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7897269 v13 Execution Version   RESEARCH COLLABORATION AND LICENCE AGREEMENT by and between ORCHARD THERAPEUTICS (EUROPE) LIMITED and PHARMING TECHNOLOGIES B.V. Dated as of 1 July 2021 

 

7897269 v13 1 THIS RESEARCH COLLABORATION AND LICENCE AGREEMENT is made and  entered into effective as of 1 July 2021 (the “Effective Date”) by and between (1) ORCHARD THERAPEUTICS (EUROPE) LIMITED, a company organized under the  laws of England and Wales, and with its office at 108 Cannon Street, London EC4A 6EU  (“Orchard”), and (2) PHARMING TECHNOLOGIES B.V, a company organized under the laws of the  Netherlands with its office at Darwinweg 24, 2333 CR Leiden, The Netherlands  (“Pharming”). Orchard and Pharming are sometimes referred to herein individually as a “Party” and collectively  as the “Parties”. BACKGROUND (A) Orchard is a global, commercial stage biopharmaceutical company developing innovative  gene therapies and owns or Controls certain intellectual property rights with respect to the  research and development of haematopoietic stem cell lentivirus-mediated gene therapy. (B) Pharming is a global, commercial stage biopharmaceutical company developing innovative  protein replacement therapies and precision medicines for the treatment of rare diseases  and unmet medical needs. (C) The Parties have agreed to collaborate to research, develop, and manufacture an ex vivo  autologous haematopoietic stem cell lentivirus-mediated gene therapy, which Pharming  will commercialise, all as further set out herein.    NOW, THEREFORE, in consideration of the mutual promises and conditions hereinafter set  forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby  acknowledged, the Parties, intending to be legally bound, do hereby agree as follows: 

 

7897269 v13 2 ARTICLE 1 DEFINITIONS As used in this Agreement, the following capitalized terms, whether used in the singular or plural,  shall have the meanings set out below: 1.1 “Acceptance of a Drug Approval Application by the FDA” as used in Section 9.3.1  (Development Milestone Payments) means a determination by the FDA that the Drug  Approval Application is sufficiently complete to permit a substantive review (consistent  with the definition in 21 C.F.R. § 314.101(a) of the “filing” of an NDA). 1.2 “Accounting Standards” means, with respect to each Party, International Financial  Reporting Standards (IFRS).   1.3 “Additional Competitive Program” means both (i) any Competitive Program, and/or (ii)  the research, development, promotion, regulatory approval or commercialisation of any  haematopoietic stem cell gene therapy product. 1.4 “Affiliate” means, with respect to a Party or other Person, any Person that, directly or  indirectly, through one (1) or more intermediaries, controls, is controlled by or is under  common control with such Party or such other Person.  For the purposes of this definition,  “control” and, with correlative meanings, the terms “controlling”, “controlled by” and  “under common control with”, means (a) the possession, directly or indirectly, of the  power to direct the management or policies of a Person, whether through the ownership  of voting securities, by contract relating to voting rights or corporate governance, or  otherwise; or (b) the ownership, directly or indirectly, of more than fifty percent (50%)  of the voting securities or other ownership interest of a Person (or, with respect to a  limited partnership or other similar entity, its general partner or controlling entity). 1.5 “Agreement” means this agreement and all schedules, appendices and other addenda  attached hereto as any of the foregoing may be amended in accordance with the  provisions of this Agreement. 1.6 “Alliance Manager” has the meaning set forth in Section 2.10. 

 

7897269 v13 3 1.7 “Annual Net Sales” means the total Net Sales of the Licensed Product in a particular Year  or, with respect to the Year that includes the First Commercial Sale, the period beginning  on such date of First Commercial Sale through to the end of the Year in which such First  Commercial Sale occurred. 1.8 “Anti-Corruption Laws” has the meaning set forth in Section 13.3.4. 1.9 “Applicable Law” means federal, state, local, national and supra-national laws, statutes,  rules, and regulations, including any rules, regulations, guidelines, or other requirements  of the Governmental Authorities, major national securities exchanges or major securities  listing organizations, that may be in effect from time to time during the Term and  applicable to a particular activity or country or other jurisdiction hereunder. 1.10  “Business Day” means a day other than a Saturday or Sunday on which banking  institutions in Amsterdam, The Netherlands, New York, the United States of America,  and London, England are open for business. 1.11 “Centralized Approval Procedure” means the procedure through which an MAA filed  with the EMA results in a single marketing authorization valid throughout the European  Union. 1.12 “Change of Control” means, with respect to a Party: (a) a transaction in which such Party (or a Holding Company of such Party) sells, conveys  or otherwise disposes of all or substantially all of its property or business; or  (b) (i) a transaction in which such Party (or a Holding Company of such Party) merges  or consolidates with any other Person (other than a wholly-owned subsidiary of such  Party or a Holding Company of such Party), or (ii)  any other transaction or series of  transactions; in each case of clause (i) or (ii), in consequence of which any Person and/or  any group of Persons acting in concert (as such expression is defined in the Code)  acquires a Controlling Interest in such Party (or in a Holding Company of such Party). For the purposes of Sections 1.12 or 1.107, the following capitalized terms shall have the  meanings set out below: 

 

7897269 v13 4 “Code” means the UK City Code on Takeovers and Mergers; “Controlling Interest” means an interest in shares giving to the holder or holders the  power to secure (a) by means of the holding of shares or the possession of voting  power in relation to that or any other body corporate and/or (b) as a result of any  powers conferred by the articles of association or other document regulating that or  any other body corporate (i) the election of a majority of the members of the  company’s board of directors or similar governing body and/or (ii) that the affairs of  the company are conducted in accordance with such holder or holder’s wishes; and “Holding Company” has the meaning given to “holding company” in section 1159 of  the Companies Act 2006. 1.13 “Claims” has the meaning set forth in Section 14.1. 1.14 “Clinical Development Plan” means the plan setting out: (i) the clinical development  activities to be performed by or on behalf of Pharming, (ii) the Manufacturing activities  and technology and knowledge transfer obligations to be performed by Orchard, and (iii)  any relevant development activities with respect to NTCR performed by either Party or  both Parties, as such plan is approved by the JSC in accordance with Section 2.2.5, and  as amended by the JSC from time to time in accordance with Section 2.2.5. 1.15 “Clinical Studies” means any and all Phase 1 Trials, Phase 2 Trials, Phase 3 Trials, Phase  4 Trials and Pivotal Studies and such other tests and studies in human subjects that are  required by Applicable Law, or otherwise recommended by any applicable Regulatory  Authority, to obtain or maintain Regulatory Approvals for the Licensed Product,  including such tests or studies that are intended to expand the approved indications for  the Licensed Product. 1.16 “Collaboration” means the collaboration between the Parties with respect to the Licensed  Products which is the subject matter of this Agreement. 1.17 “Commercialization” means any and all activities directed to the preparation for sale of,  offering for sale of, or sale of any Licensed Product, including activities related to  

 

7897269 v13 5 marketing, promoting, distributing, importing and exporting such product, and, for the  purposes of setting forth the rights and obligations of the Parties under this Agreement,  shall be deemed to include conducting medical affairs activities and conducting Phase 4  Trials, and interacting with Regulatory Authorities regarding any of the foregoing.  When  used as a verb, “to Commercialize” and “Commercializing” means to engage in  Commercialization, and “Commercialized” has a corresponding meaning. 1.18 “Commercially Reasonable Efforts” means:  1.18.1 with respect to a Party’s activities, the carrying out of such activities using  efforts and resources that such Party and its Affiliates would typically devote  to carrying out such activities, acting in good faith, to products of similar  market potential at a similar stage in development or product life, taking into  account all scientific, commercial and other factors that such Party and its  Affiliates would typically take into account, including (i) [issues of expected  and actual cost and time to develop], (ii) the [stage of development], (iii)  [efficacy and safety], (iv) actual or anticipated [Regulatory Approval], (v) the  expected and actual [labeling], (vi) expected and actual [profitability  (including royalties and other payments required hereunder)], (vii) expected  and actual [competitiveness of alternative Third Party products (including  generic products) in the marketplace], (viii) and the nature and extent of  expected and actual [market exclusivity (including patent coverage,  proprietary position and Regulatory Exclusivity)], (ix) the expected and  actual [reimbursability and pricing] and (x) the expected and actual amounts  of [marketing and promotional expenditures required]; provided, that in any  event such efforts and resources shall be no less than the efforts used by  similarly situated and reputable companies in each Party’s respective industry  (taking into account the foregoing scientific, commercial and other factors);  and  1.18.2 with respect to an activity that is subcontracted by such Party or any of its  Affiliates to a Third Party as permitted hereunder, the exercise of such care  

 

7897269 v13 6 and the dedication of such efforts by such Party or its Affiliate with respect to  (a) the selection of such Third Party, (b) the entry into the subcontract with  such Third Party (including with respect to the terms thereof), and (c) the  management of such subcontract, in each case ((a), (b), and (c)), as are  consistent with the standards typically applied by the relevant subcontracting  Party and, in any event, such Party shall procure that such Third Party shall  perform such subcontracted activities with at least the level of efforts and  resources required of such Party as set forth in Section 1.18.1 as if such  subcontractor were such Party. 1.19 “Competitive Infringement” has the meaning set forth in Section 11.3.1. 1.20 “Competitive Program” has the meaning set forth in Section 4.1. 1.21 “Conditioning Regimen” means any treatment used to [deplete resident haematopoietic  stem cells] in a patient prior to administration of the Licensed Product.  1.22 “Confidential Information” means any Information or data provided orally, visually, in  writing or other form by or on behalf of one (1) Party (or an Affiliate or representative  of such Party) to the other Party (or to an Affiliate or representative of such Party) in  connection with this Agreement, whether prior to, on, or after the Effective Date,  including Information relating to the terms of this Agreement, any Licensed Product, any  Exploitation of any Licensed Product, any Know-How with respect thereto developed by  or on behalf of the disclosing Party or its Affiliates (including Pharming Collaboration  Know-How and Orchard Collaboration Know-How, as applicable), or the scientific,  regulatory, or business affairs or other activities of either Party.  Notwithstanding the  foregoing, (a) Orchard Background IP, Orchard Collaboration IP, Orchard Conditioning  IP and Platform IP will be considered Confidential Information of Orchard, (b) Pharming  Background IP, Pharming Collaboration IP and Pharming Conditioning IP will be  considered Confidential Information of Pharming, and (c) Joint Collaboration IP and  Joint Conditioning IP shall be considered the Confidential Information of both Parties  and both Parties shall be deemed to be the receiving Party and the disclosing Party with  respect thereto.  

 

7897269 v13 7 1.23 “Control” means, with respect to any item of Information, Know-How, material, Patent,  or other property right and a Party or its Affiliates, the possession by such Party or its  Affiliates of the right, whether directly or indirectly, and whether by ownership, license,  covenant not to sue, or otherwise (other than by operation of the licence and other grants  in this Agreement), to grant a license, sublicense, or other right to or under such  Information, Know-How, material, Patent, or other property right as provided for herein  without violating the terms of any agreement or other arrangement with any Third Party;  provided, however, that, with respect to any of the foregoing that is in-licensed by such  Party or its Affiliates from a Third Party, if (a) the grant to the other Party of access to or  a license under such item or right and/or (b) the exercise by the other Party of rights under  such license, as provided herein, in either case ((a) or (b)), would trigger a payment  obligation by a Party to a Third Party, such item or right, as applicable, shall: (A) if such  Party is Orchard, only be deemed Controlled by Orchard if: (i) Pharming agrees in  writing and executes a mutually acceptable agreement confirming that Pharming shall be  responsible for such payment obligations to the extent resulting from such grant of access  or license to Pharming and/or such exercise by Pharming of such rights under such  license, and any other obligations required by the respective Third Party under the  applicable licence agreement between Orchard and such Third Party as a condition of  such sublicence; and (ii) solely in the case of any Know-How or Patent that constitutes  Manufacturing Process Improvements, to the extent disclosed by Orchard under Section  2.2.7 or otherwise provided or made available by Orchard or its Affiliates for use in the  Collaboration; or (B) if such Party is Pharming, shall not be deemed to be Controlled by  Pharming such Party or its Affiliates. Notwithstanding the foregoing, neither a Party or its Affiliates will be deemed to  “Control” any Information, Know-How, material, Patent or other property right that is  owned or controlled by an Affiliate of such Party that was not an Affiliate of such Party  immediately prior to a Change of Control of such Party: (1) prior to such Change of  Control, that is not generated through the use or incorporation of such Party’s or any of  its Affiliates’ (who was an Affiliate of such Party prior to such Change of Control)  material, Know-How or Patent Rights or through the Exploitation of the Licensed  Product or (2) after such Change of Control of such Party, to the extent generated without  

 

7897269 v13 8 using or incorporating any of the Orchard Background IP, Pharming Background IP,  Orchard Collaboration IP, Joint Collaboration IP, Pharming Collaboration IP, Orchard  Conditioning IP, Joint Conditioning IP and Pharming Conditioning IP and to the extent  generated through activities that do not involve the Exploitation of the Licensed Product. 1.24 “Costs” means all: (a) out-of-pocket costs and expenses and (b) FTE Costs. 1.25 “Cover” means, with respect to a particular subject matter at issue and a relevant Patent,  that, in the absence of ownership of or a licence under such Patent, the manufacture, use,  sale, offer for sale, or importation of such subject matter would infringe one or more  issued Valid Claims of such Patent, or, as to a pending claim included in such Patent, the  manufacture, use, sale, offer for sale, or importation of such subject matter would infringe  such Patent if such pending claim were to issue in an issued patent. 1.26  “Development” means all activities related to the clinical development of the Licensed  Product conducted on or after the filing of a first IND in respect thereof, including,  without limitation, testing, test method development and stability testing, toxicology,  formulation, process development, manufacturing scale-up, qualification and validation,  quality assurance/quality control, Clinical Studies, including Manufacturing in support  thereof, statistical analysis and report writing, the preparation and submission of Drug  Approval Applications, regulatory affairs with respect to the foregoing, and all other  activities necessary or reasonably useful or otherwise requested or required by a  Regulatory Authority as a condition or in support of obtaining or maintaining a  Regulatory Approval.  When used as a verb, “Develop” means to engage in  Development.  For purposes of clarity, Development shall include any submissions (and  activities required in support thereof) required by Applicable Laws or a Regulatory  Authority as a condition or in support of obtaining a pricing or reimbursement approval  for an approved Licensed Product. 1.27 “Development Milestone Payments” has the meaning set forth in Section 9.3.1. 1.28 “Development Milestones” has the meaning set forth in Section 9.3.1. 1.29 “Dispute” has the meaning set forth in Section 16.8(a). 

 

7897269 v13 9 1.30 “Distributor” has the meaning set forth in Section 3.4. 1.31 “Dollars” or “$” means United States Dollars. 1.32 “Drug Approval Application” means (a) a New Drug Application, submitted to the FDA  pursuant to Section 505 of the Federal Food, Drug, and Cosmetic Act and 21 CFR  § 314.50 (“NDA”); (b) a Biologics License Application submitted to the FDA pursuant  to Section 351(a) of the Public Health Service Act and the regulations promulgated  thereunder (“BLA”); (c) an application for authorization to market and/or sell a  biological or pharmaceutical product submitted to a Regulatory Authority in any country  or jurisdiction other than the United States (“MAA”), including, with respect to the  European Union, a marketing authorization application filed with the EMA pursuant to  the Centralized Approval Procedure; or (d) with respect to any biological or  pharmaceutical product for which a NDA, BLA or MAA has been approved by the  applicable Regulatory Authority, an application to supplement, amend or vary such  NDA, BLA or MAA. 1.33 “Effective Date” means the effective date of this Agreement as set forth in the preamble  hereto. 1.34 “Election Notice” has the meaning set forth in Section 15.6.2. 1.35 “EMA” means the European Medicines Agency and any successor agency or authority  having substantially the same function. 1.36 “European Union” means the economic, scientific, and political organization of member  states known as the European Union, as its membership may be altered from time to time,  and any successor thereto. 1.37  “Exploit” or “Exploitation” means to make, have made, import, have imported, export,  have exported, use, have used, sell, have sold, offer for sale, or have offered for sale,  including to research, Develop, Commercialize, register, Manufacture, have  Manufactured, hold, or keep (whether for disposal or otherwise), or otherwise dispose of.   

 

7897269 v13 10 1.38 “FDA” means the United States Food and Drug Administration and any successor agency  or authority having substantially the same function. 1.39 “Field” means any and all uses in humans, including the diagnosis, prophylaxis, treatment,  palliation or cure of any human indication. 1.40 “First Commercial Sale” means, with respect to the Licensed Product and a country, the  first sale for monetary value, after Regulatory Approval of such Licensed Product in that  country, for use or consumption by the end user of the Licensed Product in such country.   For the avoidance of doubt any so-called “treatment IND sales”, “named patient sales”,  and/or “compassionate use sales” of the Licensed Product in a country following  Regulatory Approval of such Licensed Product in such country shall constitute a First  Commercial Sale of such Licensed Product in such country. 1.41 “FTE” means the equivalent of the work of one (1) appropriately qualified individual  working on a full-time basis in performing work in connection with this Agreement for  a twelve (12) month period, consisting of at least a total of [one thousand six hundred  eighty (1,680)] hours per Year. 1.42 “FTE Costs” means the internal cost of a Party incurred in the performance of work in  connection with this Agreement, being the FTEs incurred by such Party in such  performance, multiplied by the FTE Rate. 1.43  “FTE Rate” means, for the period from the Effective Date to 31 December 2021, [three  hundred thousand Dollars ($300,000)] per FTE.  Thereafter, the FTE Rate shall be  [increased or decreased on 1 January] of each Year by [the annual percentage increase or  decrease in the UK Consumer Price Inflation published by the UK Office of National  Statistics].  1.44 “Generic Competition” has the meaning set forth in Section 9.5.3(c). 1.45 “Generic Product” means, with respect to a particular Licensed Product (the “Reference  Product”) and regulatory jurisdiction, any product that is sold by a Third Party that is  not an Affiliate or Sublicensee of Pharming under a Regulatory Approval granted by a  

 

7897269 v13 11 Regulatory Authority in such regulatory jurisdiction to such Third Party and (a) contains  the same active ingredient (or any equivalent derivatives) of the Licensed Product, (b) its  Regulatory Approval was granted through reference to the Regulatory Approval of the  Reference Product, and/or (c) is approved as (i) a ‘biosimilar’ (as defined in the United  States under 42 U.S.C. § 262(i)(2)) of the Reference Product, (ii) a “similar biological  medicinal product” (in the EU in accordance with Directive 2001/83/EC) with respect to  which the Reference Product is the “reference medicinal product,” or (iii) if not in the  US or EU, the foreign equivalent of a “biosimilar” or “similar biological medicinal  product” of such Reference Product. 1.46 “Government Official” means (a) any Person acting on behalf of a government,  government-controlled agency or entity or public international organization, (b) any  political party, party official or candidate, (c) any Person who holds or performs the  duties of an appointment, office or position created by custom or convention or (d) any  Person who holds himself out to be the authorized intermediary of any of the foregoing. 1.47 “Governmental Authority” means any court, administrative body, local authority or other  governmental or quasi-governmental entity with competent jurisdiction, any supra- national, national, federal, state, municipal, provincial or local governmental, regulatory  or administrative authority, agency, commission, court tribunal, arbitral body, self- regulated entity, private body exercising any regulatory, taxing, importing or other  governmental or quasi-governmental authority or other governmental entity, including  any relevant Regulatory Authority. 1.48  “High Incidence Secondary Indication” means a Secondary Indication in relation to  which the Licensed Product has not received orphan drug designation in the United  States.  1.49 “IND” means an application filed with a Regulatory Authority for authorization to  commence Clinical Studies, including (a) an Investigational New Drug Application as  defined in the United States Federal Food, Drug, and Cosmetic Act, as amended, or any  successor application or procedure filed with the FDA, (b) any equivalent of a United  States IND in other countries or regulatory jurisdictions, (e.g., a Clinical Trial  

 

7897269 v13 12 Application), and (c) all supplements, amendments, variations, extensions, and renewals  thereof that may be filed with respect to the foregoing. 1.50 “IND Clearance” means, with respect to an IND, the earlier to occur of: (a) receipt by  Pharming, any of its Affiliates, or any Sublicensee of written confirmation from a  Regulatory Authority that Clinical Studies may commence or be conducted under such  IND; or (b) expiration of the applicable waiting period after which Clinical Studies may  commence or be conducted under such IND. 1.51 “Indemnitee” has the meaning set forth in Section 14.3. 1.52 “Indemnitor” has the meaning set forth in Section 14.3. 1.53 “Indication” means a disease, disorder, illness, or health condition and all of its associated  signs, symptoms, stages, or any progression of the foregoing (including precursor  conditions), in each case, for which a separate Pivotal Study is required. 1.54 “Indirect Taxes” has the meaning set forth in Section 10.4.2. 1.55 “Information” means all knowledge of a technical, scientific, business or other nature,  including know-how, technology, means, methods, processes, practices, formulae,  instructions, skills, techniques, procedures, experiences, ideas, technical assistance,  designs, drawings, assembly procedures, computer programs, apparatuses,  specifications, data, results and other material, regulatory data, and other biological,  chemical, pharmacological, toxicological, pharmaceutical, physical and analytical, pre- clinical, clinical, safety, manufacturing and quality control data and information,  including study designs and protocols, reagents (e.g., plasmids, proteins, cell lines, assays  and compounds) and biological methodology; in each case (whether or not confidential,  proprietary, patented or patentable, or of commercial advantage) in written, electronic,  or any other form now known or hereafter developed. 1.56 “Infringement” has the meaning set forth in Section 11.3.1. 

 

7897269 v13 13 1.57 “Initiation” means, with respect to a Clinical Study, the first dosing of a Licensed Product  in the first (1st) human subject in such Clinical Study.  “Initiated” has a correlative  meaning. 1.58 “Joint Collaboration IP” means the Joint Collaboration Patents and Joint Collaboration  Know-How. 1.59 “Joint Collaboration Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date jointly by or on behalf of Pharming or  its Affiliates on the one hand, and by or on behalf of Orchard or its Affiliates on the other  hand, in performing activities under this Agreement, but excluding all Platform Know- How, Orchard Collaboration Know-How, Pharming Collaboration Know-How and Joint  Conditioning Know-How.   1.60 “Joint Collaboration Patents” means any and all Patents that Cover any Joint  Collaboration Know-How. 1.61 “Joint Conditioning IP” means the Joint Conditioning Know-How and the Joint  Conditioning Patents. 1.62 “Joint Conditioning Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date jointly by or on behalf of Pharming or  its Affiliates on the one hand, and by or on behalf of Orchard or its Affiliates on the other  hand, in performing activities under this Agreement that relates to a Conditioning  Regimen, but excluding all Platform Know-How, Orchard Collaboration Know-How,  and Pharming Collaboration Know-How.   1.63  “Joint Conditioning Patents” means any and all Patents that Cover any Joint  Conditioning Know-How. 1.64 “Joint Steering Committee” or “JSC” has the meaning set forth in Section 2.1. 1.65 “Know-How” means any and all data, results, inventions, methods, processes, practices,  trade secrets, techniques, technology, and other proprietary Information, whether  patentable or not, but which are not generally known, including discoveries, formulae,  

 

7897269 v13 14 materials (including chemicals), biological materials (including expression constructs,  nucleic acid sequences, amino acid sequences, and cell lines), clinical trial and patient  selection designs and methodology, test data (including pharmacological, toxicological,  pre-clinical and clinical information and test data), analytical and quality control data  (including drug stability data), manufacturing technology and data (including  formulation data), and sales forecasts, data and descriptions. 1.66 “Knowledge” means the actual knowledge of Orchard’s Chief Business Officer and  General Counsel, without the requirement of conducting any specific enquiry or due  diligence. 1.67 “[LCIA ]Rules” has the meaning set forth in Section 16.8(b). 1.68 “Licensed Product” means any ex vivo autologous haematopoietic stem cell lentivirus- mediated gene therapy developed, whether in whole or in part, under this Agreement. 1.69 “Losses” has the meaning set forth in Section 14.1. 1.70 “Low Incidence Secondary Indication” means a Secondary Indication in relation to  which the Licensed Product has received orphan drug designation in the United States. 1.71 “Manufacture” and “Manufacturing” means all activities related to the synthesis,  making, production, processing, purifying, formulating, filling, finishing, packaging,  labelling, shipping, and holding of any molecule, product or any intermediate thereof,  including process development, process qualification and validation, scale-up, pre- clinical, clinical and commercial production and analytic development, product  characterization, supply chain, stability testing, quality assurance testing and release, and  quality control and “Manufactured” and “Manufacturer” have correlative meanings.  1.72 “Manufacturing Process” means all Information pertaining to the Manufacture of the  Licensed Product, including the lentiviral vector, manufacturing methods, test methods,  specifications, materials, and other procedures, directions and controls associated with  the Manufacture of the Licensed Product.  

 

7897269 v13 15 1.73 “Manufacturing Process Improvements” means any Patents or Know-How Controlled  by Orchard or its Affiliates, that (a) constitute a modification, enhancement, development  or improvement to the Manufacturing Process, (b) are created, conceived or developed  independently of the performance of the Agreement at any time during the period from  the Effective Date until the first Drug Approval Application in respect of the Licensed  Product is submitted anywhere in the Territory, and (c) which Orchard discloses or has  an obligation to disclose to Pharming pursuant to Section 2.2.7.   1.74 “[MolMed]” means [AGC Biologics SpA] and its Affiliates. 1.75 “[MolMed] Agreements” means the agreement(s) between Orchard and [MolMed] under  which Orchard will arrange for the Manufacture and supply of the Licensed Product from  [MolMed] to Orchard as of the Effective Date. 1.76 “Net Sales” means, with respect to the Licensed Product for any period, the [total amounts  billed or invoiced] on sales of the Licensed Product during such period by Pharming, its  Affiliates, or Sublicensees in the Territory to Third Parties (including to Distributors), in  bona fide arm’s length transactions, less the following actually incurred deductions, in  each case related specifically to the Licensed Product and not otherwise recovered by or  reimbursed to Pharming, its Affiliates, or Sublicensees:   (a) [trade, cash and quantity discounts];  (b) [taxes on sales (such as sales, value added, or use taxes) to the extent added to  the sale price and set forth separately as such in the total amount invoiced];  (c) [amounts repaid or credited by reason of rejections, defects, return goods  allowance, recalls or returns, or because of retroactive price reductions];  (d) [rebates (or their equivalent, including performance rebates), administrative  fees, chargebacks and retroactive price adjustments and any other similar  allowances granted to Third Parties (including to Governmental Authorities,  purchasers, reimbursers, customers, distributors, wholesalers, and managed  

 

7897269 v13 16 care organizations (and other similar entities and institutions)) which  effectively reduce the selling price or gross sales of the Licensed Product]; and (e) [freight, insurance, import/export, and other transportation charges to the extent  added to the sale price and set forth separately as such in the total amount  invoiced]. Net Sales shall not include [transfers or dispositions for charitable, promotional, pre- clinical, clinical, regulatory, or governmental purposes, provided such transfers or  dispositions take place for no consideration].  Net Sales shall include the amount or fair  market value of [all other consideration received by Pharming, its Affiliates, or  Sublicensees in respect of the Licensed Product, whether such consideration is in cash,  payment in kind, exchange, or other form].  Net Sales shall not include [sales between or  among Pharming, its Affiliates, or Sublicensees]. Subject to the above, Net Sales shall be calculated in accordance with the standard internal  policies and procedures of Pharming, its Affiliates, or Sublicensees, which must be in  accordance with Accounting Standards and consistent with the audited net sales reported  externally by Pharming. For the purposes of calculating Net Sales, all Net Sales shall be converted into Dollars in  accordance with Section 10.3. 1.77 “NTCR” means a [reduced toxicity Conditioning Regimen] that: (a) does not involve the  use of [busulfan and/or treosulfan]; and (b) requires no more than [two (2) overnight  stays in hospital before hospital discharge and has no known side-effects which impact a  recipient’s fertility].  1.78 “NTCR Activities” means those activities specified in the Pre-Clinical Plan and/or the  Clinical Development Plan as NTCR Activities.  For the avoidance of doubt, NTCR  Activities shall not include any activities that (i) are specific to the Licensed Product, or  (ii) which relate to the implementation of the NTCR or any Conditioning Regimen, as  opposed to its Development, improvement or enhancement. 

 

7897269 v13 17 1.79 “NTCR Activities Costs” has the meaning set forth in Section 9.2.1(b). 1.80 “NTCR Budget” means the budget for the NTCR Activities set out in the Pre-Clinical  Plan and the Clinical Development Plan. 1.81 “Ongoing Clinical Studies” has the meaning set forth in Section 15.6.3. 1.82 “Orchard Background IP” means the Orchard Background Patents and Orchard  Background Know-How. 1.83 “Orchard Background Know-How” means any and all Know-How Controlled by  Orchard or any of its Affiliates:  1.83.1 on the Effective Date, or at any time during the period from the Effective Date  until the first Drug Approval Application in respect of the Licensed Product  is submitted anywhere in the Territory, which has been generated otherwise  than in the performance of this Agreement, in each case, solely to the extent  that such Know-How is (a) actually used by Orchard, its Affiliates or  Subcontractors in the performance of its activities under this Agreement, or  made available to Pharming or its Affiliates for use in the performance of their  activities under this Agreement, and, in the case of any Know-How pertaining  to the Manufacture of the Licensed Product, to the extent such Know-How is  included in the Manufacturing Process actually used for the Manufacture of  the Licensed Product, or (b) without limiting the foregoing, necessary for the  performance of Pharming’s obligations under this Agreement or to Exploit  any Licensed Product, or 1.83.2 that constitutes Know-How included in any Manufacturing Process  Improvements licensed to Pharming pursuant to Section 3.7. 1.84 “Orchard Background Patents” means any and all Patents Controlled by Orchard or any  of its Affiliates:  1.84.1 on the Effective Date or at any time during the period from the Effective Date  until the first Drug Approval Application in respect of the Licensed Product  

 

7897269 v13 18 is submitted anywhere in the Territory, which become Controlled by Orchard  or its Affiliates otherwise than in the performance of this Agreement, in each  case, solely to the extent that such Patents are (a) actually used by Orchard,  its Affiliates or Subcontractors in the performance of its activities under this  Agreement, or licensed to Pharming or its Affiliates for use in the  performance of their activities under this Agreement, and, in the case of any  Patents pertaining to the Manufacture of the Licensed Product, to the extent  such Patents Cover the Manufacturing Process actually used for the  Manufacture of the Licensed Product; or (b) without limiting the foregoing,  necessary for the performance of Pharming’s obligations under this  Agreement or to Exploit any Licensed Product; or 1.84.2 that constitutes Patents included in any Manufacturing Process Improvements  licensed to Pharming pursuant to Section 3.7; or 1.84.3 that Cover any Orchard Background Know-How. For the avoidance of doubt, Orchard Background Patents include the Patents set forth on  Schedule 1.84 which may be amended in writing from time to time. 1.85 “Orchard CMC Costs” has the meaning set forth in Section 8.1.3. 1.86 “Orchard CMO” means any Third Party contract manufacturing organization engaged by  Orchard for the manufacture and supply of the Licensed Product, including the Third  Party Manufacturer.  As of the Effective Date and without limiting the foregoing, the  Orchard CMO is expected to include [MolMed]. 1.87 “Orchard Collaboration IP” means the Orchard Collaboration Patents and Orchard  Collaboration Know-How. 1.88 “Orchard Collaboration Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date solely by or on behalf of Orchard or its  Affiliates in performing activities under this Agreement, but excluding all Platform  Know-How and Orchard Conditioning Know-How.   

 

7897269 v13 19 1.89 “Orchard Collaboration Patents” means any and all Patents Controlled by Orchard or its  Affiliates after the Effective Date that Cover any Orchard Collaboration Know-How. 1.90 “Orchard Conditioning IP” means the Orchard Conditioning Patents and Orchard  Conditioning Know-How. 1.91 “Orchard Conditioning Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date solely by or on behalf of Orchard or its  Affiliates in performing activities under this Agreement relating to a Conditioning  Regimen, but excluding all Platform Know-How. 1.92 “Orchard Conditioning Patents” means any Patents that Cover any Orchard  Conditioning Know-How. 1.93 “Orchard Decision Matter” has the meaning set forth in Section 2.8.2(a). 1.94 “Orchard Indemnitees” has the meaning set forth in Section 14.1. 1.95 “Orchard Platform Patents” means any and all Platform Patents that Cover any Orchard  Collaboration Know-How that is created, conceived or developed solely by or on behalf  of Orchard or its Affiliates.   1.96 “Orchard Pre-Clinical Research Costs” has the meaning set forth in Section 9.2.1(a). 1.97 “Patent Challenge” has the meaning set forth in Section 15.4. 1.98 “Patents” means (a) all national, regional and international patents and patent applications,  including provisional patent applications and any and all rights to claim priority thereto,  (b) all patent applications filed either from such patents, patent applications, or  provisional applications or from an application claiming priority from either of these,  including divisionals, continuations, continuations-in-part, provisionals, converted  provisionals, and continued prosecution applications, (c) any and all patents that have  issued or in the future issue from the foregoing patent applications ((a) and (b)), including  utility models, petty patents, and design patents and certificates of invention, (d) any and  all extensions or restorations by existing or future extension or restoration mechanisms,  

 

7897269 v13 20 including revalidations, reissues, re-examinations, and extensions (including any  supplementary protection certificates and the like) of the foregoing patents or patent  applications or other patents resulting from post-grant proceedings ((a), (b), and (c)), and  (e) any similar patent rights, including so-called pipeline protection or any importation,  revalidation, confirmation, or introduction patent or registration patent or patent of  additions to any of such foregoing patent applications and patents. 1.99 “Person” means an individual, sole proprietorship, partnership, limited partnership,  limited liability partnership, corporation, limited liability company, business trust, joint  stock company, trust, unincorporated association, joint venture or other similar entity or  organization, including a government or political subdivision, department, or agency of  a government. 1.100  “Pharming Background IP” means the Pharming Background Patents and Pharming  Background Know-How. 1.101 “Pharming Background Know-How” means any and all Know-How Controlled by  Pharming or any of its Affiliates as of the Effective Date or during the Term that is  developed or invented by or on behalf of Pharming or any of its Affiliates performing  activities outside the activities performed under this Agreement. 1.102 “Pharming Background Patents” means any and all Patents Controlled by Pharming or  any of its Affiliates on the Effective Date or during the Term that Cover any Pharming  Background Know-How. 1.103 “Pharming COC Notification Date” has the meaning set forth in Section 16.4. 1.104 “Pharming Collaboration IP” means the Pharming Collaboration Patents and Pharming  Collaboration Know-How.  For the avoidance of doubt, the Pharming Collaboration IP  excludes the Platform IP. 1.105 “Pharming Collaboration Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date solely by or on behalf of Pharming or its  

 

7897269 v13 21 Affiliates in performing activities under this Agreement, but excluding all Platform  Know-How.   1.106 “Pharming Collaboration Patents” means any and all Patents Controlled by Pharming  after the Effective Date that Cover any Pharming Collaboration Know-How.  1.107 “Pharming Competitive Acquiror” means any Person acquiring a Controlling Interest in  Pharming (or a Holding Company of Pharming) or its property or business pursuant to a  Change of Control of Pharming, where, as of the date of such Change of Control, such  acquiring Person or any of its Affiliates either: 1.107.1 derives more than [twenty-five percent (25%)] of its gross revenues from ex  vivo gene therapy products, or  1.107.2 where [fifty percent (50%)] or more of the publicly disclosed products being  developed by such Person or any of its Affiliates are ex-vivo haematopoietic  stem cell gene therapy products. 1.108 “Pharming Conditioning IP” means the Pharming Conditioning Patents and Pharming  Conditioning Know-How. 1.109 “Pharming Conditioning Know-How” means any and all Know-How that is created,  conceived or developed after the Effective Date solely by or on behalf of Pharming or its  Affiliates in performing activities under this Agreement relating to a Conditioning  Regimen, but excluding all Platform Know-How. 1.110 “Pharming Conditioning Patents” means any Patents that Cover any Pharming  Conditioning Know-How. 1.111 “Pharming Indemnitees” has the meaning set forth in Section 14.2. 1.112 “Phase 1 Trial” means a human clinical trial of the Licensed Product that satisfies the  requirements for a Phase 1 study as defined in 21 CFR § 312.21(a) (or any amended or  successor regulations), regardless of where such clinical trial is conducted. 

 

7897269 v13 22 1.113 “Phase 2 Trial” means a human clinical trial of the Licensed Product that satisfies the  requirements for a Phase 2 study as defined in 21 CFR § 312.21(b) (or any amended or  successor regulations), regardless of where such clinical trial is conducted. 1.114 “Phase 3 Trial” means a human clinical trial of the Licensed Product that satisfies the  requirements for a Phase 3 study as defined in 21 CFR § 312.21(c) (or any amended or  successor regulations), regardless of where such clinical trial is conducted. 1.115 “Phase 4 Trial” means a human Clinical Study of the Licensed Product conducted after  Regulatory Approval of the Licensed Product has been obtained from an appropriate  Regulatory Authority, and includes (a) trials conducted voluntarily for enhancing  marketing or scientific knowledge of an approved indication and (b) trials conducted  after Regulatory Approval due to request or requirement of a Regulatory Authority or as  a condition of a previously granted Regulatory Approval, including studies conducted in  response to a paediatric written request or condition of approval studies. 1.116 “Pivotal Study” means, with respect to the Licensed Product, a Clinical Study that: (a)  would satisfy the requirements of a Phase 3 Trial; (b) Pharming designates as a pivotal,  or registrational, Clinical Study; or (c) is otherwise designed to generate efficacy data  having a nature and quality that will be sufficient to support a Drug Approval Application  for the Licensed Product.  For clarity, a Pivotal Study described in sub-clause (c) may be  any form of Clinical Study; provided, however, that, for any Clinical Study other than a  Clinical Study described in sub-clause (a), such Clinical Study shall be deemed a Pivotal  Study only: (i) if the applicable Regulatory Authority agrees in writing that such Clinical  Study will be deemed a pivotal trial sufficient for obtaining Regulatory Approval of the  Licensed Product with no further Clinical Studies being conducted prior to the grant of  such Regulatory Approval; or (ii) upon the filing of a Drug Approval Application with  the FDA, EMA or any Regulatory Authority in the European Union by Pharming, any of  its Affiliates, or any Sublicensee for the Licensed Product based upon the results of such  Clinical Study as a pivotal study, in which case, for the avoidance of doubt, such Pivotal  Study shall also be deemed to have been Initiated. 

 

7897269 v13 23 1.117 “Platform” means Orchard’s proprietary gene therapy platform existing at the Effective  Date and as developed outside of this Agreement, including as described in the Orchard  Background IP. 1.118 “Platform IP” means the Platform Patents and Platform Know-How. 1.119 “Platform Know-How” means any and all Know-How that is created, conceived or  developed after the Effective Date: (a) by or on behalf of either Party or (b) jointly by or  on behalf of Pharming on the one hand, and by or on behalf of Orchard on the other hand,  in each case (a) and (b), in performing activities under this Agreement, in each case to  the extent such Know-How relates solely to the Platform.   1.120 “Platform Patents” means any Patents that Cover any Platform Know-How. 1.121 “PMDA” means Japan’s Pharmaceuticals and Medical Devices Agency and any successor  agency or authority having substantially the same function. 1.122 “Pre-Clinical Budget” means the budget for the Pre-Clinical Plan (excluding any NTCR  Activities) set out in the Pre-Clinical Plan. 1.123 “Pre-Clinical Plan” means the pre-clinical research plan attached hereto as Schedule  1.123. 1.124 “Pre-Clinical Research” means the activities carried out by or on behalf of a Party  hereunder (whether on its own or jointly with the other Party) pursuant to the Pre-Clinical  Plan.   1.125 “Pricing Approval” means, with respect to any country where a Governmental Authority  authorizes reimbursement or access, or approves or determines pricing, for  pharmaceutical or biologic products, receipt (or, if required to make such authorization,  approval of determination effective publication) of such reimbursement or access  authorization or pricing approval or determination (as the case may be). 1.126 “Primary Indication” means the diagnosis, prophylaxis, treatment, palliation or cure of  hereditary angioedema in humans. 

 

7897269 v13 24 1.127 “Product Specific Patent” means any Orchard Background Patent, Orchard Collaboration  Patent, Orchard Conditioning Patent or Platform Patent that specifically and solely claims  the composition of matter, manufacture, and/or method of use of the Licensed Product.   Without limiting the foregoing: (a) the Product Specific Patent identified by Orchard and  existing at the Effective Date is set out in Schedule 1.127; (b) Product Specific Patents  include the Patent set out in Schedule 1.127, and all Patents that claim priority from or  arise from such Patent, and (c) the Parties may choose to designate any other Orchard  Background Patent, Orchard Collaboration Patent, Orchard Conditioning Patent or  Platform Patent as a Product Specific Patent, subject to prior written agreement. 1.128 “Proof of Concept NTCR Endpoints” means the endpoints of the preclinical in vivo proof  of concept NTCR study set out in the Pre-Clinical Plan, to the extent approved by the  JSC for inclusion in the Pre-Clinical Plan under Section 2.2.4, and thereafter as amended  by the JSC under Section 2.2.4.   1.129 “Publishing Party” has the meaning set forth in Section 12.5.3. 1.130 “Quarter” means each successive period of three (3) calendar months commencing on  January 1, April 1, July 1 and October 1, except that the first Quarter of the Term shall  commence on the Effective Date and end on the day immediately prior to the first to  occur of January 1, April 1, July 1 or October 1 after the Effective Date, and the last  Quarter shall commence on the last to occur of the foregoing dates during the Term and  shall end on the last day of the Term. 1.131 “Reasonable Efforts” means, with respect to any activities performed by a Party under  this Agreement with respect to the Licensed Product, the performance of such activities  using at least the same degree of skill, quality and care, and using at least the same level  of efforts and resources, that are used by such Party and its Affiliates for themselves with  respect to their own wholly-owned products at a similar stage of development or product  life as the Licensed Product. 1.132 “Regulatory Approval” means, with respect to a country or other jurisdiction in the  Territory, any and all approvals (including Drug Approval Applications), licences,  

 

7897269 v13 25 registrations, or authorizations of any Regulatory Authority necessary to Commercialize  the Licensed Product in such country or other jurisdiction, excluding Pricing Approval  in such country or other jurisdiction. 1.133 “Regulatory Authority” means any applicable supra-national, federal, national, regional,  state, provincial, or local governmental or regulatory authority, agency, department,  bureau, commission, council, or other entities regulating or otherwise exercising  authority with respect to activities contemplated in this Agreement, including the  Exploitation of the Licensed Product in the Territory, including the FDA, EMA, and  PMDA. 1.134 “Regulatory Exclusivity” means, with respect to any country or other jurisdiction in the  Territory, an additional market protection, other than Patent protection, granted by a  Regulatory Authority in such country or other jurisdiction which confers an exclusive  Commercialization period during which Pharming or its Affiliates or Sublicensees have  the exclusive right to market and sell the Licensed Product in such country or other  jurisdiction through a regulatory exclusivity right (e.g., new chemical entity exclusivity,  new use or indication exclusivity, new formulation exclusivity, orphan drug exclusivity,  paediatric exclusivity, or any applicable data exclusivity). 1.135 “Royalty Patents” has the meaning set forth in Section 1.137. 1.136  “Royalty Payments” has the meaning set forth in Section 9.5.1. 1.137  “Royalty Term” means, with respect to each country in the Territory, the period  beginning on the date of the First Commercial Sale of the Licensed Product in such  country, and ending on the latest to occur of (a) the expiration of the last-to-expire Valid  Claim of any Orchard Background Patent, Orchard Collaboration Patent, Platform Patent  or Joint Collaboration Patent (provided that, in respect of Joint Collaboration Patents, its  earliest priority date is prior to filing of the first IND for the Licensed Product) that  Covers the Licensed Product in such country (such Patents containing such Valid Claim,  the “Royalty Patents”), (b) the expiration of Regulatory Exclusivity for the Licensed  

 

7897269 v13 26 Product in such country, and (c) the twelfth (12th) anniversary of the First Commercial  Sale of the Licensed Product in such country. 1.138 “Sales Milestone Payments” has the meaning set forth in Section 9.4.1. 1.139 “Sales Milestones” has the meaning set forth in Section 9.4.1. 1.140 “Secondary Indication” means any Indication except the Primary Indication. 1.141 “Senior Officer” means, with respect to Orchard, its Chief Executive Officer or his/her  designee, and with respect to Pharming, its Chief Executive Officer or his/her designee. 1.142 “Subcontractor” means any contractor, subcontractor or other vendor to whom a Party  has subcontracted any of its obligations under the Pre-Clinical Plan or the Clinical  Development Plan. 1.143 “Sublicensee” means a Third Party, other than a Distributor or a Third Party to whom  Pharming, its Affiliate or a Sublicensee subcontracts any activities with respect to the  Development or Manufacture of the Licensed Product, to whom Pharming (or a  sublicensee of Pharming) grants a sublicence to Develop, use, import, promote, offer for  sale, sell, have sold, or otherwise Commercialize any Licensed Product in the Field in  the Territory. 1.144 “Term” has the meaning set forth in Section 15.1. 1.145 “Territory” means worldwide. 1.146 “Third Party” means any Person other than Orchard, Pharming, or an Affiliate of Orchard  or Pharming. 1.147 “Third Party Manufacturer” means the Third Party manufacturer approved by the JSC  pursuant to Section 2.2.10. 1.148 “Valid Claim” means either: (a) a claim of a pending Patent application, which claim was  filed and is being prosecuted in good faith and has not been abandoned or finally  disallowed without the possibility of appeal or re-filing of the application, provided that  

 

7897269 v13 27 such prosecution has not been on-going for more than [eight (8)] years from its earliest  priority date and provided further that if, thereafter, a patent containing such claim issues,  then such claim shall thereafter be considered a Valid Claim in accordance with clause  (b) below; or (b) a claim of any issued and unexpired Patent for which the validity,  enforceability, or patentability has not been affected by any of the following: (x)  irretrievable lapse, abandonment, revocation, dedication to the public, or disclaimer; or  (y) a holding, finding, or decision of invalidity, unenforceability, or non-patentability by  a court, governmental agency, national or regional patent office, or other appropriate  body that has competent jurisdiction, such holding, finding, or decision being final and  unappealable or unappealed within the time allowed for appeal. 1.149 “Validation of a Drug Approval Application by the EMA” as used in Section 9.3.1  (Development Milestone Payments)  means a determination by the EMA that all essential  regulatory elements required for scientific assessment are included in an MAA, triggering  the start of the assessment of such MAA. 1.150 “Year” means each successive period of twelve (12) calendar months commencing on  January 1 and ending on December 31, except that the first Year of the Term shall  commence on the Effective Date and end on December 31 of the year in which the  Effective Date occurs and the last Year of the Term shall commence on January 1 of the  year in which the Term ends and end on the last day of the Term. 1.151 In this Agreement: 1.151.1 all references to a particular clause or schedule shall be a reference to that  clause or schedule in or to this Agreement as it may be amended from time to  time pursuant to this Agreement; 1.151.2 the headings are inserted for convenience only and shall be ignored in  construing this Agreement; 1.151.3 words importing the masculine gender shall include the feminine and vice  versa and words in the singular include the plural and vice versa; 

 

7897269 v13 28 1.151.4 the words “include”, “included”, and “including” are to be construed without  conveying any limitation to the generality of the preceding words; 1.151.5 reference to any statute or regulation includes any modification or re- enactment of that statute or regulation; 1.151.6 any reference to notices or consent being sought or given in writing shall  require the consent or notice to be signed by an appropriately authorized  person and shall not include consents or notices conveyed by email; and 1.151.7 in the event of any inconsistency or conflict between this Agreement and any  of the schedules attached hereto, the provision set forth in the main body of  this Agreement shall prevail over the conflicting provision in the attached  schedule to the extent of such conflict, unless such provision in the attached  schedule is expressly stated in such schedule to prevail over such provision in  the main body of this Agreement. ARTICLE 2 COLLABORATION MANAGEMENT 2.1 Joint Steering Committee.  Within [fifteen (15)] days after the Effective Date, or as  mutually agreed to by the Parties, the Parties shall establish a joint steering committee  (the “Joint Steering Committee” or “JSC”).  The JSC shall consist of two (2)  representatives from each of the Parties, each with the requisite experience and seniority  to enable such person to make decisions on behalf of the Parties with respect to the issues  falling within the responsibility of the JSC.  From time to time, notwithstanding good  faith efforts to ensure the continuity of the key personnel representing the Parties on the  JSC, each Party may substitute one (1) or more of its representatives to the JSC by  providing prior written confirmation (which may be by email) to the other Party, provided  such substituted JSC member possesses the requisite experience and seniority to enable  such person to make decisions on behalf of the Parties as provided herein.  The  chairperson of the JSC shall be one of the representatives selected by Orchard prior to  IND Clearance for the Licensed Product, and one of the representatives selected by  

 

7897269 v13 29 Pharming thereafter.  From time to time, the appointing Party may change the  representative who will serve as chairperson on written notice to the other Party.   2.2 Specific Responsibilities of the JSC.  The JSC shall provide strategic oversight of the  Collaboration.  In particular, the JSC shall: 2.2.1 review and discuss the outcome of all material activities performed under the  Pre-Clinical Plan and/or Clinical Development Plan, and the strategy relating  thereto;  2.2.2 act as a forum to exchange information between the Parties.  Without limiting  the foregoing, Orchard shall, through the JSC, periodically inform Pharming  of any Orchard Background IP, Orchard Collaboration IP, Orchard  Conditioning IP, Joint Collaboration IP, Joint Conditioning IP and Platform  IP which Orchard reasonably expects to be of benefit to Pharming under the  Collaboration and, in each case, to the extent not previously reported to  Pharming;  2.2.3 facilitate the preparation and filing by Pharming of submissions to Regulatory  Authorities in respect of the Licensed Product; 2.2.4 review and agree to any material amendment to the Pre-Clinical Plan.   Without limiting the foregoing, the JSC shall review and agree on any  amendment to the Pre-Clinical Plan to include or amend the endpoints of the  [preclinical in vivo proof of concept NTCR study] which will determine  whether or not the Development Milestone set out in row 1 of the table in  Section 9.3.1 is achieved; 2.2.5 review and agree the Clinical Development Plan and any material  amendments thereto; 2.2.6 review and discuss the prosecution strategy for any Joint Collaboration  Patents; 

 

7897269 v13 30 2.2.7 review and discuss any Manufacturing requirements for the Licensed Product,  including, solely prior to the submission of the first Drug Approval  Application in respect of the Licensed Product anywhere in the Territory, (a)  any Manufacturing Process Improvements that: (i) Orchard or any of its  Affiliates has used in any other development program it is involved in, and  (ii) which Orchard reasonably expects to be of benefit to Pharming under the  Collaboration and (b) solely prior to the submission of the first Drug Approval  Application in respect of the Licensed Product anywhere in the Territory, any  Third Party intellectual property rights to the extent not already included in  subclause (a) which Orchard identifies and reasonably believes will be of  benefit to Pharming under the Collaboration.  Orchard shall periodically  disclose the foregoing to Pharming through its JSC representatives under this  Section 2.2.7.  In the event that any Third Party intellectual property rights  are identified by Orchard pursuant to Section 2.2.7(b), the Parties shall discuss  if a Party should obtain a licence to such Third Party intellectual property and,  all Costs incurred by Orchard in obtaining such licence (if it is agreed that  Orchard will obtain such licence), which arise under such licence, or which  arise from any activities performed under this Agreement to incorporate or  otherwise utilize such Third Party intellectual property rights, shall in each  case be borne by Pharming unless otherwise agreed between the Parties in  writing;  2.2.8 subject to Section 9.2.2, review and agree any amendment to the Pre-Clinical  Budget or NTCR Budget; 2.2.9 discuss and agree a communication plan that sets out the Parties’ obligations  with respect to the communications with Regulatory Authorities prior to the  first filing of an IND for the Licensed Product;  2.2.10 identify and agree a drug product Third Party Manufacturer, based in the  United States; 

 

7897269 v13 31 2.2.11 on an as-needed basis, establish subcommittees to perform specific duties of  the JSC, direct each such subcommittee to perform the functions for which it  is established, and oversee each subcommittee, including resolution of  disputes raised to the JSC by any subcommittee; and 2.2.12 perform such other functions, and direct each subcommittee to perform such  other functions, as are set forth herein or as the Parties may mutually agree in  writing, except where in conflict with any provision of this Agreement. 2.3 Disbandment.  The JSC shall continue to exist until the first to occur of (a) the Parties  mutually agreeing to disband the JSC and (b) the First Commercial Sale of the Licensed  Product (unless otherwise mutually agreed in writing).  Notwithstanding anything herein  to the contrary, upon the first to occur of the foregoing (a) or (b), the JSC shall  automatically dissolve and shall have no further rights or obligations under this  Agreement, and thereafter (i) each Party shall designate, to the extent necessary, a contact  person for the exchange of Information under this Agreement or such exchange of  Information shall be made through the Alliance Managers, and (ii) decisions of the JSC,  if any, shall be decisions as between the Parties, subject to the other terms and conditions  of this Agreement.   2.4 Location of Meetings.  The JSC shall meet at least [once per Quarter], or as otherwise  agreed to by the Parties.  JSC meetings may be held in person or by audio or video  teleconference; provided that unless otherwise agreed, at least [one (1) meeting] per Year  shall be held in person, provided that such in-person meeting is reasonably possible.  In- person meetings shall be held at locations in the United Kingdom or the Netherlands, or  such other location as selected by the Parties. 2.5 Conduct of Meetings.  The chairperson of the JSC shall be responsible for calling  meetings on no less than [fifteen (15)] Business Days’ notice, unless an urgent issue  arises that requires an earlier meeting date, in which case the chairperson shall call a  meeting on the first available date as mutually agreed between the Parties.  Each Party  shall make all proposals for agenda items and shall provide all appropriate information  with respect to such proposed items at least [ten (10)] Business Days in advance of the  

 

7897269 v13 32 applicable meeting; provided that if the input by the JSC is required urgently, a Party  may provide its agenda items to the other Party within a shorter period of time in advance  of the meeting, or may propose that there not be a specific agenda for a particular  meeting, so long as the other Party consents to such later addition of such agenda items  or the absence of a specific agenda for such meeting, such consent not to be unreasonably  withheld, conditioned, or delayed.  Notwithstanding the foregoing, either Party may  instruct the chairperson to call a meeting of the JSC on less than [fifteen (15)] Business  Days’ notice in the event that such Party reasonably believes that a significant matter  must be addressed by the JSC within such sooner timeframe, and such Party shall provide  any materials reasonably adequate to enable an informed decision to be made by the JSC  at such meeting.  An individual designated by the chairperson of the JSC shall prepare  and circulate the minutes of each meeting for review and approval of the Parties within  [thirty (30)] days after the meeting.  The Parties shall agree on the minutes of each  meeting promptly, but in no event later than the next meeting of the JSC. 2.6 Procedural Rules.  The JSC shall have the right to adopt such standing rules as shall be  necessary for its work, to the extent that such rules are not inconsistent with this  Agreement.  A quorum of the JSC shall exist whenever there is present at a meeting at  least one (1) representative appointed by each Party.  Representation by proxy shall be  allowed.  The JSC shall take action by consensus of the representatives present at a  meeting at which a quorum exists, with each Party having a single vote irrespective of  the number of representatives of such Party in attendance, or by a written resolution  which may be delivered by way of email confirmation.  Employees or consultants of  either Party that are not representatives of the Parties on the JSC may attend meetings of  the JSC; provided that (a) unless the other Party agrees, no more than two (2) such  persons, not including Alliance Managers of such Party, may attend any particular  meeting, (b) attendance of any non-employee must be pre-approved by the other Party,  such approval not to be unreasonably withheld, conditioned or delayed, (c) such attendees  shall not vote or otherwise participate in the decision-making process of the JSC, and  (d) such attendees are bound by obligations of confidentiality and non-disclosure that are  substantially similar to those set forth in ARTICLE 12. 

 

7897269 v13 33 2.7 Clinical Development Plan.  The JSC shall establish a subcommittee in accordance with  Section 2.2.11, whose task it shall be to assist with the preparation of a draft Clinical  Development Plan that sets out the Development activities to be performed by Pharming  under this Agreement to enable Pharming to submit an initial version of the Clinical  Development Plan in accordance with the subsequent sentence.  Pharming shall in good  faith consider any comments from the subcommittee, but shall prepare, in its sole  discretion, the initial version of the Clinical Development Plan for submission to the JSC  for review and approval, such submission to take place no later than the first anniversary  of the Effective Date.   2.8 Decision Making. 2.8.1 JSC Decisions.  All JSC decisions shall be made by unanimous vote, with  each Party’s representatives collectively having one (1) vote.  If after  reasonable discussion and good faith consideration of each Party’s view on a  particular matter, the JSC cannot, or does not, reach consensus on an issue  within the jurisdiction of the JSC within [five (5)] Business Days of the matter  having been first discussed by the JSC, then the dispute shall first be referred  to the Senior Officers of the Parties, who shall confer in good faith on the  resolution of the issue.  Any final decision mutually agreed by the Senior  Officers shall be conclusive and binding on the Parties. 2.8.2 Final Decision-Making Authority.  If the Senior Officers are not able to  agree on the resolution of any such issue under Section 2.8.1 within [thirty  (30)] days after such issue was first referred to them, then: (a) Orchard shall have final decision-making authority with respect to  any issue that relates to (i) the Pre-Clinical Research, (ii) the  Manufacturing Process (including the incorporation of any  Manufacturing Process Improvements) or Manufacture of the  Licensed Product prior to the submission of the first Drug Approval  Application in respect of the Licensed Product anywhere in the  Territory, and (iii) the identity of the Third Party drug product  

 

7897269 v13 34 Manufacturer referenced in Section 2.2.10, for clarity, in each case  (i) to (iii), that does not relate to the Clinical Development Plan or  any submission to or other communications with a Regulatory  Authority in respect of the Licensed Product (each, an “Orchard  Decision Matter”), provided that Orchard shall not use its final  decision-making authority: (a) to require Pharming to violate any  Applicable Law or any agreement it, at the time of making the  relevant decision, has with a Third Party; (b) to increase the total  level of FTE effort or costs to be incurred by Pharming under the  Pre-Clinical Plan by more than [ten percent (10%)] from those set  out in the last version of the Pre-Clinical Budget or NTCR Budget  (as applicable), including for the NTCR Activities included therein,  that was approved by Pharming or, if there have not been any, the  version of the Pre-Clinical Plan set out in Schedule 1.123; (c) to  materially increase or decrease the obligations to be performed by  Pharming under this Agreement; (d) to reallocate obligations of a  Party to the other Party under the Pre-Clinical Plan; (e) to materially  reduce the level of resources to be provided by Orchard to the  Collaboration; (f) with respect to any matter that is reasonably  determined by Pharming as materially adversely affecting the safety  of the Licensed Product; or (g) with respect to any amendment to  the Pre-Clinical Plan to include or amend any endpoints of the  preclinical in vivo proof of concept NTCR study; and further  provided that, Orchard shall not, and shall procure that its JSC  representatives: (1) shall not unreasonably withhold, condition or  delay its approval of any Third Party drug Manufacturer proposed  by Pharming and (2) shall not withhold, condition or delay approval  of the incorporation of any Manufacturing Process Improvements  disclosed under Section 2.2.7 and licensed by Pharming under  Section 3.7; and 

 

7897269 v13 35 (b) Pharming shall have final decision-making authority with respect to:  (i) from the date of the first IND filing and for the rest of the Term,  any issue that relates to the Clinical Development Plan, (ii) at any  time during the Term, any submission to or other communications  with a Regulatory Authority in respect of the Licensed Product, and  (iii) the Manufacturing Process (including the incorporation of any  Manufacturing Process Improvements) or Manufacture of the  Licensed Product on or subsequent to the submission of the first  Drug Approval Application in respect of the Licensed Product by  Pharming, its Affiliates or Sublicensees to the applicable Regulatory  Authority anywhere in the Territory, provided that Pharming shall  not use its final decision-making authority to (a) require Orchard to  violate any Applicable Law or any agreement it, at the time of  making the relevant decision, has with a Third Party; (b) increase  the Costs to be incurred by Orchard under the Clinical Development  Plan by more than [ten per cent (10%)] from those set out in the last  version of the Clinical Development Plan or NTCR Budget (as  applicable), (c) materially amend the NTCR Activities included in  the Clinical Development Plan, (d) increase the amount of time to  be spent by Orchard, its Affiliates or Subcontractors in performing  any activities by more than [ten per cent (10%)] from those set out  in the last version of the Clinical Development Plan for (e) reallocate  obligations under the Clinical Development Plan from a Party to the  other Party.  For clarity, prior to the date of the first IND filing,  Pharming shall not have final decision-making authority with  respect to any issue that relates to the Clinical Development Plan  (including with respect to the initial Clinical Development Plan set  out in Section 2.7), which must be agreed by the JSC on a unanimous  basis provided that, Orchard shall not (and shall procure that its JSC  representatives shall not) unreasonably withhold, condition or delay  approval of any such issue (including with respect to the initial  

 

7897269 v13 36 Clinical Development Plan submitted by Orchard under Section  2.7). 2.8.3 Other Disputes.  For clarity, disputes arising between the Parties in  connection with or relating to this Agreement or any document or instrument  delivered in connection herewith that are outside of the jurisdiction of the JSC  shall be resolved pursuant to Section 16.8. 2.9 Limitations on Authority.  Each Party shall retain the rights, powers, and discretion  granted to it under this Agreement and no such rights, powers, or discretion shall be  delegated to or vested in the JSC unless such delegation or vesting of rights is expressly  provided for in this Agreement or the Parties expressly so agree in writing.  Subject to  Sections 2.2.4, 2.2.5 and 2.2.8, the JSC does not have the power to amend, modify, or  waive compliance with this Agreement; this Agreement may only be amended or  modified as provided in Section 16.11, and compliance with this Agreement may only  be waived as provided in Section 16.13. 2.10 Alliance Manager.  Promptly after the Effective Date, each Party shall appoint a person  who shall oversee contact between the Parties for all matters between meetings of the  JSC and shall have such other responsibilities as the Parties may agree in writing after  the Effective Date (each, an “Alliance Manager”).  The Alliance Managers shall work  together to manage and facilitate the communication between the Parties under this  Agreement, including to facilitate the resolution (in accordance with the terms of this  Agreement) of issues between the Parties that arise in connection with this Agreement.   The Alliance Managers shall not have final decision-making authority with respect to  any matter under this Agreement.  If not already a member of the JSC, each Alliance  Manager shall support the efforts of the JSC and shall be permitted to attend JSC  meetings as appropriate as non-voting participants.  Each Party may replace its Alliance  Manager at any time by [thirty (30)] days’ prior notice in writing to the other Party.  Each  Party shall bear the costs of its Alliance Manager. 2.11 Costs.  Each Party shall be responsible for all travel and related costs for its members and  other representatives to attend meetings of, and otherwise participate in, the JSC. 

 

7897269 v13 37 ARTICLE 3 LICENCE GRANTS 3.1 Licence Grants to Pharming.  Orchard hereby grants to Pharming, an exclusive (even as  to Orchard and its Affiliates), royalty-bearing licence, with the right to grant sublicences  as provided in Section 3.3, under the Orchard Background IP, Orchard Collaboration IP,  Platform IP, Orchard Conditioning IP, and Orchard’s interest in the Joint Collaboration  IP and the Joint Conditioning IP to Exploit the Licensed Product in the Field in the  Territory.   3.2 Licence Grants to Orchard.  Pharming hereby grants to Orchard:  3.2.1 a non-exclusive licence, with the right to grant sublicences to Affiliates and  Subcontractors, under the Pharming Background IP, Pharming Collaboration  IP, Pharming Conditioning IP, and Pharming’s interest in the Joint  Collaboration IP and Joint Conditioning IP, solely to conduct the Pre-Clinical  Research; and 3.2.2 a non-exclusive, fully paid-up licence, with the right to grant sublicences,  under (a) the Pharming Collaboration IP that relates to the Platform, and (b)  the Pharming Conditioning IP, in each case (a) and (b) for all uses and  purposes in the Territory, except for the Exploitation of the Licensed Product  in the Field.  3.3 Sublicences.  Pharming shall have the right to grant sublicences, through multiple tiers of  sublicences, under the licences granted in Section 3.1 to its Affiliates and Third Parties;  provided that, with respect to any sublicence granted to a Sublicensee: (a) Orchard is  notified that such sublicense is to be entered into and the identity of such sublicensee  within [ten (10)] Business Days of such sublicense being entered into, and (b) any such  sublicences shall (i) be in writing, and (ii) be consistent with the terms and conditions of  this Agreement.  Pharming shall be responsible for any act or omission of any  Sublicensee that constitutes a breach of this Agreement as if such Sublicensee was  “Pharming” hereunder. 

 

7897269 v13 38 3.4 Distributorships and Promotion.  Without limiting Section 3.3, Pharming and its  Affiliates will have the right, in their sole discretion, to grant to any Third Party the right  to import, market, distribute, promote and sell any Licensed Product in the Field, where  title to the Licensed Product transfers to such Third Party and the rights granted are  consistent with the scope of the licences granted to Pharming hereunder (with or without  packaging and/or labelling rights); provided that, such Third Party shall only constitute  a “Distributor” for the purposes of this Agreement if: (a) such grant does not include the  grant of a sublicence under any Orchard Background Patent, Orchard Collaboration  Patent, Platform Patent, Orchard Conditioning Patent, Joint Collaboration Patent or Joint  Conditioning Patent to Develop or Manufacture Licensed Product, (b) the appointed  Distributor purchases its requirements of Licensed Product from Pharming or its  Affiliates but does not otherwise pay royalties, upfront payments, milestone payments or  other payments to Pharming with respect to the Licensed Product, and (c) any such  arrangement between Pharming or its Affiliate and such Distributor is consistent with the  distribution arrangements Pharming enters into for its similar products.  3.5 Retention of Rights.  Notwithstanding the exclusive licences granted to Pharming  pursuant to Section 3.1, Orchard hereby expressly reserves the right (a) under the Orchard  Background IP, Orchard Collaboration IP, Orchard Conditioning IP, and Orchard’s  interest in the Joint Collaboration IP and Joint Conditioning IP: (i) for its internal pre- clinical research purposes; (ii) to exercise its rights and perform its obligations under this  Agreement, whether directly or through one or more Affiliates or Subcontractors,  including the right to perform those activities assigned to it under the Pre-Clinical Plan;  and (iii) to practice, and to grant licences under, the Orchard Background IP, Orchard  Conditioning IP, Orchard Collaboration IP, and Orchard’s interest in the Joint  Collaboration IP and Joint Conditioning IP outside the scope of the licences granted to  Pharming in Section 3.1 and outside the scope of its covenants under Section 4.1. 3.6 No Implied Licences.  Except as expressly provided in this Agreement, neither Party shall  acquire any licence or other intellectual property interest under or in connection with this  Agreement, whether by implication, estoppel, or otherwise, under or to any Patents,  

 

7897269 v13 39 Know-How, Information, or other intellectual property owned or controlled by the other  Party. 3.7 Manufacturing Process Improvements.  Subject to the agreement of the JSC, Pharming  shall have the right to include all Manufacturing Process Improvements disclosed by  Orchard under Section 2.2.7(a) within the scope of the licenses under Section 3.1, such  right shall be exercisable by Pharming upon written notice to Orchard on or prior to the  date that is [ninety (90)] days after the JSC meeting at which Pharming are informed of  such Manufacturing Process Improvements.  Upon Pharming’s exercise of such right  with respect to any Manufacturing Process Improvements: (i) Orchard shall use  Reasonable Efforts to transfer to Pharming, and perform such activities as reasonably  necessary or useful to enable Pharming to utilise, such Manufacturing Process  Improvements, subject to Pharming’s reimbursement to Orchard of its Costs reasonably  and actually incurred in the performance of such activities, and (ii) such Manufacturing  Process Improvements shall constitute part of the Orchard Background IP and shall be  licensed to Pharming under Section 3.1.   3.8 No Modifications.  Notwithstanding anything to the contrary in this Agreement, Pharming  shall not, directly or indirectly: (a) unless otherwise agreed by Orchard, generate analogs  of or derivatives based on, modify the structure of, or reverse engineer, the retroviral  vector used in the Licensed Product or (b) unless otherwise agreed by Orchard or the  JSC, prior to the submission of the first Drug Approval Application in respect of the  Licensed Product anywhere in the Territory, modify the drug product Manufacturing  Process used in relation to the Licensed Product.   3.9 Confirmatory Patent License.  Each Party shall, if requested to do so by the other,  promptly enter into confirmatory licence agreements in the form or substantially the form  reasonably requested by the requesting Party for purposes of recording the licences  granted under this Agreement with such patent offices in the Territory as the requesting  Party considers appropriate. 

 

7897269 v13 40 ARTICLE 4 EXCLUSIVITY 4.1 Mutual Exclusivity.  During the Term, subject to Section 16.3 (Change of Control), each  Party shall not, and shall ensure that its respective Affiliates do not, whether on their own  or with or through a Third Party, research, Develop, Manufacture or Commercialize: (a)  any ex vivo autologous haematopoietic stem cell lentivirus-mediated gene therapy  product in the Primary Indication; and (b) any ex vivo autologous haematopoietic stem  cell gene therapy product in the Field (excluding the Primary Indication) that uses a  [lentivirus vector encoding the naturally-occurring human plasma protease C1 inhibitor]  or a variant thereof, in each case (a) and (b), except in the performance of their respective  obligations or exercise of their respective rights under this Agreement (such research,  Development, Manufacture and Commercialization activities, the “Competitive  Program”).   ARTICLE 5 PRE-CLINICAL RESEARCH 5.1 Overview.  Subject to the terms and conditions of this Agreement, the Parties will  collaborate with respect to the performance of the Pre-Clinical Research and shall keep  the JSC informed of such activities. 5.2 Conduct of the Pre-Clinical Plan. 5.2.1 Diligence. (a) The Parties shall use their respective Commercially Reasonable  Efforts to carry out the tasks allocated to them in the Pre-Clinical  Plan.  Each Party shall use its Commercially Reasonable Efforts to  adhere to any timeframes set forth in the Pre-Clinical Plan. (b) Each Party shall not be required to perform any activities with  respect to non-clinical research for Licensed Products beyond those  activities assigned to it in the Pre-Clinical Plan. 

 

7897269 v13 41 (c) The Parties acknowledge and agree that, notwithstanding the use of  their respective Commercially Reasonable Efforts under Section  5.2.1(a), no outcome or success is or can be assured and that failure  to achieve desired results will not in and of itself constitute a breach  or default of any obligation in this Agreement. 5.2.2 Regulatory Support.  Orchard shall support Pharming, solely as set out in the  Pre-Clinical Plan or as otherwise agreed by the Parties in writing, to file an  IND for the Licensed Product and in the activities in support thereof, including  providing all documents or other materials Controlled by Orchard or any of  its Affiliates as are necessary for Pharming to file an IND for the Licensed  Product.   5.2.3 Updates.  From time to time, but not less than [Quarterly] (until all activities  under the Pre-Clinical Plan are completed), the Parties will prepare updates  and amendments, as appropriate, to the Pre-Clinical Plan (including any  consequential changes to the Pre-Clinical Budget), for review of and approval  by the JSC, subject to and in accordance with the applicable provisions of  ARTICLE 2, including Section 2.8. 5.2.4 Order of Precedence.  If the terms of the Pre-Clinical Plan contradict, or  create inconsistencies or ambiguities with, the terms of this Agreement, then  the terms of this Agreement shall govern. 5.2.5 Subcontracting.  Each Party shall have the right to subcontract its obligations  under this Agreement with respect to the Pre-Clinical Plan to Subcontractors  and Affiliates, subject to any limitations, restrictions or other qualifications  that are set forth in the Pre-Clinical Plan; provided, that (i) any Subcontractor  agrees in writing to be subject to the applicable terms and conditions of this  Agreement, including the confidentiality provisions of ARTICLE 12, (ii)  appropriate agreements or other measures are in place ensuring that any  intellectual property rights, to the extent related to the Licensed Product that  are created under this Agreement, conceived, discovered, developed, or  

 

7897269 v13 42 otherwise made by such Subcontractors or Affiliates will vest in, are assigned  to or shall be licensed to one of the Parties in accordance with ARTICLE 11,  and (iii) the subcontracting Party shall be responsible for the management of  all of its Subcontractors and shall remain fully liable to the other Party for the  acts and omissions of such Subcontractors. 5.2.6 Research Records. (a) Creation.  Each Party shall maintain complete and accurate records  (including both paper and electronic records) in sufficient detail and  in good scientific manner appropriate for patent and regulatory  purposes, and in compliance with Applicable Law and regulatory  guidance, of all work done and results achieved in the performance  of any activities under the Pre-Clinical Plan.  Such records shall be  retained by the applicable Party for at least [three (3)] years after the  termination or expiration of the Agreement, or for such longer  period as may be required by Applicable Law. (b) Inspection.  Each Party shall have the right to reasonably inspect  the other Party’s records, and shall provide copies of all requested  records, to the extent reasonably required for the exercise or  performance of the requesting Party’s rights under this Agreement;  provided, however, that the requesting Party shall maintain such  records and the Information of the other Party as Confidential  Information of the other Party in accordance with ARTICLE 12  hereof and shall not use such records or Information except to the  extent otherwise permitted by this Agreement. 5.2.7 Pre-Clinical Plan; Updates; Information-Sharing.   (a) The initial version of the Pre-Clinical Plan is set out in Schedule  1.123. From time to time, either Party may prepare updates and  amendments, as appropriate, to the Pre-Clinical Plan, for review of  

 

7897269 v13 43 and approval by the JSC under Section 2.8, provided that, any such  update or amendment shall not be effective unless and until the JSC  approves such update or amendment.   (b) At least every [six (6)] months, through a JSC meeting, each Party  shall update the JSC in respect of any then-ongoing Pre-Clinical  Research activities for which such Party is responsible under the  Pre-Clinical Plan.  The Parties shall discuss the status, progress, and  results of all such activities at such JSC meetings. ARTICLE 6 DEVELOPMENT  6.1 Overview.  Subject to the terms and conditions of this Agreement, after the first IND  Clearance in respect of the Licensed Product, as between the Parties, Pharming will be  solely responsible for conducting all Development activities and shall keep the JSC  informed of such activities. 6.2 Conduct of the Clinical Development Plan. 6.2.1 Finalisation of the Clinical Development Plan.  The initial version of the  Clinical Development Plan shall be prepared by Pharming and approved by  the JSC pursuant to Section 2.2.5.  6.2.2 Diligence.   (a) Pharming shall use its Commercially Reasonable Efforts to carry out  the activities assigned to it and as set out in the Clinical  Development Plan, including to use its Commercially Reasonable  Efforts to adhere to any timeframes set forth in the Clinical  Development Plan with respect to such activities.  Orchard shall use  its Commercially Reasonable Efforts to carry out any  Manufacturing, supply and NTCR Activities set out in the Clinical  Development Plan that are assigned to Orchard, including to use its  

 

7897269 v13 44 Commercially Reasonable Efforts to adhere to any timeframes set  forth in the Clinical Development Plan with respect to such  activities.  The foregoing obligations shall no longer apply upon the  the submission of the first Drug Approval Application in respect of  the Licensed Product anywhere in the Territory. (b) The Parties acknowledge and agree that, notwithstanding each  Party’s use of their respective Commercially Reasonable Efforts  under Section 6.2.2(a), no outcome or success is or can be assured  and that failure to achieve desired results will not in and of itself  constitute a breach or default of any obligation in this Agreement. 6.2.3 Updates.  From time to time, the Parties may prepare updates and  amendments, as appropriate, to the Clinical Development Plan, for review of  and approval by the JSC, subject to and in accordance with the applicable  provisions of ARTICLE 2, including Section 2.8. 6.2.4 Order of Precedence.  If the terms of the Clinical Development Plan  contradict, or create inconsistencies or ambiguities with, the terms of this  Agreement, then the terms of this Agreement shall govern. 6.2.5 Subcontracting.  Each Party shall have the right to subcontract its obligations  under this Agreement with respect to the Clinical Development Plan to  Subcontractors and Affiliates, subject to any limitations, restrictions or other  qualifications that are set forth in the Clinical Development Plan; provided,  that (i) any Subcontractor agrees in writing to be subject to the applicable  terms and conditions of this Agreement, including the confidentiality  provisions of ARTICLE 12, (ii) appropriate agreements or other measures are  in place ensuring that any intellectual property rights, to the extent related to  the Licensed Product that are created under this Agreement, conceived,  discovered, developed, or otherwise made by such Subcontractors or  Affiliates will vest in, are assigned to or shall be licensed to one of the Parties  in accordance with ARTICLE 11, and (iii) the subcontracting Party shall be  

 

7897269 v13 45 responsible for the management of all of its Subcontractors and shall remain  fully liable to the other Party for the acts and omissions of such  Subcontractors. 6.2.6 Research Records. (a) Creation.  Pharming shall maintain complete and accurate records  (including both paper and electronic records) in sufficient detail and  in good scientific manner appropriate for patent and regulatory  purposes, and in compliance with Applicable Law and regulatory  guidance, of all work done and results achieved in the performance  of any activities under the Clinical Development Plan.  Such records  shall be retained by Pharming for at least [three (3)] years after the  termination or expiration of the Agreement, or for such longer  period as may be required by Applicable Law. (b) Inspection.  Orchard shall have the right to reasonably inspect the  Pharming’s records, and shall provide copies of all requested  records, to the extent reasonably required for the exercise or  performance of the Orchard’s rights under this Agreement;  provided, however, that Orchard shall maintain such records and the  Information of Pharming as Confidential Information of Pharming  in accordance with ARTICLE 12 hereof and shall not use such  records or Information except to the extent otherwise permitted by  this Agreement. 6.2.7 Updates; Information-Sharing.  At each regularly scheduled JSC meeting,  each Party shall update the JSC in respect of any then-ongoing activities for  which such Party is responsible under the Clinical Development Plan.  The  Parties shall discuss the status, progress, and results of all such activities at  such JSC meetings.  In addition, Pharming shall provide a written report of  its activities under the Clinical Development Plan, and the results of such  activities, to Orchard each Quarter. 

 

7897269 v13 46 ARTICLE 7 COMMERCIALISATION  7.1 Overview.  From the date of grant of the first Regulatory Approval in respect of the  Licensed Product in the Field, Pharming shall be solely responsible for the  Commercialization and Manufacture of the Licensed Product in the Field in the Territory. 7.2 Diligence.  [Pharming] will use its Commercially Reasonable Efforts to seek Regulatory  Approval for, and to Commercialize, the Licensed Product in the [Primary Indication in  the United States, the European Union, the United Kingdom and Japan]. 7.3 Reporting.  Pharming shall provide to Orchard within [sixty (60)] days following the end  of each Year of the Term (commencing as of the First Commercial Sale) copies of written  reports containing sufficient detail to enable Orchard to assess Pharming’s compliance  with Section 7.2.  All such reports and the information contained therein shall constitute  the Confidential Information of Pharming. ARTICLE 8 MANUFACTURING & SUPPLY; TECHNOLOGY TRANSFER AND OTHER  ASSISTANCE 8.1 Orchard Manufacturing. 8.1.1 Orchard shall use its Reasonable Efforts to: (a) develop the Manufacturing  Process in accordance with the Pre-Clinical Plan; (b) Manufacture and supply  to Pharming sufficient quantities of the drug product for the Licensed Product  for the performance of the Clinical Studies under the Clinical Development  Plan, in accordance with the Clinical Development Plan; (c) transfer the  Manufacturing Process in relation to the drug product to the Third Party  Manufacturer’s facilities in the United States, as further set out in the Clinical  Development Plan; and (d) transfer the necessary information and knowledge  relating to the Manufacturing Process to Pharming, as further specified in the  Clinical Development Plan.  For the avoidance of doubt, Orchard shall not be  required to, or to procure that any Orchard CMO or any Third Party to: (i)  

 

7897269 v13 47 create any new Know-How, (ii) undertake any Manufacturing activities not  expressly specified in the Pre-Clinical Plan or Clinical Development Plan, or  (iii) transfer any Manufacturing Process to any Third Party other than to the  Third Party Manufacturer as set out in Section 8.1.1(c) above, or to Pharming  as set out in Section 8.1.1(d), in each case (i) to (iii) unless otherwise agreed  with Orchard in writing in advance.  8.1.2 Upon receipt of a written request by Pharming, Orchard shall facilitate  Pharming to enter into a direct manufacturing and supply arrangement with  the Orchard CMO, by introducing the Orchard CMO to Pharming, and by  providing Orchard’s consent to allow the Orchard CMO to use any know-how  developed by the Orchard CMO in relation to the Manufacture of the Licensed  Product on Orchard’s behalf, for the benefit of Pharming. 8.1.3 CMC Costs.  Pharming shall reimburse Orchard for all Costs incurred by  Orchard in the performance of its obligations under this Section 8.1 in  accordance with this Agreement to the extent such Costs do not constitute  Orchard Pre-Clinical Research Costs or NTCR Activities Costs (the  “Orchard CMC Costs”).  Prior to entering into any agreement or  arrangement with a Third Party or performing any activities which would  cause Orchard to incur any Orchard CMC Costs, Orchard shall  ensure that  Pharming has first approved such agreement or arrangement and such  Orchard CMC Costs (such approval not to be unreasonably withheld,  conditioned or delayed).  If Orchard has incurred any Orchard CMC Costs  without first obtaining such approval from Pharming with respect thereto in  accordance with this Section 8.1.3, then Pharming shall have no obligation to  pay for such costs under Section 9.2.1(c).  In the event that Pharming delays,  conditions or refuses its consent under this Section 8.1.3, then Orchard shall  not be liable for any delay or failure to perform its obligations, that arises as  a result of such delay or refusal to give consent. 

 

7897269 v13 48 8.1.4 Orchard shall reasonably co-operate with Pharming to ensure the commercial  infrastructure is robust and efficient, including with respect to the  Manufacture, supply chain and administration of the Licensed Product,  provided that, if Pharming wishes to engage any Third Party resources already  being used by Orchard, without limiting its other obligations under this  Agreement, Orchard shall facilitate an introduction to such Third Party, but  Pharming shall be required to directly contract with the selected Third Party. 8.1.5 Pharming will be solely responsible for the Manufacture of the Licensed  Product for Commercialization, at its own expense.   8.1.6 Regulatory Support. (a) As between the Parties, Pharming shall, at its sole discretion, be  responsible for preparing, obtaining, and maintaining INDs and  other Regulatory Approvals and submissions, and conducting  communications with the Regulatory Authorities, in each case, with  respect to the Licensed Product, subject to Sections 5.2.2 and  8.1.6(b).  Each Party shall comply with its respective obligations  under any regulatory communications plan to the extent approved  by the JSC under Section 2.2.8. (b) Orchard shall support Pharming, as set out in the Pre-Clinical Plan  or as otherwise agreed by the Parties in writing, to file the INDs for  the Licensed Product and in the activities in support thereof,  including providing all documents or other materials Controlled by  Orchard or any of its Affiliates as are necessary for Pharming to file  the INDs for the Licensed Product. (c) If Orchard, its Affiliates or their Subcontractors (including  [MolMed]) receives any notice or correspondence from Regulatory  Authorities with respect to the Licensed Product, Orchard shall  promptly (and, in any event, within [three (3)] Business Days of  

 

7897269 v13 49 Orchard’s receipt of such notice) provide a copy thereof to  Pharming, notwithstanding the foregoing Pharming agrees that any  content of such notice or correspondence that is not specifically  related to the Licensed Product may be redacted prior to such  minutes and summaries being provided to Pharming.   (d) If Orchard, its Affiliates or their subcontractors (including the  Orchard CMO) is requested to attend a meeting with the Regulatory  Authority with respect to the Licensed Product, Orchard shall use  Reasonable Efforts to procure that Pharming representatives shall  be permitted to attend such meeting, and shall provide to Pharming  copies of all minutes and summaries of such meeting within [ten  (10)] Business Days after Orchard’s receipt or production of such  minutes or summaries, Pharming agrees that any content of such  minutes and summaries that is not specifically related to the  Licensed Product may be redacted prior to such minutes and  summaries being provided to Pharming. ARTICLE 9 PAYMENTS AND RECORDS 9.1 Upfront Payment.   9.1.1 Within [thirty (30)] days of the Effective Date, Pharming shall pay to Orchard  the non-refundable, non-creditable sum of Ten Million Dollars  ($10,000,000). 9.1.2 Pharming shall purchase Seven Million Five Hundred Thousand Dollars  ($7,500,000) of common shares in Orchard at the price and on the terms set  out in a share purchase agreement entered into by the Parties on the Effective  Date. 9.2 Pre-Clinical Research Costs; NTCR Activities Costs and CMC Costs 

 

7897269 v13 50 9.2.1 Allocations of Costs.   (a) Pharming shall bear one hundred percent (100%) of all Costs that  are not NTCR Activities Costs: (a) incurred by Pharming or its  Affiliates in the performance of its obligations under the Pre- Clinical Plan or the Clinical Development Plan; and (b) incurred by  Orchard or its Affiliates in the performance of its obligations under  the Pre-Clinical Plan (the “Orchard Pre-Clinical Research  Costs”), subject to Section 9.2.2(a). (b) The Parties shall share equally all Costs incurred by either Party or  its Affiliates in the performance of the NTCR Activities (the  “NTCR Activities Costs”), subject to Section 9.2.2(b). (c) Subject to Section 8.1.3, Pharming shall bear one hundred per cent  (100%) of the Orchard CMC Costs.   9.2.2 Budget Caps. (a) Pharming shall have no obligation to pay to Orchard any Orchard  Pre-Clinical Research Costs with respect to any activity(ies) under  the Pre-Clinical Plan to the extent exceeding [one hundred and ten  percent (110%)] of the Costs allocated to such activity(ies) under  the Pre-Clinical Budget, and such excess Costs shall be deemed  excluded from Orchard Pre-Clinical Research Costs, unless such  excess Costs are thereafter covered by any Pre-Clinical Budget  amended by the JSC. (b) Either Party shall have no obligation to share the NTCR Activities  Costs incurred by the other Party or its Affiliates with respect to any  NTCR Activity(ies) to the extent exceeding [one hundred and ten  percent (110%)] of the Costs allocated to be incurred by such Party  for such NTCR Activity(ies) under the NTCR Budget, and  such  excess Costs shall be deemed excluded from the NTCR Activities  

 

7897269 v13 51 Costs, unless such excess Costs are thereafter covered by any NTCR  Budget amended by the JSC. (c) If either Party reasonably expects that it will incur, in the case of  Orchard, Orchard Pre-Clinical Research Costs or, in the case of  either Party, NTCR Activities Costs in excess of the corresponding  budgeted Costs in the Pre-Clinical Budget or NTCR Budget (as  applicable), then subject to Sections 9.2.1(a) and 9.2.1(b), such  Party shall promptly inform the JSC with respect thereto, upon  which the JSC shall discuss and, if appropriate, approve any  amendment of such Pre-Clinical Budget or NTCR Budget (as  applicable) to cover such excess Costs under Section 2.2.8.  In the  event that the JSC delays, conditions or refuses its consent under  Section 2.2.8 to approve any such amendment to cover such excess  Costs (above [one hundred and ten percent (110%)] of the applicable  Costs set out in the Pre-Clinical Budget or NTCR Budget), then   such Party shall not be liable for any delay or failure to perform its  obligations under the Pre-Clinical Plan or its NTCR Activities (as  applicable), to the extent caused by such delay or refusal to give  consent, provided that such Party shall remain liable for such delay  or failure to perform its obligations, if such actual or potential excess  Costs are caused by such Party’s failure to perform its obligations  under the Pre-Clinical Plan or its NTCR Activities using its  Commercially Reasonable Efforts or its failure to materially comply  with Applicable Laws. 9.2.3 Reports.  Each Party shall report to the other Party, within [thirty (30)] days  after the end of each Quarter, the Orchard Pre-Clinical Research Costs, NTCR  Activities Costs, and the Orchard CMC Costs to the extent incurred by or on  behalf of such Party or its Affiliates during such Quarter.  Such report shall  specify in reasonable detail, in a form as the Parties may mutually agree from  time-to-time, all amounts included in such Costs during such Quarter.  In the  

 

7897269 v13 52 case of any report including Orchard Pre-Clinical Research Costs or NTCR  Activities Costs, each such report shall enable the receiving Party to compare  the reported Orchard Pre-Clinical Research Costs or NTCR Activities Costs  against the Pre-Clinical Budget or NTCR Budget (as applicable), including to  break-down the Costs incurred on a per-activity basis, and on both a Quarterly  basis and a cumulative basis for each activity.  The Parties shall seek to  resolve any questions related to such cost reports within [thirty (30)] days  following receipt by each Party of the other Party’s report hereunder. 9.3 Development Milestones. 9.3.1 Development Milestone Payments.  In partial consideration of the rights  granted by Orchard to Pharming hereunder, Pharming shall pay to Orchard  the non-refundable, non-creditable milestone payments set out below (the  “Development Milestone Payments”) upon the first achievement by  Pharming, its Affiliates or Sublicensees of each of the corresponding  milestone events set out in the table below with respect to the Licensed  Product (the “Development Milestones”).  Milestone Event Milestone  Payment  (Primary  Indication) (Dollars) Milestone  Payment (Low  Incidence  Secondary  Indications)  (Dollars) Milestone  Payment (High  Incidence  Secondary  Indications)  (Dollars) 1. [Upon achievement of  preclinical in vivo proof of  concept of a NTCR.  For the  purposes of this Development  Milestone, such proof of concept  of a NTCR shall only be  considered achieved if: (a) such  NTCR meets all Proof of  Concept NTCR Endpoints; or (b)  Pharming has filed an IND for  the Licensed Product that  specifically references the use of  [$2,000,000] [N/A] [N/A] 

 

7897269 v13 53 such NTCR for the applicable  Clinical Study.] 2. [Upon Initiation in the first  Clinical Study of the Licensed  Product in the applicable  Indication]  [$2,000,000] [N/A] [N/A] 3. [Upon dosing of the tenth (10th)  subject in the first Clinical Study  of the Licensed Product in the  applicable Indication, provided  that such Clinical Study involves  the use of a NTCR]  [$2,000,000] [N/A] [N/A] 4. [Upon Initiation in the first  Pivotal Study of the Licensed  Product in the applicable  Indication]  [$1,500,000] [N/A] [N/A] 5. [Upon Initiation in the first  Pivotal Study of the Licensed  Product in the applicable  Indication, provided that such  Clinical Study involves the use  of a NTCR] [$3,500,000] [N/A] [N/A] 6. [Upon the Acceptance of a Drug  Approval Application by the  FDA or Validation of a Drug  Approval Application by the  EMA, in each case, in respect of  a Drug Approval Application  submitted by Pharming, any of  its Affiliates, or any Sublicensee  with respect to the Licensed  Product in the applicable  Indication] [$5,000,000] [N/A] [N/A] 7. [Upon the Acceptance of a Drug  Approval Application by the  FDA or Validation of a Drug  Approval Application by the  EMA, in each case, in respect of  a Drug Approval Application  submitted by Pharming, any of  its Affiliates, or any Sublicensee  [$10,000,000] [N/A] [N/A] 

 

7897269 v13 54 with respect to the Licensed  Product in the applicable  Indication that positively  references usage of a NTCR in  the applicable dossier] 8. [Upon First Commercial Sale of  the Licensed Product in the  United States in the applicable  Indication] [$7,500,000] [$3,750,000] $15,000,000] 9. [Upon First Commercial Sale of  the Licensed Product in the  applicable Indication that  positively references usage of a  NTCR in the applicable dossier,  in the United States] [$14,500,000] [$7,250,000] $29,000,000] 10. [Upon First Commercial Sale of  the Licensed Product in the  applicable Indication in one of  Germany, France, Italy, Spain or  the United Kingdom]  [$3,500,000] [$1,750,000] $7,000,000] 11. [Upon First Commercial Sale of  the Licensed Product in the  applicable Indication that  positively references usage of a  NTCR in the applicable dossier,  in one of Germany, France, Italy,  Spain or the United Kingdom] [$7,500,000] [$3,750,000] [$15,000,000] 12. [Upon First Commercial Sale of  the Licensed Product in the  applicable Indication in Japan]  [$2,000,000] [$1,000,000] [$4,000,000] 13. [Upon First Commercial Sale of  the Licensed Product in the  applicable Indication that  positively references usage of a  NTCR in the applicable dossier,  in Japan] [$3,500,000 [$1,750,000] [$7,000,000] Total [$64,500,000] [$19,250,000] [$77,000,000] 9.3.2 For the purposes of the table above: 

 

7897269 v13 55 (a) [“positively references usage of a NTCR in the applicable dossier”,  means: (a) with respect to a Drug Approval Application submitted  to the EMA or the First Commercial Sale of the Licensed Product in  the applicable Indication in Germany, France, Italy, Spain or the  United Kingdom, the administration of such NTCR is included in  the summary of product characteristics (SmPC) for the applicable  Regulatory Approval for such Licensed Product as a requirement or  recommendation prior to the administration of such Licensed  Product; or (b) with respect a Drug Approval Application submitted  to the FDA or the First Commercial Sale of the Licensed Product in  the applicable Indication in the United States or in Japan, the  administration of such NTCR is included in the proposed product  labelling in such Drug Approval Application or in the product  labelling approved by the FDA or PMDA (as applicable) for such  Licensed Product, in each case, as a requirement or recommendation  prior to administration of such Licensed Product];  (b) First Commercial Sale of a Licensed Product in a country in a  specific Indication will be deemed to have been occurred if such  Licensed Product that is the subject of such First Commercial Sale  has received Regulatory Approval by a Regulatory Authority in  such country for the use of the Licensed Product in such Indication; (c) in the event that any Development Milestone is triggered in more  than one Indication at the same time, then, subject to Section 9.3.5,  all of the applicable Development Milestone Payments shall be paid  simultaneously (if not previously paid).  By way of example, if the  First Commercial Sale of the Licensed Product in Japan is of a  Licensed Product that has received Regulatory Approval by a  Regulatory Authority in Japan for the Primary Indication and a Low  Incidence Secondary Indication, but the applicable dossier did not  positively reference usage of a NTCR, and, if the corresponding  

 

7897269 v13 56 Development Milestone Payments have not been previously paid,  such event would trigger a Development Milestone Payment of  [three million Dollars ($3,000,000), reflecting two million Dollars  ($2,000,000) for the Primary Indication and one million Dollars  ($1,000,000) for such Low Incidence Secondary Indication]; and (d) If there is a First Commercial Sale of the Licensed Product in the  applicable indication in a particular country and the dossier (i.e.  SmPC or product labelling, as applicable) of such Licensed Product  does not positively reference usage of a NTCR in the applicable  dossier, then if such Licensed Product’s dossier is subsequently  amended, updated or varied to include such positive reference, any  Development Milestone payable upon the First Commercial Sale of  the Licensed Product in such Indication that positively references  usage of a NTCR in the applicable dossier, subject to Section 9.3.5,  shall be deemed achieved and become payable (if not previously  paid) upon the First Commercial Sale of such Licensed Product in  the relevant country after the dossier has been so amended, updated  or varied, provided that such amendment, update or variation of such  dossier occurs on or prior to the [fifth anniversary] of the First  Commercial Sale of such Licensed Product. 9.3.3 Notice and Payment.  Pharming shall promptly notify Orchard in writing  after the first achievement of any Development Milestone, upon which  Orchard will issue an invoice to Pharming.  Pharming shall ensure that each  Development Milestone Payment is paid to Orchard by the later of (a) [sixty  (60)] days of the first achievement of the corresponding Development  Milestone and (b) [five (5)] Business Days from receipt of an invoice for such  Development Milestone Payment from Orchard.   9.3.4 Skipped Milestones.  In the event that the Development Milestone set out in  row 4 in the table set out in Section 9.3.1 is first achieved without the  

 

7897269 v13 57 Development Milestone set out in row 2 in such table having been achieved,  the Development Milestone set out in row 2 in such table shall be deemed to  be achieved at the same time and the corresponding Development Milestone  Payment shall be payable at the same time.  In the event that the Development  Milestone set out in rows 6 is first achieved without the Development  Milestone(s) set out in row 2 or row 4 in such table having been achieved,  such Development Milestone(s) set out in row 2 or row 4 in such table (to the  extent not previously achieved) shall be deemed to be achieved at the same  time and the corresponding Development Milestone Payment(s) shall be  payable at the same time.  9.3.5 One-time payments.  Each Development Milestone in rows 1 to 7 in the table  set out in Section 9.3.1 shall be able to be achieved only once and the  Development Milestones in rows 8 to 13 in such table shall be able to be  achieved only once in respect of each different Indication.  By way of  example:  (a) [if the First Commercial Sale of the Licensed Product in the Primary  Indication in the United States is achieved by Pharming, but the  applicable dossier did not positively reference usage of a NTCR,  then the Primary Indication Development Milestone of seven  million and five hundred thousand Dollars ($7,500,000) would be  payable pursuant to Section 9.3.3];   (b) [if the First Commercial Sale of the Licensed Product in a first Low  Incidence Secondary Indication in the United States is subsequently  achieved by Pharming, but the applicable dossier did not positively  reference usage of a NTCR, then the Low Incidence Secondary  Indication Development Milestone of three million and seven  hundred and fifty thousand Dollars ($3,750,000) would be payable  pursuant to Section 9.3.3]; and 

 

7897269 v13 58 (c) [if the First Commercial Sale of the Licensed Product in a second  Low Incidence Secondary Indication (i.e. one that is different to the  first Low Incidence Secondary Indication) is subsequently achieved  by Pharming, but the applicable dossier did not positively reference  usage of a NTCR, then the Low Incidence Secondary Indication  Development Milestone of three million and seven hundred and fifty  thousand Dollars ($3,750,000) would be payable in respect of such  second Low Incidence Secondary Indication pursuant to Section  9.3.3]. 9.4 Sales-Based Milestones 9.4.1 Licensed Product Sales Milestone Payments.  In partial consideration of  the rights granted by Orchard to Pharming hereunder, Pharming shall pay to  Orchard the following non-creditable, non-refundable milestone payments  (the “Sales Milestone Payments”) upon the first achievement, as a result of  the Annual Net Sales of Pharming, its Affiliates and/or Sublicensees, of each  of the corresponding milestone events set out in the table below (the “Sales  Milestones”) for the Licensed Product in the Field. Annual Net Sales of the Licensed Product in  any and all Indications (in Dollars) Sales Milestone  Payments (Dollars) [Equals or exceeds $250,000,000] [$12,500,000] [Equals or exceeds $500,000,000] [$25,000,000] [Equals or exceeds $750,000,000] [$37,500,000] [Equals or exceeds $1,000,000,000] [$50,000,000] Total [$125,000,000]   

 

7897269 v13 59 9.4.2 Notice and Payment.  Pharming shall notify Orchard in writing of the first  achievement of any Sales Milestone in its report provided pursuant to Section  10.1.  Orchard will issue an invoice to Pharming for such Sales Milestone  following Orchard’s receipt of the first statement under Section 10.1 that  reflects achievement of such Sales Milestone are due, which invoice shall be  payable by Pharming within [sixty (60)] days of receipt.  For clarity, each  Sales Milestone Payment set forth in the table above shall be paid only once  upon first achievement of the corresponding Sales Milestone, regardless of  the number of times such Sales Milestone is achieved. 9.5 Royalties. 9.5.1 Royalty Rate.  In partial consideration for the rights granted to Pharming  under this Agreement, subject to the other terms of this Section 9.5, during  each applicable Royalty Term, Pharming shall make [quarterly], non- refundable, non-creditable royalty payments to Orchard on the Net Sales of  the Licensed Product sold in the Territory at the applicable royalty rate set  forth below (the “Royalty Payments”): Annual worldwide Net Sales of the Licensed  Product in any and all Indications Royalty Rate For that portion of Net Sales in any Year which are up  to and including [$250,000,000] [5%] For that portion of Net Sales in any Year which are  greater than [$250,000,000] but less than or equal to  [$500,000,000] [7%] For that portion of Net Sales in any Year which are  greater than [$500,000,000] but less than or equal to  [$750,000,000] [10%] For that portion of Net Sales in any Year which are  greater than [$750,000,000] [12%] 9.5.2 Royalty Term.  Royalty Payments shall be paid on a country-by-country  basis in the Territory from the First Commercial Sale of the Licensed Product  

 

7897269 v13 60 in a country by or on behalf of Pharming, its Affiliates, or Sublicensees, until  the expiration of the Royalty Term for the Licensed Product in such country.   For clarity, upon the expiry of any Royalty Term for the Licensed Product in  such country, the Net Sales for such Licensed Product in such country shall  not be taken into account when determining the royalty rate under the table  set out in Section 9.5.1. 9.5.3 Reductions. (a) In the event that (i) Pharming enters into an agreement with a Third  Party to obtain a licence or other right under any Patents owned by  a Third Party with respect to the composition of matter or method  of use of any Licensed Product in the Primary Indication, and for  the avoidance of doubt excluding any licence or Third Party right  relating to the Conditioning Regimen or Manufacturing Process, and  (ii) the Licensed Product cannot be Developed or Commercialised  in the Primary Indication without such licence or other Third Party  right, then Pharming shall be entitled to deduct [fifty percent (50%)]  of all royalty payments paid to such Third Party pursuant to such  agreement from the royalties due to Orchard pursuant to Section  9.5.1. (b) If, on a Licensed Product-by-Licensed Product basis, any Royalty  Payments that are payable pursuant to Section 9.5.1 attributable to  Net Sales in the United States in which there is no Valid Claim  within the Orchard Background Patents, Orchard Collaboration  Patents or Orchard Platform Patents Covering the composition of  matter or method of use in the Field with respect to such Licensed  Product, then the royalty rate otherwise applicable to the Net Sales  of such Licensed Product in the United States under Section 9.5.1  will be reduced by [thirty percent (30%)]. 

 

7897269 v13 61 (c) In the event that one (1) or more Generic Products with respect to  the Licensed Product are commercially available in a given country  in the Territory (“Generic Competition”), in a given Quarter, then  Pharming shall be entitled to deduct (i) (x) in respect of all countries  other than the United States [thirty-five percent (35%)] and (y) in  respect of the United States [seven and a half percent (7.5%)], in  each case (x) and (y) from the royalties due to Orchard under Section  9.5.1 with respect to the Licensed Product in such country, provided  that Net Sales of the Licensed Product in such country in such  Quarter equals between [seventy-five percent (75%)] [and fifty  percent (50%)] of the average Net Sales of the Licensed Product  over the four (4) consecutive Quarters immediately prior to the  Quarter in which one or more Generic Products first became  commercially available in such country, or (ii) [fifty percent (50%)]  from the royalties due to Orchard under Section 9.5.1 with respect  to the Licensed Product in such country if Net Sales of the Licensed  Product in such country in such Quarter equals less than [fifty  percent (50%)] of the average Net Sales of the Licensed Product  over the four (4) consecutive Quarters immediately prior to the  Quarter in which one or more Generic Products first became  commercially available in such country, in each case of (i) and (ii),  in such Quarter and thereafter in each Quarter during the Royalty  Term in which there is Generic Competition at either such level,  with respect to the Licensed Product in such country. (d) In no event will the aggregate amount of royalties due to Orchard  for the Licensed Product in a country in the Territory in any given  Quarter during the Royalty Term for the Licensed Product in such  country be reduced by more than [fifty percent (50%)] of the amount  that otherwise would have been due and payable to Orchard in such  Quarter for the Licensed Product in such country under Section 9.5.1  but for the reductions set forth in Sections 9.5.3(a), (b), and (c)  

 

7897269 v13 62 above.  Pharming shall have the right to carry over to subsequent  Quarters any excess deduction that Pharming did not use to offset  Royalty Payments due in such Quarter as a result of this Section  9.5.3(d) until the credit has been fully applied. ARTICLE 10 PAYMENT; RECORDS; AUDITS 10.1 Royalty Payments and Reports.  Pharming shall calculate all amounts payable to Orchard  pursuant to Section 9.5 at the end of each Quarter, which amounts shall be converted to  Dollars, in accordance with Section 10.3.  Within [sixty (60)] days of the end of such  Quarter, Pharming shall provide to Orchard a statement of (a) the amount of gross sales  and Net Sales of the Licensed Product in each country in the Territory during the  applicable Quarter (including such amounts expressed in local currency and as converted  to Dollars), (b) the deductions applied in the calculation of Net Sales from gross sales,  (c) the applicable royalty rate(s) under Section 9.5.1 (including any reduction(s) to such  royalty rate(s) under Section 9.5.3), and (d) a calculation of the amount of royalty  payment due on such Net Sales for such Quarter.  Following the receipt of such statement  for such Quarter, Orchard shall issue to Pharming an invoice of the Royalty Payments  for such Quarter, which invoice shall be payable by Pharming within [thirty (30)] days  of receipt. 10.2 Pre-Clinical Research, NTCR and Manufacturing Payments.  Within [thirty (30)] days  after the later of (a) the receipt of each report pursuant to Section 9.2.3 and (b) the  resolution of any questions raised by the receiving Party of any such report with respect  to such report, the applicable Party shall issue an invoice to the paying Party to achieve  the allocation of Costs provided in Section 9.2.1, and the paying Party will pay such  invoice within [thirty (30)] days of receipt. 10.3 Mode of Payment.  All payments to either Party under this Agreement shall be made,  without setoff, by deposit of Dollars in the requisite amount from an entity domiciled in  the United States, the United Kingdom or the Netherlands, to such bank account as the  payee Party may from time to time designate by notice to the paying Party.  For the  

 

7897269 v13 63 purpose of calculating any sums due under, or otherwise reimbursable pursuant to, this  Agreement (including the calculation of Net Sales expressed in currencies other than  Dollars), a Party shall convert any amount expressed in a foreign currency into Dollar  equivalents using the exchange rate used by such Party in its standard conversion  methodology consistent with Accounting Standards in the quarter when such Net Sales  occurred. 10.4 Taxes. 10.4.1 Withholding Taxes.  Where any sum due to be paid to either Party under this  Agreement is subject to any withholding tax under Applicable Laws, the  Parties shall use their reasonable efforts to take all such actions, including but  not limited to executing and delivering relevant documents, as will enable  them to take advantage of any applicable double taxation agreement or treaty  or otherwise reduce or eliminate such withholding tax.  If and to the extent  the withholding tax is applicable, the payor shall remit such withholding tax  to the appropriate government authority, deduct the amount paid from the  amount due to payee, and secure and send to payee satisfactory evidence of  the payment of such withholding tax.  If any withholding taxes are refundable,  creditable or otherwise recoverable, each Party will provide the other such  assistance as is reasonably required to obtain a refund of the withheld taxes,  obtain a credit with respect to such taxes paid, or otherwise recover such  taxes.   10.4.2 Indirect Taxes.  All payments are exclusive of value added taxes, sales taxes,  consumption taxes, and other similar taxes (the “Indirect Taxes”).  If any  Indirect Taxes are chargeable in respect of any payments, the paying Party  shall pay such Indirect Taxes at the applicable rate in respect of such  payments following receipt, where applicable, of an Indirect Taxes invoice in  the appropriate form issued by the receiving Party in respect of those  payments.  The Parties shall issue invoices for all amounts payable under this  

 

7897269 v13 64 Agreement consistent with Indirect Tax requirements and irrespective of  whether the sums may be netted for settlement purposes.   10.4.3 Taxes Resulting from a Party’s Action.  Notwithstanding the foregoing in  this Section 10.4, if a Party takes any action of its own discretion (not required  by Applicable Laws, the terms of this Agreement or a Regulatory Authority  or any other agreement between the Parties written or otherwise), including  any assignment without the prior written consent of the other Party, or change  of place of incorporation, or failure to comply with Applicable Laws or filing  or record retention requirements, which directly results in an additional or  increased amount of withholding tax with respect to payments to be made  pursuant to this Agreement compared with what would have been made had  such action not been taken (“Withholding Tax Action”), then such Party  shall bear the amount of such withholding tax to the extent resulting from  such Withholding Tax Action.  For clarity, if Pharming undertakes a  Withholding Tax Action, then the sum payable by Pharming (in respect of  which such withholding is required to be made) shall be increased to the  extent necessary to ensure that Orchard receives a sum equal to the sum which  it would have received had no such Withholding Tax Action occurred after  taking into account any tax credit available to the payee in respect of such  withholding and provided that in no circumstances shall Pharming be liable  for any withholding tax that would not have arisen had the recipient been a  resident of the United Kingdom and eligible for all the benefits under an  applicable Double Tax Treaty with the United Kingdom. 10.5 Financial Records.  Each Party shall, and shall cause its Affiliates and Sublicensees to,  keep complete and accurate financial books and records pertaining to the activities  performed under the Pre-Clinical Plan, the Clinical Development Plan or the Exploitation  of the Licensed Product (including, the Net Sales of the Licensed Product) in sufficient  detail to calculate all amounts payable hereunder with respect thereto and to verify  compliance with its obligations under this Agreement.  Such books and records shall be  

 

7897269 v13 65 retained by the Parties and their Affiliates until [three (3)] years after the end of the Year  to which such books and records pertain. 10.6 Audit.  At either Party’s request, the other Party shall, and shall cause its Affiliates and  Sublicensees to, permit an independent public accounting firm of internationally  recognized standing designated by the auditing Party and reasonably acceptable to the  audited Party, at reasonable times during normal business hours and upon reasonable  notice, to audit the books and records maintained pursuant to Section 10.5 to ensure the  accuracy of all reports and payments made hereunder.  Such examinations may not be  conducted more than once in any [twelve (12)] month period (unless a previous audit  during such [twelve (12)]-month period revealed an underpayment or overpayment with  respect to such period).  The accounting firm shall report to the Parties with reasons  whether the reports are correct or not, and the specific details concerning any  discrepancies.  Except as provided below, the cost of this audit shall be borne by the  auditing Party, unless the audit reveals an underpayment by the audited Party of more  than [seven and a half percent (7.5%)] from the amounts due, in which case the audited  Party shall bear the cost of the audit.  Unless the audited Party disputes the conclusion of  such audit under Section 16.8, if such audit concludes that (x) additional amounts were  owed by the audited Party, the audited Party shall pay the additional amounts within  [thirty (30)] days, or (y) excess payments were made by the audited Party, the auditing  Party shall reimburse such excess payments, in either case ((x) or (y)), within [thirty (30)]  days after the date on which such audit is completed by the auditing Party. 10.7 Confidentiality.  The receiving Party shall treat all information subject to review under  this ARTICLE 10 in accordance with the confidentiality provisions of ARTICLE 12 and  the Parties shall cause any independent public accounting firm appointed in accordance  with Section 10.6, to enter into reasonably acceptable confidentiality agreements with  the audited Party obligating such firm to retain all such financial information in  confidence pursuant to such confidentiality agreement. 

 

7897269 v13 66 ARTICLE 11 INTELLECTUAL PROPERTY 11.1 Ownership of Intellectual Property. 11.1.1 United States Law.  For purposes of establishing the Parties’ respective  ownership of intellectual property conceived, discovered, developed, or  otherwise made under this Agreement, inventorship of Information and  inventions conceived, discovered, developed, or otherwise made under this  Agreement shall be determined in accordance with Applicable Law in the  United States as such law exists as of the Effective Date irrespective of where  such conception, discovery, development or making occurs. 11.1.2 Orchard Ownership.  As between the Parties, Orchard or an Affiliate  designated by Orchard shall own and retain all right, title, and interest in and  to any and all Orchard Background IP, Orchard Conditioning IP, Orchard  Collaboration IP and Platform IP and to the extent any right, title or interest  in or to any Orchard Conditioning IP, Orchard Collaboration IP or Platform  IP vests in Pharming, Pharming hereby assigns all of its right, title and interest  in and to any Orchard Conditioning IP, Orchard Collaboration IP and  Platform IP to Orchard. 11.1.3 Pharming Ownership.  As between the Parties, Pharming or an Affiliate  designated by Pharming shall own and retain all right, title, and interest in and  to any and all Pharming Background IP, Pharming Conditioning IP and  Pharming Collaboration IP.  To the extent any right, title or interest in or to  any Pharming Collaboration IP or Pharming Conditioning IP vests in  Orchard, Orchard hereby assigns all of its right, title and interest in and to any  Pharming Collaboration IP or Pharming Conditioning IP to Pharming. 11.1.4 Joint Ownership of Joint Collaboration IP.  As between the Parties, the  Parties shall each own an equal and undivided interest in any and to all Joint  Collaboration IP and the Joint Conditioning IP and each Party hereby assigns  

 

7897269 v13 67 into the joint names of both Parties an equal and undivided interest in and to  all Joint Collaboration IP and Joint Conditioning IP.  At least [once per  Quarter] each Party shall disclose to the other Party in writing the  development, making, conception, or reduction to practice of any Joint  Collaboration IP and Joint Conditioning IP.  Subject to the exclusive licences  granted to the Joint Collaboration IP and Joint Conditioning IP under Section  3.1, each Party shall have the right to research and Exploit (including by way  of granting licences, assignments, mortgages or otherwise, in each case,  solely over its share of the Joint Collaboration IP or Joint Conditioning IP)  the Joint Collaboration IP and the Joint Conditioning IP without a duty of  seeking consent or accounting to the other Party.   11.1.5 Assignment Obligation.  Each Party shall cause all Persons who perform  Pre-Clinical Research or Development activities for such Party under this  Agreement to be under an obligation to assign (or, if such Party is unable to  cause such Person to agree to such assignment obligation despite such Party’s  using reasonable efforts to negotiate such assignment obligation, provide a  licence under) their rights in any Information, Know-How and inventions  resulting therefrom to such Party to the extent that the foregoing relates  specifically to the Licensed Product.  11.2 Maintenance and Prosecution of Patents. 11.2.1 Orchard Patents.  Orchard shall have the sole right subject to this Section  11.2.1, but not the obligation, to prepare, file, prosecute, and maintain the  Orchard Background Patents, Orchard Collaboration Patents, Orchard  Conditioning Patents and the Platform Patents worldwide.  The cost and  expense of such activities shall be borne as follows: (i) to the extent relating  to any and all Product Specific Patents, by Pharming, and (ii) to the extent  relating to any and all Orchard Background Patents, Orchard Collaboration  Patents, Orchard Conditioning Patents and the Platform Patents which are not  Product Specific Patents, by Orchard.  Orchard shall keep Pharming  

 

7897269 v13 68 reasonably informed of all steps with regard to the preparation, filing,  prosecution, and maintenance of the Orchard Background Patents, Orchard  Collaboration Patents, Orchard Conditioning Patents and the Platform  Patents, including any Product Specific Patents.  If Orchard, during the Term,  determines in its sole discretion to abandon or not maintain any of the Orchard  Background Patents, Orchard Collaboration Patents, Orchard Conditioning  Patents, or the Platform Patents, in the Territory, and such Orchard  Background Patent, Orchard Collaboration Patent, Orchard Conditioning  Patents or Platform Patent Covers any Licensed Product, then Orchard shall  provide Pharming with prior written notice sufficiently in advance of any  abandonment to enable Pharming, at its sole discretion, to maintain such  Orchard Background Patents, Orchard Collaboration Patents, Orchard  Conditioning Patents or Platform Patents, as the case may be, and assume the  prosecution, at its sole cost and expense, and on receipt of such notice,  Orchard shall transfer such prosecution to Pharming. 11.2.2 Pharming Patents.  Pharming shall have the sole right with respect to the  Pharming Background Patents, and the sole right subject to this Section 11.2.2  with respect to the Pharming Conditioning Patents and the Pharming  Collaboration Patents, but not the obligation, to prepare, file, prosecute, and  maintain the Pharming Background Patents, Pharming Conditioning Patents  and the Pharming Collaboration Patents worldwide, at Pharming’s own cost  and expense.  Pharming shall keep Orchard reasonably informed of all steps  with regard to the preparation, filing, prosecution, and maintenance of the  Pharming Conditioning Patents and Pharming Collaboration Patents.  If  Pharming, during the Term, determines in its sole discretion to abandon or  not maintain any Pharming Collaboration Patent or Pharming Conditioning  Patent in the Territory, then Pharming shall provide Orchard with prior  written notice sufficiently in advance of any abandonment to enable Orchard,  at its sole discretion, to maintain such Pharming Collaboration Patent or  Pharming Conditioning Patent, as the case may be, and assume the  

 

7897269 v13 69 prosecution, at its own cost and expense, and on receipt of such notice,  Pharming shall transfer such prosecution to Orchard. 11.2.3 Joint Collaboration Patents.  Pharming shall have the first right, but not the  obligation, to prepare, file, prosecute, and maintain the Joint Collaboration  Patents and the Joint Conditioning Patents worldwide, the cost and expense  of such activities shall be borne as follows: (i) to the extent relating to any  and all Joint Collaboration Patents and the Joint Conditioning Patents filed on  or before the first IND Clearance in respect of the Licensed Product, by  Pharming, and (ii) to the extent relating to any and all Joint Collaboration  Patents and the Joint Conditioning Patents filed after the first IND Clearance  in respect of the Licensed Product, equally between the Parties.  Pharming  shall keep Orchard reasonably informed of all steps with regard to the  preparation, filing, prosecution, and maintenance of such Joint Collaboration  Patents and Joint Conditioning Patents, and shall provide Orchard with a copy  of all communications to and from the patent authorities regarding such Joint  Collaboration Patents and Joint Conditioning Patents, including drafts of any  filings or responses to be made to such patent authorities sufficiently in  advance of submitting such filings or responses so as to allow Orchard a  reasonable opportunity to review and comment thereon.  Pharming shall  reasonably consider and incorporate Orchard’s requests and suggestions with  respect to such drafts and with respect to strategies for filing and prosecuting  such Joint Collaboration Patents and Joint Conditioning Patents.  If Pharming,  during the Term, determines in its sole discretion to abandon or not maintain  any of such Joint Collaboration Patents and Joint Conditioning Patents in the  Territory, then Orchard shall have the right, but not the obligation, to maintain  and assume the prosecution of such Patent.  Pharming shall provide Orchard  with prior written notice sufficiently in advance of any abandonment to enable  Orchard, at its sole discretion, to maintain such Joint Collaboration Patent or  Joint Conditioning Patent and assume the prosecution, at its sole cost.   Promptly upon receipt of any notice from Orchard that it wishes to maintain  

 

7897269 v13 70 and assume the prosecution of such Patent in accordance with the foregoing,  Pharming shall transfer such prosecution to Orchard. 11.2.4 Patent Term Extension and Supplementary Protection Certificate.  The  Parties shall cooperate on decisions regarding patent term extensions,  including supplementary protection certificates and any other extensions that  are now or become available in the future, wherever applicable, for Product  Specific Patents and Joint Collaboration Patents, and Joint Conditioning  Patents in any country or other jurisdiction.  Pharming shall have the first  right, but not the obligation, to apply for any extension or supplementary  protection certificate for Product Specific Patents and Joint Collaboration  Patents, Joint Conditioning Patents and, where Pharming elects not to make  an application for any extension or supplementary protection certificate, it  shall inform Orchard in sufficient time for Orchard to make such application  and provide a copy of all documents and other information that Orchard may  need to make such application.  Each Party shall keep the other fully informed  of its efforts to obtain such extension or supplementary protection certificate.   Each Party shall provide prompt and reasonable assistance, as requested by  the other, including by taking such action as patent holder as is required under  any Applicable Law to obtain such patent extension or supplementary  protection certificate. 11.3 Enforcement of Patents. 11.3.1 Notice.  Each Party shall promptly notify the other Party in writing of any  alleged or threatened infringement of the Orchard Background Patents, the  Orchard Conditioning Patents, the Orchard Collaboration Patents, the  Pharming Conditioning Patents, Pharming Collaboration Patents, the Joint  Conditioning Patents, the Platform Patents or Joint Collaboration Patents,  including the Product Specific Patents, in any jurisdiction in the Territory of  which such Party becomes aware in connection with the Exploitation of any  Licensed Product or any product that competes with the Licensed Product (an  

 

7897269 v13 71 “Infringement”), in each case to the extent such Infringement involves, as to  the Licensed Product, a competing product in the Field (a “Competitive  Infringement”). 11.3.2 Orchard Patents.  Subject to Section 11.3.5, Orchard shall have the sole and  exclusive right, but not the obligation, to enforce and defend worldwide under  its control, at its own Cost, the Orchard Background Patents, Orchard  Collaboration Patents, Orchard Conditioning Patents and Platform Patents.  11.3.3 Pharming Patents.  Pharming shall have the sole right, but not the obligation,  to enforce and defend worldwide under its control, and at its own Cost, the  Pharming Background Patents, Pharming Conditioning Patents, and  Pharming Collaboration Patents. 11.3.4 Joint Collaboration Patents and Joint Conditioning Patents.  Unless and  until [Orchard] assumes the maintenance and prosecution of such Joint  Collaboration Patent or Joint Conditioning Patent pursuant to Section 11.2.3,  [Pharming] shall have the first right, but not the obligation, to enforce and  defend worldwide under its control, and at its own Cost, the Joint  Collaboration Patents and Joint Conditioning Patents.  If [Pharming] does not  use Reasonable Efforts to enforce or defend any such Infringement with  respect to such Joint Collaboration Patents or Joint Conditioning Patents  (a) within [one hundred twenty (120)] days following the first notice provided  to it pursuant to this Section 11.3.4, or (b) if earlier, [forty (40)] Business Days  before the time limit, if any, set forth in appropriate laws and regulations for  filing of such actions, then [Orchard] may enforce such Joint Collaboration  Patent(s) or Joint Conditioning Patent(s) at its own Cost. 11.3.5 Product Specific Patents.  [Pharming] shall have the first right, but not the  obligation, to enforce and defend worldwide under its control, and at its own  Cost, the Product Specific Patents.  If [Pharming] does not exercise  Reasonable Efforts to enforce or defend any such Infringement with respect  to such Product Specific Patents (a) within [sixty (60)] days following the first  

 

7897269 v13 72 notice provided to it pursuant to this Section 11.3.5, or (b) if earlier, [thirty  (30)] Business Days before the time limit, if any, set forth in appropriate laws  and regulations for filing of such actions, then [Orchard] may enforce such  Product Specific Patents at its own Cost. 11.3.6 Cooperation.  The Parties agree to cooperate fully in any Infringement action  pursuant to this Section 11.3.6.  Where a Party brings such an action, the other  Party shall, where necessary, furnish a power of attorney solely for such  purpose or shall join in, or be named as a necessary party to, such action.   Unless otherwise set forth herein, the Party entitled to bring any Infringement  litigation in accordance with this Section 11.3.6 shall have the right to settle  such claim; provided that no Party shall have the right to settle any  Infringement litigation under this Section 11.3.6 in a manner that (a) [would  restrict the scope or admit the invalidity or unenforceability of a Patent owned  or controlled (other than pursuant to this Agreement) by the other Party], (b)  [diminishes or has a material adverse effect on the rights or interest of the  other Party], or (c) [imposes any costs or liability on, or involves any  admission by, the other Party], in each case (a) – (c) without the express  written consent of such other Party, such consent not to be unreasonably  withheld, conditioned, or delayed.  The Party commencing the litigation shall  provide the other Party with copies of all pleadings and other documents filed  with the court and shall consider reasonable input from the other Party during  the course of the proceedings. 11.3.7 Recovery.  Except as otherwise agreed by the Parties in connection with a  cost sharing arrangement, any recovery realized as a result of such litigation  described in this Section 11.3.7 (whether by way of settlement or otherwise)  shall be first allocated to reimburse the Parties for their costs and expenses in  making such recovery (which amounts shall be allocated pro rata if  insufficient to cover the totality of such costs and expenses).  Any remainder  after such reimbursement is made shall be retained by the Party that has  exercised its right to bring the enforcement action; provided that to the extent  

 

7897269 v13 73 that any award or settlement (whether by judgment or otherwise) is paid to  Pharming in respect of any of the Royalty Patents, such amounts shall be  treated as Net Sales of the relevant Licensed Product in the Quarter in which  such award or settlement is received solely for the purposes of calculation of  Royalty Payment, but, for clarity, such amounts shall not count towards the  achievement of any Sales Milestone.   11.4 Infringement Claims by Third Parties.  If the Exploitation of the Licensed Product in  the Territory pursuant to this Agreement results in, or may result in, any claim, suit, or  proceeding by a Third Party alleging patent infringement by [Pharming] (or its Affiliates  or Sublicensees), [Pharming] shall have the first right, but not the obligation, to defend  and control the defence of any such claim, suit, or proceeding at its own Cost, using  counsel of its own choice; provided, however, that the provisions of Sections 11.3.2 and  11.3.5 shall govern the right of [Pharming] to assert a counterclaim of infringement of  any Orchard Background Patent, Orchard Collaboration Patent, Orchard Conditioning  Patent or Platform Patent. 11.5 Invalidity or Unenforceability Defences or Actions. 11.5.1 Notice.  Each Party shall promptly notify the other Party in writing of any  alleged or threatened assertion of invalidity or unenforceability of any of the  Orchard Background Patents, Orchard Collaboration Patents, Orchard  Conditioning Patents, Platform Patents, Joint Conditioning Patents or Joint  Collaboration Patents by a Third Party, in each case in the Territory and of  which such Party becomes aware. 11.5.2 Orchard Patents.  Except as set out in Section 11.5.5, Orchard shall have the  sole right, but not the obligation, to defend and control the defence of the  validity and enforceability of the Orchard Background Patents, Orchard  Collaboration Patents, Orchard Conditioning Patents and Platform Patents.  11.5.3 Pharming Patents.  Except as set out in Section 11.5.5, Pharming shall have  the sole right, but not the obligation, to defend and control the defence of the  

 

7897269 v13 74 validity and enforceability of the Pharming Background Patents, Pharming  Conditioning Patents and Pharming Collaboration Patents. 11.5.4 Joint Collaboration Patents and Joint Conditioning Patents.  Unless and  until [Orchard] assumes the maintenance and prosecution of such Joint  Collaboration Patent or Joint Conditioning Patent pursuant to Section 11.2.3,  [Pharming] shall have the first right, but not the obligation, to defend and  control the defence of the validity and enforceability of the Joint  Collaboration Patents and Joint Conditioning Patents.  [Orchard] may  participate in any such claim, suit, or proceeding in the Territory related to  such Joint Collaboration Patents or Joint Conditioning Patents with counsel  of its choice at its own Cost; provided that [Pharming] shall retain control of  the defence in such claim, suit, or proceeding.  If [Pharming] elects not to  defend or control the defence of any such Joint Collaboration Patents or Joint  Conditioning Patents, in a suit brought in the Territory, or otherwise fails to  initiate and maintain the defence of any such claim, suit, or proceeding, then  [Orchard] may conduct and control the defence of any such claim, suit, or  proceeding, at its own Cost; provided, that [Orchard] shall obtain the written  consent of [Pharming] prior to settling or compromising such defence, such  consent not to be unreasonably withheld, conditioned, or delayed.  To the  extent that there is any claim, suit, or proceeding of any of the Joint  Collaboration Patents or Joint Conditioning Patents in the Territory that is not  covered by the process set forth above, then each Party shall have the right to  defend and control the defence of the validity and enforceability of the Joint  Collaboration Patents or Joint Conditioning Patents subject to Applicable  Law. 11.5.5 Product Specific Patents.  [Pharming] shall have the first right, but not the  obligation, to defend and control the defence of the validity and enforceability  of the Product Specific Patents.  [Orchard] may participate in any such claim,  suit, or proceeding in the Territory related to such Product Specific Patents  with counsel of its choice at its own Cost; provided that [Pharming] shall  

 

7897269 v13 75 retain control of the defence in such claim, suit, or proceeding.  If [Pharming]  elects not to defend or control the defence of any such Product Specific  Patents, or otherwise fails to initiate and maintain the defence of any such  claim, suit, or proceeding, then [Orchard] may conduct and control the  defence of any such claim, suit, or proceeding, at its own Cost; provided that  [Orchard] shall obtain the written consent of [Pharming] prior to settling or  compromising such defence, such consent not to be unreasonably withheld,  conditioned, or delayed. 11.5.6 Cooperation.  Each Party shall assist and cooperate with the other Party as  such other Party may reasonably request from time to time in connection with  its activities set forth in this Section 11.5, including by being joined as a party  plaintiff in such action or proceeding, providing access to relevant documents  and other evidence, and making its employees available at reasonable  business hours.  In connection with any such defence or claim or counterclaim  related to Section 11.5.4, the controlling Party shall keep the other Party  reasonably informed of any steps taken, and shall provide copies of all  documents filed, in connection with such defence, claim, or counterclaim.  In  connection with the activities set forth in this Section 11.5, each Party shall  consult with the other as to the strategy for the defence of the Joint  Collaboration Patents and Joint Conditioning Patents. 11.6 UPC.   11.6.1 To the extent Pharming or its designee is maintaining and prosecuting such  Patents under Section 11.2, Pharming will have the right to determine whether  to opt in or opt out (and to opt in again) of the Unified Patent Court system in  respect of the Pharming Background Patents, Pharming Collaboration  Patents, Pharming Conditioning Patents, Joint Conditioning Patents, Product  Specific Patents and Joint Collaboration Patents and if requested by  Pharming, Orchard will promptly do all things reasonably necessary and  execute all documents required to give effect to such decision(s), provided  

 

7897269 v13 76 that Pharming will reimburse Orchard its reasonable out-of-pocket costs  incurred in performing such acts. 11.6.2 To the extent Orchard or its designee is maintaining and prosecuting such  Patents under Section 11.2, as between the Parties, Orchard will have the right  to determine whether to opt in or opt out (and to opt in again) of the Unified  Patent Court system in respect of the Orchard Background Patents, Orchard  Conditioning Patents, Orchard Collaboration Patents and Platform Patents, in  each case, excluding any Product Specific Patents, and if requested by  Orchard, Pharming will promptly do all things reasonably necessary and  execute all documents required to give effect to such decision(s), provided  that Orchard will reimburse Pharming its reasonable out-of-pocket costs  incurred in performing such acts.  ARTICLE 12 CONFIDENTIALITY AND NON-DISCLOSURE 12.1 Confidentiality Obligations.  At all times during the Term and for a period of [ten (10)]  years following termination or expiration hereof in its entirety, each Party shall, and each  of the foregoing shall cause its Affiliates and its and their respective officers, directors,  employees, consultants, contractors, and agents to, keep confidential and not publish or  otherwise disclose to a Third Party and not use, directly or indirectly, for any purpose,  any Confidential Information furnished or otherwise made known to it, directly or  indirectly, by the other Party, except to the extent such disclosure or use is expressly  permitted by the terms of this Agreement.  Notwithstanding the foregoing, to the extent  the receiving Party can demonstrate by documentation or other competent proof, the  confidentiality and non-use obligations under this Section 12.1 with respect to any  Confidential Information shall not include any information that: 12.1.1 has been published by a Third Party or otherwise is or hereafter becomes part  of the public domain through no fault on the part of the receiving Party; 

 

7897269 v13 77 12.1.2 have been in the receiving Party’s possession prior to disclosure by the  disclosing Party without any obligation of confidentiality with respect to such  information; 12.1.3 is subsequently received by the receiving Party from a Third Party without  restriction and without breach of any agreement between such Third Party and  the disclosing Party; 12.1.4 that is generally made available to Third Parties by the disclosing Party  without restriction on disclosure; or 12.1.5 have been independently developed by or for the receiving Party without  reference to or use of the disclosing Party’s Confidential Information. Specific aspects or details of Confidential Information shall not be deemed to be within  the public domain or in the possession of the receiving Party merely because the  Confidential Information is embraced by more general information in the public domain  or in the possession of the receiving Party.  Further, any combination of Confidential  Information shall not be considered in the public domain or in the possession of the  receiving Party merely because individual elements of such Confidential Information are  in the public domain or in the possession of the receiving Party unless the combination  and its principles are in the public domain or in the possession of the receiving Party. 12.2 Permitted Disclosures.  Each Party may disclose Confidential Information of the other  Party to the extent such disclosure is reasonably necessary in the following instances: 12.2.1 (a) filing or prosecuting Patents as contemplated by this Agreement,  (b) prosecuting or defending litigation as contemplated by this Agreement, or  (c) obtaining or maintaining Regulatory Approval of the Licensed Product; 12.2.2 complying with applicable court orders or governmental regulations,  including regulations promulgated by securities exchanges on which the  securities of the disclosing Party are listed (or to which an application for  listing has been submitted);  

 

7897269 v13 78 12.2.3 disclosure to its and its Affiliates’ respective officers, directors, employees,  auditors, consultants, contractors, and agents, in each case on a need-to-know  basis in connection with the Exploitation of any Licensed Product in  accordance with the terms of this Agreement, in each case under written  obligations of confidentiality and non-use at least as stringent as those herein;  and 12.2.4 disclosure to actual and bona fide potential investors, acquirors, licensees,  sublicensees, and other financial or commercial partners for the purpose of  evaluating or carrying out an actual or potential investment, acquisition, or  collaboration, in each case under written obligations of confidentiality and  non-use at least as stringent as those herein (provided that the foregoing  obligation shall be deemed satisfied if the duration of such obligations of  confidentiality and non-use is at least [ten (10)] years and such obligations of  confidentiality and non-use are otherwise at least as stringent as those herein);  provided that the disclosing Party redacts the financial terms and other  provisions of this Agreement that are not reasonably required to be disclosed  in connection with such potential investment, acquisition, or collaboration,  which redaction shall be prepared in consultation with the other Party. Notwithstanding the foregoing, in the event a Party is required to make a disclosure of  the other Party’s Confidential Information pursuant to Section 12.2.1 or 12.2.2, it will,  except where impermissible, give reasonable advance notice to the other Party of such  disclosure and comply with all reasonable requests of the disclosing Party with respect  to maintaining confidence in such Confidential Information and in any event shall use  the same diligent efforts to secure confidential treatment of such Confidential  Information as such Party would use to protect its own Confidential Information, but in  no event less than reasonable efforts.  In any event, the Parties agree to take all reasonable  action to avoid disclosure of Confidential Information.  Any information disclosed  pursuant to this Section 12.2 shall remain Confidential Information and subject to the  restrictions set forth in this Agreement, including the foregoing provisions of this  ARTICLE 12. 

 

7897269 v13 79 12.3 Use of Name.  Except as expressly provided in this Agreement and subject to Section 12.4,  neither Party shall use the name, logo, or trademark of the other Party or any of its  Affiliates (or any abbreviation or adaptation thereof) in any publication, press release,  marketing and promotional material, or other form of publicity without the prior written  approval of such other Party in each instance, which approval shall not be unreasonably  withheld, conditioned, or delayed.  The restrictions imposed by this Section 12.3 shall  not prohibit either Party from making any disclosure identifying the other Party that, in  the opinion of the disclosing Party’s counsel, is required by Applicable Law; provided,  that such Party shall submit the proposed disclosure identifying the other Party in writing  to such other Party as far in advance as reasonably practicable (and in no event less than  [three (3)] Business Days prior to the anticipated date of disclosure) so as to provide a  reasonable opportunity to comment on such disclosure. 12.4 Public Announcements.  The Parties have agreed the press release set out as Schedule  12.4 shall be the press release announcing the transaction contemplated by this  Agreement.  Other than this press release, neither Party shall issue any public  announcement, press release, or other public disclosure regarding this Agreement or its  subject matter without the other Party’s prior written consent, except for any such  disclosure that is, in the opinion of the disclosing Party’s counsel, required by Applicable  Law or the rules of a stock exchange on which the securities of the disclosing Party are  listed (or to which an application for listing has been submitted).  In the event a Party is,  in the opinion of its counsel, required by Applicable Law or the rules of a stock exchange  on which its securities are listed (or to which an application for listing has been  submitted) to make such a public disclosure, such Party shall submit the proposed  disclosure in writing to the other Party as far in advance as reasonably practicable (and  in no event less than [five (5)] Business Days prior to the anticipated date of disclosure)  so as to provide a reasonable opportunity to comment thereon, but provided that such  [five (5)] Business Days review period has expired, such Party shall be free to make such  public disclosure.  Notwithstanding anything to the contrary herein, following the initial  press release announcing this Agreement, each Party shall be free to disclose, without the  other Party’s prior written consent, the existence of this Agreement, the identity of the  

 

7897269 v13 80 other Party, and those terms of the Agreement which have already been publicly  disclosed in accordance herewith. 12.5 Publications.  The Parties acknowledge that scientific publications must be strictly  monitored to prevent any adverse effect from premature publication of results of the Pre- Clinical Research and Development activities hereunder. 12.5.1 By Orchard.  Subject to Section 12.4, Orchard shall have the right to make  any publications, presentations, or public disclosures related to the Licensed  Product, or the Pre-Clinical Research or Development thereof, subject to  Pharming’s prior review and approval under Section 12.5.3, such approval  not to be unreasonably withheld, conditioned or delayed.  Notwithstanding  the foregoing, Orchard shall not require Pharming’s review or approval in the  event that any such publication, presentation or public disclosure has either  (i) been previously approved by Pharming, or (ii) contains only information  which is already in the public domain. 12.5.2 By Pharming.  Subject to Section 12.4, Pharming shall have the right to make  any publications, presentations, or public disclosures related to the Licensed  Product, subject to Orchard’s prior review, as set out in Section 12.5.3.   Notwithstanding the foregoing, Pharming shall not require Orchard’s prior  review in the event that any such publication, presentation or public disclosure  has either (i) been previously approved by Orchard, or (ii) contains only  information which is already in the public domain. 12.5.3 Review Process.  Before any paper, poster or abstract is submitted for  publication or an oral presentation is made under Section 12.5.1 or Section  12.5.2, the publishing or presenting Party (the “Publishing Party”) shall  deliver a then-current copy of the paper or materials for oral presentation to  the non-publishing Party at least [forty-five (45)] days prior to submitting the  paper to a publisher or making the presentation.  The non-publishing Party  shall review any such paper and give its comments to such Publishing Party  within [thirty (30)] days after the delivery of such paper to such other Party,  

 

7897269 v13 81 and, in the case of Orchard as the Publishing Party, Pharming shall confirm  whether or not it approves the publication, presentation or disclosure (such  approval not to be unreasonably withheld, conditioned or delayed).  The  Publishing Party shall comply with the other Party’s request to delete  references to the other Party’s Confidential Information in any such paper  prior to submission and will withhold publication of any such paper or any  presentation of same for an additional [ninety (90)] days in order to permit  the Parties to obtain Patent protection if such other Party deems it necessary  (in the case of Orchard as the Publishing Party, and if Pharming approves the  applicable publication presentation or disclosure, the foregoing may be  required by Pharming as a condition of such approval). 12.6 Return of Confidential Information.  Upon termination of this Agreement in its entirety,  each Party shall promptly return to the other Party, or delete or destroy, all records and  materials in such Party’s possession or control containing Confidential Information of  the other Party; provided that the other Party shall be permitted to retain one (1) copy of  such Confidential Information for the sole purpose of performing any continuing  obligations under this Agreement, as required by Applicable Law, or for legal archival  purposes.  Notwithstanding the foregoing, such other Party also shall be permitted to  retain such additional copies of or any computer records or files containing such  Confidential Information that have been created solely by such Party’s automatic  archiving and back-up procedures, to the extent created and retained in a manner  consistent with such other Party’s standard archiving and back-up procedures, but not for  any other use or purpose. ARTICLE 13 REPRESENTATIONS AND WARRANTIES 13.1 Mutual Warranties.  Each Party hereby represents and warrants, as of the Effective Date,  as follows: 13.1.1 Organization.  It is a company duly organized, validly existing, and in good  standing under the laws of the jurisdiction of its organization, and has all  

 

7897269 v13 82 requisite power and authority, corporate or otherwise, to execute, deliver, and  perform this Agreement. 13.1.2 Authorization.  The execution and delivery of this Agreement and the  performance by such Party of the transactions contemplated hereby have been  duly authorized by all necessary corporate action, and do not violate (a) such  Party’s charter documents, bylaws, or other organizational documents, (b)  any agreement, instrument, or contractual obligation to which such Party is  bound, (c) any requirement of any Applicable Law, or (d) any order, writ,  judgment, injunction, decree, determination, or award of any court or  governmental agency presently in effect applicable to such Party. 13.1.3 Binding Agreement.  This Agreement is a legal, valid, and binding  obligation of such Party enforceable against it in accordance with its terms,  subject to the effects of bankruptcy, insolvency, or other laws of general  application affecting the enforcement of creditor rights, judicial principles  affecting the availability of specific performance, and general principles of  equity (whether enforceability is considered a proceeding at law or equity). 13.1.4 No Inconsistent Obligation.  It is not under any obligation, contractual or  otherwise, to any Person that conflicts with or is inconsistent with the terms  of this Agreement, or that would impede the diligent and complete fulfilment  of its obligations hereunder. 13.1.5 No Litigation.  There is no claim, demand, suit, proceeding, arbitration,  inquiry, investigation or other legal action of any nature, civil, criminal,  regulatory or otherwise, pending or, to its actual knowledge, threatened,  against it or any of its Affiliates. 13.2 Additional Warranties by Orchard.  Orchard hereby warrants to Pharming, as of the  Effective Date, as follows:   13.2.1 it or its Affiliates are the sole owner of the Orchard Background IP, all of  which are free and clear of any liens, charges and encumbrances, except such  

 

7897269 v13 83 liens, charge and encumbrances that do not adversely affect or diminish  Orchard’s ability to perform its obligations or grant any licence under this  Agreement;  13.2.2 Orchard has not received any written notice of any, nor is there any ongoing  claim or, to Orchard’s Knowledge, threatened claim by any Third Party  (i) challenging the scope, validity or enforceability of any issued Orchard  Background Patents, (ii) asserting the misuse or non-infringement of any of  the Orchard Background IP, (iii) challenging Orchard’s ownership or control  of any of the Orchard Background IP; or (iv) otherwise instituting any Patent  Challenge; 13.2.3 Schedule 1.84 sets out a complete and accurate list of all Orchard Background  Patents, as they exist as of the Effective Date, 13.2.4 Orchard does not own, Control, or otherwise possess any Know-How or  Patent, as applicable, that is necessary in connection with the Exploitation of  the Licensed Product, as the Licensed Product exists at the Effective Date,  which is not, or which is not contemplated to be, licensed under this  Agreement; 13.2.5 Orchard and its Affiliates have complied with all Applicable Law in all  material respects, including any disclosure requirements, in connection with  the filing, prosecution, and maintenance of the Orchard Background Patents  in the Territory.  In addition, Orchard has paid all necessary application,  registration, maintenance, and renewal fees in respect of the Orchard  Background Patents, and Orchard has filed all necessary documents and  certificates with the relevant agencies for the purpose of maintaining the  Orchard Background Patents; 13.2.6 to the Knowledge of Orchard, no Third Party has infringed, is infringing or  has threatened to infringe any Orchard Background Patents or has  

 

7897269 v13 84 misappropriated, is misappropriating or has threatened to misappropriate any  Orchard Background Know-How; 13.2.7 to the Knowledge of Orchard, the Development, Manufacture or  Commercialization of the Licensed Product does not infringe any Third Party  Patents or misappropriate any Third Party Know-How.  To the Knowledge of  Orchard, Orchard has not (a) infringed any Patents of any Third Party, or (b)  misappropriate any Know-How of any Third Party, in each case ((a) and (b)),  in connection with its Development or Manufacture of any Licensed Product; 13.2.8 all material and non-public Orchard Background Know-How related to any  Licensed Product has been kept confidential or has been disclosed to Third  Parties only under terms of confidentiality.  To the Knowledge of Orchard,  no material breach of such confidentiality has been committed by any Third  Party; 13.2.9 Orchard and [MolMed] have entered into the [MolMed] Agreements, which  are in full force and effect, and Orchard has the right under the [MolMed]  Agreements to order from [MolMed] and deliver to Pharming Licensed  Products for the purposes of performing Clinical Studies, and the [MolMed]  Agreements do not conflict with Orchard’s obligations under Section 8.1; 13.2.10 Orchard, its Affiliates and its and their respective contractors and consultants  have conducted (including the generation, preparation, maintenance and  retention of documentation with respect thereto) all Development and  Manufacture of Licensed Products in accordance with Applicable Law in all  material respects; and 13.2.11 neither Orchard nor any of its Affiliates, nor, to the Knowledge of Orchard,  its subcontractors, has received written notice of any proceedings pending  before or threatened by any Regulatory Authority with respect to any  Licensed Product.  

 

7897269 v13 85 Solely for the purposes of this Section 13.2, when interpreting the definition of “Orchard  Background IP” as used in this Section 13.2, Orchard Background Know-How and Orchard  Background Patents shall be construed as those Know-How or Patents (as applicable)  that  are contemplated to be used by Orchard, its Affiliates or Subcontractors in the performance  of its activities under the Agreement as of the Effective Date, or contemplated to be  provided to Pharming or its Affiliates for use in its performance of their activities under  this Agreement as of the Effective Date, including those Know-How or Patents (as  applicable) contemplated to be used or provided under the Pre-Clinical Plan. 13.3 Mutual Covenants.  Each Party hereby covenants and agrees, in connection with the  performance of its activities under this Agreement:  13.3.1 it shall not employ, contract with, or retain any person directly or indirectly  to perform any of the activities under this Agreement if such person is under  investigation by the FDA for debarment or is presently debarred by the FDA  pursuant to the Generic Drug Enforcement Act of 1992, as amended (21  U.S.C. § 301, et seq.); 13.3.2 all activities conducted by or on behalf of it under this Agreement shall be  performed in accordance with Applicable Laws, and applicable established  internal policies and procedures (if any), including policies and procedures  pertaining to research involving laboratory animals or hazardous agents and  materials, as applicable.  Each Party agrees that any animals used in the  performance of studies under the Pre-Clinical Plan will be handled in  accordance with established guidelines for the care and use of laboratory  animals;  13.3.3 in performing its obligations under the Pre-Clinical Plan or the Clinical  Development Plan, ensure that it complies with the following good data  management practices: (a) data is generated using sound scientific techniques  and processes; (b) data is being accurately recorded in accordance with good  scientific practices by persons conducting such activities; (c) data is being  analyzed appropriately without bias in accordance with good scientific  

 

7897269 v13 86 practices; and (d) data trails exist to demonstrate or reconstruct key decisions  made during the conduct of such activities;   13.3.4 in the exercise of rights and performance of its obligations under this  Agreement, such Party shall comply and shall cause its and its Affiliates’  employees and contractors to comply with all Applicable Laws and, without  limiting the generality of the foregoing, it shall not perform any actions that  are prohibited by local or other anti-corruption laws (collectively, “Anti- Corruption Laws”) that may be applicable to such Party.  Without limiting  the generality of the foregoing, neither Party shall make any payments, or  offer or transfer anything of value, to any Government Official or government  employee, to any political party official or candidate for political office or to  any other Third Party, in each case, related to the transaction in a manner that  would violate Anti-Corruption Laws; and 13.3.5 if such Party is Orchard, Orchard shall not, and shall procure that its Affiliates  shall not, after the Effective Date, grant to any Affiliate of Orchard or any  Third Party any license or other rights that would materially reduce or limit  the rights granted to Pharming under this Agreement, restrict or result in a  restriction on Pharming’s ability to Exploit any Licensed Product in  accordance with this Agreement, or that would limit or eliminate the  ownership or control of any Know-How or Patent that would be subject to the  license grant under Section 3.1 in the absence of such agreement or  arrangement.   13.4 Disclaimer of Warranties.  Except for the express warranties set forth herein, neither  Orchard nor Pharming nor any of their respective Affiliates makes any warranties,  express or implied, either in fact or by operation of law, by statute, or otherwise, and each  Party specifically disclaims any other warranties, whether written or oral, express or  implied, including any warranty of quality, merchantability, or fitness for a particular use  or purpose, or any warranty as to the validity of any patents or the non-infringement of  any intellectual property rights of Third Parties. 

 

7897269 v13 87 ARTICLE 14 INDEMNITY 14.1 Indemnification of Orchard.  Pharming shall indemnify Orchard, its Affiliates, and their  respective directors, officers, employees, consultants, contractors and agents  (collectively, the “Orchard Indemnitees”) against any and all losses, damages,  liabilities, penalties and costs (including reasonable attorneys’ fees and costs)  (collectively, “Losses”) in connection with any and all suits, investigations, claims, or  demands of Third Parties (collectively, “Claims”) incurred by or rendered against the  Orchard Indemnitees arising from or occurring as a result of: 14.1.1 the Exploitation of any Licensed Product by or on behalf of any Pharming  Indemnitee or Sublicensee; or 14.1.2 the breach by Pharming of any warranty, representation, covenant, or  agreement made by Pharming in this Agreement; or 14.1.3 the negligence, recklessness or willful misconduct of any Pharming  Indemnitee or Sublicensee;  excluding, in each case of Sections 14.1.1 to 14.1.3, such Losses: (a)  to the extent Orchard  has an indemnification obligation pursuant to Section 14.2 for such Losses, as to which  Losses each Party shall indemnify the other to the extent of their respective liability for  such Losses, or (b) to the extent resulting from any Orchard Indemnitee’s breach of this  Agreement, negligence or wilful misconduct. 14.2 Indemnification of Pharming.  Orchard shall indemnify Pharming, its Affiliates, and its  and their respective directors, officers, employees, consultants, contractors and agents  (collectively, the “Pharming Indemnitees”), against any and all Losses in connection  with any and all Claims incurred by or rendered against the Pharming Indemnitees arising  from or occurring as a result of: 14.2.1 the breach by Orchard of any warranty, representation, covenant, or  agreement made by Orchard in this Agreement; or 

 

7897269 v13 88 14.2.2 the negligence, recklessness or willful misconduct of any Orchard  Indemnitee;  excluding, in each case of Section 14.2.1 and 14.2.2, such Losses: (a) for which Pharming  has an indemnification obligation pursuant to Section 14.1, as to which Losses each Party  shall indemnify the other to the extent of their respective liability for such Losses, or (b) to  the extent resulting from any Pharming Indemnitee’s breach of this Agreement, negligence  or wilful misconduct. 14.3 Indemnification Procedure.  A Party that intends to claim indemnification under this  ARTICLE 14 (the “Indemnitee”) shall promptly notify the indemnifying Party (the  “Indemnitor”) in writing of any Claim in respect of which the Indemnitee intends to  claim such indemnification, and the Indemnitor shall have sole control of the defence or  settlement of such Claim.  The Indemnitee may participate at its Cost in the Indemnitor’s  defence of and settlement negotiations for any Claim with counsel of the Indemnitee’s  own choice.  The indemnity arrangement in this ARTICLE 14 shall not apply to amounts  paid in settlement of any action with respect to a Claim if such settlement is effected  without the consent of the Indemnitor, which consent shall not be unreasonably withheld,  conditioned, or delayed.  The failure to deliver written notice to the Indemnitor within a  reasonable time after the commencement of any action with respect to a Claim shall only  relieve the Indemnitor of its indemnification obligations under this ARTICLE 14 if and  to the extent the Indemnitor is actually prejudiced thereby.  The Indemnitee shall  cooperate fully with the Indemnitor and its legal representatives in the investigation of  any action with respect to a Claim covered by this indemnification. 14.4 Indirect and Consequential Losses.  Except to the extent any such damages are required  to be paid to a Third Party as part of a Claim for which a Party provides indemnification  under this ARTICLE 14, neither Party nor any of its Affiliates shall be liable for any: (i)  indirect or consequential loss, or (ii) loss of profits, loss of revenue, loss of goodwill, or  business interruption, howsoever caused, whether or not direct or indirect, and whether  or not reasonably foreseeable, in each case (i) and (ii) whether in contract, tort,  negligence, breach of statutory duty, or otherwise in connection with or arising in any  

 

7897269 v13 89 way out of the terms of this agreement or the transactions contemplated hereby or the use  of the Licensed Product, even if advised of the possibility of such damage.  The foregoing  limitation of liability shall not operate to limit or exclude either Party’s liability for (a)  death or personal injury, (b) wilful misconduct (including fraud and fraudulent  misrepresentation), or (c) any other liability which, pursuant to Applicable Law, cannot  be limited or excluded. 14.5 Insurance.  Each Party shall have and maintain, at its sole cost, an adequate liability  insurance or self-insurance program (including product liability insurance) to protect  against potential liabilities and risk arising out of activities to be performed under this  Agreement and any agreement related hereto and upon such terms (including coverages,  deductible limits and self-insured retentions) as are customary in the pharmaceutical  industry generally for the activities to be conducted by such Party under this Agreement.   Such liability insurance or self-insurance program shall insure against all types of  liability, including liability for personal injury, physical injury or property damage,  arising out of such Party’s activities hereunder.  This Section 14.5 shall not create any  limitation on the Parties’ liability under this Agreement.  Such insurance information  shall be kept in confidence in the same manner as any other Confidential Information  disclosed by the Parties hereunder. ARTICLE 15 TERM AND TERMINATION 15.1 Term.  This Agreement shall commence on the Effective Date and, unless earlier  terminated as provided herein, shall remain in effect, on a country-by-country basis, until  the expiration of the Royalty Term for the Licensed Product in such country (the  “Term”).  Upon the expiration of the Royalty Term for the Licensed Product in a  particular country, the licences granted to Pharming under Section 3.1 for the Licensed  Product in such country shall become fully-paid, royalty-free, perpetual, and remain  exclusive, and shall continue solely to the limited extent that such licences grant rights  to (i) Know-How that is at such time, and which remains, confidential and/or (ii) Valid  Claims of any Patents licensed to Pharming under Section 3.1.   For clarity, subject to  

 

7897269 v13 90 ARTICLE 4, nothing in this Agreement shall restrict or limit either Party’s (or their  respective Affiliates’ or sublicensees’) ability to use or practice any Know-How  Controlled by Orchard or its Affiliates that subsequently comes within the public domain. 15.2 Termination by Pharming for Convenience.  Pharming shall have the right to terminate  this Agreement for any or no reason: (i) in the event that such termination notice is  submitted prior to the first IND Clearance being received in respect of the Licensed  Product, upon [ninety (90)] days’ prior written notice to Orchard and (ii) in the event that  such termination notice is submitted on or after the first IND Clearance is received in  respect of the Licensed Product, upon [one hundred and eighty (180)] days’ prior written  notice to Orchard, provided that in either case (i) or (ii), such notice is not served by  Pharming within the [18 months] following the Effective Date.   15.3 Termination for Material Breach.  Each Party shall have the right to terminate this  Agreement in the event that the other Party materially breaches this Agreement, and such  breach shall have continued for [ninety (90)] days (or [ten (10)] days with respect to any  payment breach) after receipt from the non-breaching Party of written notice specifying  the breach and requesting its cure, provided that, in the event of a good faith dispute as  to whether the other Party has materially breached this Agreement, the relevant cure  period with respect thereto shall be tolled from the date of receipt from the non-breaching  Party of such written notice and through the resolution to such dispute in accordance with  Section 16.8, and it is understood and agreed that during the pendency of such dispute,  all of the terms and conditions of this Agreement shall remain in effect and the Parties  shall continue to perform all of their respective obligations hereunder, and, if the material  breach in question is cured by the end of the tolled cure period (i.e. prior to resolution of  such dispute in accordance with such applicable provisions), then the non-breaching  Party shall no longer have a right to termination under this Section 15.3 with respect to  such material breach.   15.4 Termination by Orchard for Patent Challenge.  Orchard shall have the right to terminate  this Agreement, upon [sixty (60)] day advance written notice to Pharming, during which  [sixty (60)] day period, the Parties shall confer in good faith on the resolution of any  

 

7897269 v13 91 disputed issue, in the event that Pharming or any of its Affiliates or Sublicensees directly  asserts in its own name, or directs a Third Party to assert, a Patent Challenge, provided  that, Orchard’s right to terminate under this Section 15.4 shall not apply if: (a) Pharming  or any of its Affiliates or Sublicensees withdraws such Patent Challenge, or causes such  Patent Challenge to be withdrawn, within the [sixty (60)]-day notice period, or (b) such  Patent Challenge is a defense against a claim, action or proceeding asserted by or on  behalf of Orchard (or any of its Affiliates) against Pharming or any of its Affiliates or  Sublicensees, or otherwise in connection with an assertion of a cross-claim or a  counterclaim.  For purposes of this Section 15.4, “Patent Challenge” means any  challenge in a legal or administrative proceeding to the patentability, validity, ownership  or enforceability of any of the Orchard Background Patents, Orchard Conditioning  Patents, Orchard Collaboration Patents or Orchard Platform Patents (or any claim  thereof), including by: (x) filing or pursuing a declaratory judgment action in which any  of the Orchard Background Patents, Orchard Conditioning Patents, Orchard  Collaboration Patents or Orchard Platform Patents is alleged to be invalid or  unenforceable; (y)  filing a request for or pursuing a re-examination of any of the Orchard  Background Patents, Orchard Conditioning Patents, Orchard Collaboration Patents,  Orchard Platform Patents, (other than with Orchard’s written agreement), or becoming a  party to or pursuing an interference; or (z) filing or pursuing any opposition, cancellation,  nullity, or other like proceedings against any of the Orchard Background Patents, Orchard  Conditioning Patents, Orchard Collaboration Patents or Orchard Platform Patents.  15.5 Termination for Insolvency.  In the event that a Party (a) files or resolves to file for  protection under (i) bankruptcy, (ii) insolvency, (iii) reorganization (save in the case of a  solvent reorganization), (iv) restructuring (save in the case of a solvent restructuring), or  (v) business rescue laws applicable to that Party in any jurisdiction; (b) makes an  assignment for the benefit of creditors; (c) appoints or suffers appointment of a receiver,  administrative receiver, bailiff or trustee or analogous appointment over substantially all  of its property; (d) proposes or implements a scheme of arrangement, company voluntary  arrangement or other agreement of composition, compromise or extension of its debts  (other than in circumstances where such scheme, arrangement or agreement would have  no adverse impact on the rights of any other Party to this Agreement); (e) proposes or is  

 

7897269 v13 92 a party to any dissolution or liquidation or ceases continuation of substantially all of its  business; (f) is subject to any filing of an application or a petition under any (i)  bankruptcy, (ii) insolvency, (iii) reorganization (save in the case of a solvent  reorganization), (iv) restructuring (save in the case of a solvent restructuring), or (v)  business rescue laws or has any such application or petition filed against it that, in any  such case, is not discharged within [sixty (60)] days of the filing thereof; or (g) admits in  writing its inability generally to meet its obligations as they fall due in the general course  (providing always that a request for fulfilment of a specific obligation to be postponed  for a specified time shall not amount to an admission that the Party is generally unable to  meet its obligations as they fall due), then the other Party may terminate this Agreement  in its entirety effective immediately upon written notice to such Party. 15.6 Effects of Termination. 15.6.1 Licence Termination.  Upon any termination of this Agreement, all rights  and licences granted under Section 3.1 shall terminate and be of no further  force or effect.  For the avoidance of doubt, the licence granted under Section  3.2.2 shall survive termination of this Agreement. 15.6.2 Additional Remedies of Pharming in Lieu of Termination of Agreement  by Pharming for Orchard’s Breach.  In the event that it is finally  determined under Section 16.8 that Pharming has the right to terminate this  Agreement under Section 15.3 (for clarity, subject to the provisions of Section  15.3 with respect to cure and tolling), and if such determination occurs prior  to the later of: (i) the successful completion of the technology transfer  activities under Sections 8.1.1(c) and (d); and (ii) the date when the first Drug  Approval Application in respect of the Licensed Product is submitted by  Pharming, its Affiliates or Sublicensees to the applicable Regulatory  Authority anywhere in the Territory, then, provided that the arbitrator has  determined under Section 16.8, in writing, that the remedy set out in this  Section 15.6.2 would be a reasonable and proportionate remedy, then  Pharming shall have the right to elect, by providing written notice to Orchard  

 

7897269 v13 93 referencing this Section 15.6.2 not later than [thirty (30)] days from such  determination under Section 16.8 (the “Election Notice”), as Pharming’s sole  and exclusive remedy with respect to such material breach by Orchard, to  have this Agreement continue in full force and effect, and to have the  following to apply: (a) Pharming’s obligations to pay Development Milestone Payments,  Sales Milestone Payments and Royalty Payments shall be reduced  to [seventy five percent (75%)] of the amount that would otherwise  have been payable under this Agreement;  (b) Orchard shall, subject to the requirements of Applicable Law,  including any regulatory or ethical requirements, and the orderly  completion and wind-down of all work in progress, promptly cease  performing any further activities under the Pre-Clinical Plan or  Clinical Development Plan and the JSC shall be disbanded; and  (c) to the extent the Manufacturing Process has not already been  successfully transferred to Pharming, Orchard shall, at its Cost, use  Reasonable Efforts to transfer such Manufacturing Process to  Pharming, and, to the extent a technology transfer plan has been  agreed pursuant to the subsequent sentence, in accordance with any  technology transfer plan agreed between the Parties. The Parties will  promptly agree, in good faith, a technology transfer plan, which will  include the transfer of all information and documents necessary to  allow Pharming to assume and carry out the terminated activities  previously ascribed to be performed by Orchard under the Pre- Clinical Plan and Clinical Development Plan.  Notwithstanding the  foregoing, Orchard shall not be required to provide support or  assistance or to perform any activities under this Section 15.6.2(c)  after the expiry of [six (6)] months from the date of receipt by  

 

7897269 v13 94 Orchard of the notice sent by Pharming under this Section 15.6.2,  and for clarity: (1) Pharming’s rights under this Section 15.6.2 shall only apply if  the material breach by Orchard of this Agreement has not been cured within  the applicable cure period under Section 15.3; and (2) if Pharming has not  provided any Election Notice within [thirty (30)] days after such final  determination, Pharming shall continue to have the right to terminate this  Agreement under Section 15.3 or to have the Agreement continue in full force  and effect, and, in addition, to pursue any other rights or remedies available  to Pharming. 15.6.3 Development Wind-Down or Transition.   (a) Clinical Studies.  Pharming shall, in its discretion, on written notice  to Orchard, either (i) wind down all Clinical Studies that were  Initiated by or on behalf of it prior to the termination of this  Agreement (“Ongoing Clinical Studies”), or (ii) be responsible for  completing (in accordance with the established protocols) all  Ongoing Clinical Studies; provided, that if requested by Orchard in  writing, Pharming shall transition such Ongoing Clinical Studies to  Orchard.  Pharming shall not commence any Clinical Studies with  respect to any Licensed Product at any time after it has given or  received a notice of termination pursuant to this ARTICLE 15.  (b) Cooperation.   (i) In the event that Orchard requests to assume responsibility  for any of the Ongoing Clinical Studies, Pharming shall  provide reasonable cooperation to Orchard and its  designee(s) to facilitate, and the Parties shall use reasonable  efforts to effect, a reasonable, orderly, and prompt transition  of the Ongoing Clinical Studies and other Development  

 

7897269 v13 95 activities relating to the Licensed Product to Orchard and/or  its designee(s) following delivery of notice of termination so  that Orchard is able to assume responsibility for the same as  of the effective date of termination (unless such termination  is disputed by either Party).  Where the same cannot be fully  achieved prior to the effective date of termination, Pharming  shall continue to provide such reasonable cooperation to  Orchard and its designee(s) until such transition has been  completed.  Without limiting the generality of the foregoing,  in the event of such termination of this Agreement, Pharming  shall provide reasonable consultation and assistance after  termination, for the purpose of transferring or transitioning  to Orchard, Pharming Background Know-How and  Pharming Collaboration Know-How not already in  Orchard’s possession in each case, to the extent reasonably  necessary or useful for Orchard to continue the Ongoing  Clinical Studies of the Licensed Product. (ii) In the event this Agreement is terminated by Pharming for  convenience pursuant to Section 15.2, by Orchard for  Pharming’s breach pursuant to Section 15.3, by Orchard in  the event of a Patent Challenge pursuant to Section 15.4, or  by Orchard in the event of Pharming’s insolvency pursuant  to Section 15.5, Pharming shall bear all reasonable Costs  incurred by either Party in the disposition of Ongoing  Clinical Studies as set forth in this Section 15.6.3. (iii) In the event this Agreement is terminated by Pharming for  Orchard’s breach pursuant to Section 15.3, or by Pharming  in the event of Orchard’s insolvency pursuant to Section 15.5  then Orchard shall bear all reasonable Costs of the activities  performed by either Party under this Section 15.6. 

 

7897269 v13 96 (iv) In the event Orchard has requested to assume responsibility  for such Ongoing Clinical Studies, then at the request of  Orchard, as soon as reasonably practicable thereafter the  Parties shall in good faith negotiate a Transitional Assistance  Agreement, setting out in further detail, the terms on which  Orchard shall assume such responsibility including, if  applicable, details of the assistance set out in Section  15.6.3(b)(i) to be provided.  The aim of such agreement shall  be to ensure that Orchard is able to assume responsibility for  any Ongoing Clinical Studies and any other Development  activities relating to the Licensed Product as promptly and  efficiently as possible, to ensure that all necessary regulatory  filing(s) or submission(s) are maintained and filed for in  good time and that Orchard has access to all documents,  records, information, and correspondence reasonably  required in connection therewith. 15.6.4 Purchase of Inventory.  In the event this Agreement is terminated by  Pharming for convenience pursuant to Section 15.2 or by Orchard for  Pharming’s breach pursuant to Section 15.3, Orchard shall have the right, at  its discretion, to purchase from Pharming any or all of the inventory of the  Licensed Product, and inventory of all plasmids and vectors relevant to the  manufacture of Licensed Product, held by or on behalf of Pharming at the  date of termination at a price equal to Pharming’s Manufacturing cost with no  mark-up; provided that Pharming shall be able to retain a sufficient amount  of inventory to complete the termination of its Development or  Commercialization activities.  Orchard shall notify Pharming within [sixty  (60)] days of the effective date of termination whether Orchard elects to  exercise such right. 15.6.5 Contract Transfer.  In the event this Agreement is terminated by Pharming  for convenience pursuant to Section 15.2, by Orchard for Pharming’s breach  

 

7897269 v13 97 pursuant to Section 15.3, by Orchard in the event of a Patent Challenge  pursuant to Section 15.4, or by Orchard in the event of Pharming’s insolvency  pursuant to Section 15.5, at Orchard’s request, Pharming shall use  Commercially Reasonable Efforts to assign to Orchard or its designee all  then-existing commercial agreements entered into between Pharming and a  Third Party relating to the Licensed Products (or, in the case of such  commercial agreements that relate to the Licensed Products and other product  being Developed or Commercialized by or on behalf of Pharming, the rights  and obligations under such commercial agreements solely with respect to the  Licensed Product) to the extent reasonably necessary for Orchard to continue  the Development and/or Commercialization of the Licensed Product. 15.6.6 Exclusivity.  For clarity, upon termination of this Agreement, each Party’s  obligations under ARTICLE 4 shall terminate. 15.6.7 Licenses and Patent Prosecution.  Upon any termination of this Agreement,  Orchard hereby grants to Pharming a non-exclusive, sublicensable right under  the Orchard Background IP, Orchard Collaboration IP, Orchard Conditioning  IP, Platform IP and Orchard’s interest in the Joint Collaboration IP and the  Joint Conditioning IP solely for the purposes of performing Pharming’s  remaining obligations under this Agreement and completing any Ongoing  Clinical Studies.  For clarity, upon termination of this Agreement, Pharming’s  rights in respect of the prosecution and enforcement of any Orchard  Background Patents, Orchard Conditioning Patents, Orchard Collaboration  Patents, Platform Patents and Product Specific Patents shall terminate.   15.6.8 Confidential Information.  Upon termination of this Agreement, each Party  shall return or cause to be returned to the other Party all Confidential  Information of the other Party as provided in Section 12.6.   15.6.9 Remedies.  Except as otherwise expressly provided herein, termination of this  Agreement in accordance with the provisions hereof shall not limit remedies  that may otherwise be available in law or equity. 

 

7897269 v13 98 15.6.10 Negotiation for IP Licence.  Upon termination of this Agreement by Orchard  pursuant to Section 15.3, 15.4, or 15.5, or by Pharming pursuant to Section  15.2, at Orchard’s request, Pharming hereby grants to Orchard a licence in the  Field under any Patents and Know-How Controlled by Pharming as of the  effective date of such termination, on substantially the terms of this  Agreement save as to the diligence obligations, to the extent necessary to  Exploit the Licensed Product and shall include a royalty of up to [five percent  (5%)]  on the applicable Net Sales (each reference to “Pharming, its Affiliates,  or Sublicensees” in such definition shall be construed as “Orchard, its  Affiliates or their sublicensees” for the purposes of the definition of Net Sales  in this Section 15.6.10) of the Licensed Product but shall otherwise be fully  paid-up.  In the event that the Parties cannot agree the appropriate royalty rate  or any other terms of such licence, the royalty rate and/or other terms shall be  determined by the dispute resolution processes set out in Section 16.8. 15.6.11 Accrued Rights; Surviving Obligations.  Termination or expiration of this  Agreement for any reason shall be without prejudice to any rights that shall  have accrued to the benefit of a Party prior to such termination or expiration.   Such termination or expiration shall not relieve a Party from obligations that  are expressly indicated to survive the termination or expiration of this  Agreement.  Without limiting the foregoing, the following Articles and  Sections shall survive any such termination or expiration: [ARTICLE 1,  ARTICLE 12, ARTICLE 14, and ARTICLE 16; and Section 3.6, Sections  10.1 to 10.4 (for the duration of any outstanding payment obligations under  this Agreement), Section 10.5 (for the duration of any remaining obligations  set out therein), and Section 11.1 and Section 15.6]. ARTICLE 16 MISCELLANEOUS 16.1 Force Majeure.  Neither Party shall be held liable or responsible to the other Party or be  deemed to have defaulted under or breached this Agreement for failure or delay in  

 

7897269 v13 99 fulfilling or performing any term of this Agreement when such failure or delay is caused  by or results from events beyond the reasonable control of the non-performing Party,  including fires, floods, earthquakes, hurricanes, embargoes, shortages, epidemics,  pandemics, quarantines, war, acts of war (whether war be declared or not), terrorist acts,  insurrections, riots, civil commotion, strikes, lockouts, or other labour disturbances  (whether involving the workforce of the non-performing Party or of any other Person),  acts of God or acts, omissions or delays in acting by any Governmental Authority (except  to the extent such delay results from the breach by the non-performing Party or any of its  Affiliates of any term or condition of this Agreement).  The non-performing Party shall  notify the other Party of such force majeure within [thirty (30)] days after such  occurrence by giving written notice to the other Party stating the nature of the event, its  anticipated duration, and any action being taken to avoid or minimize its effect.  The  suspension of performance shall be of no greater scope and no longer duration than is  necessary and the non-performing Party shall use Reasonable Efforts to remedy its  inability to perform. 16.2 Export Control.  Neither Party shall export, directly or indirectly, any technical  information acquired from the other Party under this Agreement or any products using  such technical information to a location or in a manner that at the time of export requires  an export licence or other governmental approval, without first obtaining the written  consent to do so from the appropriate agency or other governmental entity in accordance  with Applicable Law. 16.3 Change of Control.   16.3.1 If either Party undergoes a Change of Control with a Third Party, and  immediately prior to such Change of Control that Party or its Affiliates is  performing any Competitive Program: (a) such Party (or its successor) shall  provide the other Party with written notice of such Change of Control, within  [ten (10)] Business Days following the earlier of the first public  announcement of the execution of any agreement with respect to such  transaction and the closing date of such transaction; and (b)  such Party will  

 

7897269 v13 100 not be in breach of the restrictions set forth in Section 4.1 due to such Change  of Control with such a Third Party, and such Third Party (or such Affiliate)  may continue to perform, or commence the performance of, the applicable  Competitive Program, so long as such Party (or its successor) does one of the  following: (a) as soon as is practicable following the Change of Control of such  Party or initiation of such Competitive Program, establish and  implement appropriate firewall procedures to segregate the  Competitive Program (and the personnel conducting such activities)  from the activities performed by or on behalf of such Party pursuant  to this Agreement, including ensuring that personnel directly  involved in working in such Competitive Program shall not have  access to any Confidential Information of either Party with respect  to activities under this Agreement, provided that such firewall  procedures and obligation to segregate shall not extend to any  accounts, financial or administrative personnel and that the directors  of the applicable Third Party may receive general updates on  progress and all financial information with respect to both the  Competitive Program and the activities performed under this  Agreement; or (b) divest, or cause its relevant Affiliates to divest, whether by sale,  assignment, exclusive license or otherwise, its interest in such  Competitive Program within [twelve (12)] months following such  Change of Control. Where a Party implements firewalls pursuant to Section 16.3.1(a), such Party  (or its successor) shall provide the other Party with a reasonably detailed  written description of the applicable firewall procedures as soon as reasonably  practicable following the consummation of such Party’s Change of Control  and the other Party shall have the opportunity to comment on such firewall  

 

7897269 v13 101 procedures, which comments such Party shall consider in good faith for  incorporation into such procedures.  For clarity, if the Party undergoing such Change of Control is Pharming, and  such Change of Control of Pharming is by any Pharming Competitive  Acquiror and such Pharming Competitive Acquiror has any Additional  Competitive Program, the provisions of Section 16.4 shall also apply in  respect of such Additional Competitive Program. 16.4 Pharming (or its successor) shall provide Orchard with written notice of any Change of  Control of Pharming by any Pharming Competitive Acquiror that has any Additional  Competitive Program(s) immediately prior to such Change of Control within [ten (10)]  Business Days following the earlier of the first public announcement of the execution of  any agreement with respect to such transaction and the closing date of such transaction  (the “Pharming COC Notification Date”).  In the event of a Pharming Change of  Control, if the Pharming Competitive Acquiror has or initiates any Additional  Competitive Program(s): (a) Pharming (or its successor) will do at least one of the following with  respect to each such Additional Competitive Program: (i) as soon as is practicable following the Change of Control of  Pharming or initiation of the Additional Competitive  Program, establish and implement appropriate firewall  procedures to segregate all activities (and the personnel  conducting such activities) in such Additional Competitive  Program from the activities performed by or on behalf of  Pharming pursuant to this Agreement, including ensuring  that personnel involved in working in such Competitive  Program shall not have access to any Confidential  Information of either Party with respect to activities under  this Agreement; or 

 

7897269 v13 102 (ii) divest, or cause its relevant Affiliates to divest, whether by  sale, assignment, exclusive license or otherwise, its interest  in such Additional Competitive Program within [twelve  (12)] months following such Change of Control of  Pharming. (b) Where Pharming implements firewalls pursuant to Section  16.4(a)(i), Pharming (or its successor) shall provide Orchard with a  reasonably detailed written description of the applicable firewall  procedures as soon as reasonably practicable following the  consummation of such Pharming Change of Control and Orchard  shall have the opportunity to comment on such firewall procedures,  which comments Pharming shall consider in good faith for  incorporation into such procedures. (c) Following the Pharming Change of Control, Orchard shall have the  right to limit the information or reports otherwise required to be  provided to Pharming or the JSC hereunder to only that which is  essential to ensure Pharming’s compliance with its obligations  hereunder and Orchard shall have the right to refrain from including  in such information or reports commercially sensitive information  of Orchard (as Orchard may determine in its sole discretion). For clarity, following any change of control (including any change in ownership) of either  Party, such Party shall continue to perform its obligations under this Agreement in accordance  with the terms of this Agreement. 16.5 Assignment.  Except as expressly provided hereunder, neither this Agreement nor any  rights or obligations hereunder may be assigned or otherwise transferred by either Party  without the prior written consent of the other Party (which consent shall not be  unreasonably withheld, conditioned, or delayed); provided, however, that either Party  may assign or otherwise transfer this Agreement and its rights and obligations hereunder  without the other Party’s consent to an Affiliate, provided that if the Person to which this  

 

7897269 v13 103 Agreement is assigned ceases to be an Affiliate of the assigning Party, the Agreement  shall be automatically assigned back to the assigning Party or its successor.  In addition,  either Party shall have the right to assign its rights and obligations under this Agreement  to an acquiror of all or substantially all of its assets to which this Agreement relates.  The rights and obligations of the Parties under this Agreement shall be binding upon and  inure to the benefit of the successors and permitted assigns of the Parties, and the name  of a Party appearing herein will be deemed to include the name of such Party’s successors  and permitted assigns to the extent necessary to carry out the intent of this Section 16.5.   Any assignment not in accordance with this Section 16.5 shall be null and void. 16.6 Severability.  If, for any reason, any part of this Agreement is adjudicated invalid,  unenforceable, or illegal by a court of competent jurisdiction, such adjudication shall not,  to the extent feasible, affect or impair, in whole or in part, the validity, enforceability, or  legality of any remaining portions of this Agreement.  All remaining portions shall  remain in full force and effect as if the original Agreement had been executed without  the invalidated, unenforceable, or illegal part.  In such event, the Parties shall negotiate  promptly to replace such invalid, unenforceable, or illegal part with a valid, enforceable,  and legal provision which most closely effectuates the Parties’ original intent. 16.7 Governing Law.  This Agreement or the performance, breach, or termination hereof shall  be interpreted, governed by, and construed in accordance with the laws of [England and  Wales], excluding any conflicts or choice of law rule or principle that might otherwise  refer construction or interpretation of this Agreement to the substantive law of another  jurisdiction; provided, that all questions concerning (a) inventorship of Patents under this  Agreement shall be determined in accordance with Section 11.1.1 and (b) the  construction or effect of Patents shall be determined in accordance with the laws of the  country or other jurisdiction in which the particular Patent has been filed or granted, as  the case may be.  The parties agree to exclude the application to this Agreement of the  United Nations Convention on Contracts for the International Sale of Goods. 16.8 Dispute Resolution.   

 

7897269 v13 104 (a) Except for disputes resolved by the procedures set forth in Section  2.8.2, if a dispute arises between the Parties in connection with or  relating to this Agreement or any document or instrument delivered  in connection herewith (a “Dispute”), it shall be resolved pursuant  to this Section 16.8.  Any Dispute shall first be referred to the Senior  Officers of the Parties, who shall confer in good faith on the  resolution of the issue.  Any final decision mutually agreed to by the  Senior Officers shall be conclusive and binding on the Parties.  If  the Senior Officers are not able to agree on the resolution of any  such issue within [thirty (30)] days (or such other period of time as  mutually agreed by the Senior Officers) after such issue was first  referred to them, then, if a Party wishes to pursue further resolution  of such Dispute, such Dispute shall be resolved in accordance with  Section 16.8(b); (b) Subject to Section 16.8(a), any Dispute shall be referred to and  finally resolved by arbitration administered by the [London Court of  International Arbitration] under the [Rules of Arbitration in force as  of January 1, 2021] (the “[LCIA] Rules”) by a sole arbitrator who  shall be appointed in accordance with the [LCIA] Rules.  The legal  seat of the arbitration shall be [London, England].  The arbitration  shall be conducted in the English language.  The award issued by  the arbitrator shall be final and binding upon the Parties to the  Dispute and shall not be subject to appeal.  The parties to this  Agreement agree that a judgment recognizing and enforcing the  award may be entered in any court with jurisdiction, and irrevocably  submit to the jurisdiction of any such court over the parties or their  assets for purposes of recognizing and enforcing the award.  The  Parties hereby agree that the arbitration agreement set out in this  Section 16.8(b) shall be governed by the laws of [England and  Wales]. 

 

7897269 v13 105 16.9 Interim Relief.  Notwithstanding anything herein to the contrary, nothing in Section 16.8  shall preclude either Party from seeking interim or provisional relief, including a  temporary restraining order, preliminary injunction, or other interim equitable relief  concerning a Dispute, if necessary to protect the interests of such Party.  This Section  shall be specifically enforceable. 16.10 Notices.  Any notice or other communication required under this Agreement shall be in  writing, shall refer specifically to this Agreement, and shall be deemed given only if (a)  delivered by hand or (b) sent by internationally recognized overnight delivery service  addressed to the Parties at their respective addresses specified below or to such other  address as a Party may specify in accordance with this Section 16.10.  Such notice shall  be deemed to have been given as of the date delivered by hand or on the second (2nd)  Business Day (at the place of delivery) after deposit with an internationally recognized  overnight delivery service.  This Section 16.10 is not intended to govern the day-to-day  business communications necessary between the Parties in performing their obligations  under the terms of this Agreement. 

 

7897269 v13 106 If to Pharming, to:  Pharming Technologies B.V. Darwinweg 24, Leiden 2333 CR, The Netherlands Attn: Legal Department, With a copy to: Pharming Healthcare, Inc. 10 Independence Blvd, Warren, New Jersey 07059  Attn: Legal Department If to Orchard, to:  Orchard Therapeutics (Europe) Limited 108 Cannon Street London EC4N 6EU Attention: Legal Department [legalnotices@orchard-tx.com] With a copy to:  (i) Orchard Therapeutics (Europe) Limited 108 Cannon Street London EC4N 6EU Attention: Business Development Department and (ii) [business.development@orchard-tx.com] 16.11 Entire Agreement; Amendments.  This Agreement, together with the Schedules attached  hereto, sets forth and constitutes the entire agreement and understanding between the  Parties with respect to the subject matter hereof and all prior agreements, understandings,  promises, and representations, whether written or oral, with respect thereto are  

 

7897269 v13 107 superseded hereby (including that certain Confidential Disclosure Agreement between  the Parties dated 21 January 2021; provided that all “Confidential Information” disclosed  or received under such Confidential Disclosure Agreement shall be deemed  “Confidential Information” under this Agreement and subject to the terms and conditions  of this Agreement).  Each Party confirms that it is not relying on any representations or  warranties of the other Party except as specifically set forth in this Agreement.  No  amendment, modification, release, or discharge shall be binding upon the Parties unless  in writing and duly executed by authorized representatives of both Parties. 16.12 English Language.  This Agreement shall be written and executed in, and all other  communications under or in connection with this Agreement shall be in, the English  language.  Any translation into any other language shall not be an official version thereof,  and in the event of any conflict in interpretation between the English version and such  translation, the English version shall control. 16.13 Waiver and Non-Exclusion of Remedies.  Any term or condition of this Agreement may  be waived at any time by the Party that is entitled to the benefit thereof, but no such  waiver shall be effective unless set forth in a written instrument duly executed by the  Party waiving such term or condition.  The waiver by either Party of any right or of the  failure to perform or of a breach by the other Party shall not be deemed a waiver of any  other right or of any other breach or failure by such other Party whether of a similar  nature or otherwise.  The rights and remedies provided herein are cumulative and do not  exclude any other right or remedy provided by Applicable Law or otherwise available  except as expressly set forth herein. 16.14 No Benefit to Third Parties.  Except as provided in ARTICLE 14, covenants and  agreements set forth in this Agreement are for the sole benefit of the Parties hereto and  their successors and permitted assigns, and they shall not be construed as conferring any  rights on any other Persons. 16.15 Further Assurance.  Each Party shall duly execute and deliver, or cause to be duly  executed and delivered, such further instruments and do and cause to be done such further  acts and things, including the filing of such assignments, agreements, documents, and  

 

7897269 v13 108 instruments, as may be necessary or as the other Party may reasonably request in  connection with this Agreement or to carry out more effectively the provisions and  purposes hereof, or to better assure and confirm unto such other Party its rights and  remedies under this Agreement. 16.16 Relationship of the Parties.  Orchard and Pharming are independent contractors and the  relationship between the Parties shall not constitute a partnership, joint venture, or  agency, including for tax purposes.  Neither Party shall have the authority to make any  statements, representations, or commitments of any kind, or to take any action, which  shall be binding on the other Party, without the prior written consent of such other Party.   All persons employed by a Party shall be employees of such Party and not of the other  Party and all costs and obligations incurred by reason of any such employment shall be  for the account and Cost of such Party. 16.17 Counterparts; Facsimile Execution.  This Agreement may be executed in two (2) or more  counterparts, each of which shall be deemed an original, but all of which together shall  constitute one (1) and the same instrument.  This Agreement may be executed by  facsimile or electronically transmitted signatures and such signatures shall be deemed to  bind each party hereto as if they were original signatures.  {SIGNATURE PAGE FOLLOWS} 

 

7897269 v13 THIS RESEARCH COLLABORATION AND LICENCE AGREEMENT IS EXECUTED by the  authorized representatives of the Parties as of the Effective Date. ORCHARD THERAPEUTICS (EUROPE)  LIMITED By: Name:  Title:  PHARMING TECHNOLOGIES B.V. By: Name:  Title:  

 

7897269 v13 Schedule 1.123 Pre-Clinical Plan [Orchard’s Activities Efficacy MS 1 (CD34+  HSC) Determine serum levels of C1INH  achievable by HSC-GT: expression  in human haemopoietic compartment  in NSG-SGM3 mice • Exp 1.1 (initiated w/c 05APR2021 – End date +10  months for serial sampling/ stability) • Exp 1.2 – 1.3 (End date +10 months) MS 2 (CD34+  & Lin-) Evaluate & optimise non- myeloablative conditioning regimens  in WT mice & CD34-engrafted NSG  mice • Exp 2.1-2.2 Generate CD34+ NSG reconst. mice  (12 weeks) & track BM CD34 depletion • Exp 2.3-2.4 Track BM lineage- depletion in WT  mice MS 3 (Lin-  HSC) Demonstrate restoration of SPG-1  and prevention of vascular  permeability phenotype by LV- SERPING1 gene therapy in  SERPING1-/- mouse • Exp 3.1-3.3 Generate LV-SPG-1 BmChimeric  mice & evaluate vascular permeability • Exp 3.4-3.6 Generate LV-SPG-1 BmChimeric  mice (Non-Myeloablative conditioning) &  evaluate vascular permeability MS 4 (CD34+) Demonstrate reconstitution of SPG-1  & C1-INH production in HAE-donor  (or mock-KO) CD34+HSC :  expression in human haemopoietic  compartment in NSG-SGM3 mice • Expt 4.1-4.6 Generate CD34+ NSG reconst. mice  (16 weeks) serum C1-Inhibitor detection CMC process development and manufacturing Vector process development (including  USP/DSP) • For PhI/II, deploy existing process already in  place for other Orchard programs (eg Libmeldy).  Includes 1 engineering before GMP run.  • Further subsequent improvements to optimize  vector manufacturing for pivotal/commercial  phase TBD in Clinical Plan Drug product development • For PhI/II, 4-6 months of development with  optimisation of existing processes then TT to  GMP at CDMO. 

 

7897269 v13 Drug product tech transfer to CDMO • Will involve TT plan, protocols, CDMO training,  PD and engineering runs prior to GMP TT/PPQ  (and comparability) runs. Analytical method development, qualification  and validation • Will rely on existing platform methods apart from  1-2 transgene specific (ID and functional potency)  to be developed by Orchard for vector and the DP,  then TT and qualification for PhI/II subsequent  validation Safety & biodistribution Pivotal in vivo biodistribution & toxicology study  in NSG mice • Confirm safety of the final candidate product  manufactured according to the process intended for  the clinic • Biodistribution/tumorigenicity endpoints  • Test item: Human CD34+HSPCs (from healthy donors)  transduced with lentiviral vector (pre-GMP or GMP  grade) • Animal Model: Immune-deficient mouse strain  • Duration: 5 -6 months in-life phase  Genotoxicity investigations • Insertional mutagenesis evaluation in in vitro and in  vivo models  • Test Item: cells pre-dose and on tissues at end of in- life phase of the pivotal pre-clinical POC/efficacy and  tox/biodistribution studies • Animal Model: immune-deficient mouse strain (same  mice as above)  • Duration: 5 -6 months in-life phase Pharming’s Activities None identified at the Effective Date] 

 

7897269 v13 Pre-Clinical Budget 1. [Total HAE project development costs to IND Total HAE project development costs to IND $m 2021 2022 2023 Total Pre-clinical/disc FTE 0.6 1.5 1.2 3.3 Pre-clinical/disc external 1 0.5 1 2.5 CMC FTE 0.3 1.8 2.4 4.5 CMC external 0.3 5.9 0.5 6.8 Total 2.2 9.7 5.1 17.1 2. HAE product development discovery/pre-clinical costs    HAE product development discovery/pre- clinical costs Total 2021 2022 2023 Discovery and pre-clinical external costs Costs  ($m) 2021 2022 2023 In vitro target validation & PoC 0.5 0.5 0.0 0.0 In vivo PoC in disease model 0.5 0.5 0.0 0.0 Human cells transduction opt 0.5  0.0 0.5 0.0 Pivotal tox & biodistribution study         1  0.0 0.0 1 Total $2.5 1 0.5 1 FTEs Costs  ($m) 2021 2022 2023 Disc 1.2 0.3 0.6 0.3 Pre-clin 1.35 0.2 0.6 0.6 Reg/PM/PL 0.75 0.2 0.3 0.3 Total FTE cost 3.3 0.6 1.5 1.2 Costs ($m) 1.6 2 2.2 

 

7897269 v13 3.  HAE product development CMC costs HAE product development CMC external costs Costs  ($m) 2021 2022 2023 Pre-IND costs Drug product process development: 1.2 0 1.2 0 Materials and consumables costs for internal cell  PD & characterization 0.45 0.0 0.45 0.0 Healthy donor apheresis 0.5 0.0 0.5 0.0 Product specific method development 0.25 0.0 0.25 0.0 Vector process development and manufacture: 4.3 0.3 3.5 0.5 Transgene plasmid manufacture (GMP-S) 0.75 0.2 0.5   0.0 3 x Helper plasmid manufacture 0.3 0.1 0.2   0.0 Vector GMP manufacture (2 x batches) 1   0.0 0.5 0.5 Vector development consumables 0.5   0.0 0.5   0.0 Vector development and manufacture CDMO FTE  time 1.75           0.0 1.8   0.0 Tech transfer (assuming only for DP) + GMP 1.25 1.25 Total through to IND 6.75 0.3 5.9 0.5 HAE product development CMC Orchard FTE  costs Costs  ($m) 2021 2022 2023 Pre-IND costs Vector development 1.4 0.2 0.6 0.6 Drug product development 1.4 0.2 0.6 0.6 Analytical development 0.9 0.0 0.3 0.6 Other tech ops (supply chain, QA, CMC program management, CMC lead etc.) 0.9 0.0 0.3 0.6 Total pre-IND OTL FTE costs 4.5 0.3 1.8 2.4 ] 

 

7897269 v13  Schedule 1.127 Product Specific Patent Application  No. Priority  Date Filing  Date Status Title [USSN  63/066,011 August 14,  2020 August  14, 2020 Pending COMPOSITIONS AND METHODS FOR  TREATING OR PREVENTING  HEREDITARY ANGIOEDEMA] 

 

7897269 v13 Schedule 1.84 Orchard Background Patents The Product Specific Patent set out in Schedule 1.127, and all Patents claiming priority from or  arising from such Product Specific Patent.  

 

Schedule 12.4 Form of Press Releases Orchard Therapeutics and Pharming Group Announce  Collaboration to Develop and Commercialize ex vivo HSC Gene  Therapy for Hereditary Angioedema Highlights the broader potential of Orchard’s ex vivo autologous HSC gene therapy platform  approach in new and larger indications Reinforces Pharming’s commitment to the HAE community and utilizes its relevant clinical  expertise and global commercialization infrastructure Companies to host joint investor call at 8:00 a.m. EDT / 2:00 p.m. CEST BOSTON, LONDON and LEIDEN, The Netherlands, July 1, 2021 -- Orchard Therapeutics (Nasdaq: ORTX), a  global gene therapy leader, and Pharming Group N.V. (Euronext Amsterdam: PHARM/Nasdaq: PHAR), a  global, commercial stage biopharmaceutical company, today announced a strategic collaboration to  research, develop, manufacture and commercialize OTL-105, a newly disclosed investigational ex vivo  autologous hematopoietic stem cell (HSC) gene therapy for the treatment of hereditary angioedema (HAE),  a life-threatening rare disorder that causes recurring swelling attacks in the face, throat, extremities and  abdomen. OTL-105 is an investigational HSC gene therapy designed to increase C1 esterase inhibitor (C1-INH) in HAE  patient serum to prevent hereditary angioedema attacks. OTL-105 inserts one or more functional copies of  the SERPING1 gene into patients own HSCs ex vivo which are then transplanted back into the patient for  potential durable C1-INH production. In preclinical studies, to date, OTL-105 demonstrated high levels of  SERPING1 gene expression via lentiviral-mediated transduction in multiple cell lines and primary human  CD34+ HSCs. Furthermore, the program achieved production of functional C1-INH protein, as measured by  a clinically validated assay. Under the terms of the collaboration, Pharming has been granted worldwide rights to OTL-105 and will be  responsible for clinical development, regulatory filings, and commercialization of the investigational gene  therapy, including associated costs. Orchard will lead the completion of IND-enabling activities and oversee  manufacturing of OTL-105 during pre-clinical and clinical development, which will be funded by Pharming.  In addition, both companies will explore the application of non-toxic conditioning regimen for use with OTL- 105 administration. Orchard will receive an upfront payment of $17.5 million comprising $10 million in cash and a $7.5 million  equity investment from Pharming at a premium to Orchard's recent share price. Orchard is also eligible to  receive up to $189.5 million in development, regulatory and sales milestones as well as mid-single to low  double-digit royalty payments on future worldwide sales. 

 

“Given the combination of our expertise in HSC gene therapy with Pharming’s long-standing legacy and  experience, we have the potential to reinvent the treatment paradigm for HAE by providing people living  with this life-threatening disorder a sustained therapy with a single administration,” said Bobby Gaspar,  M.D., Ph.D., chief executive officer of Orchard Therapeutics. “This collaboration demonstrates the promise  of the HSC gene therapy platform and how it can be applied to new therapeutic areas with larger patient  populations. We believe the HSC gene therapy pipeline we are building could continue to be a source of  future partnerships in areas where the biology supports our approach.” “Pharming has been committed to the HAE community for more than two decades,” said Sijmen de Vries  M.D., MBA, chief executive officer of Pharming. “We have partnered with Orchard Therapeutics, a leader  in the development of autologous HSC gene therapy, to develop a potentially curative treatment for HAE.  Based on Pharming’s experience in HAE, we believe that HSC gene therapy has the potential for the  highest probability of success. This confidence is based on the durability of effect and safety observed in  approved treatments from Orchard’s HSC gene therapy portfolio and positive clinical data in several other  programs. This a significant first step in developing a potentially transformative one-time treatment for  HAE.” “Great progress has been made in HAE treatment over the last 15 years. However, HAE remains a severe,  debilitating disease with an ongoing burden of angioedema attacks or chronic medication use,” said Dr.  Marc Riedl, professor of medicine and clinical director of the U.S. Hereditary Angioedema Association  Center at the University of California, San Diego. This promising work toward treatment with the potential  for durable long-term clinical benefit is encouraging and signifies an ongoing commitment to the HAE  community. I look forward to these efforts to identify and carefully advance a potential cure for HAE.” The HAE market is expected to generate ~$2 billion in sales in 2021, currently growing at 8% per annum.  This represents a significant commercial opportunity for Pharming Group and Orchard Therapeutics. Webcast Link: https://webcast.openbriefing.com/pharming-jul21/   Participant Dial-in Details: United Kingdom 0800 640 6441 United Kingdom (Local) 020 3936 2999 United States (Local) 1 646 664 1960 Netherlands      085 888 7233 All other locations          +44 20 3936 2999 Access code: 470719 About HAE  Hereditary angioedema (HAE) is a rare genetic disorder. The condition is caused by a deficiency of the C1  esterase inhibitor protein, which is normally present in blood and helps control inflammation (swelling) and  parts of the immune system. Deficient C1 inhibitor does not adequately perform its regulatory function  and, as a result, a biochemical imbalance can occur and produce unwanted peptides that induce the  capillaries to release fluids into surrounding tissue, thereby causing swelling or edema. 

 

HAE is characterized by spontaneous and recurrent episodes of swelling (edema attacks) of the skin in  different parts of the body, as well as in the airways and internal organs. Edema of the skin usually affects  the extremities, the face, and the genitals. Patients suffering from this kind of edema often withdraw from  their social lives because of the disfiguration, discomfort and pain these symptoms may cause. Almost all  HAE patients suffer from bouts of severe abdominal pain, nausea, vomiting and diarrhea caused by swelling  of the intestinal wall. Edema of the throat, nose or tongue is particularly dangerous and potentially life-threatening as it can lead  to obstruction of the airway passages. Although there is currently no known cure for HAE, it is possible to  treat the symptoms associated with angioedema attacks. HAE affects about 1 in 10,000 to 1 in 50,000  people worldwide. Experts believe a lot of patients are still seeking the right diagnosis: although HAE is (in  principle) easy to diagnose, it is frequently identified very late or not discovered at all. The reason HAE is  often misdiagnosed is because the symptoms are similar to those of many other common conditions such  as allergies or appendicitis. By the time it is diagnosed correctly, the patient has often been through a long  ordeal. About Pharming Group N.V. Pharming Group N.V. is a global, commercial stage biopharmaceutical company developing innovative  protein replacement therapies and precision medicines for the treatment of rare diseases and unmet  medical needs.  The flagship of our portfolio is our recombinant human C1 esterase inhibitor (rhC1INH) franchise. C1INH  is a naturally occurring protein that down regulates the complement and contact cascades in order to  control inflammation in affected tissues.  Our lead product, RUCONEST®, is the first and only plasma-free rhC1INH protein replacement therapy. It  is approved for the treatment of acute hereditary angioedema (HAE) attacks. We are commercializing  RUCONEST® in the United States, the European Union and the United Kingdom through our own sales  and marketing organization, and the rest of the world through our distribution network.  In addition, we are investigating the clinical efficacy of rhC1INH in the treatment of further indications,  including pre-eclampsia, acute kidney injury, and severe pneumonia as a result of COVID-19 infections.  Furthermore, we are leveraging our transgenic manufacturing technology to develop next-generation  protein replacement therapies, most notably for Pompe disease, which is currently in preclinical  development. About Orchard Therapeutics Orchard Therapeutics is a global gene therapy leader dedicated to transforming the lives of people  affected by severe diseases through the development of innovative, potentially curative gene therapies.  Our ex vivo autologous gene therapy approach harnesses the power of genetically modified blood stem  cells and seeks to correct the underlying cause of disease in a single administration. In 2018, Orchard  acquired GSK’s rare disease gene therapy portfolio, which originated from a pioneering collaboration  between GSK and the San Raffaele Telethon Institute for Gene Therapy in Milan, Italy. Orchard now has  one of the deepest and most advanced gene therapy product candidate pipelines in the industry  spanning multiple therapeutic areas where the disease burden on children, families and caregivers is  immense and current treatment options are limited or do not exist. 

 

Orchard has its global headquarters in London and U.S. headquarters in Boston. For more information,  please visit www.orchard-tx.com, and follow us on Twitter and LinkedIn. Availability of Other Information About Orchard Therapeutics Investors and others should note that Orchard communicates with its investors and the public using the  company website (www.orchard-tx.com), the investor relations website (ir.orchard-tx.com), and on  social media (Twitter and LinkedIn), including but not limited to investor presentations and investor fact  sheets, U.S. Securities and Exchange Commission filings, press releases, public conference calls and  webcasts. The information that Orchard posts on these channels and websites could be deemed to be  material information. As a result, Orchard encourages investors, the media, and others interested in  Orchard to review the information that is posted on these channels, including the investor relations  website, on a regular basis. This list of channels may be updated from time to time on Orchard’s investor  relations website and may include additional social media channels. The contents of Orchard’s website or  these channels, or any other website that may be accessed from its website or these channels, shall not  be deemed incorporated by reference in any filing under the Securities Act of 1933. Orchard Therapeutics Forward-looking Statements This press release contains certain forward-looking statements about Orchard’s strategy, future plans and  prospects, which are made pursuant to the safe harbor provisions of the Private Securities Litigation  Reform Act of 1995. Forward-looking statements include express or implied statements relating to, among  other things, Orchard’s business strategy and goals, the therapeutic potential of Orchard’s product  candidates, including the product candidate or candidates referred to in this release, and the possibility of  future milestone or royalty payments. These statements are neither promises nor guarantees and are  subject to a variety of risks and uncertainties, many of which are beyond Orchard’s control, which could  cause actual results to differ materially from those contemplated in these forward-looking statements.  In  particular, these risks and uncertainties include, without limitation: the risk that prior results, such as  signals of safety, activity or durability of effect, observed from preclinical studies or clinical trials will not  be replicated or will not continue in ongoing or future studies or trials involving Orchard’s product  candidates, will be insufficient to support regulatory submissions or marketing approval in the US or EU, as  applicable, or that long-term adverse safety findings may be discovered; the risk that any one or more of  Orchard’s product candidates, including the product candidates referred to in this release, will not be  approved, successfully developed or commercialized; the risk of cessation or delay of any of Orchard’s  ongoing or planned clinical trials; the risk that Orchard may not successfully recruit or enroll a sufficient  number of patients for its clinical trials; the delay of any of Orchard’s regulatory submissions; the failure to  obtain marketing approval from the applicable regulatory authorities for any of Orchard’s product  candidates or the receipt of restricted marketing approvals; the inability or risk of delays in Orchard’s  ability to commercialize its product candidates, if approved, or Libmeldy in the EU; the risk that the market  opportunity for Libmeldy, or any of Orchard’s product candidates, may be lower than estimated; the risk  that certain milestones may never be achieved or royalty payments may never be earned and paid; and  the severity of the impact of the COVID-19 pandemic on Orchard’s business, including on clinical  development, its supply chain and commercial programs.  Given these uncertainties, the reader is advised  not to place any undue reliance on such forward-looking statements. 

 

Other risks and uncertainties faced by Orchard include those identified under the heading "Risk Factors" in  Orchard’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2021, as filed with the U.S.  Securities and Exchange Commission (SEC), as well as subsequent filings and reports filed with the SEC.  The forward-looking statements contained in this press release reflect Orchard’s views as of the date  hereof, and Orchard does not assume and specifically disclaims any obligation to publicly update or revise  any forward-looking statements, whether as a result of new information, future events or otherwise,  except as may be required by law. Pharming Group N.V. Forward-looking Statements  This press release contains forward-looking statements, including with respect to timing and progress of  Pharming’s preclinical studies and clinical trials of its product candidates, Pharming’s clinical and  commercial prospects, Pharming’s ability to overcome the challenges posed by the COVID-19 pandemic to  the conduct of its business, and Pharming’s expectations regarding its projected working capital  requirements and cash resources, which statements are subject to a number of risks, uncertainties and  assumptions, including, but not limited to the scope, progress and expansion of Pharming’s clinical trials  and ramifications for the cost thereof; and clinical, scientific, regulatory and technical developments. In  light of these risks and uncertainties, and other risks and uncertainties that are described in Pharming’s  2020 Annual Report and the Annual Report on Form 20-F for the year ended December 31, 2020 filed with  the U.S. Securities and Exchange Commission, the events and circumstances discussed in such forward- looking statements may not occur, and Pharming’s actual results could differ materially and adversely  from those anticipated or implied thereby. Any forward-looking statements speak only as of the date of  this press release and are based on information available to Pharming as of the date of this release. Inside Information This press release relates to the disclosure of information that qualifies, or may have qualified, as inside  information within the meaning of Article 7(1) of the EU Market Abuse Regulation. Orchard Therapeutics Contacts Investors Renee Leck Director, Investor Relations +1 862-242-0764 Renee.Leck@orchard-tx.com Media Benjamin Navon Director, Corporate Communications +1 857-248-9454 Benjamin.Navon@orchard-tx.com 

 

Pharming Group N.V. Contacts Company Pharming Group, Leiden, The Netherlands Sijmen de Vries,  CEO +31 71 524 7400 Investors Susanne Embleton Investor Relations Manager +31 71 524 7400 investor@pharming.com  Media  FTI Consulting, London, UK Victoria Foster Mitchell/Alex Shaw  +44 203 727 1000 LifeSpring Life Sciences Communication, Amsterdam, The Netherlands Leon Melens +31 6 53 81 64 27 pharming@lifespring.nlExhibit
4.1

 

Form
of Representative’s Warrant Agreement

 

THE
REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT
EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR
HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY (180) DAYS FOLLOWING THE EFFECTIVE DATE (DEFINED BELOW) TO ANYONE
OTHER THAN (I) THE BENCHMARK COMPANY, LLC, OR AN UNDERWRITER OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING, OR (II) A BONA FIDE
OFFICER OR PARTNER OF THE BENCHMARK COMPANY, LLC OR OF ANY SUCH UNDERWRITER OR SELECTED DEALER.

 

THIS
PURCHASE WARRANT IS NOT EXERCISABLE PRIOR TO [________________] [DATE THAT IS 180 DAYS FROM THE EFFECTIVE DATE OF THE OFFERING].
VOID AFTER 5:00 P.M., EASTERN TIME, [___________________] [DATE THAT IS FIVE YEARS FROM THE EFFECTIVE DATE OF THE OFFERING].

 

 

 

WARRANT
TO PURCHASE COMMON STOCK 

 

EXPION360
INC.

 

Warrant
Shares: _______

Initial
Exercise Date: ______, 202__

 

 

THIS
WARRANT TO PURCHASE COMMON STOCK (the “Warrant”) certifies that, for value received, _____________ or its assigns
(the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter
set forth, at any time on or after ____, 202__ (the “Initial Exercise Date”) and, in accordance with FINRA Rule 5110(g)(8)(A),
prior to at 5:00 p.m. (New York time) on the date that is five (5) years following the Effective Date (the “Termination Date”)
but not thereafter, to subscribe for and purchase from Expion360 Inc., a Nevada corporation (the “Company”), up to
______ shares of common stock, $0.001par value per share (the “Common Stock”), of the Company (the “Warrant
Shares”), as subject to adjustment hereunder. The purchase price of one share of Common Stock under this Warrant shall be equal
to the Exercise Price, as defined in Section 2(b).

 

Section
1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms have the meanings indicated
in this Section 1:

 

“Affiliate”
means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control
with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.

 

“Business
Day” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day
on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.

 

“Commission”
means the United States Securities and Exchange Commission.

    	 

    	 

    

 

“Effective
Date” means the effective date of the registration statement on Form S-1 (File No. 333-261829), including any related prospectus
or prospectuses, for the registration of the Company’s Common Stock and the Warrant Shares under the Securities Act, that the Company
has filed with the Commission.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Person”
means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Rule
144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted
from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect
as such Rule.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Trading
Day” means a day on which the Trading Market is open for trading.

 

“Trading
Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date
in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York
Stock Exchange (or any successors to any of the foregoing).

 

“VWAP”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock then listed or
quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30
a.m. (New York City time) to 4:02 p.m. (New York City time)), (b)  if OTCQB or OTCQX is not a Trading Market, the volume weighted
average price of a share of Common Stock for such date (or the nearest preceding date) on the OTCQB or OTCQX as applicable, (c) if Common
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Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices),
the most recent bid price per share of Common Stock so reported, or (d) in all other cases, the fair market value of the Common
Stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company, the fees
and expenses of which shall be paid by the Company.

  

Section
2. Exercise.

 

a)                 
Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial
Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may
designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly
executed facsimile copy (or e-mail attachment) of the Notice of Exercise Form annexed hereto. Within two (2) Trading Days following the
date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the Warrant Shares specified in the applicable
Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified
in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall
any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise form be required. Notwithstanding anything
herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased
all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this
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Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall
have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number
of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the
date of such purchases. The Company shall deliver any objection to any Notice of Exercise Form within two (2) Business Days of receipt
of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of
this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase
hereunder at any given time may be less than the amount stated on the face hereof.

    	 

    	 

    

 

b)                 
Exercise Price. The exercise price per share of the Common Stock under this Warrant shall be $_______[1], subject
to adjustment hereunder (the “Exercise Price”).

 

c)                 
Cashless Exercise. If there is not an effective registration statement registering the Warrant Shares, then in lieu of exercising
this Warrant by delivering the aggregate Exercise Price by wire transfer or cashier’s check, at the election of the Holder, this
Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall
be entitled to receive the number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:

 

(A)
= as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of
Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and
delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in
Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) the VWAP on the Trading Day
immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading
hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular
trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise
if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section
2(a) hereof after the close of “regular trading hours” on such Trading Day;

 

(B)
= the Exercise Price of this Warrant, as adjusted hereunder; and

 

(X)
= the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such
exercise were by means of a cash exercise rather than a cashless exercise.

 

If
Warrant Shares are issued in such a “cashless exercise,” the parties acknowledge and agree that in accordance with Section
3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised, and the
holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares.  The Company agrees
not to take any position contrary to this Section 2(c). 

 

 Notwithstanding
anything herein to the contrary, on the Termination Date, this Warrant shall be automatically exercised via cashless exercise pursuant
to this Section 2(c).

 

d)                
Mechanics of Exercise.

 

                                           i.           
Delivery of Warrant Shares Upon Exercise. The Company shall cause the Warrant Shares purchased hereunder to be transmitted by
its transfer agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository
Trust Company through its Deposit or Withdrawal at Custodian system (“DWAC”) if the Company is then a participant
in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale
of the Warrant Shares by Holder, or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations
pursuant to Rule 144 and, in either case, the Warrant Shares have been sold by the Holder prior to the Warrant Share Delivery Date (as
defined below), and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of
the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address
specified by the Holder in the Notice of Exercise by the date that is two (2) Trading Days after the delivery to the Company of
the Notice of Exercise (such date, the “Warrant Share Delivery Date”). If the Warrant Shares can be delivered via
DWAC, the transfer agent shall have received from the Company, at the expense of the Company, any legal opinions or other documentation
required by it to deliver such Warrant Shares without legend (subject to receipt by the Company of reasonable back up documentation from
the Holder, including with respect to affiliate status) and, if applicable and requested by the Company prior to the Warrant Share Delivery
Date, the transfer agent shall have received from the Holder a confirmation of sale of the Warrant Shares (provided the requirement of
the Holder to provide a confirmation as to the sale of Warrant Shares shall not be applicable to the issuance of unlegended Warrant Shares
upon a cashless exercise of this Warrant if the Warrant Shares are then eligible for resale pursuant to Rule 144(b)(1)). The Warrant
Shares shall be deemed to have been issued, and Holder or any other person so designated to be named therein shall be deemed to have
become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with payment to the Company
of the Exercise Price (or by cashless exercise, if permitted) and all taxes required to be paid by the Holder, if any, pursuant to Section 2(d)(vi)
prior to the issuance of such shares, having been paid. If the Company fails for any reason to deliver to the Holder the Warrant Shares
subject to a Notice of Exercise by the second (2nd) Trading Day following the Warrant Share Delivery Date, the Company shall
pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to
such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing
to $20 per Trading Day on the fifth (5th) Trading Day after such liquidated damages begin to accrue) for each Trading Day
after the second (2nd) Trading Day following such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder
rescinds such exercise.

    	 

    	 

    

    

                                                                                         
ii.            Delivery of New Warrants Upon Exercise. If this Warrant
shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the
time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased
Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.

 

                                                                                       
iii.            Rescission Rights. If the Company fails to cause its transfer
agent to deliver to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will
have the right to rescind such exercise; provided, however, that the Holder shall be required to return any Warrant Shares
or Common Stock subject to any such rescinded exercise notice concurrently with the return to Holder of the aggregate Exercise Price
paid to the Company for such Warrant Shares and the restoration of Holder’s right to acquire such Warrant Shares pursuant to this
Warrant (including, issuance of a replacement warrant certificate evidencing such restored right).

 

                                                                                       
iv.            Compensation for Buy-In on Failure to Timely Deliver Warrant
Shares Upon Exercise. In addition to any other rights available to the Holder, if the Company fails to cause its transfer agent to
transmit to the Holder the Warrant Shares pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date
the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise
purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated
receiving upon such exercise (a “Buy-In”), then the Company shall (A) pay in cash to the Holder the amount, if any,
by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the shares of Common Stock so purchased
exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder
in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed,
and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such
exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common
Stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example,
if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise
of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately
preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating
the amounts payable to the Holder in respect of the Buy-In and, upon request
of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available
to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect
to the Company’s failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms
hereof.

    	 

    	 

    

  

                                                                                         
v.            No Fractional Shares or Scrip. No fractional shares or scrip
representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would
otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of
such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.

 

                                                                                       
vi.            Charges, Taxes and Expenses. Issuance of Warrant Shares
shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such
Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of
the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event that Warrant
Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied
by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of
a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all transfer agent fees required for
same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation
performing similar functions) required for same-day electronic delivery of the Warrant Shares.

 

                                                                                     
vii.            Closing of Books. The Company will not close its stockholder
books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.

 

                                                                                     
viii.            Signature. This Section 2 and the exercise form attached
hereto set forth the totality of the procedures required of the Holder in order to exercise this Warrant.  Without limiting the
preceding sentences, no ink-original exercise form shall be required, nor shall any medallion guarantee (or other type of guarantee or
notarization) of any exercise form be required in order to exercise this Warrant.  No additional legal opinion, other information
or instructions shall be required of the Holder to exercise this Warrant.  The Company shall honor exercises of this Warrant and
shall deliver Warrant Shares underlying this Warrant in accordance with the terms, conditions and time periods set forth herein.

 

e)                 
Holder’s Exercise Limitations. The Company shall not effect any exercise of this Warrant, and a Holder shall not have the
right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance
after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other
Persons acting as a group together with the Holder or any of the Holder’s Affiliates), would beneficially own in excess of the
Beneficial Ownership Limitation (as defined below).  For purposes
of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates shall include the
number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall
exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this
Warrant beneficially owned by the Holder or any of its Affiliates and (ii) exercise or conversion of the unexercised or nonconverted
portion of any other securities of the Company (including, without limitation, any other Common Stock equivalents) subject to a limitation
on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates. 
Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance
with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that
the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder
is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in
this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder
together with any Affiliates) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and
the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable
(in relation to other securities owned by the Holder together with any Affiliates) and of which portion of this Warrant is exercisable,
in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy
of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with
Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in determining
the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected
in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public
announcement by the Company or (C) a more recent written notice by the Company or the Company’s transfer agent setting forth the
number of shares of Common Stock outstanding.  Upon the written or oral request of a Holder, the Company shall within two (2) Trading
Days confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding.  In any case, the number
of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company,
including this Warrant, by the Holder or its Affiliates since the date as of which such number of outstanding shares of Common Stock
was reported. The “Beneficial Ownership Limitation” shall be 9.99% of the number of shares of the Common Stock outstanding
immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice
to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial
Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect
to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall
continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such
notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in
strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent
with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly
give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant. 

    	 

    	 

    

  

Section
3. Certain Adjustments.

 

a)                 
Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise
makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares
of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this
Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse
stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the
Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which
the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event
and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of
shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant
shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for
the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the
effective date in the case of a subdivision, combination or re-classification. For the purposes of clarification, the Exercise Price
of this Warrant will not be adjusted in the event that the Company or any subsidiary thereof, as applicable, sells or grants any option
to purchase, or sell or grant any right to reprice, or otherwise dispose of or issue (or announce any offer, sale, grant or any option
to purchase or other disposition) any Common Stock or Common Stock equivalents, at an effective price per share less than the Exercise
Price then in effect.

 

b)                 
[RESERVED]

  

c)                 
Subsequent Rights Offerings. In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants,
issues or sells any Common Stock equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record
holders of any class of shares of Common Stock (the “Purchase Rights”), then the Holder will be entitled to acquire,
upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had
held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for
the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares
of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the
Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of
Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for
the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).

 

d)                
Pro Rata Distributions. During such time as this Warrant is outstanding, if the Company shall declare or make any dividend (other
than cash dividends) or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way
of return of capital or otherwise (including, without limitation, any distribution of shares or other securities, property or options
by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a "Distribution"),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held
the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise
hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for
such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined
for the participation in such Distribution (provided, however, to the extent that the Holder's right to participate in
any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled
to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such
Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such
time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation). To the extent that
this Warrant has not been partially or completely exercised at the time of such Distribution, such portion of the Distribution shall
be held in abeyance for the benefit of the Holder until the Holder has exercised this Warrant.

    	 

    	 

    

  

e)                 
Fundamental Transaction. If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or
more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly
or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of
its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer
(whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock,
(iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization
of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for
other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock
or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off
or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding
shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated
or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each
a “Fundamental Transaction”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right
to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental
Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number
of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional
consideration (the “Alternate Consideration”) receivable by holders of Common Stock as a result of such Fundamental
Transaction for each share of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without
regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the
Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration
issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price
among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration.
If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then
the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such
Fundamental Transaction. The Company shall cause any successor
entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in
writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(e) pursuant to written
agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior
to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security
of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable
for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common
Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior
to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock
(but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such
shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic
value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in
form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and
be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the
“Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume
all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company
herein.

    	 

    	 

    

  

f)                  
Calculations. All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the
case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date
shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

g)                 
Notice to Holder.

 

                                                                                           
i.            Adjustment to Exercise Price. Whenever the Exercise Price
is adjusted pursuant to any provision of this Section 3, the Company shall promptly mail to the Holder a notice setting forth the Exercise
Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts
requiring such adjustment.

 

                                                                                         
ii.            Notice to Allow Exercise by Holder. If (A) the Company
shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special
nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of
the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the
approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any
consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the
Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the
Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in
each case, the Company shall cause to be mailed a notice to the Holder at its last address as it shall appear upon the Warrant
Register of the Company, at least 20 calendar days prior to the applicable
record or effective date hereinafter specified, stating (x) the date on which a record is to be taken for the purpose of such dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock
of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which
such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date
as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock
for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange;
provided that the failure to provide such notice or any defect therein shall not affect the validity of the corporate action required
to be specified in such notice. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information
regarding the Company or any of the subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a
Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such
notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.

    	 

    	 

    

  

Section
4. Transfer of Warrant.

 

a)                 
Transferability. Pursuant to FINRA Rule 5110(e)(1), neither this Warrant nor any Warrant Shares issued upon exercise of this Warrant
shall be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call
transaction that would result in the effective economic disposition of the securities by any person for a period of 180 days immediately
following the date of effectiveness or commencement of sales of the offering pursuant to which this Warrant is being issued, except the
transfer of any security:

 

                                                             i.                       
by operation of law or by reason of reorganization of the Company;

 

                                                             ii.                       
to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred remain
subject to the lock-up restriction in this Section 4(a) for the remainder of the time period;

 

                                                             iii.                       
if the aggregate amount of securities of the Company held by the Holder or related person do not exceed 1% of the securities being offered;

 

                                                             iv.                       
that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member manages
or otherwise directs investments by the fund, and participating members in the aggregate do not own more than 10% of the equity in the
fund; or

 

                                                             v.                       
the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction in this Section 4(a)
for the remainder of the time period.

  

Subject
to the foregoing restriction, any applicable securities laws and the conditions set forth in Section 4(d), this Warrant and all rights
hereunder (including, without
limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of
the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly
executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer.
Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the
assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall
issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled.
Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company
unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within three
(3) Trading Days of the date the Holder delivers an assignment form to the Company assigning this Warrant full. The Warrant, if properly
assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.

    	 

    	 

    

 

b)                 
New Warrants. This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of
the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by
the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division
or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided
or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of
this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.

 

c)                 
Warrant Register. The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the
“Warrant Register”), in the name of the record Holder hereof from time to time. The Company may deem and treat the
registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder,
and for all other purposes, absent actual notice to the contrary.

 

d)                
Representation by the Holder. The Holder, by the acceptance hereof, represents and warrants that it is acquiring this Warrant
and, upon any exercise hereof, will acquire the Warrant Shares issuable upon such exercise, for its own account and not with a view to
or for distributing or reselling such Warrant Shares or any part thereof in violation of the Securities Act or any applicable state securities
law, except pursuant to sales registered or exempted under the Securities Act.

Section
5. Registration Rights.

 

5.1.
Demand Registration.

 

5.1.1          Grant
of Right. The Company, upon written demand (a “Demand Notice”) of the Holder(s) of at least 51% of the Warrants and/or the
underlying Warrant Shares, agrees to register, on one (1) occasion, all or any portion of the Warrant Shares underlying the Warrants
(collectively, the “Registrable Securities”). On such occasion, the Company will file a registration statement with the Commission
covering the Registrable Securities within sixty (60) days after receipt of a Demand Notice and use its reasonable best efforts to have
the registration statement declared effective promptly thereafter, subject to compliance with review by the Commission; provided,
however, that the Company shall not be required to comply with a Demand Notice if the Company has filed a registration statement with
respect to which the Holder is entitled to piggyback registration rights pursuant to Section 5.2 hereof and either: (i) the Holder has
elected to participate in the offering covered by such registration statement or (ii) if such registration statement relates to an underwritten
primary offering of securities of the Company, until the offering covered by such registration statement has been withdrawn or until
thirty (30) days after such offering is consummated. The demand for registration may be made at any time beginning on the Initial Exercise
Date and expiring on the fifth anniversary of the date of the Underwriting Agreement (as defined below) in accordance with FINRA Rule
5110(g)(8)(C). The Company covenants and agrees to give written notice of its receipt of any Demand Notice by any Holder(s) to all other
registered Holders of the Warrants and/or the Registrable Securities within ten (10) days after the date of the receipt of any such Demand
Notice.

    	 

    	 

    

 

5.1.2
          Terms. The Company shall bear all fees and expenses attendant to the registration
of the Registrable Securities pursuant to Section 5.1.1, but the Holders shall pay any and all underwriting commissions and the expenses
of any legal counsel selected by the Holders to represent them in connection with the sale of the Registrable Securities. The Company
agrees to use its reasonable best efforts to cause the filing required herein to become effective promptly and to qualify or register
the Registrable Securities in such States as are reasonably requested by the Holder(s); provided, however, that in no event shall the
Company be required to register the Registrable Securities in a State in which such registration would cause: (i) the Company to be obligated
to register or license to do business in such State or submit to general service of process in such State, or (ii) the principal shareholders
of the Company to be obligated to escrow their shares of capital stock of the Company. The Company shall cause any registration statement
filed pursuant to the demand right granted under Section 5.1.1 to remain effective for a period of at least twelve (12) consecutive months
after the date that the Holders of the Registrable Securities covered by such registration statement are first given the opportunity
to sell all of such securities. The Holders shall only use the prospectuses provided by the Company to sell the Warrant Shares covered
by such registration statement, and will immediately cease to use any prospectus furnished by the Company if the Company advises the
Holder that such prospectus may no longer be used due to a material misstatement or omission. Notwithstanding the provisions of this
Section 5.1.2, the Holder shall be entitled to a demand registration under Section 5.1.1 on only one (1) occasion and such demand registration
right shall terminate on the fifth anniversary of the date of the Underwriting Agreement (as defined below) in accordance with FINRA
Rule 5110(g)(8)(C).

 

	 	5.2	“Piggy-Back”
    Registration.

 

5.2.1          Grant
of Right. In addition to the demand right of registration described in Section 5.1 hereof, the Holder shall have the right, for a period
of no more than two (2) years from the Initial Exercise Date in accordance with FINRA Rule 5110(g)(8)(D), to include the Registrable
Securities as part of any other registration of securities filed by the Company (other than in connection with a transaction contemplated
by Rule 145(a) promulgated under the Securities Act or pursuant to Form S-8 or Form S-4 or any equivalent form); provided, however, that
if, solely in connection with any primary underwritten public offering for the account of the Company, the managing underwriter(s) thereof
shall, in its reasonable discretion, impose a limitation on the number of Warrant Shares which may be included in the Registration Statement
because, in such underwriter(s)’ judgment, marketing or other factors dictate such limitation is necessary to facilitate public
distribution, then the Company shall be obligated to include in such Registration Statement only such limited portion of the Registrable
Securities with respect to which the Holder requested inclusion hereunder as the underwriter shall reasonably permit. Any exclusion of
Registrable Securities shall be made pro rata among the Holders seeking to include Registrable Securities in proportion
to the number of Registrable Securities sought to be included by such Holders; provided, however, that the Company shall not exclude
any Registrable Securities unless the Company has first excluded all outstanding securities, the holders of which are not entitled to
inclusion of such securities in such Registration Statement or are not entitled to pro rata inclusion with the Registrable Securities.

    	 

    	 

    

 

5.2.2
          Terms. The Company shall bear all fees and expenses attendant to registering
the Registrable Securities pursuant to Section 5.2.1 hereof, but the Holders shall pay any and all underwriting commissions and the expenses
of any legal counsel selected by the Holders to represent them in connection with the sale of the Registrable Securities. In the event
of such a proposed registration, the Company shall furnish the then Holders of outstanding Registrable Securities with not less than
thirty (30) days written notice prior to the proposed date of filing of such registration statement. Such notice to the Holders shall
continue to be given for each registration statement filed by the Company during the two (2) year period following the Initial Exercise
Date until such time as all of the Registrable Securities have been sold by the Holder. The holders of the Registrable Securities shall
exercise the “piggy-back” rights provided for herein by giving written notice within ten (10) days of the receipt of the
Company’s notice of its intention to file a registration statement. Except as otherwise provided in this Warrant, there shall be
no limit on the number of times the Holder may request registration under this Section 5.2.1; provided, however, that such registration
rights shall terminate on the second (2nd) anniversary of the Initial Exercise Date.

 

	 	5.3	General
    Terms

 

5.3.1          Indemnification.
The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement hereunder and
each person, if any, who controls such Holders within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange
Act against all loss, claim, damage, expense or liability (including all reasonable attorneys’ fees and other expenses reasonably
incurred in investigating, preparing or defending against any claim whatsoever) to which any of them may become subject under the Securities
Act, the Exchange Act or otherwise, arising from such registration statement but only to the same extent and with the same effect as
the provisions pursuant to which the Company has agreed to indemnify the Underwriters contained in Section 5.1 of the Underwriting Agreement,
dated June 3, 2021, by and between the Company and The Benchmark Company, LLC as representatives of the underwriters set forth therein
(the “Underwriting Agreement”). The Holder(s) of the Registrable Securities to be sold pursuant to such registration statement,
and their successors and assigns, shall severally, and not jointly, indemnify the Company, against all loss, claim, damage, expense or
liability (including all reasonable attorneys’ fees and other expenses reasonably incurred in investigating, preparing or defending
against any claim whatsoever) to which they may become subject under the Securities Act, the Exchange Act or otherwise, arising from
information furnished by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion in such registration
statement to the same extent and with the same effect as the provisions contained in Section 5.2 of the Underwriting Agreement pursuant
to which the Underwriters have agreed to indemnify the Company.

 

5.3.2
          Exercise of Warrants. Nothing contained in this Warrant shall be construed
as requiring the Holder(s) to exercise their Warrants prior to or after the initial filing of any registration statement or the effectiveness
thereof.

 

5.3.3
          Documents Delivered to Holders. The Company shall furnish to each Holder
participating in any of the foregoing offerings and to each underwriter of any such offering, if any, a
signed counterpart, addressed to such Holder or underwriter, of: (i) an opinion of counsel to the Company, dated the effective date of
such registration statement (and, if such registration includes an underwritten public offering, an opinion dated the date of the closing
under any underwriting agreement related thereto), and (ii) a “cold comfort” letter dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering, a letter dated the date of the closing under the underwriting
agreement) signed by the independent registered public accounting firm which has issued a report on the Company’s financial statements
included in such registration statement, in each case covering substantially the same matters with respect to such registration statement
(and the prospectus included therein) and, in the case of such accountants’ letter, with respect to events subsequent to the date
of such financial statements, as are customarily covered in opinions of issuer’s counsel and in accountants’ letters delivered
to underwriters in underwritten public offerings of securities. The Company shall also deliver promptly to each Holder participating
in the offering requesting the correspondence and memoranda described below and to the managing underwriter, if any, copies of all correspondence
between the Commission and the Company, its counsel or auditors and all memoranda relating to discussions with the Commission or its
staff with respect to the registration statement and permit each Holder and underwriter to do such investigation, upon reasonable advance
notice, with respect to information contained in or omitted from the registration statement as it deems reasonably necessary to comply
with applicable securities laws or rules of FINRA. Such investigation shall include access to books, records and properties and opportunities
to discuss the business of the Company with its officers and independent auditors, all to such reasonable extent and at such reasonable
times as any such Holder shall reasonably request.

    	 

    	 

    

 

5.3.4
          Underwriting Agreement. The Company shall enter into an underwriting agreement
with the managing underwriter(s), if any, selected by any Holders whose Registrable Securities are being registered pursuant to this
Section 5, which managing underwriter shall be reasonably satisfactory to the Company. Such agreement shall be reasonably satisfactory
in form and substance to the Company, each Holder and such managing underwriters, and shall contain such representations, warranties
and covenants by the Company and such other terms as are customarily contained in agreements of that type used by the managing underwriter.
The Holders shall be parties to any underwriting agreement relating to an underwritten sale of their Registrable Securities and may,
at their option, require that any or all the representations, warranties and covenants of the Company to or for the benefit of such underwriters
shall also be made to and for the benefit of such Holders. Such Holders shall not be required to make any representations or warranties
to or agreements with the Company or the underwriters except as they may relate to such Holders, their Warrant Shares and their intended
methods of distribution.

 

5.3.5
          Documents to be Delivered by Holder(s). Each of the Holder(s) participating
in any of the foregoing offerings shall furnish to the Company a completed and executed questionnaire provided by the Company requesting
information customarily sought of selling security holders.

 

5.3.6
          Damages. Should the registration or the effectiveness thereof required by
Sections 5.1 and 5.2 hereof be delayed by the Company or the Company otherwise fails to comply with such provisions, the Holder(s) shall,
in addition to any other legal or other relief available to the Holder(s), be entitled to obtain specific performance or other equitable
(including injunctive) relief against the threatened breach of such provisions or the continuation of any such breach, without the necessity
of proving actual damages and without the necessity of posting bond or other security.

 

 

    	 

    	 

    

Section
6. Miscellaneous.

 

a)                 
No Rights as Stockholder Until Exercise. This Warrant does not entitle the Holder to any voting rights, dividends or other rights
as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i).

 

b)                 
Loss, Theft, Destruction or Mutilation of Warrant. The Company covenants that upon receipt by the Company of evidence reasonably
satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any certificate relating to the Warrant Shares, and
in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall
not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company
will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or
stock certificate.

 

c)                 
Saturdays, Sundays, Holidays, etc. If the last or appointed day for the taking of any action or the expiration of any right required
or granted herein shall not be a Trading Day, then, such action may be taken or such right may be exercised on the next succeeding Trading
Day.

 

d)                
Authorized Shares.

 

The
Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a
sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant.
The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with
the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any
applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants
that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise
of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly
issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof
(other than taxes in respect of any transfer occurring contemporaneously with such issue).

  

Except
and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending
its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale
of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary
or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the
foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise
immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company
may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially
reasonable efforts to obtain all such authorizations, exemptions or consents from
any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this
Warrant.

    	 

    	 

    

 

Before
taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from
any public regulatory body or bodies having jurisdiction thereof.

 

e)                 
Jurisdiction. All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined
in accordance with the provisions of the Underwriting Agreement.

 

f)                  
Restrictions. The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and
the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.

 

g)                 
Nonwaiver and Expenses. No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall
operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision
of this Warrant or the Underwriting Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant,
which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover
any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred
by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.

 

h)                 
Notices. Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall
be delivered in accordance with the notice provisions of the Underwriting Agreement.

  

i)                   
Limitation of Liability. No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant
to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of
the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company
or by creditors of the Company.

 

j)                   
Remedies. The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will
be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to
assert the defense in any action for specific performance that a remedy at law would be adequate.

 

k)                 
Successors and Assigns. Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall
inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns
of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall
be enforceable by the Holder or holder of Warrant Shares.

 

l)                   
Amendment. This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and
the Holder.

    	 

    	 

    

 

m)               
Severability. Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall
be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining
provisions of this Warrant.

 

n)                 
Headings. The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.

 

 

********************

 

(Signature
Page Follows)

 

    	 

    	 

    

 

 

IN
WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above
indicated.

 

	 	EXPION360
    INC.
	 	 
	 	 
	 	By:__________________________________________

    Name:

    Title:

 

 

    	 

    	 

    

NOTICE
OF EXERCISE

 

 

TO:EXPION360
INC.

_________________________

 

(1)  
The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only
if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

 

(2)  
Payment shall take the form of (check applicable box):

 

[
] in lawful money of the United States; or

 

[
] if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection
2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure
set forth in subsection 2(c).

 

(3)  
Please register and issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:

 

_______________________________

 

 

The
Warrant Shares shall be delivered to the following DWAC Account Number or by physical delivery of a certificate to:

 

_______________________________

 

_______________________________

 

_______________________________

 

(4)  
Accredited Investor. The undersigned is an “accredited investor” as defined in Regulation D promulgated under the
Securities Act of 1933, as amended

 

 

[SIGNATURE
OF HOLDER]

 

Name
of Investing Entity: _______________________________________________________________

Signature
of Authorized Signatory of Investing Entity: _________________________________________

Name
of Authorized Signatory: ___________________________________________________________

Title
of Authorized Signatory: ____________________________________________________________

Date:
________________________________________________________________________________

 

    	 

    	 

    

ASSIGNMENT
FORM

 

(To
assign the foregoing warrant, execute

this form and supply required information.

Do not use this form to exercise the warrant.)

 

 

 

FOR
VALUE RECEIVED, [____] all of or [_______] shares of the foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

 

_______________________________________________
whose address is

 

_______________________________________________________________.

 

 

 

_______________________________________________________________

 

Dated:
______________, _______

 

 

Holder’s
Signature: _____________________________

 

Holder’s
Address: _____________________________

 

_____________________________

 

 

 

NOTE:
The signature to this Assignment Form must correspond with the name as it appears on the face of the Warrant, without alteration or enlargement
or any change whatsoever. Officers of corporations and those acting in a fiduciary or other representative capacity should file proper
evidence of authority to assign the foregoing Warrant.

 

 

 

 

 

 

 

[1]
130% of the public offering price per share of common stock in the offering.

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