agreement.

	
 
	
1.
	
Product List and Specifications (See Schedule A attached hereto)

	
 
	
2.
	
Minimum Order Quantity, Annual Volume, and Price (See Schedule B attached hereto)

	
 
	
3.
	
Annual Stability Testing and Validation Activities (if applicable) (See Schedule C attached hereto) 

	
 
	
4.
	
Active Materials, Active Materials Credit Value and Maximum Credit Value (See Schedule D attached hereto)

	
 
	
5.
	
Yearly Forecasted Volume: 

6.Territory: (insert the description of the Territory here)

	
 
	
7.
	
Manufacturing Site: 

Subcontractor: Patheon Italia SpA.  Address: 2 Trav. SX, Via Morolense 5, 03013, Ferentino, Italy

Subcontractor:  Patheon Manufacturing Services LLC.  Address: 5900 Martin Luther King Jr. Highway, Greenville, NC 27834, USA

	
 
	
8.
	
Inflation Index: pursuant to Section 4.2(a) of the Master Agreement, the inflation index is:

Italy: the Consumer Price Index, published by ISTAT.  This index is set forth at the following web address: [details to be included] 

 

Master Manufacturing Services Agreement

North America: Producer Price Index pcu325412325412 for Pharmaceutical Preparation Manufacturing (“PPI”) published by the United States Department of Labor, Bureau of Labor Statistics

	
 
	
9.
	
Currency: (if applicable under Section 1.4 of the Master Agreement) 

	
 
	
10. 
	
Initial Set Exchange Rate (if applicable – if Currency included above)

	
 
	
11.
	
Initial Product Term: (if applicable under Section 8.1 of the Master Agreement)

	
 
	
12.
	
Notices: (if applicable under Section 13.9 of the Master Agreement)

	
 
	
13.
	
Other Modifications to the Master Agreement: (if applicable under Section 1.2 of the Master Agreement)

Sole Manufacturer

Patheon shall be the sole manufacturer for at least [**]% of the volumes of the Product set out in the forecast in Schedule [  ].  With respect to those countries in the Territory that are member states of the EEA (“EEA Countries”), [**] years after the Effective Date, Client’s commitment in the preceding sentence will be reduced automatically to a commitment to purchase no more than [**]% of its requirements of Products for distribution and sale in those EEA Countries. The parties may, however, agree to extend the period of exclusivity for the EEA Countries for an additional period by mutual written consent.  

Adjustments Due to Currency Fluctuations.  [delete this section if pricing will be in Euros]

If the parties agree in this Product Agreement [Item 10 of Product Agreement] to invoice in a currency other than the local currency for the Manufacturing Site, Patheon will adjust the Price to reflect currency fluctuations.  The adjustment will be calculated after all other annual Price adjustments under this Section [   ] have been made.  The adjustment will proportionately reflect the increase or decrease, if any, in the Set Exchange Rate compared to the Set Exchange Rate established for the prior Year or the Initial Set Exchange Rate, as the case may be.  

“Initial Set Exchange Rate” means as of the Effective Date of a Product Agreement, the initial exchange rate set forth in the Product Agreement to convert one unit of the billing currency into the Patheon Manufacturing Site local currency, calculated as the daily average interbank exchange rate for conversion of one unit of the billing currency into the Patheon Manufacturing Site local currency during the 90 day period immediately preceding the Effective Date as published by OANDA.com “The Currency Site” under the heading “FxHistory: historical currency exchange rates”  at www.OANDA.com/convert/fxhistory;

“Set Exchange Rate” means the exchange rate to convert one unit of the billing currency into the Patheon Manufacturing Site local currency for each Year, calculated as the average daily interbank exchange rate for conversion of one unit of the billing currency into the Patheon Manufacturing Site local currency during the full year period (October 1st [preceding year] to September 30th) as published by OANDA.com “The Currency Site” under the heading “FxHistory: historical currency exchange rates” at www.OANDA.com/convert/fxhistory;

________________________________________

 

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Master Manufacturing Services Agreement

IN WITNESS WHEREOF, the duly authorized representatives of the parties have executed this Product Agreement as of the Effective Date set forth above.

 

	
 
	
PATHEON UK LIMITED [or applicable Patheon Affiliate]

	
 
	
 
	
 

	
 
	
By:
	
 

	
 
	
Name:
	
 

	
 
	
Title:
	
 

	
 
	
 
	
 

	
 
	
TETRAPHASE PHARMACEUTICALS, INC.

	
 
	
 
	
 

	
 
	
By:
	
 

	
 
	
Name:
	
 

	
 
	
Title:
	
 

 

 

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Master Manufacturing Services Agreement

SCHEDULE A

PRODUCT LIST AND SPECIFICATIONS

Product List

eravacycline for injection

Specifications

Prior to the start of commercial manufacturing of Product under this Agreement Client will give Patheon the originally executed copies of the Specifications as approved by the applicable Regulatory Authority.  If the Specifications received are subsequently amended, then Client will give Patheon the revised and originally executed copies of the revised Specifications.  Upon acceptance of the revised Specifications, Patheon will give Client a signed and dated receipt indicating Patheon’s acceptance of the revised Specifications.

 

 

 

Master Manufacturing Services Agreement

SCHEDULE B

MINIMUM ORDER QUANTITY, ANNUAL VOLUME, AND PRICE

 

				
	
[Insert Price Table]

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

 

Manufacturing Assumptions:

Packaging Assumptions:

Testing Assumptions:

Confidential Materials omitted and filed separately with the Securities and Exchange Commission. A total of two pages were omitted. [**]

 

Master Manufacturing Services Agreement

SCHEDULE C

ANNUAL STABILITY TESTING [and VALIDATION ACTIVITIES (if applicable)] 

Patheon and Client will agree in writing on any stability testing to be performed by Patheon on the Products.  This agreement will specify the commercial and Product stability protocols applicable to the stability testing and the fees payable by Client for this testing.

 

 

 

Master Manufacturing Services Agreement

SCHEDULE D

ACTIVE MATERIALS

 

		
	
Active Materials
	
Supplier

	
●
	
●

	
●
	
●

 

ACTIVE MATERIALS CREDIT VALUE

The Active Materials Credit Value will be as follows:

			
	
PRODUCT
	
ACTIVE MATERIALS
	
ACTIVE MATERIALS

CREDIT  VALUE

	
 
	
 
	
Client’s actual cost for Active Materials not to exceed $ / EUR_____per kilogram

	
 
	
 
	
 

 

MAXIMUM CREDIT VALUE

Patheon's liability for Active Materials calculated in accordance with Section 2.2 of the Master Agreement [for any Product] in a Year will not exceed, in the aggregate, the maximum credit value set forth below:

		
	
PRODUCT
	
MAXIMUM CREDIT VALUE

	
 
	
[**]% of revenues (being payments of the Price) per Year received by Patheon under this Product Agreement, 

	
 
	
 

 

[End of Product Agreement] 

 

Master Manufacturing Services Agreement

EXHIBIT A

TECHNICAL DISPUTE RESOLUTION

Technical Disputes which cannot be resolved by negotiation as provided in Section 12.2 will be resolved in the following manner:

1.Appointment of Expert. Within [**] Business Days after a party requests under Section 12.2 that an expert be appointed to resolve a Technical Dispute, the parties will jointly appoint a mutually acceptable independent expert with experience and expertise in the subject matter of the dispute.  If the parties are unable to so agree within the [**] Business Day period, or if there is a disclosure of a conflict by an expert under Paragraph 2 hereof which results in the parties not confirming the appointment of the expert, then an expert (willing to act in that capacity hereunder) will be appointed by an experienced arbitrator on the roster of the American Arbitration Association.

2.Conflicts of Interest.  Any person appointed as an expert will be entitled to act and continue to act as an expert even if at the time of his appointment or at any time before he gives his determination, he has or may have some interest or duty which conflicts or may conflict with his appointment if before accepting the appointment (or as soon as practicable after he becomes aware of the conflict or potential conflict) he fully discloses the interest or duty and the parties will, after the disclosure, have confirmed his appointment.

3.Not Arbitrator.  No expert will be deemed to be an arbitrator and the provisions of the American Arbitration Act or of any other applicable statute (foreign or domestic) and the law relating to arbitration will not apply to the expert or the expert's determination or the procedure by which the expert reaches his determination under this Exhibit A.

4.Procedure.  Where an expert is appointed:

	
 
	
(a)
	
Timing.  The expert will be so appointed on condition that (i) he promptly fixes a reasonable time and place for receiving representations, submissions or information from the parties and that he issues the authorizations to the parties and any relevant third party for the proper conduct of his determination and any hearing and (ii) he renders his decision (with full reasons) within [**] Business Days (or another other date as the parties and the expert may agree) after receipt of all information requested by him under Paragraph 4(b) hereof.

	
 
	
(b)
	
Disclosure of Evidence.  The parties undertake one to the other to give to any expert all the evidence and information within their respective possession or control as the expert may reasonably consider necessary for determining the matter before him which they will disclose promptly and in any event within [**] Business Days of a written request from the relevant expert to do so.

	
 
	
(c)
	
Advisors.  Each party may appoint any counsel, consultants and advisors as it feels appropriate to assist the expert in his determination and so as to present their respective cases so that at all times the parties will co-operate and seek to narrow and limit the issues to be determined.

 

 

Master Manufacturing Services Agreement

	
 
	
(d)
	
Appointment of New Expert.  If within the time specified in Paragraph 4(a) above the expert will not have rendered a decision in accordance with his appointment, a new expert may (at the request of either party) be appointed and the appointment of the existing expert will thereupon cease for the purposes of determining the matter at issue between the parties except if the existing expert renders his decision with full reasons prior to the appointment of the new expert, then this decision will have effect and the proposed appointment of the new expert will be withdrawn.

	
 
	
(e)
	
Final and Binding.  The determination of the expert will, except for fraud or manifest error, be final and binding upon the parties.

	
 
	
(f)
	
Costs.  Each party will bear its own costs for any matter referred to an expert hereunder and, in the absence of express provision in the Agreement to the contrary, the costs and expenses of the expert will be shared equally by the parties.

For greater certainty, the release of the Products for sale or distribution under the applicable marketing approval for the Products will not by itself indicate compliance by Patheon with its obligations for the Manufacturing Services and further that nothing in this Agreement (including this Exhibit A) will remove or limit the authority of the relevant qualified person (as specified by the Quality Agreement) to determine whether the Products are to be released for sale or distribution.

 

- 2 -

Master Manufacturing Services Agreement

EXHIBIT B

COMMERCIAL QUALITY AGREEMENT

Quality Agreement

Commercial Product

 

Between

 

TETRAPHASE PHARMACEUTICALS, INC.

a corporation existing under the laws of Delaware, USA

 

(“Client”)

 

-and-

 

PATHEON ITALIA S.p.A. 

a corporation existing under the laws of Italy

 

Ferentino Operations (FRT)

2° Trav. SX Via Morolense 5, 03013 Ferentino, Italy 

 

(“Patheon”)

 

Effective Date: <ENTER EFFECTIVE DATE HERE>

 

 

Master Manufacturing Services Agreement

TABLE OF CONTENTS

			
	
SECTION 1
	
BACKGROUND AND AGREEMENT
	
3

	
SECTION 2
	
RESPONSIBILITIES TABLE
	
4

	
SECTION 3
	
GENERAL
	
6

	
SECTION 4
	
DESCRIPTION OF RESPONSIBILITIES
	
7

	
SECTION 5
	
APPENDICES
	
20

	
 
	
APPENDIX A: PRODUCT(S)
	
 

	
 
	
APPENDIX B:  QUALITY CONTACTS
	
 

	
 
	
APPENDIX C:  PATHEON APPROVED VENDOR LIST
	
 

	
 
	
APPENDIX D:  CLIENT APPROVED VENDOR LIST
	
 

	
 
	
APPENDIX E:  PATHEON APPROVED CONTRACT LABORATORIES AND MANUFACTURERS LIST
	
 

	
 
	
APPENDIX F:  API STARTING MATERIAL EU REQUIREMENTS
	
 

 

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Master Manufacturing Services Agreement

Section 1:  BACKGROUND and Agreement

BACKGROUND.  Under a manufacturing services agreement dated <ENTER MSA DATE HERE> between Patheon UK Limited (the “Contract Acceptor”) and the Client (the "MSA"), the Contract Acceptor agreed to sub-contract the performance of pharmaceutical manufacturing services for certain marketed products in certain countries (as set forth in Appendix A hereto) (“Products”) to Patheon.  The parties agreed that the Contract Acceptor will remain solely liable to the Client for any breach of the duties and responsibilities assumed by Patheon under this Agreement.  The Client is required to give the Contract Acceptor certain Specifications in order for Patheon to perform the manufacturing services.  Under the MSA, the Contract Acceptor is required to ensure that Patheon operates within the Specifications and in accordance with cGMP.  The Client and Patheon, as provider of the manufacturing services on behalf of the Contract Acceptor for the benefit of the Client, desire to allocate the responsibility for procedures and Specifications impacting on the identity, strength, quality and purity of the Products by entering into this Quality Agreement (this “Agreement”).

AGREEMENT.  NOW THEREFORE in consideration of the rights conferred and the obligations assumed under the MSA and herein, and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged by each party), and intending to be legally bound, the parties agree as follows:

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Master Manufacturing Services Agreement

Section 2: Responsibilities Table

 

Patheon will be responsible for all the operations that are marked with "X" in the column titled "Patheon" and the Client will be responsible for all the operations that are marked with "X" in the column titled "Client". If marked with "(X)", cooperation is required from the designated party. If more than one Patheon site is involved the “X” representing Patheon will be replaced with the three letter acronym(s) on the title page applicable to each site.

 

	
Section No.
	
Subject / Terms
	
Client
	
Patheon

	
4.1 Quality Management

	
4.1.1
	
cGMP, Health and Safety Compliance
	
X
	
X (or PPP)

	
4.1.2
	
Client Audit Rights
	
X
	
 

	
4.1.3
	
Subcontracting
	
(X)
	
X

	
4.1.4
	
Self-Inspection
	
 
	
X

	
4.2 Regulatory Requirements

	
4.2.1
	
Permits
	
X
	
 

	
4.2.2
	
Regulatory Filing / Registration Change Control
	
X
	
(X)

	
4.2.3
	
Regulatory Compliance
	
 
	
X

	
4.2.4
	
Government Agency Inspections, Communications and Requisitions
	
(X)
	
X

	
4.3 Incoming Material Control

	
4.3.1
	
Test Methods and Specifications
	
X
	
 

	
4.3.2
	
Material Destruction
	
(X)
	
X

	
4.3.3
	
Vendor Audit Responsibility
	
X
	
X

	
4.3.4
	
Client Furnished Materials
	
X
	
 

	
4.3.5
	
Temperature Monitoring Devices for In-Coming Materials
	
X
	
 

	
4.3.6
	
Incoming Material Release
	
 
	
X

	
4.3.7
	
Packaging Component Qualification
	
X
	
 

	
4.4 Building, Facilities, Utilities and Equipment

	
4.4.1
	
General
	
 
	
X

	
4.4.2
	
Equipment, Calibration and Preventative Maintenance
	
 
	
X

	
4.4.3
	
Environmental Monitoring Program
	
 
	
X

	
4.5 Product Controls

	
4.5.1
	
Technical Transfer
	
X
	
 

	
4.5.2
	
Master Batch Record
	
(X)
	
X

	
4.5.3
	
Reprocessing and Rework
	
(X)
	
X

	
4.5.4
	
Personnel Training
	
 
	
X

	
4.6 Packaging, Labeling and Printed Materials

	
4.6.1
	
Master Batch Packaging Records
	
(X)
	
X

	
4.6.2
	
Printed Material and Artwork
	
X
	
 

	
4.6.3
	
Test Methods and Method Validation
	
X
	
(X)

	
4.7 Deviation Reports (DRs)

	
4.7.1
	
Deviations
	
 
	
X

	
4.7.2
	
Notification of Deviations
	
 
	
X

	
4.7.3
	
Client Support
	
X
	
 

	
4.8 Release of Product

	
4.8.1
	
Test Methods and Specifications
	
X
	
 

	
4.8.2
	
Batch Release for Shipment
	
 
	
X

	
4.8.3
	
Certificate of Manufacture
	
 
	
X

- 4 -

Master Manufacturing Services Agreement

	
Section No.
	
Subject / Terms
	
Client
	
Patheon

	
4.8.4
	
Certificate of Analysis
	
 
	
X

	
4.8.5
	
Product Release
	
X
	
 

	
4.9 Validation

	
4.9.1
	
Master Validation Plan
	
(X)
	
X

	
4.9.2
	
Cleaning Validation Program
	
(X)
	
X

	
4.9.3
	
Analytical Method and Procedure Validation
	
X
	
(X)

	
4.9.4
	
Process Validation
	
X
	
(X)

	
4.10 Change Control

	
4.10.1
	
General
	
X
	
X

	
4.11 Documentation

	
4.11.1
	
Record Retention
	
 
	
X

	
4.11.2
	
Batch Document Requisition
	
 
	
X

	
4.11.3
	
Record Destruction
	
(X)
	
X

	
4.12 Laboratory Controls

	
4.12.1
	
Specifications and Test Methods
	
X
	
X

	
4.12.2
	
Out of Specifications (OOS) / Out of Trend (OOT)
	
 
	
X

	
4.13 Stability

	
4.13.1
	
Sample Storage
	
 
	
X

	
4.13.2
	
Stability Studies
	
X
	
X

	
4.13.3
	
Stability Failures
	
 
	
X

	
4.13.4
	
API and Product Retest and Expiry Date
	
X
	
 

	
4.14 Annual Product Review

	
4.14.1
	
Annual Report
	
X
	
(X)

	
4.14.2
	
Product Quality Report
	
(X)
	
X

	
4.15 Storage and Distribution
	
 
	
 

	
4.15.1
	
General
	
 
	
X

	
4.15.2
	
Product Storage and Shipment Changes
	
(X)
	
X

	
4.15.3
	
Product Quarantine
	
 
	
X

	
4.16 Product Complaints

	
4.16.1
	
Complaint Investigation
	
X
	
(X)

	
4.16.2
	
Complaint Sample Retrieval
	
X
	
 

	
4.17 Product Recall

	
4.17.1
	
Product Recall Notification
	
X
	
 

	
4.17.2
	
Government Agency Notification
	
X
	
 

	
4.18 Reference and Retention Samples

	
4.18.1
	
Excipient, Primary and Printed Packaging Materials, and Active Ingredient Reference Sample
	
 
	
X

	
4.18.2
	
Finished Product Retention Sample
	
X
	
X

	
4.18.3
	
Sample Destruction
	
(X)
	
X

 

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Master Manufacturing Services Agreement

Section 3:  General

	
3.1 
	
Capitalized terms not otherwise defined herein will have the meaning specified in the MSA.

	
3.2 
	
Any communications about the subject matter of this Agreement will be directed, in the first instance, to the person(s) identified in Appendix B.

	
3.3 
	
If any provision of this Agreement should be found invalid, or unenforceable by law, the rest of the Agreement will remain valid and binding and the parties will negotiate a valid provision which meets as closely as possible the objective of the invalid provision.  

	
3.4 
	
Any amendment of this Agreement will be made in writing and signed by both parties.  

In particular, in the event of a substantial change to cGMPs or regional governances directly impacting Product Quality compliance, it shall be mutually agreed upon prior to implementation.

	
3.5
	
If there is any conflict between the terms of this Agreement and the MSA, the MSA will take precedence except for any specific quality-related issue.  Notwithstanding anything to the contrary in this Agreement, the MSA will take precedence with respect to any commercial terms, including fees for quality-related services. 

	
3.6
	
The “Background” provisions of Section 1 are incorporated into this Agreement.

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Master Manufacturing Services Agreement

Section 4: Description of Responsibilities

	
4.1
	
Quality Management

	
4.1.1
	
cGMP, Health and Safety Compliance

Patheon will conduct operations in compliance with applicable environmental, occupational health and safety laws, and cGMP regulations.  

	
4.1.2
	
Client Audit Rights

Patheon will permit audits by the Client on reasonable prior written notice, of all relevant premises, procedures and documentation related to Client’s Product.  Client audits are limited to [**] with a maximum of [**] auditors for [**] per calendar year unless for cause. Client representatives for audits must be preapproved by Patheon.

	
4.1.3
	
Subcontracting

Unless otherwise allowed herein, Patheon will not subcontract tasks to a third party without Client’s consent.  Patheon may subcontract tasks to the Patheon approved contract manufacturers and laboratories set forth in Appendix E hereto.

 

	
4.1.4
	
Self-Inspection 

Patheon will perform self-inspections of its premises, facilities, and processes used to manufacture, package, test, and store the Client’s starting, intermediate, and/or finished products in accordance with Patheon’s written standard operating procedures (“SOPs”) to ensure compliance with cGMP.

	
4.2
	
Regulatory Requirements

	
4.2.1
	
Permits 

The Client will be solely responsible for obtaining or maintaining, on a timely basis, any permits or other regulatory approvals for the Products or the Specifications, including, without limitation, all marketing and post-marketing approvals and reporting.

 

Patheon will obtain and maintain the appropriate manufacturing license(s) to allow for the Manufacturing services.

	
4.2.2
	
Regulatory Filing / Registration Change Control

The Client will ensure product filing and registrations are in compliance with all Applicable Laws. 

 

The Client will determine whether changes to the Product or related to the Product will impact a regulatory filing and will apply for and receive approval for any required manufacturing amendment, change or addition to their Product marketing authorization. Upon request, Patheon will provide assistance in the preparation and review of pertinent sections of new or supplemental regulatory applications before filing.  

 

For EU products it is the responsibility of the Client to provide Patheon sites with the accurate Product registration information as per European legislations (cGMPs guide part I - chapters 1,4,6,7 and annex 16 / directives 2001/83/EC – title IV, articles 46, 48, 51 and 2003/94/EC article 5).

 

Prior to submission of any new, or change to any existing applicable CMC, CTD, Regulatory File, Product Registration, etc., to any Regulatory Authority relating to the Product, the Client will provide Patheon copies of sections of the submissions that are relevant to the services provided.  

 

Specifically, Client will provide Patheon with a copy of any documentation which is or is equivalent to the Quality Module (Drug Product Section) of the Common Technical Document and any 

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Master Manufacturing Services Agreement

amendments thereto (all such documentation herein referred to as “CTD”) related to any Marketing Authorization, such as a US New Drug Application, US Abbreviated New Drug Application, US Biologics Licence Application, or EU Marketing Authorisation Application at least [**] days prior to filing such information with the Regulatory Authority.  

 

The parties agree that no inspections by any Regulatory Authority may be scheduled until Patheon has had an opportunity to review the requested documents and is satisfied with their accuracy.

 

Patheon will communicate directly with the Regulatory Agency after discussions with Client. 

 

The Client is responsible for all communications with Regulatory Authorities as well as for the approval, maintenance, and updating of marketing approval in a timely manner.

	
4.2.3
	
Regulatory Compliance 

Patheon will ensure that Product(s) are manufactured and tested in strict compliance with;

	
 
	
•
	
current Canadian regulatory requirements (as defined under Part C, Division 2 of the Food and Drug Regulations), 

	
 
	
•
	
US Federal regulatory and statutory requirements relating to Good Manufacturing Practices (cGMP) (US 21 CFR parts 210, 211, 600, 601, 610, etc...)

	
 
	
•
	
EU Directive 2003/94/EC for the Manufacture of Finished Medicinal Products) 

	
 
	
•
	
EU Directives 2004/27/EC and 2011/62/EU, as applicable to the Holder of the Manufacturing Authorization.

as applicable, as well as all regulatory approvals and Applicable Laws at the site(s) of manufacture and/or testing.

 

The Client shall comply with EU Directives 2004/27/EC and 2011/62/EU as applicable to the holder of the relevant marketing authorisation or to the extent that such Directives apply to the supply of API.

	
4.2.4
	
Government Agency Inspections, Communication and Requisitions

Each party will permit all relevant inspections by Regulatory Authorities of premises, procedures, and documentation. 

 

The parties will notify each other within [**] Business Days of receipt of any notice of inspection from a Regulatory Authority and within [**] of any regulatory authority request for Product samples, batch documentation, or similar information related to the Product.

 

Each party reserves the right to be present on site during a regulatory inspection that relates to the Product.

 

The parties will notify within [**] of receipt of any Form 483's warning letter or similar communication from any Regulatory Authority that relates to the Product; or if the supply of Product will be affected, or if the facilities used to produce, test or package the Product will be affected. 

 

During a regulatory inspection relating to the Product, upon request, a party will provide the requesting party with the applicable Product data for which it is responsible under this Agreement.

 

Patheon is responsible for responding to all regulatory audits conducted at any Patheon site.  Patheon will provide Client with a draft of any responses directly related to the Product prior to submission to the Regulatory Authority.  Client must provide approval or request changes in a 

- 8 -

Master Manufacturing Services Agreement

timely manner to enable Patheon to respond to the Regulatory Authority by the applicable deadline.  Notwithstanding, Patheon reserves the right to respond to the Regulatory Authority without Client’s prior approval, if, in the opinion of Patheon’s Legal counsel, it is required or reasonable to do so.

 

Client is responsible for responding to all regulatory audits at any Client site.  Client will provide Patheon with a draft of any response directly related to Patheon services prior to submission to the Regulatory Authority.  Patheon must provide approval or request changes in a timely manner to enable Client to respond to the Regulatory Authority by the applicable deadline.  Notwithstanding, Client reserves the right to respond to the Regulatory Authority without Patheon’s prior approval, if, in the reasonable opinion of Client’s Legal counsel, it is required or reasonable to do so.

	
4.3 
	
Incoming Material Control

	
4.3.1 
	
Test Methods and Specifications 

The Client will give Patheon a copy of the Specifications and test methods used if the Client issues raw material Specifications.

	
4.3.2
	
Material Destruction

Patheon has the right to either return to the Client or dispose of any outdated or rejected material.  If the material is disposed of, disposal will be consistent with the nature of the material and sent to a permitted waste disposal facility.  Prior to disposal:

	
 
	
(i.)
	
Patheon will send notice to the Client about Patheon’s intent to dispose of the material.  If no direction is received from the Client, Patheon will dispose of the material no sooner than [**] days after the date of the notice.  

	
 
	
(ii.)
	
The materials will be disposed and destroyed in compliance with local environmental regulations and performed in a secure and legal manner that prevents unauthorized use or diversion. 

 

Patheon will maintain destruction records in accordance with Patheon SOPs.  

	
4.3.3
	
Vendor Audit Responsibility

(For the purposes of this Section the term “Vendor” refers to the sites performing the manufacturing and testing of a material).

 

Excipient, Packaging Component, and API Vendors:

	
 
	
(i.)
	
If the Client stipulates a Vendor, the Client will audit and approve the Vendor and ensure cGMP compliance in accordance with Section 4.3.4 of this Agreement.  If Patheon is to release an API or other Client stipulated material based on “ID Only”, the Client will ensure the required verification testing by an independent laboratory has been completed.  The Client stipulated Vendor(s) will be included on the Client’s approved Vendor list (attached hereto as Appendix D).   

 

	
 
	
(ii.)
	
If Patheon stipulates a Vendor, Patheon will audit and approve the manufacturers and ensure cGMP compliance in accordance with Patheon’s SOP.  The Patheon stipulated Vendor(s) will be included on Patheon’s approved Vendor list (attached hereto as Appendix C).

 

	
 
	
(iii.)
	
Upon request by any regulatory body audits of API manufacturing sites should be available to both parties.

	
4.3.4
	
Client Furnished Materials 

The Client is responsible for Vendor qualification of Client furnished materials and for providing a certificate of compliance confirming the following as applicable:

- 9 -

Master Manufacturing Services Agreement

 

	
 
	
(i)
	
That the materials are compliant with the provisions outlined in the “Note for Guidance on minimizing the risk of transmitting spongiform encephalopathy agents via human and veterinary medicinal products” (EMA/410/01, most current revision or equivalent requirement).

 

	
 
	
(ii)
	
Certification there is no potential for specific toxic solvents listed in the EP / USP / ICH residual solvents Class I, Class II or Class III to be present and the material, if tested, will comply with established EP / USP / ICH requirements.  If any of the solvents listed in the EP / USP / ICH residual solvents Class I, Class II or Class III are used in the manufacture or are generated in the manufacturing process, solvents of concern will be indicated. 

 

	
 
	
(iii)
	
A cGMP compliance declaration for the API, assuring compliance with the latest regulatory requirements (e.g. EU directive 2004/27/EC for an API sourced from inside the EU or, ICH Q7 for an API sourced from outside the EU,  for API see Appendix F); and

 

	
 
	
(iv)
	
Any other certification applicable to the furnished material (e. g. Residues of Metals Catalysts & Reagents, Genotoxic Impurities, Kosher, Melamine, Viral Inactivation, etc...).

	
4.3.5
	
Temperature Monitoring Devices for In-Coming Materials 

The Client is responsible for ensuring that the furnished API and all other furnished temperature sensitive materials are shipped to Patheon with the following conditions to ensure no temperature excursions occurred during transportation of the materials:

 

	
 
	
(i)
	
Ambient or Room Temperature APIs must be transported in a manner that reflects the label requirements.  Temperature stability data for the API to support label requirements will be provided to Patheon. If temperature stability data is not available, temperature monitoring devices will need to accompany each API shipment until this data is made available.   

 

	
 
	
(ii)
	
APIs and other materials that require special storage conditions (e.g. 2-8°C, (-15)-(-25°C), “Do Not Freeze”, etc.) must be transported in a manner which reflects the label requirements of the material.  Temperature stability data for the API to support label requirements will be provided to Patheon.  As such, temperature monitoring devices will accompany each shipment of these materials unless validated shipping processes are followed. 

	
4.3.6
	
In-Coming Material Release

Patheon will use established systems and procedures for the receipt of materials to ensure all incoming materials are checked against receiving documentation and purchase orders, and are properly labeled and identified.  Prior to use in the manufacture of any Product, material(s) will be inspected, tested and released by Patheon against the Specification approved by the Client.

	
4.3.7
	
 Packaging Component Qualification

In all cases the Client is responsible for qualifying any packaging container closure system for use in Product, for example USP<660>, <661>, <670>, <671>, Poison Prevention Act (Child Resistance), etc., unless other provisions are agreed to.

 

	
4.4
	
Building, Facilities, Utilities and Equipment 

	
4.4.1
	
General

All buildings and facilities used in the manufacturing, packaging, testing and storage of any materials and/or Product will be of suitable size, construction and location to facilitate cleaning, and will be maintained in a good state of repair.  Maintenance and cleaning records will be kept in accordance with Patheon’s SOPs.

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Master Manufacturing Services Agreement

	
4.4.2
	
Equipment, Calibration and Preventative Maintenance

All equipment used in the manufacturing, packaging, testing and storage of any materials and/or Product will be suitable for its intended use and appropriately located to allow for cleaning and maintenance.  Calibration and maintenance records will be kept according to Patheon SOPs for all critical equipment. Patheon will calibrate instrumentation and qualify computer systems used in the manufacture and testing of the Product in accordance with Patheon’s SOPs. 

	
4.4.3
	
Environmental Monitoring Program

Patheon will perform and maintain an environmental monitoring program.  The collected data will be reviewed and interpreted by the responsible person within Patheon’s quality unit.  Any out of limit results will be managed appropriately in accordance with Patheon SOPs. 

	
4.5
	
Production Controls

	
4.5.1
	
Technical Transfer

For all processes related to the Product developed outside of Patheon, the Client will provide technical information to support a technical transfer, including development reports, critical Deviations and OOS, related CAPA, and other relevant aspects of the product performance history.

	
4.5.2
	
Master Batch Record 

The Client will provide the Specifications to Patheon and Patheon will manufacture Product in accordance with the Specifications.

 

Patheon is responsible for preparing the master batch records for the Product, however, the Client is responsible to review and approve the master batch records prior to the manufacture of the Product unless otherwise agreed to in writing. 

 

Patheon will not make changes to master batch records except through the established Patheon change control system, and all master document revisions will be approved by the Client’s quality unit unless otherwise agreed to in writing.  Any changes made to issued batch records (prior to master revisions) must be reviewed and approved by the Client’s quality unit prior to implementation unless otherwise agreed to in writing.

 

Patheon will maintain a batch numbering system designed to assure traceability of the product and associated documentation.

	
4.5.3
	
Reprocessing and Rework

Patheon will not reprocess or rework the Product without the prior written consent of the Client.

 

Reprocessing is defined as the introduction of material back into the process and repeating a step, (e.g. redrying, remilling) using the same equipment and techniques of the established manufacturing process. 

 

Rework is defined as the introduction of material to one or more processing steps that are different from the established manufacturing process.

	
4.5.4
	
Personnel Training

Patheon will provide appropriate training for all employees.  Each person engaged in the manufacture, packaging, testing, storage, and shipping of the Product will have the education, training, and experience necessary, consistent with current cGMP and safety training requirements.

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Master Manufacturing Services Agreement

	
4.6
	
Packaging, Labeling and Printed Materials

	
4.6.1
	
Master Batch Packaging Records

The Client will provide Patheon with the Specifications for all packaging components. Patheon will create, control, issue, and execute in accordance with the master batch packaging record and the Specifications.   

 

Patheon will not make changes to master batch packaging records except through the established Patheon change control system, and all master document revisions will be approved by the Client’s quality unit. Any changes made to issued batch records (prior to Master revisions) must be reviewed and approved by the Client’s quality unit prior to implementation unless agreed to in writing.

 

Patheon will maintain a batch numbering system designed to assure traceability of the product and associated documentation.

 

	
4.6.2
	
Printed Material and Artwork

The Client will provide artwork and labelling text (blister, carton, leaflet, label etc.) Specifications to Patheon.  The labelling proofs must be reviewed and approved by the Client.

	
4.6.3
	
Test Methods and Method Validation

The Client will provide test methods and method validation for packaging components to Patheon. Where applicable, Patheon will provide test methods and validation for packaging components purchased from Vendors on the Patheon approved Vendor list only (Appendix C).

	
4.7
	
Deviation Reports (DRs) 

	
4.7.1
	
Deviations

Patheon will document, investigate and resolve deviations from approved manufacturing/packaging instructions or Specifications in accordance with Patheon’s SOPs.  

	
4.7.2
	
Notification of Deviations

Patheon will notify the Client within [**] Business Days if any significant deviation occurs during manufacture of the Product, where the deviation affects the quality, efficacy or availability of the Product.  

	
4.7.3
	
Client Support 

As part of the written notification acknowledgement, Client will confirm if they require approval of the DR within [**] Business Days.  If no response is received, Patheon will proceed to complete in the investigation without Client approval.  A copy of the closed DR will be provided to Client if required.

 

As the Product license holder and technical Product/process expert the Client will provide technical and/or Product quality assessments in support of DRs, if required.  

 

If Client approval is required on a specific DR, Client will provide investigation comments or approval within [**] Business Days of receipt of draft or Patheon approved DR.  This Client approval will not be unreasonably withheld.  

	
4.8 
	
Release of Product

	
4.8.1
	
 Test Methods and Specifications

- 12 -

Master Manufacturing Services Agreement

The Client will provide to Patheon the finished Product Specifications.

	
4.8.2 
	
Batch Release for Shipment

Batch review and release for shipment will be the responsibility of Patheon’s Quality Assurance department who will act in accordance with Patheon's SOPs. 

	
4.8.3
	
 Certificate of Manufacture (Certificate of Compliance, Conformance, etc.)

For each batch certified by Patheon, Patheon will deliver to the Client a Certificate of Manufacture that will include a statement that the batch has been manufactured in accordance with cGMPs and the Specifications. 

	
4.8.4
	
 Certificate of Analysis

For each batch released by Patheon, Patheon will deliver to the Client a Certificate of Analysis with analytical data showing the batch complies with the Product Specifications.

	
4.8.5
	
Product Release

The Client will have sole responsibility for release of the Product to the market.  When Patheon EU Qualified Person (“QP”) services are employed, Patheon QP may release the Product for distribution on behalf of the Client.

 

	
4.9
	
Validation

	
4.9.1
	
Master Validation Plan

Patheon will establish applicable master validation plans and maintain a validation program for the Product.  The Client will review and approve performance qualification and process validation protocols and reports for the Product.

	
4.9.2
	
Cleaning Validation Program

The Client will provide required information (i.e. LD50, toxicity, solubility, batch size, fill volume, product min dose/70Kg patient) to establish cleaning limits. 

 

In addition the Client will inform Patheon of any planned changes in dosing strategies, particularly smallest therapeutic and largest single dose prior to change in clinic or market to ensure cleaning limits justification remain applicable.

 

Patheon will maintain an appropriate cleaning and cleaning validation program.

	
4.9.3
	
Analytical Method and Procedure Validation

The Client will provide to Patheon non-compendial test methods.  The Client must ensure that its analytical methods and manufacturing procedures (including packaging procedures) are validated.  If the methods and procedures are not validated by the Client, then Patheon may assist in validation. 

	
4.9.4
	
Process Validation

Subject to the terms of the MSA, Patheon, with technical support from the client, will conduct process validation for commercial products consistent with the regulations and guidelines for the intended market.  The Client will support the process validation program by supplying development details, technical Specifications and submission details.  Following the initial process and packaging validation, Patheon and the Client will be responsible to periodically assess the validated state of the product and conduct revalidation as necessary.  

- 13 -

Master Manufacturing Services Agreement

	
4.10
	
change control

	
4.10.1
	
General

 

Patheon will notify the Client in accordance to Patheon’s SOPs before implementing any proposed changes to the process, materials, testing, equipment or premises, where such changes may directly affect the Product.  

 

The Client will be responsible for determining whether or not to initiate registration variation procedures, post approval changes, etc..., and for maintaining adequate control over the quality commitments of the marketing authorization made to the regulatory authorities by the Client for the Products.

 

The Client will review and provide any comments, regulatory advice, or Product implementation requirements related to any changes within [**] days of notice.  Patheon will proceed with implementation of changes if no response is received after [**] days.

 

Following validation of a process change, Patheon will deliver a copy of the related validation report to the Client and the associated stability data, if applicable, as it becomes available.

	
4.11
	
Documentation

	
4.11.1
	
Record Retention

Patheon will maintain all batch records for a minimum of [**] past Product expiry date and supply all these records to the Client upon request. Patheon will maintain records and evidence on the testing of raw materials and packaging/labeling materials for [**] after the materials were last used in the manufacture or packaging/labeling of the Product. 

	
4.11.2
	
Batch Document Requisition

At the request of the Client, Patheon will provide a copy of any of the executed batch documents relating to Products to the Client as soon as reasonably possible.  This does not apply to processes that Patheon considers proprietary (e.g. specific gel capsule technologies).

	
4.11.3
	
Record Destruction

Following the expiry of the retention period, Patheon will provide notice to Client in accordance with the contact information set forth in Appendix B (or as updated in writing from time to time) of its intent to destroy the documents.  Client will have [**] days from the date of Patheon’s notice to notify Patheon in writing if Client wishes to have documents returned.  Client will then have up to [**] days from the date of Patheon’s notice to remove the documents from Patheon’s premises.

 

Patheon assumes no responsibility for documents destroyed after the expiry of the [**] day limit above.  Client will be solely responsible for providing Patheon with up-to-date contact information for notification purposes.  

	
4.12
	
Laboratory Controls

	
4.12.1
	
Specifications and Test Methods

Patheon will test and approve starting material, intermediate, and the finished Product in accordance with the approved Specifications, analytical methods, and Patheon’s SOPs.

 

The Client will provide to Patheon the API Specifications for furnished API, including a certificate of analysis for each batch.

 

- 14 -

Master Manufacturing Services Agreement

The Client will supply any required reference standards that are not readily available through a commonly recognized source.  These reference standards must be accompanied by a Certificate of Analysis listing the expiration date and any correction factors that need to be applied.

	
4.12.2
	
Out of Specifications (OOS) / Out of Trend (OOT)

Patheon and Client will notify each others’ quality unit of confirmed out-of-Specification (“OOS”) or out-of-trend (“OOT”) results within [**] Business Days. 

 

If Client approval is required on a specific OOS, Client will provide investigation comments or approval within [**] Business Days of receipt of draft or Patheon approved OOS.  This Client approval will not be unreasonably withheld.  

 

For all confirmed OOS results generated by Patheon, Patheon will generate a DR type deviation as per Patheon SOPs and obtain approval of the DR from the Client’s responsible person within their quality unit.  This Client approval will not be unreasonably withheld.

	
4.13
	
Stability

	
4.13.1
	
Sample Storage

Patheon will store stability samples if and as required under the MSA.

4.13.2Stability Studies

The Client will develop and validate stability indicating assay(s) prior to process validation.  If required, Patheon may assist with this activity.

 

If applicable, Patheon will conduct stability studies in accordance with the agreed and validated stability testing analytical methods at the agreed upon testing points in accordance with the agreed stability protocol.

 

Patheon will perform the stability testing described in a stability protocol agreed to by both Patheon and the Client.  Stability data will be provided by Patheon to the Client on an ongoing basis as agreed to by both parties. 

	
4.13.3
	
Stability Failures

Patheon will notify the Client of any potential OOS within [**] of the potential OOS being identified.  

 

Client will notify regulatory agencies in accordance with Section 4.17 of this Agreement.

 

	
4.13.4
	
API and Product Retest and Expiry Date

The Client will be responsible for establishing and approving the Retest and Expiry Date for all API and Product in compliance with all applicable regulatory requirements.

	
4.14
	
Annual Product Review

	
4.14.1
	
Annual Product Review

The Client will complete Annual Product Review (“APR”) in accordance with regulatory requirements of the Product marketed authorization, for example 21CFR 314.81(b)(2).  Patheon will provide copies of all information and correspondence necessary to support the APR when requested by the Client.

 

Client will provide a copy of the approved Final APR (redacted as applicable) where required.

 

- 15 -

Master Manufacturing Services Agreement

	
4.14.2
	
Product Quality Report

Patheon will perform annual Product Quality Reports (“PQR”) applicable to the Services after commencement of commercial activities in compliance with all applicable regulatory requirements, for example 21CFR211.180e.  This will include, for example, status of batches processed, status of product deviations/investigations/CAPA, trending of complaints, status of stability studies maintained by Patheon, status of change controls, statistical trending of the finished product test results performed by Patheon, and a summary report of applicable finished product retained sample inspection. The PQR will be provided [**] after each anniversary date, unless agreed otherwise in writing.  

 

Upon receipt of the PQR from Patheon, the Client will complete the Final PQR with applicable Product information that Patheon does not have.  The Client will notify Patheon of any issues detected during the Final PQR potentially affecting processes supported by Patheon and will provide a summary of any related concerns or issues related to the services provided prior to Final PQR completion.  Client will provide a copy of the approved Final PQR (redacted as applicable) where required.

	
4.15
	
Storage and Distribution

	
4.15.1
	
General

Patheon will store and ship Product in accordance with the agreed qualified (and where required, validated) temperature, packaging, monitoring, and transportation requirements specified by the Client. 

	
4.15.2
	
Product Storage and Shipment Changes

Patheon will communicate any proposed changes in storage or shipping to the Client for review and approval.  Client approval will not be unreasonably withheld.  

	
4.15.3
	
Product Quarantine

Patheon will have a system in place for assuring that unreleased Product is not shipped unless authorized by the Client’s quality unit.

	
4.16
	
Product Complaints

	
4.16.1
	
Complaint Investigation 

The Client is responsible for investigating and resolving all medical and non-medical Product complaints, adverse events, etc....  Patheon will assist in the investigations involving all Patheon manufacturing and packaging type Product complaints related to the Manufacturing Services provided. 

 

The Client is responsible to comply with all pharmacovigilence legislation.

 

Patheon will inform the Client within [**] of any complaints Patheon becomes aware of from other sources.  

	
4.16.2
	
Complaint Sample Retrieval

The Client is responsible for retrieving complaint sample(s) and forwarding them to Patheon in a timely manner to facilitate a complete and comprehensive investigation.  If the complaint sample(s) cannot be obtained and provided to Patheon, the Client will provide a written explanation detailing the reasons as to why the complaint sample cannot be obtained.

 

- 16 -

Master Manufacturing Services Agreement

In order for Patheon to conduct a valid investigation, the Client must provide:

 

	
 
	
(i)
	
A physical sample of the Product which triggered the Complaint.  An alternate option is for the Client to provide clear multiple digital photographs.  In those cases where a physical sample or photos are impossible to be retrieved and provided, Client documentation must be provided as evidence that reasonable efforts were made to obtain a sample.  

	
 
	
(ii)
	
Special handling instructions for the returned sample (i.e. refrigeration, Health & Safety concerns based on product, security for controlled drugs / narcotic) as applicable.

	
 
	
(iii)
	
Complete, clear concise information from the complainant.  This information needs to be reviewed by the Client prior to forwarding to Patheon and assessed on completeness before processing the Complaint to Patheon.  These include the following, as applicable

	
 
	
a.
	
Descriptive detailed odour descriptions

	
 
	
b.
	
Full Product Name, Lot number(s) (Patheon and Client), Dosage Form, Strength, pack size, Product Code Number (Patheon and Client), Expiry date

	
 
	
c.
	
Complaint Origin

	
 
	
d.
	
Market Country

	
 
	
e.
	
Client Complaint Number

	
 
	
f.
	
Client Severity Assignment

	
 
	
g.
	
Client Complaint Classification

	
4.17
	
Product Recall 

	
4.17.1
	
Product Recall Notification

The Client and Patheon will notify each other about a Product Recall or other regulatory type product notification (e.g. US field alert, confirmed stability OOS notifications, suspected falsified product, etc...) related to the Product as soon as possible, but, in any event, prior to informing the appropriate regulatory authorities. 

 

The Client will be responsible for all related Recall activities.  In the event of a confirmed falsified Product, the client will take all appropriate measures to physically and securely segregate Product from the legitimate Product supply chain, and the Client will inform the applicable authorities.  Patheon will assist in the investigations involving all Patheon manufacturing and packaging type Product complaints related to the Manufacturing Services provided.

 

Patheon will supply Client any related documentation, as requested, to support the Recall or other actions, including investigating Patheon activities as a deviation as outlined in Section 4.7.  Affected products at Patheon’s facility will be quarantined and labeled according to Patheon’s SOP.

	
4.17.2
	
Government Agency Notification

The Client will notify the appropriate regulatory authorities of any Field Alert, Recall, Falsified Product, etc... type quality issues.  

 

The Client will perform the Product recall and will communicate with the appropriate regulatory authorities.  

 

Where legislated, Patheon reserves the right to notify regulatory authorities of Product quality issues.  Patheon will inform the Client prior to any notification to the regulatory authorities.

- 17 -

Master Manufacturing Services Agreement

 

	
4.17
	
Reference and retention Samples

	
4.18.1
	
Excipient, Primary and Printed Packaging Materials, and Active Ingredient Reference Sample

Patheon will keep a reference sample of each material supplied to Patheon and used to manufacture the Product.  The reference sample will consist of at least [**] times the necessary quantity for all Quality Control tests required to determine whether the materials meet required Specifications.

 

Where applicable each packaging site will keep reference samples of each batch of primary and printed packaging materials. 

 

The reference samples will be stored by Patheon under controlled conditions in accordance with cGMP storage requirements for [**] beyond the expiration date of the last batch of product containing the materials. The reference samples will be made available by Patheon to the Client, if requested.

	
4.18.2
	
Finished Product Retention Sample

Retention samples of finished Product will be retained by Patheon for [**] past Product expiry or such longer period as required by law.  Where applicable, the legal sample(s) of finished Product must be retained by the Client.

	
4.18.3
	
Sample Destruction

Following the expiry of the retention period, Patheon will provide notice to Client in accordance with the contact information set forth in Appendix B (or as updated in writing from time to time) of its intent to destroy the samples.  Client will have [**] days from the date of Patheon’s notice to notify Patheon in writing if Client wishes to have samples returned.  Client will then have up to [**] days from the date of Patheon’s notice to remove the samples from Patheon’s premises.

 

Patheon assumes no responsibility for samples destroyed after the expiry of the [**] day limit above.  Client will be solely responsible for providing Patheon with up-to-date contact information for notification purposes. 

 

*   *   *

- 18 -

Master Manufacturing Services Agreement

IN WITNESS WHEREOF, the parties have caused their duly authorized officer to execute and deliver this Quality Agreement as of the Effective Date identified on the first page:

 

TETRAPHASE PHARMACEUTICALS, INC.

 

	
By:
	
 
	
 
	
Date:
	
 

	
Name:
	
 
	
 
	
 
	
 

	
Title:
	
 
	
 
	
 
	
 

 

PATHEON ITALIA S.p.A

 

	
By:
	
 
	
 
	
Date:
	
 

	
Name:
	
 
	
 
	
 
	
 

	
Title:
	
 
	
 
	
 
	
 

 

 

 

- 19 -

Master Manufacturing Services Agreement

Section 5: APPENDICES

note, appendices can change independent of the Quality Agreement upon written confirmation by each party.

	
 
	
•
	
Appendix A: Product(s)

	
 
	
•
	
Appendix B: Quality Contacts

	
 
	
•
	
Appendix C: Patheon Approved Supplier List

	
 
	
•
	
Appendix D: Client Approved Supplier List

	
 
	
•
	
Appendix E: Patheon Approved Contract Manufacturers and Laboratories List

 

- 20 -

Master Manufacturing Services Agreement

Appendix A TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>: 

Product(s)

 

	
Product (s) 
	
Dosage Form
	
Dosage (Strength)

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

 

- 21 -

Master Manufacturing Services Agreement

Appendix B TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>: 

Quality Contacts

 

	
 
	
Patheon

 
	
(Client)

	
Responsibility
	
QUALITY ASSURANCE
	
QUALITY ASSURANCE

	
Name
	
 
	
 

	
Title
	
 
	
 

	
Phone
	
 
	
 

	
E-mail
	
 
	
 

	
Address 

 
	
 
	
 

	
Responsibility
	
QUALITY CONTROL
	
QUALITY CONTROL

	
Name
	
 
	
 

	
Title
	
 
	
 

	
Phone
	
 
	
 

	
E-mail
	
 
	
 

	
Address 

 
	
 
	
 

	
Responsibility
	
BUSINESS
	
BUSINESS

	
Name
	
 
	
 

	
Title
	
 
	
 

	
Phone
	
 
	
 

	
E-mail
	
 
	
 

	
Address 

 
	
 
	
 

 

- 22 -

Master Manufacturing Services Agreement

Appendix C TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>:

Patheon Approved Vendor List

 

	
MATERIAL NUMBER
	
DESCRIPTION
	
MANUFACTURER NAME
	
MANUFACTURER CITY/PROVINCE/
STATE

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

 

- 23 -

Master Manufacturing Services Agreement

Appendix D TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>: 

Client Approved Vendor List

 

				
	
MATERIAL NUMBER
	
DESCRIPTION
	
MANUFACTURER NAME
	
MANUFACTURER CITY/PROVINCE/
STATE

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

 

 

 

- 24 -

Master Manufacturing Services Agreement

Appendix e TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>:  

PATHEON APPROVED CONTRACT MANUFACTURERS AND lABORATORIES LIST

 

			
	
Contractor Name
	
Address
	
Contact Information

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

 

This list does not include any contractors specified by individual clients of Patheon Inc.

In addition to Patheon Inc.’s Quality Control Laboratory, the approved contract labs are used only in situations when:

	
 
	
a)
	
Patheon Inc., does not have the equipment to perform the testing, or,

	
 
	
b)
	
Patheon Inc., does not have enough resources available to perform the testing

 

- 25 -

Master Manufacturing Services Agreement

Appendix e TO THE QUALITY AGREEMENT BETWEEN TETRAPHASE PHARMACEUTICALS, INC. AND PATHEON DATED <EFFECTIVE DATE HERE>:  

APPENDIX E: API starting materials EU requirementS

The Customer is responsible for providing Patheon with the following on any supplied API:

Registration information

-all registered API manufacturing sites including addresses & functions;

-approved registered file (CTD module 3.2.S) and any relevant update;

	
 
	
-
	
latest Certificate of suitability to the European Pharmacopoeia (CEP), Active Substance Master File (ASMF) or scientific data in force (as applicable).

Regulatory compliance information

-for API sourced from an EU Member State:

	
 
	
o
	
proof of the manufacturer, distributor & importer registration in the relevant Member State (EUDRA GMDP);

	
 
	
o
	
manufacturer GMP & distributor GDP certificate from the National Competent Authority as available (EUDRA GMDP);

	
 
	
-
	
for API sourced from a non listed Third country (waiver for listed ones):

	
 
	
o
	
EU Member State or foreign authority GMP certificate; 

	
 
	
o
	
API EU GMP compliance “written confirmation” as per official template;

	
 
	
-
	
for all: TSE/ BSE (or viral safety where applicable), Residual Solvents, Genotoxic Impurities, Residues of Metal Catalyst and Reagent information.

Quality compliance information

-Proof of the API manufacturer GMP/GDP compliance via audit reports (on site availability);

-Well identified and documented API supply chain (including API manufacturers, brokers, 

•traders, repackers, relabellers, micronisers and importers).

Current EU regulation references

	
 
	
-
	
Compilation of the Community Procedures on Inspections and Exchanges of Information (version in force): 

	
 
	
o
	
Union format for registration of Manufacturer, Importer or Distributor of Active Substance;

	
 
	
o
	
Union format for a GMP certificate [including active substances];

	
 
	
o
	
Union format for a GDP certificate for active substances to be used as starting materials.

	
 
	
-
	
GMP Guide Part I: Basic Requirements for Medicinal Products (version in force):

	
 
	
o
	
Chapter 5: Production ;

	
 
	
o
	
Chapter 7: Outsourced activities,

	
 
	
-
	
GMP Guide Part II: Basic Requirements for Active Substances used as Starting Material (version in force).

	
 
	
-
	
GMP Guide Q&As – Part II: questions 8,9,10 (version in force). 

- 26 -

Master Manufacturing Services Agreement

	
 
	
-
	
GDP for active substances: [SANCO/D/6/SF/mg/ddg1.d.6(2013)179367] draft (FEB/2013).

	
 
	
-
	
Directive 2011/62/EU (JUL/2011) articles 46, 46 b (2), 47, 111b and derivative texts: 

	
 
	
o
	
Implementing decision on the assessment of a third country’s regulatory framework applicable to active substances of medicinal products for human use [2013/51/EU] (JAN/2013);

	
 
	
o
	
Template for written confirmation [SANCO/SFS/SF/mg/ddg1.d.6(2013)118630] (version in force) & Q&As [SANCO/D/6/] (version in force);

	
 
	
o
	
Implementing regulation on principles and guideline for GMP for AS [(EU) n°1252/2014] (MAY/2014)

	
 
	
-
	
EMA/334808/2014: Qualified Person’s declaration concerning GMP compliance of the active substance manufacture - “The QP declaration template” and guidance for the “QP declaration template EMA/196292/2014 (version in force).

	
 
	
-
	
EMA/410/01: Note for guidance on guidance on minimising the risk of transmitting animal spongiform encephalopathy agents via human and veterinary medicinal product (version in force).

	
 
	
-
	
Ph. Eur. 5.2.8: Minimising the risk of transmitting animal spongiform encephalopathy agents via human and veterinary medicinal products.

	
 
	
-
	
EU EMA/CHMP/ICH/82260/2006: (ICH topic Q3C R5) Impurities - guideline for residual solvents (version in force) + annexes I & II CPMP/QWP/450/03 (version in force)

	
 
	
-
	
Ph. Eur. Chapter 5.4: Residual Solvents.

	
 
	
-
	
EMEA/CHMP/SWP/4446/2000: Guideline on the specification limits for residues of metal catalysts or metal reagents (version in force).

	
 
	
-
	
Ph Eur Chapter 5.20: Metal catalyst and metal reagents residues.

	
 
	
-
	
ICHQ3D Draft guideline for elemental impurities (step 4) (DEC/2014).

	
 
	
-
	
CPMP/SWP/5199/02 - EMEA/CHMP/QWP/251344/2006: Guideline on the limits of genotoxic impurities (version in force) + Q&As EMA/CHMP/SWP/431994/2007 (version in force).

 

 

- 27 -

Master Manufacturing Services Agreement

EXHIBIT C

QUARTERLY ACTIVE MATERIALS INVENTORY REPORT

 

 

	
TO:
	
TETRAPHASE PHARMACEUTICALS, INC.

 

 

	
FROM:
	
PATHEON UK LIMITED [or applicable Patheon Affiliate]

 

	
RE: 
	
Active Materials quarterly inventory report under Section 2.2(a) of the Master Manufacturing Services Agreement dated • (the "Agreement")

 

 

	
Reporting quarter:
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Active Materials on hand
	
 
	
 
	
 
	
 

	
at beginning of quarter:
	
 
	
 
	
kg 
	
(A)

	
 
	
 
	
 
	
 
	
 

	
Active Materials on hand
	
 
	
 
	
 
	
 

	
at end of quarter:
	
 
	
 
	
kg 
	
(B)

	
 
	
 
	
 
	
 
	
 

	
Quantity Received during quarter:
	
 
	
 
	
kg 
	
(C)

	
 
	
 
	
 
	
 
	
 

	
Quantity Dispensed1 during quarter:
	
 
	
 
	
kg 
	
 

	
(A + C – B)
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Quantity Converted during quarter:
	
 
	
 
	
kg 
	
 

	
(total Active Materials in Products produced
	
 
	
 
	
 
	
 

	
and not rejected, recalled or returned)
	
 
	
 
	
 
	
 

 

Capitalized terms used in this report have the meanings given to the terms in the Agreement.

 

	
PATHEON UK LIMITED
	
 
	
DATE:
	
 

	
[or applicable Patheon Affiliate]
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Per:
	
 
	
 
	
 
	
 

	
Name:
	
 
	
 
	
 
	
 

	
Title:
	
 
	
 
	
 
	
 

 

 

 

 

	
	 

	
1 
	
 Excludes any (i) Active Materials that must be retained by Patheon as samples, (ii) Active Materials contained in Product that must be retained as samples, (iii) Active Materials used in testing (if applicable), and (iv) Active Materials received or consumed in technical transfer activities or development activities, including, without limitation, any regulatory, stability, validation, or test batches manufactured during the quarter.

 

Master Manufacturing Services Agreement

EXHIBIT D

REPORT OF ANNUAL ACTIVE MATERIALS INVENTORY RECONCILIATION 

AND CALCULATION OF ACTUAL ANNUAL YIELD 

 

	
TO:
	
TETRAPHASE PHARMACEUTICALS, INC.

 

	
FROM:
	
PATHEON UK LIMITED [or applicable Patheon Affiliate]

 

	
RE: 
	
Active Materials annual inventory reconciliation report and calculation of Actual Annual Yield under Section 2.2(a) of the Master Manufacturing Services Agreement dated • (the "Agreement")

 

 

	
Reporting Year ending:
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Active Materials on hand
	
 
	
 
	
 
	
 

	
at beginning of Year:
	
 
	
 
	
kg 
	
(A)

	
 
	
 
	
 
	
 
	
 

	
Active Materials on hand
	
 
	
 
	
 
	
 

	
at end of Year:
	
 
	
 
	
kg 
	
(B)

	
 
	
 
	
 
	
 
	
 

	
Quantity Received during Year:
	
 
	
 
	
kg 
	
(C)

	
 
	
 
	
 
	
 
	
 

	
Quantity Dispensed2 during Year:
	
 
	
 
	
kg 
	
(D)

	
(A + C – B)
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Quantity Converted during Year:
	
 
	
 
	
kg 
	
(E)

	
(total Active Materials in Products produced
	
 
	
 
	
 
	
 

	
and not rejected, recalled or returned)
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Active Materials Credit Value:        USD/EUR
	
 
	
 
	
/ kg
	
(F)

	
 
	
 
	
 
	
 
	
 

	
Target Yield:
	
 
	
 
	
%
	
(G)

	
 
	
 
	
 
	
 
	
 

	
Actual Annual Yield:
	
 
	
 
	
%
	
(H)

	
((E ∕ D) * 100)
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 

	
Shortfall:
	
USD/EUR
	
 
	
 
	
 
	
(I)

	
(((G – 5) - H) ∕ 100) * F * D
	
(if a negative number, insert zero)
	
 
	
 

 

Based on the foregoing reimbursement calculation Patheon will reimburse Client the amount of USD/EUR              .

 

	
	 

	
2 
	
 Excludes any (i) Active Materials that must be retained by Patheon as samples, (ii) Active Materials contained in Product that must be retained as samples, (iii) Active Materials used in testing (if applicable), and (iv) Active Materials received or consumed in technical transfer activities or development activities, including, without limitation, any regulatory, stability, validation, or test batches manufactured during the Year.

 

Master Manufacturing Services Agreement

Capitalized terms used in this report have the meanings given to the terms in the Agreement.

 

	
DATE:
	
 
	
 

 

PATHEON UK LIMITED

[or applicable Patheon Affiliate]

 

	
Per:
	
 
	
 

	
Name:
	
 
	
 

	
Title:
	
 
	
 

 

ActiveUS 163370610

 
 
- 2 -Exhibit

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
Dated as of June 23, 2017

Among
THE FINANCIAL INSTITUTIONS PARTY HERETO,
as the Lenders,
and
CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK,
as Administrative Agent,
and
SUNPOWER CORPORATION,
as Borrower
____________________________

CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK,
as Sole Lead Arranger and Sole Bookrunner

	
			
	TABLE OF CONTENTS

	ARTICLE I Definitions
	1

	SECTION 1.01.
	Defined Terms
	1

	SECTION 1.02.
	Classification of Loans and Borrowings.
	19

	SECTION 1.03.
	Terms Generally.
	19

	SECTION 1.04.
	Effectuation of Transactions.
	19

	SECTION 1.05.
	Accounting Terms; GAAP.
	19

	ARTICLE II The Credits
	20

	SECTION 2.01.
	Loan Commitments.
	20

	SECTION 2.02.
	Loans and Borrowings.
	20

	SECTION 2.03.
	Requests for Borrowing.
	21

	SECTION 2.04.
	Funding of Borrowings.
	22

	SECTION 2.05.
	Type; Interest Elections.
	23

	SECTION 2.06.
	Termination and Reduction of Commitments.
	24

	SECTION 2.07.
	Repayment of Loans; Evidence of Debt.
	25

	SECTION 2.08.
	Optional Prepayment of Loans.
	25

	SECTION 2.09.
	Mandatory Prepayment of Loans; Application of Payments after Event of Default.
	26

	SECTION 2.10.
	Fees.
	27

	SECTION 2.11.
	Interest.
	27

	SECTION 2.12.
	Alternate Rate of Interest.
	28

	SECTION 2.13.
	Increased Costs.
	29

	SECTION 2.14.
	Break Funding Payments.
	30

	SECTION 2.15.
	Taxes.
	31

	SECTION 2.16.
	Payments Generally; Allocation of Proceeds; Sharing of Set-offs.
	34

	SECTION 2.17.
	Mitigation Obligations; Replacement of Lenders.
	36

	SECTION 2.18.
	Illegality.
	37

	SECTION 2.19.
	[Reserved].
	37

	SECTION 2.20.
	Change in Control.
	37

	SECTION 2.21.
	[Reserved]
	38

	SECTION 2.22.
	Defaulting Lenders.
	38

	ARTICLE III Representations and Warranties
	40

	SECTION 3.01.
	Organization; Powers.
	40

	SECTION 3.02.
	Authorization; Enforceability.
	40

	SECTION 3.03.
	Governmental Approvals; No Conflicts.
	40

	SECTION 3.04.
	Financial Condition.
	40

	SECTION 3.05.
	Properties.
	40

	SECTION 3.06.
	Litigation.
	41

	SECTION 3.07.
	Compliance with Laws and Agreements; Licenses and Permits.
	41

	SECTION 3.08.
	Investment Company Status.
	41

	SECTION 3.09.
	Taxes.
	41

	SECTION 3.10.
	ERISA.
	41

	SECTION 3.11.
	[Reserved].
	41

	SECTION 3.12.
	Federal Reserve Regulations.
	41

	SECTION 3.13.
	USA PATRIOT Act and Other Regulations.
	42

	SECTION 3.14.
	[Reserved].
	42

	SECTION 3.15.
	Disclosure.
	42

	SECTION 3.16.
	Solvency.
	42

	SECTION 3.17.
	[Reserved].
	42

	SECTION 3.18.
	[Reserved].
	42

	SECTION 3.19.
	[Reserved].
	42

	SECTION 3.20.
	Anti-Corruption Laws and Sanctions.
	42

	ARTICLE IV Conditions Precedent
	43

	SECTION 4.01.
	Conditions Precedent to the Effective Date.
	43

	SECTION 4.02.
	Credit Extensions On or After the Effective Date.
	44

	SECTION 4.03.
	Parent Guaranty.
	45

	ARTICLE V Affirmative Covenants
	46

	SECTION 5.01.
	Financial Statements and Other Information.
	46

	SECTION 5.02.
	[Reserved]
	47

	SECTION 5.03.
	Existence; Conduct of Business.
	47

	SECTION 5.04.
	Maintenance of Properties.
	47

	SECTION 5.05.
	Compliance with Laws.
	47

	SECTION 5.06.
	Use of Proceeds.
	48

	SECTION 5.07.
	Insurance.
	48

	SECTION 5.08.
	[Reserved].
	48

	SECTION 5.09.
	Books and Records.
	48

	SECTION 5.10.
	Inspection Rights.
	48

	SECTION 5.11.
	Payment of Taxes, Etc.
	48

	SECTION 5.12.
	Cash Collateral.
	49

	SECTION 5.13.
	Payment of Judgments.
	49

	ARTICLE VI [Reserved]
	49

	ARTICLE VII Events of Default
	49

	ARTICLE VIII The Agents
	52

	ARTICLE IX Miscellaneous
	54

	SECTION 9.01.
	Notices.
	54

	SECTION 9.02.
	Waivers; Amendments.
	57

	SECTION 9.03.
	Expenses; Indemnity; Damage Waiver.
	59

	SECTION 9.04.
	Successors and Assigns.
	60

	SECTION 9.05.
	Survival.
	65

	SECTION 9.06.
	Counterparts; Integration; Effectiveness.
	65

	SECTION 9.07.
	Severability.
	66

	SECTION 9.08.
	Right of Setoff.
	66

	SECTION 9.09.
	Governing Law; Jurisdiction; Consent to Service of Process; Waiver of Jury Trial.
	66

	SECTION 9.10.
	Headings.
	67

	SECTION 9.11.
	Confidentiality.
	67

	SECTION 9.12.
	Several Obligations; Nonreliance; Violation of Law.
	68

	SECTION 9.13.
	USA PATRIOT Act.
	68

	SECTION 9.14.
	Interest Rate Limitation.
	68

	SECTION 9.15.
	Termination of Security Agreement and Subsidiary Guaranty.
	69

	SECTION 9.16.
	Acknowledgement and Consent to Bail-In of EEA Financial Institutions
	69

SCHEDULES: 
Schedule 1        Commitment Schedule

EXHIBITS: 
Exhibit A        Form of Administrative Questionnaire 
Exhibit B        Form of Assignment and Assumption  
Exhibit C        [Reserved] 
Exhibit D        Form of Effective Date Certificate 
Exhibit E        Form of Borrowing Request 
Exhibit F        Form of Promissory Note 
Exhibit G        Form of Opinion of Counsel to the Borrower 
Exhibit H        [Reserved]
Exhibit I        Form of Parent Guaranty
Exhibit J        [Reserved]
Exhibit K        Form of Cash Collateral Agreement

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT dated as of June 23, 2017 (this “Agreement”) is made by and among SunPower Corporation, a Delaware corporation (the “Borrower”), the financial institutions parties hereto from time to time (the “Lenders”), and Crédit Agricole Corporate and Investment Bank (“Crédit Agricole CIB”), as Administrative Agent (in such capacity, the “Agent”) and as Security Agent (in such capacity, the “Security Agent”).
RECITALS
WHEREAS, the Borrower, the Lenders, the Administrative Agent and the Security Agent are parties to the Revolving Credit Agreement dated as of July 3, 2013 (as amended by the First Amendment dated as of August 26, 2014, the Second Amendment dated as of February 17, 2016, the Third Amendment dated as of March 18, 2016 and the Fourth Amendment dated as of November 8, 2016, the “Existing Credit Agreement”);
WHEREAS, the parties hereto have agreed to amend and restate the Existing Credit Agreement in its entirety as set forth herein, which amendment and restatement shall become effective upon the Effective Date;
WHEREAS, it is the intent of the parties hereto that this Agreement not constitute a novation of the obligations and liabilities of the parties under the Existing Credit Agreement and that this Agreement amend and restate in its entirety the Existing Credit Agreement and re-evidence the obligations outstanding on the Effective Date as contemplated hereby; and
WHEREAS, it is the intent of the Borrower to confirm that all Obligations, as amended hereby, shall continue in full force and effect and that, from and after the date of this Agreement, all references to the “Credit Agreement” contained in the Loan Documents shall be deemed to refer to this Agreement.
Accordingly, the parties hereto agree as follows:

ARTICLE I 
 
Definitions

SECTION 1.01.    Defined Terms.  As used in this Agreement, the following terms have the meanings specified below:
“2016 Fee Letter” means the Fee Letter by and between the Agent and the Borrower, dated February 17, 2016.
“2017 Fee Letter” means the Fee Letter by and between Crédit Agricole CIB and the Borrower, dated on or about the Effective Date.
“ABR”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
“Adjusted LIBO Rate” means, for any Interest Period, the rate per annum equal to the rate obtained by dividing (i) the LIBO Rate for such Interest Period by (ii) a percentage equal to 1 minus the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained against “Eurocurrency liabilities” as specified in Regulation D (including any marginal, emergency, special or supplemental reserves).
“Administrative Questionnaire” means an Administrative Questionnaire in the form of Exhibit A, or such other form as may be supplied from time to time by the Agent.
“Affiliate” means, with respect to any specified Person, any other Person who directly or indirectly through one or more intermediaries controls, or is controlled by, or is under common control with, such specified Person. The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Agent” has the meaning assigned to such term in the preamble to this Agreement.
“Agent Engagement Letter” means that certain Engagement Letter dated May 29, 2013 by and between the Borrower and the Agent.
“Agent Fees” has the meaning assigned to such term in Section 2.10(c).
“Agent Parties” has the meaning assigned to such term in Section 9.01.
“Agents” means the Agent and the Security Agent.

“Aggregate Revolving Credit Exposure” means the aggregate amount of the Lenders’ Revolving Credit Exposures.
“Alternate Base Rate” means, for any day, a rate per annum equal to the greater of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1⁄2 of 1%, and (c) the LIBO Rate for a period of one month commencing on such day (which rate shall in no event be less than zero) plus 1%.  If the Agent shall have reasonably determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Agent to obtain sufficient quotations in accordance with the terms of the definition of “Federal Funds Effective Rate”, the Alternate Base Rate shall be determined without regard to clause (b) of the preceding sentence until the circumstances giving rise to such inability no longer exist.  Any change in the Alternate Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.
“Anti-Corruption Laws” means all laws, rules and regulations of any jurisdiction applicable to the Borrower or its Affiliates from time to time concerning or relating to bribery or corruption, including, but not limited to, the Foreign Corrupt Practices Act of 1977 and the United Kingdom Bribery Act 2010, each as amended, and the rules and regulations thereunder.
“Applicable Percentage” means, with respect to any Lender, the percentage obtained by dividing (a) the Revolving Credit Exposure of such Lender (or, if no Credit Extensions are then outstanding, the Revolving Credit Commitment of such Lender) by (b) the Aggregate Revolving Credit Exposure (or, if no Credit Extensions are then outstanding, the Total Revolving Credit Commitment).
“Applicable Rate” means, for any day on and after the Effective Date, (i) with respect to any LIBO Rate Loan, 0.60%, (ii) with respect to any ABR Loan, 0.25%, and (iii) with respect to the Commitment Fees, 0.06%.
“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers, advises or manages a Lender.
“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Agent, in the form of Exhibit B or any other form approved by the Agent.

“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
“Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
“Banks” means (a) the Lenders listed on the Commitment Schedule and (b) any Lender that shall have become a party hereto pursuant to an Assignment and Assumption.  For the avoidance of doubt, references herein to Banks shall not include any Lender that ceases to be a party hereto pursuant to an Assignment and Assumption.
“Board” means the Board of Governors of the Federal Reserve System of the United States of America.
“Board of Directors” means (a) with respect to a corporation, the board of directors of the corporation, (b) with respect to a partnership, the board of directors of the general partner of the partnership and (c) with respect to any other Person, the board, managers or committee of such Person serving a similar function.
“Borrower” has the meaning assigned to such term in the preamble to this Agreement.
“Borrowing” means any Loans of the same Type made, converted or continued on the same date and, in the case of LIBO Rate Loans, as to which a single Interest Period is in effect.
“Borrowing Request” means a request by the Borrower for a Borrowing in accordance with Section 2.03 and substantially in the form attached hereto as Exhibit E, or such other form as shall be approved by the Agent.
“Business Day” means a day of the year other than (a) Saturdays, (b) Sundays or (c) any day on which banks are required or authorized by law to close in either or both of New York or Paris, France; provided that, when used in connection with a LIBO Rate Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.
“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

“Cash Collateral Agreement” means a cash collateral agreement executed by the Borrower in favor of the Security Agent and substantially in the form attached hereto as Exhibit K.
“Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash collateral in Dollars, at a location and pursuant to documentation in form and substance satisfactory to the Agent.  “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
“Change in Control” means Total S.A. shall fail to directly or indirectly beneficially own or control at least 50.1% of the voting power represented by the issued and outstanding Equity Interests of the Borrower. 
“Change in Control Amendment” means a Change in Control Amendment implementing the adoption of a Substitute Basis.
“Change in Control Amendment Date” has the meaning assigned to such term in Section 2.20(b).
“Change in Law” means (a) the adoption of any treaty, international agreement, law, rule, or regulation after the date of this Agreement, (b) any change in any treaty, international agreement, law, rule, or regulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by the Agent or any Lender (or, for purposes of Section 2.13(b), by any lending office of such Lender or by the corporation controlling such Lender, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority (provided that compliance with such request, guideline or directive is in accord with the general practice of Persons to whom such request, guideline or directive is intended to apply) made or issued after the date of this Agreement; provided, however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, regulations, guidelines or directives thereunder or issued in connection therewith or in implementation thereof and (ii) all requests, rules, guidelines, requirements and directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case referred to in clause (i) or (ii) be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“Closing Date” means July 3, 2013.
“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any references to any Code section shall include references to the Treasury Regulations promulgated thereunder.

“Commitment Fee” has the meaning assigned to such term in Section 2.10(a).
“Commitment Schedule” means the Schedule attached as Schedule 1 to this Agreement, as such Schedule may be amended from time to time in accordance with the terms of this Agreement.
“Communications” has the meaning assigned to such term in Section 9.01(e)(ii).
“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
“Credit Date” means the date of a Credit Extension.
“Credit Extension” means the making of a Loan.
“Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.
“Defaulting Lender” means any Lender that (a) defaults in its obligation to extend credit (including funding all or any portion of its Loans) or pay to the Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date on which such credit is required to be extended, or such payment is required to be made, by it hereunder, (b) has notified the Agent or the Borrower in writing that it does not intend to satisfy any such obligations or has made a public statement with respect to any such obligations hereunder or generally with respect to all agreements in which it commits to extend credit, (c) has failed, within three Business Days after written request by the Agent or the Borrower, to confirm in writing to the Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Agent and the Borrower), (d) has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business, appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a direct or indirect parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business, appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment, or (e) has, or has a direct or indirect parent company that has, become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender 

solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.
“Dollars” or “$” refers to lawful money of the United States of America.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Effective Date” means the date on which each of the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
“Effective Date Certificate” means a certificate substantially in the form of Exhibit D.
“Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, or (c) an Approved Fund; provided that neither the Borrower nor any Affiliate thereof shall qualify as an Eligible Assignee.
“Equity Interests” means shares of capital stock, general or limited partnership interests, membership interests in a limited liability company, beneficial interests in a trust, or other equity ownership interests in a Person, and any warrants, options, or other rights entitling the holder thereof to purchase or acquire any such equity interest.
“ERISA” means the Employee Retirement Income Security Act of 1974 and the regulations promulgated thereunder, as amended from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated) that is under common control with the Borrower within the meaning of Section 4001 of ERISA, or that, together with the Borrower, is treated as a single employer under Section 414(b), or (c), (m) or (o) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30 day notice period is waived); (b) a failure by any Plan to meet the minimum funding standards within the meaning of Section 412 of the Code or Section 302 of ERISA, in each case, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice of an intent to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is insolvent or in reorganization, within the meaning of Title IV of ERISA, (h) a determination that any Plan or Multiemployer Plan is, or is expected to be, in at-risk status (within the meaning of Title IV of ERISA), or (i) the filing of a notice of intent to terminate or the termination of any Plan under Section 4041(c) of ERISA.  
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time. 
“Event of Default” has the meaning assigned to such term in Article VII.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.
“Excluded Taxes” means, with respect to a Recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) (i) income or franchise Taxes imposed on (or measured by) its net income by the jurisdiction under the laws of which such Recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located or (ii) Other Connection Taxes, (b) any branch profits Taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which such Recipient is located, (c) in the case of a Lender, any U.S. Federal withholding Taxes attributable to such 

Lender’s failure to comply with Section 2.15(f), (d) except in the case of an assignee pursuant to a request by the Borrower under Section 2.17(b), any U.S. Federal withholding Tax that is imposed on amounts payable to such recipient at the time such recipient becomes a party to this Agreement (or designates a new lending office), except to the extent that such recipient (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding Tax pursuant to Section 2.15(a) and (e) any U.S. Federal withholding Taxes imposed by FATCA.
“Existing Credit Agreement” has the meaning assigned to such term in the recitals.
“Exiting Bank” means a Lender who declines to participate in making its Revolving Credit Commitment available on a Substitute Basis.
“fair market value” means, with respect to any asset or property, the price which could be negotiated in an arm’s‐length, free market transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction. Fair market value shall be determined by the Board of Directors of the Borrower acting reasonably and in good faith.
“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), and any regulations or official interpretations thereof.
“Federal Funds Effective Rate” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Agent from three federal funds brokers of recognized standing selected by the Borrower (which rate shall in no event be less than zero).
“Fee Letters” means (i) that certain Upfront Fee Letter dated May 29, 2013 by and among the Borrower and the Agent, (ii) the Agent Engagement Letter, (iii) the 2016 Fee Letter and (iv) the 2017 Fee Letter. 
“Fees” means the Commitment Fees and the Agent Fees.
“Financial Officer” means the chief financial officer, treasurer or controller of the Borrower.

“First Amendment” means the First Amendment to Revolving Credit Agreement relating to the Existing Credit Agreement dated as of August 26, 2014, by and among the Borrower, the Agent and the Lenders listed on the signature pages thereof. 
“First Amendment Effective Date” means the “Effective Date” under and as defined in the First Amendment.
“Foreign Lender” means a Lender that is not a “United States person” within the meaning of Section 7701(a)(30) of the Code.
“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States of America, (a) except as otherwise expressly provided in this Agreement, as in effect as of the Closing Date, and (b) with respect to all financial statements and reports required to be delivered under the Loan Documents, as in effect from time to time.
“Governmental Acts” means any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority.
“Governmental Authority” means any supra-national body, the government of the United States of America, any other nation or any political subdivision of any thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
“Guaranteed Amount” means, at any time, the maximum amount of Obligations guaranteed by the Parent Guarantor at such time under the Parent Guaranty.
“Historical Financial Statements” has the meaning assigned to such term in Section 3.04.
“Indebtedness” means, as applied to any Person, without duplication (i) all obligations for borrowed money, (ii) all obligations evidenced by bonds, debentures, notes or other similar instruments, (iii) all obligations to pay the deferred purchase price of property or services (other than accounts payable and accrued expenses incurred in the ordinary course of business determined in accordance with GAAP), (iv) all obligations with respect to capital leases, (v) all obligations created or arising under any conditional sale or other title retention agreement with respect to property acquired by such Person, (vi) all non-contingent reimbursement and other payment obligations in respect of letters of credit and similar surety instruments (including construction performance bonds), 

(vii) the face amount of any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings, (ix) any obligations with respect to tax equity or similar financing arrangements, and (x) (1) the direct or indirect guaranty, endorsement (other than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another, (2) any obligation of such Person the primary purpose or intent of which is to provide assurance to an obligee that the obligation of the obligor thereof will be paid or discharged, or any agreement relating thereto will be complied with, or the holders thereof will be protected (in whole or in part) against loss in respect thereof, and (3) any liability (contingent or otherwise) of such Person for an obligation of another Person with respect to Indebtedness listed in clauses (i) through (ix) above, including any agreement (a) to purchase, repurchase or otherwise acquire such obligation or any security therefor, or to provide funds for the payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (b) to maintain the solvency or any balance sheet item, level of income or financial condition of such other Person.
“Indemnified Taxes” means Taxes other than Excluded Taxes. 
“Information” has the meaning set forth in Section 9.11.
“Interest Election Request” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.05.
“Interest Payment Date” means (a) with respect to any ABR Loan, the last Business Day of each March, June, September and December and the Revolving Credit Maturity Date, and (b) with respect to any LIBO Rate Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a LIBO Rate Borrowing with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period (or if such day is not a Business Day, the next succeeding Business Day).
“Interest Period” means with respect to any LIBO Rate Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months (or, to the extent agreed to by each relevant Lender, nine or twelve months) thereafter, as the Borrower may elect; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on 

which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
“Interpolated Rate” means, with respect to any LIBO Rate Borrowing for any Interest Period, a rate per annum which results from interpolating on a linear basis between (a) the applicable Screen Rate for the longest maturity for which a Screen Rate is available that is shorter than such Interest Period and (b) the applicable Screen Rate for the shortest maturity for which a Screen Rate is available that is longer than such Interest Period, in each case at approximately 11:00 a.m., London time, on the date that is two Business Days prior to the commencement of such Interest Period.
“IRS” means the United States Internal Revenue Service.
“Joint Venture” means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form.
“Lenders” means the Persons listed as Lenders on the Commitment Schedule and any other Person that shall have become a party hereto as a Lender pursuant to an Assignment and Assumption, other than any such Person that ceases to be a party hereto as a Lender pursuant to an Assignment and Assumption.
“LIBO Rate” means, with respect to any Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration Limited (or any other Person that takes over the administration of such rate for Dollars) for a period equal in length to such Interest Period as displayed on the Reuters screen page that displays such rate (currently page LIBOR01) or, in the event such rate does not appear on a page of the Reuters screen, on the appropriate page of such other information service that publishes such rate as shall be selected by the Agent from time to time in its reasonable discretion (in each case, the “Screen Rate”), at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided, that if the Screen Rate shall not be available at such time for such Interest Period with respect to Dollars, then the LIBO Rate shall be the Interpolated Rate.  If the LIBO Rate (as determined pursuant to the foregoing provisions of this definition) for any Interest Period is below zero, then the LIBO Rate for such Interest Period shall be deemed to be zero. 
“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, hypothecation, collateral assignment, encumbrance, deposit arrangement, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset, and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
“Loan Documents” means this Agreement, the Parent Guaranty, the Cash Collateral Agreement, each Fee Letter and any promissory notes issued pursuant to this 

Agreement.  Any reference in this Agreement or any other Loan Document to a Loan Document shall include all appendices, exhibits or schedules thereto, and all amendments, restatements, supplements or other modifications thereto.
“Loan Party” means the Borrower and the Parent Guarantor, and “Loan Parties” shall mean all such Persons, collectively.
“Loans” means the revolving loans made by the Lenders to the Borrower pursuant to Section 2.01(a).  
“Margin Stock” has the meaning assigned to such term in Regulation U.
“Material Adverse Effect” means a material adverse effect on (a) the business, financial condition, operations or properties of the Borrower and its Subsidiaries, taken as a whole, (b) the validity or enforceability of any of the Loan Documents, or (c) the ability of any Loan Party to perform its obligations under the Loan Documents.
“Material Indebtedness” means Indebtedness (other than (i) the Loans, (ii) any non-recourse Indebtedness, and (iii) any Indebtedness as to which the holders of such Indebtedness have recourse only to any one or more Project Finance Subsidiaries, including any such Project Finance Subsidiaries’ assets, but without recourse to the Borrower other than Permitted Project Recourse) for borrowed money (including notes, bonds and other similar instruments) and reimbursement obligations in respect of drawn letters of credit of the Borrower in an aggregate principal amount outstanding exceeding $70,000,000.
“Maximum Amount Due” means, at any time, the sum of (i) the aggregate principal amount of all outstanding Loans at such time plus (ii) the total amount of interest to be paid on such Loans and Commitment Fees to be paid on any unutilized Revolving Credit Commitments, in each case, from such time through and until the Scheduled Maturity Date (assuming no repayments or prepayments of such Loans) plus (iii) the amount of all due but unpaid interest, fees, costs and expenses under any Loan Document at such time plus (iv) the amount of any other fees, costs and expenses reasonably expected to be incurred by the Borrower under or in connection with any Loan Document from such time through and until the Scheduled Maturity Date.
“Multiemployer Plan” means a multiemployer plan as defined in Section 3(37) or 4001(a)(3) of ERISA then, or at any time during the previous five years maintained for, or contributed to (or for which there was an obligation to contribute) on behalf of, employees of the Borrower or any ERISA Affiliate.
“Non-Consenting Lender” has the meaning assigned to such term in Section 9.02(c).

“Non-Controlled Subsidiary” means, at any time, any Subsidiary not controlled by Borrower.  The term “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.
“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.
“obligations” means, for purposes of the definition of the term “Indebtedness”, all obligations for principal, premium, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable under the documentation governing any Indebtedness.
“Obligations” means all obligations, liabilities, and Indebtedness of every nature of the Borrower from time to time owing to the Agent or any Lender, under or in connection with this Agreement or any other Loan Document, in each case whether primary, secondary, direct, indirect, contingent, fixed or otherwise, including interest accruing at the rate provided in the applicable Loan Document on or after the commencement of any bankruptcy or insolvency proceeding, whether or not allowed or allowable.
“Officer” means the Chairman of the Board, the Chief Executive Officer, the Chief Financial Officer, the President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or the Secretary of the Borrower.
“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document). 
“Other Taxes” means any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.
“Parent Guarantor” means Total S.A., a société anonyme organized under the laws of the Republic of France.
“Parent Guaranty” means the guaranty executed by the Parent Guarantor in favor of the Agent and substantially in the form attached hereto as Exhibit I. 
“Participant” has the meaning assigned to such term in Section 9.04(c).

“Participant Register” has the meaning assigned to such term in Section 9.04(c)(i). 
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“Permitted Project Recourse” means (a) limited guarantees and side letters from the Borrower in respect of any Indebtedness of any Project Finance Subsidiary which do not guarantee obligations for borrowed money (including notes, bonds and other similar instruments), operating lease obligations, Capital Lease Obligations or reimbursement or other payment obligations in respect of letters of credit (including, without limitation, equipment, procurement and construction, operations and maintenance, asset management, liquidated damages and managing member and tax indemnity undertakings), and (b) pledges of Equity Interests in Project Finance Subsidiaries (or direct or indirect owners of Project Finance Subsidiaries) or other limited guarantees or side letters provided that the holders of such Indebtedness have acknowledged that they will not have any recourse to the assets or Equity Interests (other than as specified in this clause (b)) of any the Borrower.
“Person” means an individual, partnership, corporation, association, limited liability company, unincorporated organization, trust or Joint Venture, or a governmental agency or political subdivision thereof.
“Plan” means any “employee pension benefit plan” as defined in Section 3(2) of ERISA (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA then, or at any time during the past five years, sponsored, maintained or contributed to (or to which there is or was an obligation to contribute) on behalf of employees of the Borrower or any ERISA Affiliate.
“Platform” has the meaning assigned to such term in Section 9.01(e)(i).
“Prime Rate” means the rate of interest per annum determined from time to time by the Agent as its base rate in effect at its principal office in New York City and notified to the Borrower (which Borrower acknowledges is not necessarily Lender's lowest rate).
“Project Finance Subsidiary” means a limited purpose Subsidiary of the Borrower established in connection with the construction of a solar project, or the sale of solar equipment and/or energy.
“Recipient” means (a) the Agent or (b) any Lender, as applicable.
“Register” has the meaning assigned to such term in Section 9.04(b)(iv).

“Regulation D” means Regulation D of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof, and any successor provision thereto.
“Regulation T” means Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof, and any successor provision thereto.
“Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof, and any successor provision thereto.
“Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof, and any successor provision thereto.
“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, trustees, employees, agents and advisors of such Person and such Person’s Affiliates.
“Required Lenders” means at any time, Lenders that have Revolving Credit Exposure and unused Revolving Credit Commitments representing more than 50% of the sum of all Revolving Credit Exposure and unused Revolving Credit Commitments; provided that the Revolving Credit Exposure and unused Revolving Credit Commitments of any Defaulting Lender shall be disregarded in the determination of the Required Lenders at any time.
“Required Payment” has the meaning assigned thereto in Section 9.02(c).
“Requirement of Law” means, as to any Person, the Certificate of Incorporation and By‐Laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“Revolving Credit Commitment” means, with respect to each Lender, the commitment of such Lender to make Loans hereunder as set forth in the Commitment Schedule or in the most recent Assignment and Assumption executed by such Lender, as applicable, as the same may be (i) reduced from time to time pursuant to Section 2.06 and (ii) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04.
“Revolving Credit Exposure” means, with respect to any Lender at any time, the aggregate principal amount at such time of all outstanding Loans of such Lender.

“Revolving Credit Maturity Date” means the earliest to occur of (i) the Scheduled Maturity Date, (ii) the date the Revolving Credit Commitments are permanently reduced to zero pursuant to Section 2.06(b), and (iii) the date of the termination of the Revolving Credit Commitments pursuant to Section 2.20 or Article VII.
“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all of its functions.
“Sanctioned Country” means a country or territory which is itself the subject or target of comprehensive countrywide or territory-wide Sanctions (including, without limitation, Cuba, Iran, North Korea, Sudan and Syria).
“Sanctioned Person” means (a) any Person that is the target or subject of Sanctions or listed in any Sanctions-related list of designated Persons maintained by the U.S. government (including, without limitation, the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State) or by the United Nations Security Council, the European Union or any European Union member state, (b) any Person located, organized or resident in a Sanctioned Country, or (c) any Person Controlled by any such Person or Persons described in the foregoing clauses (a) or (b). 
“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State or (b) the United Nations Security Council, the European Union, any European Union member state or Her Majesty’s Treasury of the United Kingdom.
“Scheduled Maturity Date” means the date falling five years after the First Amendment Effective Date.
“Screen Rate” has the meaning assigned to such term in the definition of “LIBO Rate” in this Section 1.01.
“Second Amendment” means the Second Amendment to Revolving Credit Agreement relating to the Existing Credit Agreement dated as of February 17, 2016, by and among the Borrower, the Agent and the Lenders listed on the signature pages thereof. 
“Second Amendment Effective Date” means the “Effective Date” under and as defined in the Second Amendment.
“Securities Act” means the Securities Act of 1933, as amended.
“Security Agent” has the meaning assigned to such term in the recitals to this Agreement.

“Security Agreement” means that certain Security Agreement dated as of January 31, 2014 among the Borrower, certain of its Subsidiaries and the Security Agent, as amended by the First Amendment to Security Agreement dated as of the Second Amendment Effective Date.
“Solvent”, with respect to any Person, means that as of the date of determination (a) the then fair saleable value of the property of such Person is (1) greater than the total amount of liabilities (including contingent liabilities) of such Person and (2) not less than the amount that will be required to pay the probable liabilities on such Person’s then existing debts as they become absolute and due considering all financing alternatives and potential asset sales reasonably available to such Person, (b) such Person’s capital is not unreasonably small in relation to its business or any contemplated or undertaken transaction, and (c) such Person does not intend to incur, or believe that it will incur, debts beyond its ability to pay such debts as they become due. For purposes of this definition, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.
“Spot Rate” for a currency means the rate determined by the Agent as the spot rate for the purchase of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the date two Business Days prior to the date as of which the foreign exchange computation is made; provided that the Agent may obtain such spot rate from another financial institution designated by the Agent if it does not have as of the date of determination a spot buying rate for any such currency.
“subsidiary” with respect to any Person, means:
(i)any corporation of which the outstanding Equity Interests having at least a majority of the votes entitled to be cast in the election of directors under ordinary circumstances shall at the time be owned, directly or indirectly by such Person; or
(ii)    any other Person of which at least a majority of the voting interest under ordinary circumstances is at the time, directly or indirectly, owned by such Person.
“Subsidiary” means, unless the context otherwise requires, a Subsidiary of the Borrower.
“Subsidiary Guarantor” has the meaning assigned to such term in the Existing Credit Agreement, before giving effect to this Agreement.
“Subsidiary Guaranty” means the subsidiary guaranty executed by each Subsidiary Guarantor.

“Substitute Basis” has the meaning set forth in Section 2.20(a).
“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, similar charges or withholdings imposed by any Governmental Authority.
“Total Revolving Credit Commitment” means, at any time, the aggregate amount of Revolving Credit Commitments, as in effect at such time, being $300,000,000 as of the Effective Date.
“Total Utilization of Revolving Credit Commitments” means, as at any date of determination, the aggregate principal amount of all outstanding Loans.
“Transactions” means, collectively, the execution, delivery and performance by the Borrower of the Loan Documents, the making of the Credit Extensions hereunder, and the use of proceeds thereof in accordance with the terms hereof.
“Type”, when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York. 
“USA PATRIOT Act” means The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)), as amended from time to time.
“U.S. Person” means any Person that is a “United States Person” as defined in Section 7701(a)(30) of the Code. 
“U.S. Tax Certificate” has the meaning specified in Section 2.15(f). 
“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
“Withholding Agent” means the Borrower or the Agent.
“Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

SECTION 1.02.    Classification of Loans and Borrowings.  For purposes of this Agreement, Loans may be classified and referred to by Type (e.g., a “LIBO Rate Loan”).  Borrowings may also be classified and referred to by Type (e.g., a “LIBO Rate Borrowing”).

SECTION 1.03.    Terms Generally.  The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”.  Unless otherwise specifically indicated, the term “consolidated” with respect to any Person refers to such Person consolidated with its Subsidiaries.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, amended and restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

SECTION 1.04.    Effectuation of Transactions.  Each of the representations and warranties of the Borrower contained in this Agreement (and all corresponding definitions) are made after giving effect to the Transactions, unless the context otherwise requires.

SECTION 1.05.    Accounting Terms; GAAP.  Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP or, if not defined in GAAP (as determined by the Borrower in good faith) as determined by the Borrower in good faith, as in effect from time to time; provided that, to the extent set forth in clause (c) of the definition of “GAAP”, if the Borrower notifies the Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Agent notifies the Borrower that the Required Lenders request an amendment to any provision thereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be 

interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith..

ARTICLE II     
 
The Credits

SECTION 2.01.    Loan Commitments.  (a) Subject to the terms and conditions set forth herein, each Lender agrees, severally and not jointly, to make Loans to the Borrower, at any time and from time to time after the Effective Date, and until the earlier of the Revolving Credit Maturity Date and the termination of the Revolving Credit Commitment of such Lender in accordance with the terms hereof, in an aggregate principal amount at any time outstanding that will not result in such Lender’s Revolving Credit Exposure exceeding such Lender’s Revolving Credit Commitment; provided that at no time shall  the aggregate principal amount of all outstanding Loans exceed 95.0% of the Guaranteed Amount or  the Maximum Amount Due exceed the Guaranteed Amount.  Within the limits set forth in the preceding sentence and subject to the terms, conditions and limitations set forth herein, the Borrower may borrow, pay or prepay and reborrow Loans.
(b)    The Revolving Credit Commitment of each Lender as of the Effective Date is specified on the Commitment Schedule then in effect on such date.

SECTION 2.02.    Loans and Borrowings. (a)  Each Loan shall be made as part of a Borrowing consisting of Loans of the same Type made by the Lenders ratably in accordance with their applicable Revolving Credit Commitments.  The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Revolving Credit Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.  The Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) in an integral multiple of $1,000,000 and not less than $1,000,000 or (ii) equal to the remaining available balance of the applicable Revolving Credit Commitments.
(b)    Subject to Section 2.12, each Borrowing shall be comprised entirely of ABR Loans or LIBO Rate Loans as the Borrower may request in accordance herewith.  Each Lender at its option may make any LIBO Rate Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that (i) any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement, and (ii) in exercising such option, such Lender shall use reasonable efforts to minimize any increase in the Adjusted LIBO Rate or increased costs to the Borrower resulting therefrom (which obligation of 

such Lender shall not require it to take, or refrain from taking, actions that it determines would result in increased costs for which it will not be compensated hereunder or that it otherwise determines would be disadvantageous to it and in the event of such request for costs for which compensation is provided under this Agreement, the provisions of Section 2.13 shall apply).
(c)    At the commencement of each Interest Period for any LIBO Rate Borrowing, such Borrowing shall comprise an aggregate principal amount that is an integral multiple of $1,000,000 and not less than $1,000,000.  Each ABR Borrowing when made shall be in a minimum principal amount of $1,000,000; provided that an ABR Borrowing may be maintained in a lesser amount equal to the difference between the aggregate principal amount of all other Borrowings and the total amount of Loans at such time outstanding.  Borrowings of more than one Type may be outstanding at the same time; provided that there shall not at any time be more than a total of ten different Interest Periods in effect for LIBO Rate Borrowings at any time outstanding.
(d)    Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving Credit Maturity Date.

SECTION 2.03.    Requests for Borrowing.    In order to request a Borrowing, the Borrower shall notify the Agent of such request either in writing by delivery of a Borrowing Request (by hand, electronic mail, or facsimile) signed by the Borrower or by telephone (to be confirmed promptly by hand delivery, electronic mail, or facsimile of written notice) not later than 11:00 a.m., New York City time, (A) in the case of a LIBO Rate Borrowing, three (3) Business Days before a proposed Borrowing (or such later time on such Business Day as shall be acceptable to the Agent) and (B) in the case of an ABR Borrowing, one (1) Business Day before a proposed Borrowing (or such later time as shall be acceptable to the Agent and each Lender).  Each such telephonic and written Borrowing Request shall be irrevocable and shall specify the following information in compliance with Section 2.01:
(i)    the aggregate amount of the requested Borrowing;
(ii)    the aggregate principal amount of all Borrowings scheduled to be outstanding as of the date of the requested Borrowing (including, for this purpose, the principal amount of such requested Borrowing);
(iii)    the date of the Borrowing, which shall be a Business Day;
(iv)    the Guaranteed Amount (and 95% of the Guaranteed Amount) as of the date of the Borrowing;

(v)    whether the Borrowing then being requested is to be an ABR Borrowing or a LIBO Rate Borrowing;
(vi)    in the case of a LIBO Rate Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and
(vii)    the location and number of the Borrower’s account to which funds are to be disbursed;
provided, however, that notwithstanding any contrary specification in any Borrowing Request, each requested Borrowing shall comply with the requirements set forth in Section 2.02 and Section 2.04.
(b)    If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing.  If no Interest Period is specified with respect to any LIBO Rate Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of the Borrowing Request in accordance with this Section 2.03 (but in any event on the same day such Borrowing Request is received by the Agent), the Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04.    Funding of Borrowings.   (a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 (noon), New York City time, to the account of the Agent most recently designated by it for such purpose by notice to the Lenders.
(b)    Unless the Agent shall have received notice from a Lender prior to the date of any Borrowing that such Lender will not make available to the Agent such Lender’s share of such Borrowing, the Agent may assume that such Lender has made such share available on the date of such Borrowing in accordance with Section 2.04(a) and may, in reliance upon such assumption, make available to the Borrower a corresponding amount.  In such event, if a Lender has not in fact made its share of the Borrowing available to the Agent, then the applicable Lender and the Borrower severally agree to pay to the Agent forthwith on demand (without duplication) such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate reasonably determined by the Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to ABR Loans.  If such Lender pays such amount to the Agent, then such amount shall constitute such Lender’s Loan as part of such Borrowing for purposes of this Agreement.  Nothing herein shall be deemed to relieve any Lender from its obligation to fulfill its 

Revolving Credit Commitments or to prejudice any rights which the Agent or the Borrower may have against any Lender as a result of any default by such Lender hereunder.

SECTION 2.05.    Type; Interest Elections. (a)  Loans shall initially be of the Type specified in the applicable Borrowing Request and, in the case of a LIBO Rate Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, the Borrower may elect to convert all or any portion of any Borrowing (subject to the minimum amounts for Borrowings of the applicable Type specified in Section 2.02(c)) to a different Type or to continue such Borrowing and, in the case of a LIBO Rate Borrowing, may elect Interest Periods therefor, all as provided in this Section 2.05.  The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.
(b)    To make an election pursuant to this Section 2.05, the Borrower shall notify the Agent of such election by telephone (i) in the case of an election to convert to or continue as a LIBO Rate Borrowing, not later than 11:00 a.m., New York City time, three (3) Business Days before the date of the proposed conversion or continuation or (ii) in the case of an election to convert to or continue as an ABR Borrowing, not later than 10:00 a.m., New York City time, on the date of the proposed conversion or continuation.  Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery, electronic mail, or facsimile to the Agent of a written Interest Election Request in a form approved by the Agent and signed by the Borrower.
(c)    Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:
(i)    the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii)    the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii)    whether the resulting Borrowing is to be an ABR Borrowing or a LIBO Rate Borrowing; and

(iv)    if the resulting Borrowing is a LIBO Rate Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.
If any such Interest Election Request requests a LIBO Rate Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d)    Promptly following receipt of an Interest Election Request, the Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.
(e)    If the Borrower fails to deliver a timely Interest Election Request with respect to a LIBO Rate Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing.  Notwithstanding any contrary provision hereof, if an Event of Default of the type set forth in clause (a) or (b) of Article VII (without giving effect to any grace period set forth therein) has occurred and is continuing and the Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing, (i) no outstanding Borrowing may be converted to or continued as a LIBO Rate Borrowing and (ii) unless repaid, each LIBO Rate Borrowing shall be converted to an ABR Borrowing at the end of the then current Interest Period applicable thereto.

SECTION 2.06.    Termination and Reduction of Commitments.  (a)  The Revolving Credit Commitments shall automatically terminate on the Revolving Credit Maturity Date and as set forth in Section 2.20.
(b)    Upon at least three Business Days’ prior irrevocable written or fax notice (or telephonic notice promptly confirmed by written notice) to the Agent, the Borrower may at any time in whole permanently terminate, or from time to time in part permanently reduce, the Revolving Credit Commitments; provided, however, that (i) each partial reduction of the Revolving Credit Commitments shall be in an integral multiple of $1,000,000 and in a minimum amount of $1,000,000, (ii) the Total Revolving Credit Commitment shall not be reduced to an amount that is less than the Aggregate Revolving Credit Exposure at the time, (iii) the Borrower may condition a notice of termination of all of the Revolving Credit Commitments upon the effectiveness of a replacement financing, and (iv) the Borrower may condition a notice of termination of the Revolving Credit Commitments (or, if applicable, the Revolving Credit Commitments of the Exiting Banks) upon the consummation of a Change in Control.
(c)    Each reduction in the Revolving Credit Commitments hereunder, other than a reduction resulting from the termination of the Exiting Banks’ Revolving Credit Commitments in connection with a Change in Control Amendment, shall be made ratably among the Lenders in accordance with their respective Revolving Credit 

Commitments.  The Borrower shall pay to the Agent for the account of the applicable Lenders, on the date of termination of the Revolving Credit Commitments (or the Exiting Banks’ Revolving Credit Commitments, as the case may be), all accrued and unpaid Commitment Fees relating to the same but excluding the date of such termination.

SECTION 2.07.    Repayment of Loans; Evidence of Debt. (a)    The Borrower hereby unconditionally promises to pay to each Lender, through the Agent, the then unpaid principal amount of each Loan of such Lender on the Revolving Credit Maturity Date.
(b)    Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(c)    The Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Type thereof and the Interest Period (if any) applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Agent hereunder for the account of the Lenders and each Lender’s share thereof.
(d)    The entries made in the accounts maintained pursuant to clause (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
(e)    Any Lender may request that Loans made by it be evidenced by a promissory note.  In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender and its registered assigns and in substantially the form of Exhibit F hereto.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the payee named therein and its registered assigns.

SECTION 2.08.    Optional Prepayment of Loans. (a)    Upon prior notice in accordance with clause (b) of this Section, the Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part without premium or penalty (but subject to Section 2.14); provided that each partial prepayment shall be in an amount that is an integral multiple of $1,000,000 and not less than $1,000,000.

(b)    The Borrower shall notify the Agent by telephone (confirmed by facsimile) of any prepayment hereunder (i) in the case of prepayment of a LIBO Rate Borrowing, not later than 11:00 a.m., New York City time, three (3) Business Days before the date of prepayment or (ii) in the case of prepayment of an ABR Borrowing, not later than 10:00 a.m., New York City time, on the day of prepayment.  Each such notice shall be irrevocable (except in the case of a repayment in full of all of the Obligations, which may be conditioned upon the effectiveness of a new financing) and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid. Promptly following receipt of any such notice relating to a Borrowing, the Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of a Borrowing of the same Type as provided in Section 2.02.  Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing; provided that any prepayments made to Exiting Banks in connection with a termination of their Revolving Credit Commitments shall be applied ratably to the applicable Loans of such Exiting Banks.  Prepayments shall be accompanied by accrued interest as required by Section 2.11 and any prepayment of LIBO Rate Loans shall be subject to the provisions of Section 2.14; provided, however, that in the case of a prepayment of an ABR Loan that is not made in connection with a termination of the Revolving Credit Commitments, the accrued and unpaid interest on the principal amount prepaid shall be payable on the next scheduled Interest Payment Date with respect to such ABR Loan.

SECTION 2.09.    Mandatory Prepayment of Loans; Application of Payments after Event of Default. (a)   In the event of any termination of all the Revolving Credit Commitments, the Borrower shall, on the date of such termination, repay or prepay all its outstanding Borrowings, together with accrued interest thereon, accrued Fees and all other amounts payable to the Lenders hereunder.
(b)    If at any time (i) the Aggregate Revolving Credit Exposure exceeds the lower of (1) the Total Revolving Credit Commitment and (2) 95.0% of the Guaranteed Amount, or (ii) the Maximum Amount Due exceeds the Guaranteed Amount, then the Borrower shall repay or prepay Borrowings in an amount sufficient to eliminate such excess.
(c)    Upon the occurrence and during the continuation of an Event of Default, if requested by Required Lenders, or upon acceleration of the Obligations pursuant to Article VII, all payments received by the Agent, whether from the Borrower or the Parent Guarantor may, in the discretion of the Agent, be applied in full or in part by the Agents, in each case in the following order of priority:
		
	i.
	to the payment of all costs and expenses of such sale, collection or other realization, all other expenses, liabilities and advances made or incurred by the Agent in connection therewith, and all amounts for which the Agent are entitled to compensation (including the 

fees described in Section 2.10), reimbursement and indemnification under any Loan Document and all advances made by the Agent thereunder for the account of the Borrower, and to the payment of all costs and expenses paid or incurred by the Agents in connection with the Loan Documents, all in accordance with Section 9.03 and the other terms of this Agreement and the Loan Documents;
		
	ii.
	thereafter, to the payment of all Loans to the full extent thereof (with accrued interest being paid in full prior to application of amounts to pay principal); and

		
	iii.
	thereafter, to the payment to or upon the order of the Borrower or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

SECTION 2.10.    Fees.  (a)  The Borrower agrees to pay to each Non-Defaulting Lender, through the Agent, a commitment fee (a “Commitment Fee”) equal to the Applicable Rate per annum in effect from time to time on the daily unused amount of the Revolving Credit Commitments of such Lender during the preceding quarter (or other period commencing with the Closing Date or ending with the Revolving Credit Maturity Date or the date on which the Revolving Credit Commitments of such Lender shall expire or be terminated).  The Commitment Fee due to each Lender shall commence to accrue on the Closing Date and shall cease to accrue on the date on which the Revolving Credit Commitments of such Lender shall expire or be terminated as provided herein.
(b)    The fee referred to in Section 2.10(a) shall be computed on the basis of the actual number of days elapsed in a year of 360 days and shall be payable in Dollars.  The fee referred to in Section 2.10(a) shall be payable quarterly in arrears on the last Business Day of March, June, September and December in each year and on each date on which any Revolving Credit Commitment of such Lender shall expire or be terminated as provided herein.
(c)    The Borrower agrees to pay to the Agent, for its own account, the agency fees set forth in the Fee Letters, or such agency fees as may otherwise be separately agreed upon by the Borrower and the Agent payable in the amounts and at the times specified therein or as so otherwise agreed upon (the “Agent Fees”).
(d)    All Fees shall be paid on the dates due, in immediately available funds, to the Agent for distribution, if and as appropriate, among the Lenders.

SECTION 2.11.    Interest    .  (a)  The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b)    The Loans comprising each LIBO Rate Borrowing shall bear interest at the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate.
(c)    Notwithstanding the foregoing, upon the occurrence and during the continuance of an Event of Default referred to in clauses (a), (b), (g), and (h) of Article VII, at the written request of the Required Lenders, any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder shall bear interest, payable on demand, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2.0% plus the rate otherwise applicable to such Loan as provided in the preceding clauses of this Section or (ii) in the case of any other amount, 2.0% plus the rate applicable to ABR Loans as provided in clause (a) of this Section.  Payment or acceptance of the increased rates of interest provided for in this Section 2.11(c) is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of the Agent or any Lender.
(d)    Accrued interest on each Loan shall be payable to the applicable Lenders, through the Agent, in arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant to clause (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any LIBO Rate Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(e)    All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by the Agent, and such determination shall be conclusive absent manifest error.

SECTION 2.12.    Alternate Rate of Interest.  If prior to the commencement of any Interest Period for a LIBO Rate Borrowing:
(a)    the Agent determines (which determination shall be conclusive absent manifest error) that dollar deposits in the principal amount of the Loans comprising such Borrowing are not generally available in the London interbank market;

(b)    the Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period; or
(c)    the Agent is advised by the Required Lenders that the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;
then the Agent shall promptly give notice thereof to the Borrower and the Lenders by telephone or facsimile as promptly as practicable thereafter and, until the Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, any request by the Borrower for a LIBO Rate Borrowing pursuant to Section 2.03 or 2.05 shall be deemed to be a request for an ABR Borrowing.  In the event that the Agent shall give such a notice, the Borrower and the Agent (in consultation with the Lenders) shall promptly enter into negotiations in good faith with a view to agreeing on an alternative basis acceptable to the Borrower and the Lenders for the interest rate which shall be applicable to future LIBO Rate Borrowings. 

SECTION 2.13.    Increased Costs.  (a)  If any Change in Law shall:
(i)    impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); 
(ii)    subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (c) through (e) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or
(iii)    impose on any Lender or the London interbank market any other condition affecting this Agreement or LIBO Rate Loans made by such Lender;
and the result of any of the foregoing shall be to increase the cost to such Lender or such other Recipient of making, converting to, continuing or maintaining any LIBO Rate Loan or of maintaining its obligation to make any such Loan, or to reduce the amount of any sum received or receivable by such Lender or such other Recipient hereunder (whether of principal, interest or otherwise), in each case by an amount the Lender or other Recipient reasonably determines to be material, then, following delivery of the certificate contemplated by clause (c) of this Section, within fifteen (15) days after demand the Borrower will pay to such Lender or other Recipient such additional amount or amounts 

as will compensate such Lender or other Recipient for such additional costs incurred or reduction suffered (except for (i) any increased cost in respect of which a Lender is entitled to compensation under any other provision of this Agreement, (ii) any payment to the extent that it is attributable to the requirement of any Governmental Authority which regulates a Lender or its holding company which is imposed by reason of the quality of such Lender’s assets or those of its holding company and not generally imposed on all entities of the same kind regulated by the same authority, or (iii) any increased cost arising by reason of a Lender voluntarily breaching any lending limit or other similar restriction imposed by any provision of any relevant law or regulation after the introduction thereof).
(b)    If any Lender determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Credit Extensions made to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (excluding, for purposes of this Section, any such increased costs resulting from any change to the extent that it is attributable to the requirement of any Governmental Authority which regulates a Lender or its holding company which is imposed by reason of the quality of such Lender’s assets or those of its holding company and not generally imposed on all entities of the same kind regulated by the same authority) other than due to Taxes, which shall be dealt with exclusively pursuant to Section 2.15 (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time following delivery of the certificate contemplated by clause (c) of this Section the Borrower will within fifteen (15) days after demand pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.
(c)    A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company as specified in clause (a) or (b) of this Section and setting forth in reasonable detail the manner in which such amount or amounts was determined shall be delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender, as the case may be, the amount shown as due on any such certificate within ten (10) days after receipt thereof.
(d)    Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

SECTION 2.14.    Break Funding Payments.  In the event of (a) the payment of any principal of any LIBO Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any LIBO Rate Loan or the conversion of the Interest Period with respect to any LIBO Rate Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any LIBO Rate Loan on the date specified in any notice delivered pursuant hereto, or (d) the assignment of any LIBO Rate Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.17, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event.  In the case of a LIBO Rate Loan, such loss, cost or expense to any Lender shall not include loss of profit or margin and shall be deemed to be the amount reasonably determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the eurodollar market.  A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section and the basis therefor and setting forth in reasonable detail the manner in which such amount or amounts was determined shall be delivered to the Borrower and shall be conclusive absent manifest error.  The Borrower shall pay such Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

SECTION 2.15.    Taxes.  (a)  Any and all payments by or on account of any obligation of the Borrower hereunder or under any other Loan Document shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all such required deductions (including such deductions applicable to additional sums payable under this Section), the Recipient receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall timely pay the full amount so deducted to the relevant Governmental Authority in accordance with applicable law.  If at any time the Borrower is required by applicable law to make any deduction or withholding from any sum payable hereunder, the Borrower shall promptly notify the relevant Recipient upon becoming aware of the same.  In 

addition, each Recipient shall promptly notify the Borrower upon becoming aware of any circumstances as a result of which the Borrower is or would be required to make any deduction or withholding from any sum payable hereunder.
(b)    In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.
(c)    The Borrower shall indemnify each Recipient, within ten (10) days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by such Recipient on or with respect to any payment by or on account of any obligation of the Borrower hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes (or related penalties, interest, or additions to tax) were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or by the Agent on its own behalf or on behalf of a Lender shall be conclusive absent manifest error.
(d)    Each Lender shall severally indemnify the Agent, within ten (10) days after written demand therefor, for the full amount of any Excluded Taxes paid by the Agent on behalf of such Lender on or with respect to any payment by or on account of any obligation of the Borrower hereunder or under any other Loan Document and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Excluded Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to a Lender by the Agent shall be conclusive absent manifest error.
(e)    As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Agent.
(f)    (i)  Any Lender that is entitled to an exemption from or reduction of withholding Tax with respect to payments under any Loan Document shall deliver to the Borrower (with a copy to the Agent), at the time or times as reasonably requested by the Borrower or the Agent, such properly completed and executed documentation as reasonably requested by the Borrower or the Agent as will permit such payments to be made without withholding or at a reduced rate.  
(ii)    Without limiting the generality of the foregoing, any Lender shall, if it is legally eligible to do so, deliver to the Borrower (with a copy to the Agent), on or prior to the date on which such Lender becomes a party 

hereto, two duly signed, properly completed copies of whichever of the following is applicable:
		
	(A)
	in the case of a Lender that is not a Foreign Lender, IRS Form W‐9;

		
	(B)
	in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (1) with respect to payments of interest under any Loan Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the “interest” article of such tax treaty and (2) with respect to any other applicable payments under any Loan Document, IRS Form W‐8BEN or IRS Form W-8BEN-E, as applicable, establishing an exemption from U.S. Federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

		
	(C)
	in the case of a Foreign Lender for whom payments under any Loan Document constitute income that is effectively connected with such Lender’s conduct of a trade or business in the United States, IRS Form W-8ECI;

		
	(D)
	in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code both (1) IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, and (2) a certificate (a “U.S. Tax Certificate”) to the effect that such Lender is not (a) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (b) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code and (c) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code;

		
	(E)
	in the case of a Foreign Lender that is not the beneficial owner of payments made under any Loan Document (including a partnership or a Participant) (1) an IRS Form W-8IMY on behalf of itself and (2) the relevant forms prescribed in clauses (A), (B), (C), (D), (F) and (G) of this clause (f)(ii) that would be required of each such beneficial owner or partner of such partnership if such beneficial owner or partner were a Lender; provided, however, that if the Lender is a partnership and one or more of its partners are claiming the exemption for portfolio interest under 

Section 881(c) of the Code, such Lender may provide a U.S. Tax Certificate on behalf of such partners;
		
	(F)
	if a payment made to a Foreign Lender under any Loan Document would be subject to any withholding Taxes as a result of such Foreign Lender’s failure to comply with the requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code), at the time or times prescribed by law and at such time or times reasonably requested by the Withholding Agent, such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Withholding Agent as may be necessary for the Withholding Agent to comply with its obligations under FATCA, to determine that such Foreign Lender has or has not complied with such Foreign Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment; or

		
	(G)
	any other form prescribed by law as a basis for claiming exemption from, or a reduction of, U.S. Federal withholding Tax together with such supplementary documentation necessary to enable the Borrower or the Agent to determine the amount of Tax (if any) required by law to be withheld.

(iii)    Thereafter and from time to time, each Foreign Lender shall, if it is legally eligible to do so, (A) promptly submit to the Borrower (with a copy to the Agent) such additional duly completed and signed copies of one or more of the forms or certificates described in Section 2.15(f)(ii)(A), (B), (C), (D) or (E) above (or such successor forms or certificates as shall be adopted from time to time by the relevant United States taxing authorities) as may then be available under then current United States laws and regulations to avoid, or such evidence as is reasonably satisfactory to the Borrower and the Agent of any available exemption from, or reduction of, United States withholding Taxes in respect of all payments to be made to such Foreign Lender by the Borrower pursuant to this Agreement, or any other Loan Document, in each case, (1) after the occurrence of any event requiring a change in the most recent form, certificate or evidence previously delivered by it to the Borrower and (2) from time to time thereafter if reasonably requested by the Borrower or the Agent, and (B) promptly notify the Borrower and the Agent of any change in circumstances which would modify or render invalid any claimed exemption or reduction.

(g)    If the Agent or a Lender determines, in its reasonable discretion, that it has received a refund of any Indemnified Taxes or Other Taxes as to which it has been indemnified by the Borrower or the Parent Guarantor or with respect to which the Borrower has paid additional amounts pursuant to this Section 2.15 or the Parent Guarantor has paid additional amounts pursuant to the Parent Guaranty, it shall reimburse to the Borrower or the Parent Guarantor, as the case may be, such amount as the Agent or such Lender determines to be the proportion (but not more than 100%) of such refund as will leave the Agent or such Lender (after that reimbursement) in no better or worse position in respect of the worldwide liability for Taxes or Other Taxes of the Agent, or such Lender (including in each case its Affiliates) than it would have been if no such indemnity had been required under this Section.  This Section shall not be construed to require the Agent or any Lender to make available its tax returns (or any other information relating to its Taxes which it deems confidential) to the Borrower, the Parent Guarantor or any other Person.

SECTION 2.16.    Payments Generally; Allocation of Proceeds; Sharing of Set-offs.  (a)  Unless otherwise specified, the Borrower shall make each payment required to be made by it hereunder and under any other Loan Document (whether of principal, interest or fees, or of amounts payable under Section 2.13, 2.14 or 2.15, or otherwise) prior to 12:00 (noon), New York City time, on the date when due, in immediately available funds, without set‐off or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Agent to the applicable account designated to the Borrower by the Agent, except that payments pursuant to Sections 2.13, 2.14, 2.15 and 9.03 shall be made directly to the Persons entitled thereto.  The Agent shall distribute any such payments received by it, except as otherwise provided, for the account of any other Person to the appropriate recipient promptly following receipt thereof.  If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments hereunder shall be made in Dollars.  Any payment required to be made by the Agent hereunder shall be deemed to have been made by the time required if the Agent shall, at or before such time, have taken the necessary steps to make such payment in accordance with the regulations or operating procedures of the clearing or settlement system used by the Agent to make such payment.
(b)    If any Lender shall, by exercising any right of set‐off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Loans of other Lenders at such time 

outstanding to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered,  such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this clause shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant, other than to the Borrower or any subsidiary thereof (as to which the provisions of this clause shall apply).  The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(c)    Unless the Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Agent for the account of the Lenders that the Borrower will not make such payment, the Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due.  In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation.
(d)    If any Lender shall fail to make any payment required to be made by it pursuant to Sections 2.04(a), 2.16(c) or 9.03(c), then the Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Agent for the account of such Lender to satisfy such Lender’s obligations under such Sections until all such unsatisfied obligations are fully paid.
(e)    Except as otherwise provided herein, each Borrowing, each payment or prepayment of principal of any Borrowing, each payment of interest on the Loans, each payment of the Commitment Fees, each reduction of the Revolving Credit Commitments and each conversion of any Borrowing to or continuation of any Borrowing as a Borrowing of any Type shall be allocated pro rata among the Lenders in accordance with their respective applicable Revolving Credit Commitments (or, if such Revolving Credit Commitments shall have expired or been terminated, in accordance with the respective principal amounts of their outstanding Loans). 

SECTION 2.17.    Mitigation Obligations; Replacement of Lenders.  (a)  If any Lender requests compensation under Section 2.13, or if the 

Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.13 or 2.15, as applicable, in the future and (ii) would not subject such Lender to any material unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender in any material respect.  The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b)    In the event (i) any Lender requests compensation under Section 2.13 and such Lender has declined or is unable to designate a different lending office in accordance with Section 2.17(a), or (ii) the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.15 and such Lender has declined or is unable to designate a different lending office in accordance with Section 2.17(a), or (iii) any Lender becomes a Defaulting Lender or an Exiting Bank, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Agent, replace such Lender by requiring such Lender to assign and delegate (and such Lender shall be obligated to assign and delegate), without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 9.04), all its interests, rights (other than its existing rights to payments pursuant to Section 2.13 or Section 2.15) and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Agent, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued Fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and Fees) or the Borrower (in the case of all other amounts), and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.13 or payments required to be made pursuant to Section 2.15, such assignment will result in a reduction in such compensation or payments.  A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.

SECTION 2.18.    Illegality.  If any Lender reasonably determines that any Change in Law has made it unlawful, or that any Governmental Authority has asserted after the Closing Date that it is unlawful, for such Lender or its applicable lending office to make or maintain any LIBO Rate Loans, then, on notice thereof by such Lender to the Borrower through the Agent, any obligations of such Lender to make or continue LIBO Rate Loans or to 

convert ABR Borrowings to LIBO Rate Borrowings shall be suspended until such Lender notifies the Agent and the Borrower that the circumstances giving rise to such determination no longer exist and until such notice is given by such Lender, the Borrower shall only request ABR Borrowings from such Lender.  Upon receipt of such notice, the Borrower shall upon demand from such Lender (with a copy to the Agent), either convert all LIBO Rate Borrowings of such Lender to ABR Borrowings, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such LIBO Rate Borrowings to such day, or immediately, if such Lender may not lawfully continue to maintain such Loans.  Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.  Each Lender agrees to designate a different lending office if such designation will avoid the need for such notice and will not, in the determination of such Lender, otherwise be disadvantageous to it.

SECTION 2.19.    [Reserved].

SECTION 2.20.    Change in Control.  (a)  If a Change in Control occurs prior to expiration or termination of the Revolving Credit Commitments, the Borrower shall promptly so notify the Agent. The Agent shall promptly, following receipt of such notice from the Borrower or upon determining independently that a Change in Control has occurred, give notice thereof to each of the Banks (with a copy to the Borrower).  Upon the Borrower or the Agent giving any such notice, (i) the Revolving Credit Commitments shall be suspended and no Credit Extensions shall be made until the effectiveness of a Change in Control Amendment, if any, in accordance with this Section 2.20, and (ii) the Agent (in consultation with the Banks) and the Borrower may enter into negotiations in good faith with a view to agreeing on a revised basis for making Credit Extensions available to the Borrower hereunder consistent with terms and conditions and market practice for similarly situated borrowers (a “Substitute Basis”).  
(b)    If, before the expiration of thirty (30) days from the date of such notice from the Agent (the “Review Period”), the Borrower and the Required Lenders shall agree on a Substitute Basis, then the Agent shall promptly so notify the Banks.  Each Bank must then notify the Agent within five days whether such Lender will participate in future Credit Extensions made under a Substitute Basis and, in the case of each Lender, whether such Lender is an Exiting Bank. Each Bank agrees that it will be deemed to be an Exiting Bank if it does not provide such notice to the Agent on a timely basis.  Within the later of (i) five days of receipt by the Agent of such notifications from all of the Banks and (ii) the expiration of the Review Period (the “Change in Control Amendment Date”), the Borrower, the Agent and each non-Exiting Bank shall enter into a Change in Control Amendment and such other documentation as the Agent shall reasonably specify to evidence the Substitute Basis and revised terms and conditions, in each case in form and substance satisfactory to the Borrower, the Agent and each Lender 

party thereto.  If the Borrower and the Required Lenders do not agree on a Substitute Basis before the end of the Review Period, then (i) the Agent shall so notify the Banks, (ii) the Borrower shall prepay all principal, interest, Fees and other Obligations relating to the Credit Extensions within five days of the end of the Review Period and (iii) all of the Revolving Credit Commitments shall automatically be terminated on such date. 
(c)    Each Bank shall be entitled to agree or decline to participate in its sole discretion in future Credit Extensions made under a Substitute Basis. On the Change in Control Amendment Date and as a condition to the effectiveness of any Change in Control Amendment, each Exiting Bank shall (i) have its Revolving Credit Commitment terminated or be replaced as a Lender pursuant to and in accordance with Section 2.17(b) and (ii) receive payment in full of all amounts then outstanding in respect of principal, interest, Fees and other Obligations relating to its Credit Extensions, whether pursuant to Section 2.17(b) or otherwise. Upon the effectiveness of any Change in Control Amendment (i) this Agreement shall be amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Change in Control Amendment, evidenced thereby as provided for in Section 9.02, and (ii) each Exiting Bank shall no longer be a party to this Agreement.
(d)    Nothing in this Section 2.20 shall limit or otherwise modify (i) the obligation of the Borrower to satisfy all of its Obligations on the Revolving Credit Maturity Date or (ii) the rights and remedies of the Agents and the Lenders under Article VII.

SECTION 2.21.    [Reserved]

SECTION 2.22.    Defaulting Lenders.
(a)    Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable law:
(i)    Defaulting Lender Waterfall.  Any payment of principal, interest, fees or other amounts received by the Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise) or received by the Agent from a Defaulting Lender pursuant to Section 9.08 shall be applied at such time or times as may be determined by the Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Agent hereunder; second, as the Borrower may request (so long as no Default or Event of Default shall have occurred and be continuing), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Agent; third, if so determined by the Agent and the Borrower, to be held in a deposit account and released pro rata in order to satisfy such 

Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; fifth, so long as no Default or Event of Default shall have occurred and be continuing, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, and (y) such Loans were made at a time when the conditions set forth in Article IV were satisfied or waived, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans are held by the Lenders pro rata in accordance with the applicable Revolving Credit Commitments.
(ii)    Certain Fees.  No Defaulting Lender shall be entitled to receive any Commitment Fee pursuant to Section 2.10(a) for any period during which that Lender is a Defaulting Lender (and the Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender).
(b)    Defaulting Lender Cure. If the Borrower and the Agent agree in writing that a Lender is no longer a Defaulting Lender, the Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein, that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Agent may determine to be necessary to cause the Loans to be held pro rata by the Lenders in accordance with the applicable Revolving Credit Commitments, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender having been a Defaulting Lender.

ARTICLE III     
 
Representations and Warranties
The Borrower represents and warrants to the Agent and each of the Lenders that:

SECTION 3.01.    Organization; Powers.  The Borrower is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own its property and assets and to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required. 

SECTION 3.02.    Authorization; Enforceability.  The Transactions are within the Borrower’s organizational powers and have been duly authorized by all its necessary organizational action.  Each Loan Document (other than the Parent Guaranty) has been duly executed and delivered by the Borrower and is a legal, valid and binding obligation of the Borrower, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency or similar laws affecting creditors’ rights generally and to general principles of equity.

SECTION 3.03.    Governmental Approvals; No Conflicts.  The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, except to the extent that any such failure to obtain such consent or approval or to take any such action, would not reasonably be expected to result in a Material Adverse Effect, (b) will not violate any Requirement of Law applicable to the Borrower, (c) will not violate or result in a default under any other material indenture, agreement or other instrument binding upon the Borrower or any of its respective assets, or give rise to a right thereunder to require any payment to be made by the Borrower, and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower. 

SECTION 3.04.    Financial Condition.  The Borrower has heretofore furnished to the Lenders its consolidated balance sheet and statements of income, shareholders’ equity and cash flows as of and for the fiscal year ended December 31, 2016, reported on by Ernst & Young LLP, independent public accountants (collectively, the “Historical Financial Statements”).  Such Historical Financial Statements present fairly, in all material respects, the financial position and results of operations and cash flows of Borrower and its consolidated Subsidiaries as of such date and for such period in accordance with GAAP. 

SECTION 3.05.    Properties.  The Borrower has good and insurable fee simple title to, or valid leasehold interests in, or easements or other limited property interests in, all its real properties and has good and marketable title to its personal property and assets, in each case, except where the failure to have such title would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

SECTION 3.06.    Litigation.  Except as disclosed in the Borrower’s filings with the SEC from time to time, there are no actions, suits, proceedings or investigations by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened against or affecting the Borrower as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, would reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

SECTION 3.07.    Compliance with Laws and Agreements; Licenses and Permits.  The Borrower is in compliance with all Requirements of Law applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.08.    Investment Company Status.  The Borrower is not an “investment company” as defined in, and is not required to be registered under, the Investment Company Act of 1940.

SECTION 3.09.    Taxes.  The Borrower has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which it has set aside on its books adequate reserves in accordance with GAAP or (b) to the extent that the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

SECTION 3.10.    ERISA.  No ERISA Event has occurred and is continuing or is reasonably expected to occur that either on its own or, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, would reasonably be expected to result in a Material Adverse Effect.  Except as would not reasonably be expected to have a Material Adverse Effect, the present value of all accumulated benefit obligations under all Plans (based on the assumptions used for purposes of Financial Accounting Standards Board Accounting Standards Codification Topic 715) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plans, in the aggregate.

SECTION 3.11.    [Reserved].  

SECTION 3.12.    Federal Reserve Regulations.  (a)  The Borrower is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.

(b)    No part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of Regulation T, U or X.

SECTION 3.13.    USA PATRIOT Act and Other Regulations.  To the extent applicable, the Borrower is in compliance, in all material respects, with (a) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, and (b) the USA PATRIOT Act.

SECTION 3.14.    [Reserved].  

SECTION 3.15.    Disclosure.  No exhibit, report or other writing furnished by or on behalf of the Borrower to the Agent or any Lender in connection with the negotiation of this Agreement or pursuant to the terms of the Loan Documents (as modified or supplemented by other information so furnished) contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements made therein, in the light of the circumstances under which they were made, not misleading as of the date it was dated (or if not dated, so delivered); provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time and the Agent and the Lenders recognize and acknowledge that such projected financial information is not to be viewed as facts and that actual results during the period or periods covered by such projections may differ from the projected results and such differences may be material.

SECTION 3.16.    Solvency.  The Borrower is, and (after giving effect to the incurrence of any Obligations by the Borrower on any date on which this representation is made) will be, Solvent.

SECTION 3.17.    [Reserved].  

SECTION 3.18.    [Reserved].  

SECTION 3.19.    [Reserved].  

SECTION 3.20.    Anti-Corruption Laws and Sanctions.  The Borrower and each Subsidiary is in compliance, in all material respects, with Anti-Corruption Laws and Sanctions and are not engaged in any activity that would reasonably be expected to result in the Borrower being designated as a Sanctioned Person.  Policies and procedures the Borrower believes are designed to ensure compliance by its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions have been implemented, and are maintained in effect, by the Borrower or otherwise on 

behalf of its Subsidiaries. None of (a) the Borrower, any or any of their respective directors, officers or employees (except any director, officer or employee of a Non-Controlled Subsidiary appointed by a Person that is not an Affiliate of the Borrower), or (b) to the knowledge of the Borrower, any director, officer or employee of any Non-Controlled Subsidiary (to the extent appointed by a Person that is not an Affiliate of the Borrower, is a Sanctioned Person.  No Loan or use of proceeds by the Borrower will violate any Anti-Corruption Laws or applicable Sanctions.

ARTICLE IV     
 
Conditions Precedent

SECTION 4.01.    Conditions Precedent to the Effective Date.  This Agreement shall become effective on the Effective Date upon each of the following conditions having been satisfied (or waived in accordance with Section 9.02):
(a)    Loan Documents.  The Agent (or its counsel) shall have received (i) from each party hereto either (A) a counterpart of this Agreement signed on behalf of such party or (B) written evidence satisfactory to the Agent (which may include facsimile transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement, (ii) any promissory notes requested by a Lender pursuant to Section 2.07, and (iii) the 2017 Fee Letter signed on behalf of the parties thereto.
(b)    Effective Date Certificate.  The Agent shall have received (i) an Effective Date Certificate of the Borrower, dated the Effective Date and executed by its Secretary or Assistant Secretary or an Officer, which shall (A) certify the resolutions of its Board of Directors (or similar governing body) authorizing the execution, delivery and performance of the Loan Documents to which it is party by the Borrower, (B) identify by name and title and bear the signatures of the Financial Officers and any other officers of the Borrower authorized to sign such Loan Documents, (C) contain appropriate attachments, including the certificate or articles of incorporation (or similar constitutive document) of the Borrower certified by the relevant authority of the jurisdiction of organization of the Borrower and a true and correct copy of its bylaws (or similar constitutive document), or certify that such documents have not been amended since the Effective Date and remain in full force and effect, and (D) certify as to the other matters covered thereby, and (ii) a good standing certificate for the Borrower dated the Effective Date or a recent date prior to the Effective Date satisfactory to the Agent from the Borrower’s jurisdiction of organization.
(c)    Legal Opinion. The Agent shall have received, on behalf of itself and the Lenders on the Effective Date, a favorable written opinion of counsel for the Borrower in form and substance satisfactory to the Agent.

(d)    Representations and Warranties.  The representations and warranties set forth in Article III hereof and in each other Loan Document shall be true and correct in all material respects on and as of the Effective Date.
(e)    No Defaults.  At the time of and immediately after the Effective Date, no (i) Event of Default, or (ii) event or condition that would constitute an Event of Default but for the requirement that notice be given or time elapse or both, has occurred and is continuing.
(f)    Fees. The Agent and the Lenders shall have received from the Borrower payment of all fees required to be paid on or before the Effective Date.
(g)    Costs and Expenses. The Borrower shall have paid all reasonable and documented costs and expenses of the Agent (including the fees and expenses of Linklaters LLP as special counsel to the Lenders to the extent previously agreed) in connection with the preparation, execution, delivery and administration of this Agreement.
(h)    Existing Letters of Credit.  The Agent shall have received satisfactory evidence that (i) all of the letters of credit issued under the Existing Credit Agreement have been cancelled or replaced pursuant to documentation in form and substance satisfactory to the Agent, and (ii) the Borrower has no outstanding reimbursement obligations in respect thereof.
(i)    Cash Collateral.  The Borrower shall have entered into a Cash Collateral Agreement and Cash Collateralized its obligation to pay (by providing Cash Collateral with a value equal to) the Commitment Fees for the period from (and including) the Effective Date to (but excluding) the date falling one year after the Effective Date.
(j)    USA PATRIOT Act.  The Agent shall have received all documentation and other information reasonably requested by it that is required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act.

SECTION 4.02.    Credit Extensions On or After the Effective Date.  On the date of each Credit Extension on or after the Effective Date:
(a)    The Agent shall have received a Borrowing Request as required by Section 2.03.
(b)    The Agent (or its counsel) shall have received the Parent Guaranty signed on behalf of the Parent Guarantor and each of the other documents listed in Section 4.03, and the Parent Guaranty shall be in full force and effect.

(c)    The representations and warranties set forth in Article III hereof (other than Section 3.04) and in each other Loan Document shall be true and correct in all material respects on and as of the date of such Credit Extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case they shall be true and correct in all material respects on and as of such earlier date; provided that, in each case, such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof.
(d)    At the time of and immediately after such Credit Extension, no Default as described in Sections (a), (b), (g) or (h) of Article VII or Event of Default shall have occurred and be continuing or result from such Credit Extension.
(e)    After making the Credit Extensions requested on such Credit Date, the Total Utilization of Revolving Credit Commitments shall not exceed the lower of (i) the Revolving Credit Commitments then in effect, and (ii) 95.0% of the Guaranteed Amount.
(f)    After making the Credit Extensions requested on such Credit Date, the sum of the Maximum Amount Due shall not exceed the Guaranteed Amount.
(g)    Each such Credit Extension shall be deemed to constitute a representation and warranty by the Borrower on the date of such Credit Extension as to the matters specified in clauses (d) and (e) of this Article IV.

SECTION 4.03.    Parent Guaranty.  The condition precedent specified in Section 4.02(b) shall only be satisfied, and solely for purposes of satisfying such condition precedent, the Parent Guaranty and, if applicable, any amendment thereto which increases the Guaranteed Amount, shall only be deemed to be in full force and effect, upon each of the following conditions having been satisfied (or waived in accordance with Section 9.02):
(a)    The Agent shall have received, on behalf of itself and the Lenders, (i) a favorable written opinion of counsel for the Parent Guarantor in respect of the enforceability of the Parent Guaranty (or the relevant amendment thereto) and (ii) a favorable written opinion of in-house counsel to the Parent Guarantor with regard to matters of French law, in each case, in form and substance reasonably satisfactory to the Agent.
(b)    The Agent shall have received (i) a certificate of the Parent Guarantor, dated as of the date of the Parent Guaranty (or, as the case may be, the date of the relevant amendment) and executed by an authorized officer or director, which shall (A) certify the resolutions of its Board of Directors authorizing the execution, delivery and performance of the Parent Guaranty (or the relevant amendment thereto) by the Parent Guarantor, (B) identify by name and title and bear the signatures of the Persons 

authorized to sign the Parent Guaranty (or the relevant amendment thereto) on behalf of the Parent Guarantor, and (C) contain appropriate attachments, including the constitutional documents of the Parent Guarantor, and (ii)  a certificate of the Borrower confirming the Guaranteed Amount as of the date of the Parent Guaranty (or, as the case may be, the date of the relevant amendment).
For the avoidance of doubt, nothing in this Section 4.03 shall limit the effectiveness of the Parent Guaranty, which shall remain enforceable in accordance with its terms regardless of (i) the satisfaction (or otherwise) of any condition specified in this Section 4.03 or (ii) any other provision of this Agreement.

ARTICLE V     
 
Affirmative Covenants
The Borrower covenants and agrees that, until the Revolving Credit Commitments have expired or been terminated, all of the Obligations have been repaid in full:

SECTION 5.01.    Financial Statements and Other Information    .  The Borrower will furnish to the Agent (which will promptly furnish such information to the Lenders):
(a)    within ninety (90) days after the end of each fiscal year of the Borrower, its audited consolidated balance sheet and related statements of earnings, shareholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by independent public accountants of recognized national standing and reasonably acceptable to the Agent to the effect that such consolidated financial statements present fairly, in all material respects, the financial condition and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP;
(b)    within one hundred and twenty (120) days after the end of each fiscal year of the Parent Guarantor, its audited consolidated balance sheet and related statements of earnings, shareholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year;
(c)    within forty-five (45) days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, its consolidated balance sheet and related statements of earnings, shareholders’ equity and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly, in all material respects, the financial condition 

and results of operations of the Borrower and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP, subject to normal year-end audit adjustments and the absence of footnotes; provided to the extent all such documents are included in the quarterly report for the Borrower on Form 10-Q filed with the SEC, the requirements of this clause (b) shall be deemed to have been satisfied if the Agent has been furnished with such quarterly report in the time period specified above in this clause (b);
(d)    within sixty (60) days after the end of each of the first three fiscal quarters of each fiscal year of the Parent Guarantor, its consolidated balance sheet and related statements of earnings, shareholders’ equity and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year;
(e)    promptly following the Agent’s request therefor, all documentation and other information that the Agent reasonably requests on its behalf or on behalf of any Lender in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act; and
(f)    written notice of the occurrence of an Event of Default, which notice shall be given within five (5) Business Days after the actual knowledge of an officer of the Borrower of such occurrence, specifying the nature and extent thereof and, if continuing, the action the Borrower is taking or proposes to take in respect thereof.
Anything required to be delivered pursuant to clause (a), (b), (c) or (d) above (to the extent any such financial statements or reports are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which the applicable Loan Party posts such reports, or provides a link thereto, on such Loan Party’s website on the Internet, or on the date on which such reports are filed with the SEC and become publicly available.

SECTION 5.02.    [Reserved] 

SECTION 5.03.    Existence; Conduct of Business .  The Borrower will do or cause to be done all things reasonably necessary to preserve and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, authorizations, qualifications and accreditations material to the conduct of its business, in each case if the failure to do so, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect; provided that the foregoing shall not prohibit any merger, consolidation or other transaction.

SECTION 5.04.    Maintenance of Properties.  The Borrower will (a) at all times maintain and preserve all material property necessary to the normal conduct of its business in good repair, working order and condition, ordinary wear and tear excepted and casualty or condemnation excepted and (b) make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto as necessary in accordance with prudent industry practice in order that the business carried on in connection therewith, if any, may be properly conducted at all times, except, in each case, where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.05.    Compliance with Laws.  The Borrower will comply in all material respects with all Requirements of Law applicable to it or its property, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

SECTION 5.06.    Use of Proceeds.  The proceeds of the Loans will be used only for general corporate purposes.  No part of the proceeds of any Credit Extension will be used, whether directly or indirectly, for any purpose that would entail a violation of Regulation T, U or X.  The Borrower shall not, nor shall it permit any of its Subsidiaries to, directly or indirectly, use the proceeds of the Loans (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of or with any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

SECTION 5.07.    Insurance.  The Borrower will maintain, with financially sound and reputable insurance companies, insurance in such amounts and against such risks as are customarily maintained by similarly situated companies engaged in the same or similar businesses operating in the same or similar locations (after giving effect to any self-insurance reasonable and customary for similarly situated companies).  The Borrower will furnish to the Agent, upon request, information in reasonable detail as to the insurance so maintained.

SECTION 5.08.    [Reserved].  

SECTION 5.09.    Books and Records.  The Borrower will maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Borrower.

SECTION 5.10.    Inspection Rights.  The Borrower will permit representatives and independent contractors of the Agent to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its directors, officers, and independent public accountants, all at the expense of the Borrower and at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to the Borrower; provided that so long as no Event of Default has occurred and is continuing, the Borrower shall not be required to pay for more than one such visit by the Agent per fiscal year.

SECTION 5.11.    Payment of Taxes, Etc.  The Borrower will pay and discharge, before the same shall become delinquent, (i) all taxes, assessments and governmental charges or levies imposed upon it or upon its property or assets or in respect of any of its income, business or franchises before any penalty accrues thereon and (ii) all lawful claims that, if unpaid, might by law become a Lien upon its property or assets or in respect of any of its income, business or franchises before any penalty accrues thereon, except in each case where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, and provided further, that in no event shall the Borrower be required to pay or discharge any such tax, assessment, charge or claim that is being contested in good faith and by proper proceedings and as to which appropriate reserves are being maintained, unless and until any Lien resulting therefrom attaches to its property and becomes enforceable against its other creditors.

SECTION 5.12.    Cash Collateral.  If, as of any date, the Guaranteed Amount is less than $100,000,000, the Borrower shall ensure that the cash balance of the Account (as defined in the Cash Collateral Agreement) is no less than the amount of the Commitment Fees for the period from (and including) such date to (but excluding) the earlier of the date falling one year after such date and the Scheduled Maturity Date.

SECTION 5.13.    Payment of Judgments.  The Borrower shall pay all final non-appealable judgments which remain unpaid, undischarged and unstayed on or before the sixtieth (60) day after such judgment becomes final, except, in each case, where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

ARTICLE VI     
 
[Reserved]

ARTICLE VII     
 
Events of Default
If any of the following events (each, an “Event of Default”) shall occur and be continuing:
(a)    the Borrower shall fail to pay any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or by acceleration thereof or otherwise; 
(b)    the Borrower shall fail to pay any interest, fee or other amount (other than an amount referred to in clause (a) of this Article VII) payable under this Agreement or any other Loan Document, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of three Business Days;
(c)    any representation or warranty made by any Loan Party (or any of their respective officers or other representatives) under or in connection with any Loan Document shall prove to have been incorrect in any material respect when made or deemed to have been made (unless, if the circumstances giving rise to such misrepresentation or breach of warranty are capable of being remedied, such Loan Party remedies such circumstances within thirty (30) days after receipt of notice to such Loan Party from the Agent specifying such inaccuracy);
(d)    the Borrower or the Parent Guarantor shall fail to perform or observe any term, covenant, or agreement contained herein or in any other Loan Document on its part to be performed or observed if such failure shall remain unremedied for thirty (30) days after written notice thereof shall have been given to such Person by the Agent or the Required Lenders, except where such default cannot be reasonably cured within 30 days but can be cured within 60 days, such Person has (i) during such 30-day period commenced and is diligently proceeding to cure the same and (ii) such default is cured within 60 days after the earlier of becoming aware of such failure and receipt of notice to such Person from the Agent or the Required Lenders specifying such failure;
(e)    the Parent Guarantor shall fail to pay (i) any indebtedness for borrowed money pursuant to a loan agreement, or (ii) any noncontingent payment obligation pursuant to a letter of credit agreement, in either case individually or in the aggregate, in excess of $200,000,000, when the same becomes due and payable (whether by scheduled maturity, required prepayment, acceleration, demand or otherwise), and such failure shall continue after the applicable grace period, if any, specified in the agreement or instrument relating to such indebtedness or obligation, provided, however, 

that a written waiver of such failure by the Person to whom such indebtedness or obligation is owed shall be a written waiver of the Event of Default resulting pursuant to this clause (e) from such failure; or the maturity of such indebtedness or obligation is accelerated, provided, however, that a written waiver of such failure by the Person to whom such indebtedness or obligation is owed shall be a written waiver of the Event of Default resulting pursuant to this clause (e) from such failure;
(f)    (i)  the Borrower shall fail to make any payment when the same becomes due and payable with respect to any Material Indebtedness, and such failure shall continue beyond the applicable grace period, if any, specified in the agreement or instrument relating to such Material Indebtedness; (ii) any other event shall occur or condition shall exist under any agreement or instrument relating to any Material Indebtedness and shall continue after the applicable grace period, if any, specified in such agreement or instrument, if the effect of such event or condition is to accelerate, or to permit the acceleration of, the maturity of such Material Indebtedness; or (iii) any Material Indebtedness shall be declared to be due and payable, or required to be prepaid or redeemed (other than by a regularly scheduled required prepayment or redemption), purchased or defeased, or an offer to prepay, redeem, purchase or defease such Material Indebtedness shall be required to be made, in each case prior to the stated maturity thereof; 
(g)    the entry by a court having jurisdiction in the premises of (i) a decree or order for relief in respect of the Borrower or the Parent Guarantor in an involuntary case or proceeding under any applicable United States federal, state, or foreign bankruptcy, insolvency, reorganization, or other similar law or (ii) a decree or order adjudging the Borrower or the Parent Guarantor bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Borrower or the Parent Guarantor under any applicable United States federal, state, or foreign law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Borrower or the Parent Guarantor, or ordering the winding up or liquidation of the affairs of the Borrower or the Parent Guarantor, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of sixty (60) consecutive days;
(h)    the commencement by the Borrower or the Parent Guarantor of a voluntary case or proceeding under any applicable United States federal, state, or foreign bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or the consent by the Borrower or the Parent Guarantor to the entry of a decree or order for relief in respect of the Borrower or the Parent Guarantor in an involuntary case or proceeding under any applicable United States federal, state, or foreign bankruptcy, insolvency, reorganization, or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against it, or the filing by the Borrower or the Parent Guarantor of a petition or answer or consent seeking reorganization or relief under any applicable United States federal, state, or 

foreign law, or the consent by the Borrower or the Parent Guarantor to the filing of such petition or the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator, or similar official of the Borrower or the Parent Guarantor or of any substantial part of the property of, or the making by the Borrower or the Parent Guarantor of an assignment for the benefit of creditors, or the admission by the Borrower or the Parent Guarantor in writing of its inability to pay its debts generally as they become due, or the taking of corporate action by the Borrower or the Parent Guarantor in furtherance of any such action;
(i)    an ERISA Event occurs which results in the imposition or granting of security, or the incurring of a liability that individually and/or in the aggregate has or would have a Material Adverse Effect; or
(j)    at any time when Obligations are outstanding, the Parent Guarantor shall repudiate, or assert the unenforceability of, the Parent Guaranty, or the Parent Guaranty shall for any reason not be in full force and effect; 
then, and in every such event (other than an event described in clause (g) or (h) of this Article VII), and at any time thereafter during the continuance of such event, the Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take any of the following actions, at the same or different times: (i) terminate the Revolving Credit Commitments and thereupon the Revolving Credit Commitments shall terminate immediately and (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal or other amount not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower; provided that upon the occurrence of an event described in clause (g) or (h) of this Article VII, the Revolving Credit Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon, and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower, without further action of the Agent or any Lender.  Upon the occurrence and the continuance of an Event of Default, the Agent may, and at the request of the Required Lenders shall, exercise any rights and remedies provided to the Agent under the Loan Documents or at law or equity, including all remedies provided under the UCC.
In the event of any Event of Default specified in clause (f) above in this Article VII, such Event of Default and all consequences thereof (excluding any resulting payment default) shall be annulled, waived and rescinded automatically and without any action by the Agent or the Lenders if, within ten (10) days after such Event of Default arose, (i) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged, (ii) the holders thereof have rescinded or waived the acceleration, notice 

or action (as the case may be) giving rise to such Event of Default or (iii) the default that is the basis for such Event of Default has been cured to the satisfaction of the holders thereof.

ARTICLE VIII     
 
The Agents
Each of the Banks hereby irrevocably appoints each of the Agents as its agent and authorizes each of the Agents to take such actions on its behalf, including execution of the other Loan Documents, and to exercise such powers as are delegated to the Agents by the terms of the Loan Documents, together with such actions and powers as are reasonably incidental thereto.
The bank serving as either of the Agents hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Agent or the Security Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Affiliate thereof as if it were not the Agent or the Security Agent hereunder.
The Agents shall not have any duties or obligations except those expressly set forth in the Loan Documents.  Without limiting the generality of the foregoing, (a) the Agents shall not be subject to any fiduciary or other implied duties, regardless of whether an Event of Default has occurred and is continuing, (b) the Agents shall not have any duty to take any discretionary action or exercise any discretionary powers, except, subject to the last paragraph of this Article VIII, discretionary rights and powers expressly contemplated by the Loan Documents that the Agents are required to exercise in writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forth in the Loan Documents, the Agents shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Subsidiaries that is communicated to or obtained by the bank serving as the Agent or any of its Affiliates in any capacity.  Neither of the Agents shall be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or in the absence of its own gross negligence or willful misconduct.  Neither of the Agents shall be deemed to have knowledge of any Event of Default unless and until written notice thereof is given to such Agent by the Borrower or a Lender, and neither of the Agents shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or in connection with any Loan Document, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in any Loan Document, (iv) the validity, enforceability, 

effectiveness or genuineness of any Loan Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere in any Loan Document, other than to confirm receipt of items expressly required to be delivered to any of the Agents.
Each of the Agents shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person.  Each of the Agents also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon.  Each of the Agents may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
Each of the Agents may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Agents.  Each of the Agents and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties.  The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of any of the Agents and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as either of the Agents.
Subject to the appointment and acceptance of a successor Agent or Security Agent as provided in this paragraph, any of the Agents may resign at any time by notifying the Lenders and the Borrower.  Upon any such resignation, the Required Lenders shall have the right, with the consent (not to be unreasonably withheld or delayed) of the Borrower, to appoint a successor, which shall be another Lender; provided that during the existence and continuation of an Event of Default, no consent of the Borrower shall be required.  If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within thirty (30) days after the retiring Agent or Security Agent gives notice of its resignation, then the retiring Agent or Security Agent may, on behalf of the Banks, appoint a successor Agent or Security Agent which shall be a commercial bank or an Affiliate of any such commercial bank reasonably acceptable to the Borrower.  Upon the acceptance of its appointment as Agent or Security Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent or Security Agent, and the retiring Agent or Security Agent shall be discharged from its duties and obligations hereunder.  The fees payable by the Borrower to a successor Agent or Security Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor.  After either of the Agents’ resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Agent or Security Agent, its sub‐agents and their respective 

Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Agent or Security Agent.
Each Bank acknowledges that it has, independently and without reliance upon any of the Agents or any other Bank and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Bank also acknowledges that it will, independently and without reliance upon any of the Agents or any other Bank and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or related agreement or any document furnished hereunder or thereunder.
Each Bank, by virtue of its acceptance of the benefits of the Cash Collateral Agreement, hereby further authorizes the Security Agent, on behalf of and for the benefit of the Banks, to enter into the Cash Collateral Agreement as secured party and each Bank agrees to be bound by the terms of the Cash Collateral Agreement; provided that the Security Agent shall not (a) enter into or consent to any material amendment, modification, termination or waiver of any provision contained in the Cash Collateral Agreement or (b) release any Cash Collateral (except as otherwise expressly permitted or required pursuant to the terms of this Agreement or the Cash Collateral Agreement), in each case without the prior consent of the Required Lenders; provided further, however, that, without further written consent or authorization from the Lenders, the Security Agent may execute any documents or instruments necessary to release any Lien encumbering any Cash Collateral if the Guaranteed Amount as of such date is at least $100,000,000.  Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Security Agent and each Bank hereby agree that no Bank shall have any right individually to realize upon any Cash Collateral under the Cash Collateral Agreement, it being understood and agreed that all powers, rights and remedies under the Cash Collateral Agreement may be exercised solely by the Security Agent for the benefit of the Banks in accordance with the terms thereof.

ARTICLE IX     
 
Miscellaneous

SECTION 9.01.    Notices.    Except in the case of notices and other communications expressly permitted to be given by telephone (and subject to clause (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile, as follows:
(i)    if to the Borrower, to SunPower Corporation at: 
77 Rio Robles 
San Jose, CA 95134 

Attention: Charles Boynton, Chief Financial Officer 
Facsimile : 408-240-5417 
Email: Charles.Boynton@sunpowercorp.com
with a copy (which shall not constitute notice) to:
77 Rio Robles 
San Jose, CA 95134 
Attention: General Counsel 
Facsimile: 408-240-5400

(ii)    if to the Agent, to Crédit Agricole CIB at: 
Crédit Agricole Corporate and Investment Bank 
1301 Avenue of the Americas 
New York, NY 10019 
Attention:  Agnes Castillo 
Facsimile:  917-849-5463 or 917-849-5456 
Email:  Agnes.Castillo@ca-cib.com
with a copy (which shall not constitute notice) to:
Crédit Agricole Corporate and Investment Bank  
1301 Avenue of the Americas 
New York, NY 10019 
Attention:  Marisol Ortiz 
Tel:  (212) 261-3710 
Facsimile:  (917) 849-5528 
Email:  Marisol.ortiz@ca-cib.com
(iii)    if to any other Bank, to it at its address or facsimile number set forth in its Administrative Questionnaire.
(b)    All such notices and other communications (i) sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received or (ii) sent by facsimile shall be deemed to have been given when sent and when receipt has been confirmed by telephone, provided that if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient.
(c)    Notices and other communications to the Banks hereunder may be delivered or furnished by electronic communications (including e-mail and internet or intranet websites) pursuant to procedures approved by the Agent; provided that the foregoing shall not apply to notices pursuant to Article II or to notice of any Event of Default delivered pursuant to Section 5.01(f) unless otherwise agreed by the Agent and 

the applicable Bank.  The Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or communications.  All such notices and other communications (i) sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e‐mail or other written acknowledgement), provided that if not given during the normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day for the recipient, and (ii) posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (b)(i) of notification that such notice or communication is available and identifying the website address therefor.
(d)    Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto.
(e)    Platform.  
(i)    The Borrower agrees that the Agent may with the Borrower’s prior written consent as to any particular Communication (as defined below), but shall not be obligated to, make the Communications available to the other Banks by posting the Communications on Debt Domain, Intralinks, Syndtrak or a substantially similar electronic transmission system (the “Platform”).
(ii)    The Platform is provided “as is” and “as available.”  The Agent Parties (as defined below) do not warrant the adequacy of the Platform and expressly disclaim liability for errors or omissions in the Communications.  No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by the Agent Parties in connection with the Communications or the Platform.  In no event shall the Agent or any of its related parties (collectively, the “Agent Parties”) have any liability to the Borrower or any of its Affiliates, any Bank or any other Person or entity for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of the Borrower’s or the Agent’s transmission of communications through the Platform.  “Communications” means, collectively, any notice, demand, communication, information, document or other material provided by or on behalf of the Borrower or its Affiliates pursuant to any Loan Document or the transactions contemplated therein which is distributed to the Agent or any Bank by means of electronic communications pursuant to this Section, including through the Platform.

SECTION 9.02.    Waivers; Amendments.  (a)  No failure or delay by the Agent or any Bank in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of the Agent and the Banks hereunder and under any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of any Loan Document or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by clause (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  Without limiting the generality of the foregoing, to the extent permitted by law, the making of a Credit Extension shall not be construed as a waiver of any Event of Default, regardless of whether the Agent or any Lender may have had notice or knowledge of such Event of Default at the time.
(b)    Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except (i) in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders, provided that the Borrower and the Agent may enter into a Change in Control Amendment under Section 2.20, (ii) in the case of any amendment to the Parent Guaranty that increases the Guaranteed Amount, the Parent Guarantor and the Agent may enter into an agreement to effectuate such an amendment, without the consent of any Lender, or (iii) in the case of any other Loan Document (other than any such amendment to effectuate any modification thereto expressly contemplated by the terms of such other Loan Documents), pursuant to an agreement or agreements in writing entered into by the Agent and the Borrower, with the consent of the Required Lenders; provided that no such agreement shall (A) increase the Revolving Credit Commitment of any Lender without the written consent of such Lender; it being understood that the waiver of any Event of Default or mandatory prepayment shall not constitute an increase of any Revolving Credit Commitment of any Lender, (B) reduce or forgive the principal amount of any Loan or reduce the rate of interest thereon, or reduce or forgive any interest or fees (including any prepayment fees) payable hereunder, without the written consent of each Lender directly affected thereby, (C) postpone any scheduled date of payment of the principal amount of any Loan, or any date for the payment of any interest, Fees or other Obligations payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Revolving Credit Commitment, without the written consent of each Lender directly affected thereby; provided that only the consent of the Required Lenders shall be necessary to amend the provisions of Section 2.11(c) providing for the default rate of interest, or to waive any obligations of the Borrower to pay interest at such default rate, (D) change Sections 2.08(b), 2.16(b) or 2.16(e) in a manner that would alter the manner in which payments are shared, without the written consent of each Lender, 

(E) change any of the provisions of this Section 9.02, the definition of “Required Lenders” or any other provision of any Loan Document specifying the number or percentage of Lenders required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender, (F) amend any of the provisions of Section 2.20 or the definition of “Change in Control” without the written consent of each Lender, (G) without the written consent of each Lender, amend the Parent Guaranty in any material respect adverse to the Lenders (it being understood and agreed, however, that an amendment to or amendment and restatement of the Parent Guaranty shall not be deemed to be adverse to the Lenders to the extent it increases the Guaranteed Amount) or, if any Obligations are outstanding, release the Parent Guarantor from any of its obligations under the Parent Guaranty (provided that the Agent, without the consent of any Lender, may agree to a reduction of the Guaranteed Amount so long as the aggregate principal amount of all Loans then outstanding does not exceed 95.0% of the Guaranteed Amount, after giving effect to such reduction), or (H) waive any conditions precedent set out in Article IV in respect of any Credit Extension without the written consent of each Lender; provided, further, that no such agreement shall amend, modify or otherwise affect the rights or duties under this Agreement or any other Loan Document of the Agent, without the prior written consent of the Agent.  The Agent may without the consent of any Lender also amend the Commitment Schedule to reflect assignments entered into pursuant to Section 9.04.  
(c)    If, in connection with any proposed amendment, waiver or consent requiring the consent of “each Lender” or “each Lender directly affected thereby”, no Event of Default has occurred and is continuing and the consent of the Required Lenders is obtained, but the consent of other necessary Lenders is not obtained (any such Lender whose consent is necessary but not obtained being referred to herein as a “Non-Consenting Lender”), then the Borrower may, with the prior written consent of the Agent (such consents not to be unreasonably withheld or delayed), elect to replace a Non-Consenting Lender as a Lender party to this Agreement, provided that, concurrently with such replacement by the Borrower, (i) another bank or other entity which is reasonably satisfactory to the Borrower and the Agent shall agree, as of such date, to purchase for cash the Loans due to the Non-Consenting Lender pursuant to an Assignment and Assumption and to become a Lender for all purposes under this Agreement and to assume all obligations of the Non-Consenting Lender to be terminated as of such date and to comply with the requirements of clause (b) of Section 9.04, (ii) the replacement Lender shall grant its consent with respect to the applicable proposed amendment, waiver or consent and (iii) the Borrower shall pay to such Non-Consenting Lender in same day funds on the day of such replacement (1) all interest, fees and other amounts then accrued but unpaid to such Non-Consenting Lender by the Borrower hereunder to and including the date of termination, including, without limitation, payments due to such Non-Consenting Lender under Sections 2.13 and 2.15, and (2) an amount, if any, equal to the payment which would have been due to such Lender on the day of such replacement under Section 2.14 had the Loans of such Non-Consenting Lender been prepaid on such date rather than sold to the replacement Lender (the “Required Payment”).  Each Lender 

agrees that if the Borrower exercises its option hereunder, it shall promptly execute and deliver all agreements and documentation necessary to effectuate such assignment as set forth in Section 9.04.  If any Non-Consenting Lender does not promptly execute and deliver all agreements and documentation necessary to effectuate such assignment as set forth in Section 9.04, then the Agent or the Borrower shall be entitled (but not obligated) to execute and deliver such agreement and documentation relating to such assignment on behalf of such Non-Consenting Lender and any such agreement and/or documentation so executed by the Agent or the Borrower shall be effective for purposes of documenting an assignment pursuant to Section 9.04 upon the Borrower making the Required Payment to such Non-Consenting Lender.
(d)    The Agents and the Borrower may amend any Loan Document to correct administrative or manifest errors or omissions, or to effect administrative changes that are not adverse to any Lender; provided, however, that no such amendment shall become effective until the fifth Business Day after it has been posted to the Lenders, and then only if the Required Lenders have not objected in writing thereto within such five Business Day period.
(e)    Notwithstanding the foregoing, the Borrower, the Agent and the Lenders may not, without the prior written consent of the Parent Guarantor, (i) change the manner, place and terms of payment or change or extend the time of payment of, renew, or alter any Obligation guaranteed by the Parent Guarantor under the Parent Guaranty, or in any manner modify, amend or supplement the terms of this Agreement or any documents, instruments or agreements executed in connection herewith, or (ii) take and hold security or additional security for any or all of the obligations or liabilities covered by the Parent Guaranty, in each case to the extent that the Parent Guaranty is then in effect and doing so would reasonably be expected to have a material adverse effect on the Parent Guarantor.  

SECTION 9.03.    Expenses; Indemnity; Damage Waiver.  (a)    The Borrower agrees to pay on demand all reasonable and documented costs and expenses of the Agent (including the fees and expenses of Linklaters LLP as special counsel to the Lenders to the extent previously agreed) in connection with the preparation, execution, delivery and administration of the Loan Documents.
(b)    The Borrower shall indemnify the Agent and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, penalties, liabilities and related expenses (including reasonable and documented fees and expenses of counsel), incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of the Loan Documents or any agreement or instrument contemplated thereby, the performance by the parties hereto of their respective obligations thereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any environmental liability related in any way to the Borrower or any of its Subsidiaries or to 

any property owned or operated by the Borrower or any of its Subsidiaries, or (iii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto (and regardless of whether such matter is initiated by a third party or by the Borrower or any of its Affiliates); provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, penalties, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the negligence (if a Change in Control has not occurred), gross negligence (if a Change in Control has occurred) or willful misconduct of such Indemnitee. This Section 9.03(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.
(c)    To the extent that the Borrower fails to pay any amount required to be paid by it to the Agent under clause (a) or (b) above, each Lender severally agrees to pay to the Agent such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, penalty, liability or related expense, as the case may be, was incurred by or asserted against the Agent in its capacity as such.
(d)    To the extent permitted by applicable law, no party to this Agreement shall assert, and each hereby waives, any claim against any other party hereto or any Related Party thereof, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof; provided, however, that the foregoing provisions shall not relieve the Borrower of its indemnification obligations as provided herein to the extent any Indemnitee is found liable for any such damages.

SECTION 9.04.    Successors and Assigns.  (a)  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its rights or obligations hereunder except in accordance with this Section (any attempted assignment or transfer not complying with the terms of this Section shall be null and void).  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in clause (c) below) and, to the extent expressly contemplated hereby, the Related Parties of each of 

the Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(b)    (i)  Subject to the conditions set forth in clause (b)(ii) below, any Lender may assign to one or more commercial banks, savings banks, financial institutions or other institutional investors all or a portion of its rights and obligations under this Agreement (including all or a portion of its Revolving Credit Commitment or the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of:
(A)    the Borrower, provided that no consent of the Borrower shall be required (1) for an assignment to an Eligible Assignee or (2) if an Event of Default has occurred and is continuing; and
(B)    except in the case of an assignment to an Eligible Assignee, the Agent.
(ii)    Assignments shall be subject to the following additional conditions:
(A)    except in the case of an assignment to another Lender, an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Revolving Credit Commitment or Loans, the amount of the Revolving Credit Commitment or the principal amount of Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Agent and determined on an aggregate basis in the event of concurrent assignments to Related Funds (as defined below)) shall be in a minimum amount of at least $5,000,000 unless each of the Borrower and the Agent otherwise consent;
(B)    each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement;
(C)    the parties to each assignment shall execute and deliver to the Agent an Assignment and Assumption via an electronic settlement system acceptable to the Agent (or, if previously agreed with the Agent, manually) together with payment by the assignee to the Agent of a registration and processing fee of $3,500 (except that no such 

registration and processing fee shall be payable (y) in connection with an assignment by or to Credit Agricole CIB or any Affiliate thereof or (z) in the case of an assignee which already is a Lender or is an Affiliate or Approved Fund of a Lender); and
(D)    the assignee, if it shall not be a Lender, shall deliver on or prior to the effective date of such assignment, to the Agent (1) an Administrative Questionnaire and (2) if applicable, an appropriate IRS form (such as IRS Form W-8BEN, IRS Form W-8BEN-E or IRS Form W-8ECI or any successor form adopted by the relevant United States taxing authority).
The term “Related Funds” shall mean with respect to any Lender that is an Approved Fund, any other Approved Fund that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.
(iii)    Subject to acceptance and recording thereof pursuant to clause (b)(iv) below, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.13, 2.14, 2.15 (subject to the requirements of Section 2.15) and 9.03 with respect to facts and circumstances occurring on or prior to the effective date of such assignment).  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with clause (c) below.
(iv)    The Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Revolving Credit Commitment of, or principal amount of, and any interest on, the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive, absent manifest error, and the Borrower, the Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for 

inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(v)    Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire and tax certifications required by clause (b)(ii)(D)(2) above (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in this clause (b) of this Section and any written consent to such assignment required by this clause (b) of this Section, the Agent shall accept such Assignment and Assumption and record the information contained therein in the Register; provided that if either the assigning Lender or the assignee shall have failed to make any payment required to be made by it pursuant to Section 2.04(a), 2.16(c) or 9.03(c), the Agent shall have no obligation to accept such Assignment and Assumption and record the information therein in the Register unless and until such payment shall have been made in full, together with all accrued interest thereon.  No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this Section 9.04.
(vi)    By executing and delivering an Assignment and Assumption, the assigning Lender thereunder and the assignee thereunder shall be deemed to confirm to and agree with each other and the other parties hereto as follows:  (i) such assigning Lender warrants that it is the legal and beneficial owner of the interest being assigned thereby free and clear of any adverse claim and that its Revolving Credit Commitment, and the outstanding balances of its Loans, in each case without giving effect to assignments thereof which have not become effective, are as set forth in such Assignment and Assumption, (ii) except as set forth in (i) above, such assigning Lender makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with this Agreement, or the execution, legality, validity, enforceability, genuineness, sufficiency or value of this Agreement, any other Loan Document or any other instrument or document furnished pursuant hereto, or the financial condition of the Loan Parties or the performance or observance by the Loan Parties of any of their respective obligations under the Loan Documents or any other instrument or document furnished pursuant thereto; (iii) such assignee represents and warrants that it is an Eligible Assignee, legally authorized to enter into such Assignment and Assumption; (iv) such assignee confirms that it has received a copy of this Agreement, together with copies of the most recent financial statements referred to in Section 3.04 or delivered pursuant to Section 5.01 and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into such Assignment and Assumption; (v) such assignee will independently and without reliance upon the Agent, such assigning Lender or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not 

taking action under this Agreement; (vi) such assignee appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under this Agreement as are delegated to the Agent, by the terms hereof, together with such powers as are reasonably incidental thereto; and (vii) such assignee agrees that it will perform in accordance with their terms all the obligations which by the terms of this Agreement are required to be performed by it as a Lender.
(c)    (i)  Any Lender may sell participations to one or more commercial banks, savings banks or other financial institutions or, with the consent of the Borrower (so long as no Event of Default has occurred and is continuing), other entities (a “Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Revolving Credit Commitment or the Loans or other Obligations owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, (C) the Borrower, the Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement, (D) no such Participant shall be a “creditor” as defined in Regulation T or a “foreign branch of a broker-dealer” within the meaning of Regulation X, and (E) neither the Borrower nor any of its Affiliates shall be a Participant.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant.  Subject to clause (c)(ii) below, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.13, 2.14 and 2.15 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (b) above.  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.16(c) as though it were a Lender.  Each Lender that sells a participation, acting solely for this purpose as a non-fiduciary agent of the Borrower, shall maintain at one of its offices a register for the recordation of the names and addresses of each Participant and the principal amounts of, and stated interest on, each Participant’s interest in the Loans or other obligations under this Agreement (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant's interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations.  The entries in the Participant Register shall be conclusive, absent manifest error, and such Lender shall treat each Person whose name is recorded in the 

Participant Register pursuant to the terms hereof as the owner of such participation for all purposes of this Agreement, notwithstanding notice to the contrary.
(ii)    A Participant shall not be entitled to receive any greater payment under Section 2.13 or Section 2.15, with respect to any participation, than its participating Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.8 as though it were a Lender.
(d)    Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank or other governmental authority, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
(e)    If the consent of the Borrower to an assignment or to an Eligible Assignee is required hereunder, the Borrower shall be deemed to have given its consent fifteen (15) Business Days after the date notice thereof (which notice shall specify such fifteen-day notice period described herein) has been delivered by the assigning Lender (through the Agent) unless such consent is expressly refused by the Borrower prior to such fifteenth Business Day.

SECTION 9.05.    Survival.  All covenants, agreements, representations and warranties made by the Borrower in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Revolving Credit Commitments have not expired or terminated.  The provisions of Sections 2.13, 2.14, 2.15 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans and the reimbursement of any amounts drawn thereunder, and the termination hereof, the expiration or termination of the Revolving Credit Commitments or the termination of this Agreement or any provision hereof.

SECTION 9.06.    Counterparts; Integration; Effectiveness.  This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of 

which when taken together shall constitute a single contract.  This Agreement, the other Loan Documents and the Fee Letters and any separate letter agreements with respect to fees payable to the Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Agent and when the Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile or in ‘PDF’ format by electronic mail shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 9.07.    Severability.  To the extent permitted by law, any provision of any Loan Document held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions thereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 9.08.    Right of Setoff    .  If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time after the Effective Date, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by it to or for the credit or the account of the Borrower.  The applicable Lender shall notify the Borrower and the Agent of such set-off or application, provided that any failure to give or any delay in giving such notice shall not affect the validity of any such set-off or application under this Section.  The rights of each Lender and its Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

SECTION 9.09.    Governing Law; Jurisdiction; Consent to Service of Process; Waiver of Jury Trial.  (a)  THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN AS EXPRESSLY SET FORTH IN ANY OTHER LOAN DOCUMENT) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THAT WOULD REQUIRE APPLICATION OF ANOTHER LAW.

(b)    Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any New York state court or federal court of the United States of America sitting in the Borough of Manhattan in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in any such New York state court or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.
(c)    Each of the parties hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any of the other Loan Documents to which it is a party in any New York state or federal court.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court sitting in the Borough of Manhattan in New York City.
(d)    To the extent permitted by law, each party to this Agreement hereby irrevocably waives personal service of any and all process upon it and agrees that all such service of process may be made by express or overnight mail or courier, postage prepaid, directed to it at its address for notices as provided for in Section 9.01.  Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
(e)    EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver is intended to be all-encompassing of any and all disputes that may be filed in any court and that relate to the subject matter of this transaction, including contract claims, tort claims, breach of duty claims and all other common law and statutory claims. Each party hereto acknowledges that this waiver is a material inducement to enter into a business relationship, that each has already relied on this waiver in entering into this Agreement, and that each will continue to rely on this waiver in their related future dealings. Each party hereto further warrants and represents that it has reviewed this waiver with its legal counsel and that it knowingly and voluntarily waives its jury trial rights following consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN 

WAIVER SPECIFICALLY REFERRING TO THIS SECTION 9.09(e) AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a written consent to a trial by the court.

SECTION 9.10.    Headings.  Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.

SECTION 9.11.    Confidentiality.  The Agent and each Lender agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates’ directors, trustees, officers, employees and agents, including accountants, insurance providers, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory, governmental or administrative authority or any self-regulatory body, (c) to the extent required by law or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any pledgee referred to in Section 9.04(d) or (iii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations, (g) with the consent of the Borrower or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Agent or any Lender on a nonconfidential basis from a source other than the Borrower.  For the purposes of this Section, “Information” means all information received from the Borrower relating to the Borrower or its businesses, or the Transactions other than any such information that is available to the Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

SECTION 9.12.    Several Obligations; Nonreliance; Violation of Law.  The respective obligations of the Lenders hereunder are several and not joint and the failure of any Lender to make any Loan or perform any of its obligations hereunder shall not relieve any other Lender from any of its obligations hereunder.  Each Lender hereby represents that (a) it is not relying on or looking to any Margin Stock for the repayment of the Borrowings provided for herein and (b) it is not and will not become a “creditor” as defined in Regulation T or a “foreign branch of a broker-dealer” within the meaning of Regulation X.  Anything contained in this Agreement to the contrary notwithstanding, no Lender shall be obligated to extend credit to the Borrower in violation of any Requirement of Law.

SECTION 9.13.    USA PATRIOT Act.  Each Lender that is subject to the requirements of the USA PATRIOT Act hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act, it is required to obtain, verify and record information that identifies the Borrower and the Parent Guarantor and, which information includes the name and address of the Borrower and the Parent Guarantor and other information that will allow such Lender to identify the Borrower and the Parent Guarantor in accordance with the USA PATRIOT Act.

SECTION 9.14.    Interest Rate Limitation.  Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any of the Obligations, together with all fees, charges and other amounts which are treated as interest on such Obligations under applicable law (collectively, the “Charges”), shall exceed the maximum lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken, received or reserved by the Lender holding such Obligations or participation in accordance with applicable law, the rate of interest payable in respect of such Obligations or participation hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Obligations or participation but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Obligations or participations or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

SECTION 9.15.    Termination of Security Agreement and Subsidiary Guaranty.  The parties hereto hereby agree that the Security Agreement and the Subsidiary Guaranty shall be automatically terminated with immediate effect on the Effective Date. On the Effective Date, the Security Agent shall execute and deliver to the Borrower, at the Borrower’s expense, any releases or similar documents that the Borrower shall reasonably request to evidence such terminations, including without limitation (i) a release of Liens in the Collateral, 

(ii) a release of the Subsidiary Guarantors under the Subsidiary Guaranty, (iii) UCC termination statements, and (iv) a notice of termination for any deposit account control agreements, in each case in a form reasonably acceptable to the Security Agent.  Any execution and delivery of termination statements, releases or other documents pursuant to this Section 9.15 shall be without recourse to or warranty by the Security Agent.

SECTION 9.16.    Acknowledgement and Consent to Bail-In of EEA Financial Institutions.  Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a)    the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and
(b)    the effects of any Bail-In Action on any such liability, including, if applicable:
(i)    a reduction in full or in part or cancellation of any such liability;
(ii)    a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii)    the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.
[Remainder of page intentionally left blank.]

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

	
		
	SUNPOWER CORPORATION

	 

	by

	 
	 

	 
	Name:

	 
	Title:

	 
	 

	
		
	In its capacity as Parent Guarantor and as acknowledgement of its consent to this Agreement:

	 

	TOTAL S.A.

	 

	By

	 
	 

	 
	Name:

	 
	Title:

	 
	 

	
		
	CRÉDIT AGRICOLE CORPORATE AND INVESTMENT BANK, individually, as Agent and as Security Agent

	 

	By

	 
	 

	 
	Name:

	 
	Title:

	 

	By

	 
	 

	 
	Name:

	 
	Title:

	 

	 
	 

	
	
	[SIGNATURES OF OTHER LENDERS]

	 

SCHEDULE 1 
 
COMMITMENT SCHEDULE

	
				
	Bank
	Revolving Credit Commitment

	Crédit Agricole Corporate and Investment Bank
	$
	81,000,000.00
	

	Deutsche Bank AG New York Branch
	$
	69,000,000.00
	

	HSBC Bank USA, National Association
	$
	57,000,000.00
	

	Mizuho Bank, Ltd.
	$
	57,000,000.00
	

	Santander Bank, N.A.
	$
	24,000,000.00
	

	Citicorp North America, Inc.
	$
	12,000,000.00
	

	Total
	

	$300,000,000.00

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