Document:

Exhibit 4(a)(1)

 

“CONFIDENTIAL TREATMENT
REQUESTED. CONFIDENTIAL PORTIONS OF THIS DOCUMENT HAVE BEEN OMITTED AND HAVE
BEEN SEPARATELY FILED WITH THE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED WITH RESPECT TO THE OMITTED PORTIONS, WHICH ARE IDENTIFIED BY ***.”

 

ASA Termination Agreement

Progen Industries Limited

ACN 010 975 612

Progen

Medigen Biotechnology Corporation

MBC

 

 

 

 

 

 

The Clayton Utz contact for this document is

Tim Reid on +61
7 3292  7000

 

Clayton Utz

Lawyers

Level 28, Riparian Plaza  71 Eagle Street  Brisbane 
QLD  4000  Australia

GPO Box 55 
Brisbane  QLD  4001

T +61 7 3292 7000  F +61 7 3221 9669

 

www.claytonutz.com

 

Our reference  15314/80049052

 

 

Table of contents

	
  1.

  	
  Definitions and interpretations

  	
  1

  
	
   

  	
   

  	
   

  
	
   

  	
  1.1

  	
  Definitions

  	
  1

  
	
   

  	
  1.2

  	
  Interpretation

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  Termination of ASA

  	
  3

  
	
   

  	
   

  	
   

  
	
   

  	
  2.1

  	
  Termination

  	
  3

  
	
   

  	
  2.2

  	
  Continuation
  of provisions

  	
  3

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  Release

  	
  4

  
	
   

  	
   

  	
   

  
	
   

  	
  3.1

  	
  Mutual
  release

  	
  4

  
	
   

  	
  3.2

  	
  Preservation
  of rights

  	
  4

  
	
   

  	
  3.3

  	
  Independent
  obligations

  	
  4

  
	
   

  	
  3.4

  	
  Specific
  release from trial costs

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  Provision of data

  	
  4

  
	
   

  	
   

  	
   

  
	
   

  	
  4.1

  	
  Final
  HCC PR88204 Stage I Data

  	
  4

  
	
   

  	
  4.2

  	
  HCC
  PR88204 Stage I Study Report

  	
  4

  
	
   

  	
  4.3

  	
  Access
  to PPC

  	
  5

  
	
   

  	
  4.4

  	
  Access
  to MBC

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
  Payments by Progen

  	
  5

  
	
   

  	
   

  	
   

  
	
   

  	
  5.1

  	
  Payments
  on delivery of data

  	
  5

  
	
   

  	
  5.2

  	
  Form
  of payments

  	
  5

  
	
   

  	
  5.3

  	
  Issue
  of shares

  	
  5

  
	
   

  	
  5.4

  	
  Trial
  costs payment

  	
  6

  
	
   

  	
  5.5

  	
  Transaction
  Event payment

  	
  6

  
	
   

  	
  5.6

  	
  Phase
  III Trial payment

  	
  6

  
	
   

  	
  5.7

  	
  Return
  of Medigen Shares

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  Options

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  6.1

  	
  Issuance
  of options

  	
  7

  
	
   

  	
  6.2

  	
  Certificate

  	
  7

  
	
   

  	
  6.3

  	
  Options
  not to be listed

  	
  7

  
	
   

  	
  6.4

  	
  Grant
  of Options conditional

  	
  7

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
  Resignations

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  7.

  	
  Resignations

  	
  7

  
	
   

  	
  7.1

  	
  Resignation
  from Progen

  	
  7

  
	
   

  	
  7.2

  	
  Cessation
  of alternate director

  	
  7

  
	
   

  	
  7.3

  	
  Resignation
  from MBC

  	
  7

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
  Representations, warranties and undertakings

  	
  7

  
	
   

  	
   

  	
   

  
	
   

  	
  8.1

  	
  General

  	
  7

  
	
   

  	
  8.2

  	
  Warranties
  by MBC regarding data

  	
  8

  
	
   

  	
  8.3

  	
  Warranties
  by MBC regarding equity

  	
  8

  
	
   

  	
  8.4

  	
  Warranties
  by Progen

  	
  8

  
	
   

  	
  8.5

  	
  Survival
  of warranties

  	
  8

  
	
   

  	
  8.6

  	
  Undertaking
  as to share sales

  	
  9

  
	
   

  	
  8.7

  	
  Undertaking
  as to a Transaction Event

  	
  9

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
  Confidentiality and public announcements

  	
  9

  
	
   

  	
   

  	
   

  
	
   

  	
  9.1

  	
  Confidentiality

  	
  9

  
	
   

  	
  9.2

  	
  MBC
  confidentiality obligations

  	
  9

  
	
   

  	
  9.3

  	
  ASA
  obligations

  	
  10

  

 

 

i

 

	
   

  	
  9.4

  	
  Exceptions

  	
  10

  
	
   

  	
  9.5

  	
  Public
  announcements

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
  Termination

  	
  10

  
	
   

  	
   

  	
   

  
	
   

  	
  10.1

  	
  Termination
  for Default

  	
  10

  
	
   

  	
  10.2

  	
  Event
  of Insolvency

  	
  11

  
	
   

  	
  10.3

  	
  Consequences
  of termination - obligations

  	
  11

  
	
   

  	
  10.4

  	
  Consequences
  of termination - information

  	
  11

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
  Arbitration

  	
  11

  
	
   

  	
   

  	
  12

  
	
   

  	
  11.1

  	
  Reference
  to arbitration

  	
  12

  
	
   

  	
  11.2

  	
  General
  principles

  	
  12

  
	
   

  	
  11.3

  	
  Award
  final and binding

  	
  12

  
	
   

  	
  11.4

  	
  Governing
  law of arbitration agreement

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
  Notices

  	
  12

  
	
   

  	
   

  	
   

  
	
  13.

  	
  General

  	
  13

  
	
   

  	
   

  	
   

  
	
   

  	
  13.1

  	
  Amendments

  	
  13

  
	
   

  	
  13.2

  	
  Assignment

  	
  13

  
	
   

  	
  13.3

  	
  Counterparts

  	
  13

  
	
   

  	
  13.4

  	
  Entire
  agreement

  	
  14

  
	
   

  	
  13.5

  	
  Expenses

  	
  14

  
	
   

  	
  13.6

  	
  Further
  acts and documents

  	
  14

  
	
   

  	
  13.7

  	
  Governing
  law

  	
  14

  
	
   

  	
  13.8

  	
  No
  representation or reliance

  	
  14

  
	
   

  	
  13.9

  	
  Severance

  	
  14

  
	
   

  	
  13.10

  	
  Waiver

  	
  14

  
	
   

  	
  13.11

  	
  Text
  of agreement

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  Annexure A - Option terms (clause 6.1)

  	
  17

  

 

 

ii

 

 

ASA Termination Agreement made at
                                on

Parties                                                                                         Progen Industries Limited ACN 010 975 612 of 16
Benson Street Toowong Qld 4066

(“Progen”)

Medigen Biotechnology
Corporation, a company incorporated in Taiwan, of
Building F, Room A, 14F., No.3, Yuancyu St., Nangang District, Taipei City 115,
Taiwan

(“MBC”)

Background

A.                                                   Progen
and MBC entered into an Agreement for Strategic Alliance in 2000.

B.                                                     The parties have agreed to
terminate that agreement on the terms and conditions in this Agreement.

Operative provisions

1.                                                      Definitions and
interpretations

1.1                                               Definitions

“ASA”
means the Agreement for Strategic Alliance entered into in or about May 2000
between Progen and MBC as amended by the Supplementary Letter.

“ASX”
means Australian Securities Exchange Limited ACN 008 624 691.

“Business
Day” means a day that is not a Saturday, Sunday or
public holiday and on which banks are open for business generally in Brisbane
and in Taipei.

“Business
Hours” means between 9.00 am and 5.00 pm on a Business
Day.

“Claim”
means any claim, demand or cause of action whether
arising in contract or tort, under statute or otherwise in relation to any
provision of the ASA.

“Commercialise”
means the sale or other exploitation of a product developed from intellectual
property owned by or licensed to Progen in respect of PI-88 related to:

(a)                                                   the potential treatment of solid
tumours through inhibition of metastasis and new blood vessel growth; or

(b)                                                  the potential treatment for prevention
of thrombosis.

“Execution Date”
means the date that this Agreement is fully executed by each party.

“Final HCC PR88204 Stage I
Data” means final Validated Data from the results of the
HCC PR88204 Trial stage I undertaken by or on behalf of MBC in accordance with
the protocols agreed under the ASA.

“HCC PR88204 Stage I Study
Report” means the final study report prepared on the basis
of the Final HCC PR88204 Stage I Data.

 

1

 

“ICH GCP”
means the guidelines of good clinical practice as approved by the International
Conference on Harmonisation of Technical Requirements of Pharmaceuticals for
Human Use.

“Issue Price”
means *** per ordinary share, being the volume weighted closing trading price
of Progen ordinary shares on ASX for the 30 Business Days up to and including ***.

“Listing Rules”
means the listing rules of ASX as they apply to Progen from time to time.

“Medigen Shares”
means 15,176,525 shares and 34,823,475 preferred shares held by Progen in MBC,
which represent Progen’s entire shareholding in MBC.

“Options”
means the options to be issued under clause 6.1 or clause 6.2.

“Patient Records” has
the meaning given to it in clause 4.1.

“Phase II PR88205 Study”
means the phase II study of PI-88 with Darcabazine in patients with metastatic
Melanoma as referred to in the Supplementary Letter.

“Phase III Trial”
means a trial involving testing of a drug in several hundred to several
thousand patients designed to provide statistically significant data on the
drug’s effectiveness, benefits and the range of possible adverse reactions.

“PI-88” means
an oligosaccharide based compound which inhibits heparanase, extravasation and
thrombosis.

“Preliminary HCC PR88204
Stage I Data” means preliminary Validated Data from the
results of the HCC PR88204 Trial stage I undertaken by or on behalf of MBC in
accordance with the protocols agreed under the ASA.

“PPC”
means Protech Pharmaservices Corporation, a company incorporated in Taiwan,
which is the independent party appointed to hold and verify the data created
under the trials contemplated by the ASA in general and the PR88204 trial in
particular.

“Supplementary Letter”
means the letter from Progen to MBC dated 18 April 2005 agreeing amendments to
the ASA.

“Taiwan DOH” means
the Taiwan Department of Health, Republic of China.

“Transaction Event” means in
relation to Progen:

	
  (a)

  	
  a
  person acquires voting power (within the meaning in section 610 of the
  Corporations Act 2001) in more than 50% of the ordinary shares in the Company
  as a result of a takeover bid which is unconditional; or

  
	
   

  	
   

  
	
  (b)

  	
  a
  person acquires voting power (within the meaning in section 610 of the
  Corporations Act 2001) in more than 50% of the ordinary shares in the Company
  through a scheme of arrangement; or

  
	
   

  	
   

  
	
  (c)

  	
  Progen
  enters into an agreement with a third party that is not a related body
  corporate of Progen, which agreement is or has become unconditional, which
  provides for one or more of the following:

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  the grant of a licence to the third party
  to Commercialise PI-88;

  
	
   

  	
   

  
	
   

  	
  (ii)

  	
  a joint venture, partnership or similar
  arrangement under which Progen and the third party agree to carry on a
  business of Commercialising PI-

  

 

2

 

	
   

  	
  88 and the third party is obliged to make material financial contributions
  to that activity,

  
	
   

  	
   

  
	
   

  	
  whether or not such agreement includes an agreement to further
  develop PI-88.

  
			

 

“Validated
Data” means patient data that has been validated and
verified to ICH GCP requirements by PPC or another contract research organisation
approved by Progen.

1.2                                               Interpretation

In this Agreement:

	
  (a)

  	
  headings are for convenience
  only and do not affect interpretation;

  
	
   

  	
   

  
	
  and unless the context indicates a contrary
  intention:

  
	
   

  	
   

  
	
  (b)

  	
  “person” includes an individual, the estate
  of an individual, a corporation, an authority, an association or a joint
  venture (whether incorporated or unincorporated), a partnership and a trust;

  
	
   

  	
   

  
	
  (c)

  	
  a reference to a party
  includes that party’s executors, administrators, successors and permitted
  assigns, including persons taking by way of novation;

  
	
   

  	
   

  
	
  (d)

  	
  a reference to a document
  (including this Agreement) is to that
  document as varied, novated, ratified or replaced from time to time;

  
	
   

  	
   

  
	
  (e)

  	
  a reference to a statute
  includes its delegated legislation and a reference to a statute or delegated
  legislation or a provision of either includes consolidations, amendments, re-enactments
  and replacements;

  
	
   

  	
   

  
	
  (f)

  	
  a word importing the singular
  includes the plural (and vice versa), and a word indicating a gender includes
  every other gender;

  
	
   

  	
   

  
	
  (g)

  	
  a reference to a party,
  clause, schedule, exhibit, attachment or annexure is a reference to a party,
  clause, schedule, exhibit, attachment or annexure to or of this Agreement, and a reference to this Agreement includes all schedules, exhibits,
  attachments and annexures to it;

  
	
   

  	
   

  
	
  (h)

  	
  if a word or phrase is given a
  defined meaning, any other part of speech or grammatical form of that word or
  phrase has a corresponding meaning;

  
	
   

  	
   

  
	
  (i)

  	
  “includes” in any form is not a word of limitation;
  and

  
	
   

  	
   

  
	
  (j)

  	
  a reference to “$” or “dollar”
  is to Australian currency.

  

 

2.                                                      Termination of ASA

2.1                                               Termination

In consideration of the
mutual promises in this Agreement and subject to this Agreement (in particular
clause 2.2), the parties agree that the ASA will terminate, and be of no
further force and effect, on and from the Execution Date.

2.2                                               Continuation of
provisions

Notwithstanding clause 2.1,
each of the parties agrees to continue to be bound by the rights and
obligations in clause 13 of the ASA as if it was incorporated in full in this
Agreement.

 

3

 

3.                                                      Release

3.1                                               Mutual release

Subject
to clause 3.2, on and from the Execution Date, each party (“releasor”) irrevocably, fully and finally discharges and
releases the other party and each of its past or present directors, officers
and employees (“releasees”) from any claim or
action of whatsoever nature for any loss, damage or other liability that the
releasor had or may have against the releasees including the performance of any
further obligations which either of them may have pursuant to the ASA, but for
this Agreement.

3.2                                               Preservation of rights

The release in clause 3.1
does not operate to:

	
  (a)

  	
  release a party from a breach
  of the ASA occurring before the Execution Date; or

  
	
   

  	
   

  
	
  (b)

  	
  release MBC or Progen from any
  obligations under clauses 10, 11 or 13 of the ASA; or

  
	
   

  	
   

  
	
  (c)

  	
  derogate from or otherwise
  affect the intention of clause 13 of the ASA as to the ownership of the
  intellectual property referred to in that clause.

  

 

Other than the rights
specifically preserved in this clause 3.2, no other rights or obligations in
the ASA are preserved following termination of the ASA under this Agreement.

3.3                                               Independent
obligations

The obligations of the parties
under this Agreement are separate and independent obligations of the parties
and are not affected by the termination of the ASA under clause 2 or the
release in clause 3.1.

3.4                                               Specific release from
trial costs

Without limiting clause 3.1
but subject to this Agreement, Progen
irrevocably, fully and finally discharges and releases MBC from any further
obligation under the ASA to co-fund the Phase II PR88205 Study.

4.                                                      Provision of data

4.1                                               Final HCC PR88204
Stage I Data

As soon as the Final HCC
PR88204 Stage I Data is available, and in any event, no later than 14 February
2007, MBC must deliver to Progen the Final HCC PR88204 Stage I Data together
with, if available at that time, all patient case record forms including scanned forms relating to the Final HCC
PR88204 Stage I Data (“Patient Records”).
In any event, MBC must deliver to Progen the Patient Records by 14 March 2007.

4.2                                               HCC PR88204 Stage I
Study Report

As soon as the HCC PR88204
Stage I Study Report is available, and in any event, no later than 5 June 2007,
MBC must deliver to Progen the HCC PR88204 Stage I Study Report.

 

4

 

4.3                                               Access to PPC

Progen may, and MBC will
give all necessary directions to permit Progen to, directly contact PPC or such
other independent party appointed to hold and verify the data created under the
trials contemplated by the ASA in general and the PR88204 trial in particular,
to resolve any questions that Progen has in respect of Validated Data which has
been provided to Progen by PPC or that other independent party provided that such access is at Progen’s own
expense and is granted only in a manner so as not
to interfere with the normal business operations of PPC.

4.4                                               Access to MBC

If
Progen wishes to contact MBC employees involved in
the conduct of the PR88204 trial to resolve any questions that Progen has in
respect of the data provided by MBC, Progen must first give notice to MBC and MBC must arrange for such
access at no cost to Progen, provided that such access is during normal business hours and undertaken
in a manner so as not to interfere with the normal business operations of MBC.
MBC will provide access to its employees under this clause and those employees
will assist Progen resolve any questions on a timely basis.

5.                                                      Payments by Progen

5.1                                               Payments on delivery
of data

In consideration for MBC
executing this Agreement, Progen must issue the following ordinary shares in
Progen and make the following payments at the times indicated:

	
  (a)

  	
  issue 500,000 ordinary shares
  in Progen within 10 Business Days after the Execution Date;

  
	
   

  	
   

  
	
  (b)

  	
  pay $2,000,000 within 10
  Business Days of the delivery of both the Final HCC PR88204 Stage I Data and
  the Patient Records under clause 4.1; and

  
	
   

  	
   

  
	
  (c)

  	
  pay $2,000,000 within 10
  Business Days of the delivery of the HCC PR88204 Stage I Study Report under
  clause 4.2.

  

 

5.2                                               Form of payments

Progen may, in its absolute
discretion, make the payments under clause 5.1(b) and (c) in either of the
following forms:

	
  (a)

  	
  cash in which case payment
  will be made by electronic transfer in Australian dollars to an account
  nominated by MBC for that purpose, or failing nomination of an account, by
  bank cheque drawn on an Australian bank; or

  
	
   

  	
   

  
	
  (b)

  	
  by the issue of ordinary
  shares in Progen at the Issue Price,

  

 

provided that at least $2,000,000 of the total payments
under clause 5.1(b) and (c) are paid by way of the issue of shares.

5.3                                               Issue of shares

If Progen issues ordinary
shares to MBC under clause 5.2:

	
  (a)

  	
  Progen must deliver to MBC on
  the date for payment a holding statement reflecting the shares issued or such
  other evidence of the issue of the shares reasonably satisfactory to MBC;

  

 

 

5

 

	
  (b)

  	
  Progen will apply for the
  shares to be listed for quotation on ASX in accordance with the Listing
  Rules; and

  
	
   

  	
   

  
	
  (c)

  	
  MBC undertakes not to sell, or
  otherwise dispose of, the shares issued to it under clause 5.1(a) until such
  time as it has delivered to Progen both the Final HCC PR88204 Stage I Data
  and the Patient Records.

  

 

5.4                                               Trial costs payment

In
addition to the payments payable under clause 5.1, within 15 Business
Days after the Execution Date, Progen must pay to MBC $300,000 in consideration
of MBC’s contribution to the costs of the Phase II PR88205 Study, in the manner
described in clause 5.2(a).

5.5                                               Transaction Event
payment

In addition to the payments payable under
clause 5.1, within 20 Business Days after the consummation of the first
Transaction Event to occur after signing this Agreement, Progen must pay to MBC
as a once only payment, $2,000,000 in the manner described in clause 5.2(a).

 

5.6                                               Phase III Trial
payment

In
addition to the payments payable under clause 5.1, within 20 Business
Days after the commencement of the first Phase III Trial on PI-88, Progen must
pay to MBC $2,000,000 in the manner described in clause 5.2(a).

5.7                                               Return of Medigen
Shares

The parties agree that they
will take steps to cause the Medigen Shares to be returned by Progen to MBC for MBC to process the cancellation of the Medigen
Shares. Progen
and MBC must do all things necessary under Taiwanese law
to give effect to the intention of the parties under this clause including the following:

	
  (a)

  	
  within 5 Business Days of the Execution Date, Progen,
  at MBC’s cost, will appoint Ernst & Young Taiwan in Taiwan to apply to
  the Investment Commission of the Ministry of Economic Affairs on behalf of
  Progen for cancellation of Progen’s investment in MBC;

  
	
   

  	
   

  
	
  (b)

  	
  within 10 Business Days of the Execution Date, MBC
  must procure, at MBC’s cost, Ernst & Young Taiwan to prepare and provide
  to Progen for its execution, a statement by which Progen acknowledges its
  intention to abandon its equity investment in MBC;

  
	
   

  	
   

  
	
  (c)

  	
  within 10 Business Days of receiving the
  statement from MBC (or such longer period as may be required having regard to
  the need to have the statement notarized and legalized by the Taipei Economic
  and Cultural Office in Australia), Progen will execute the statement and
  arrange for it to be notarized and legalized by the Taipei Economic and
  Cultural Office in Australia at Progen’s cost up to a limit of $1,000;

  
	
   

  	
   

  
	
  (d)

  	
  MBC must cause Ernst & Young Taiwan to
  diligently pursue the application and advise Progen when it has been
  determined;

  
	
   

  	
   

  
	
  (e)

  	
  MBC must, or must instruct Ernst & Young
  Taiwan to, provide Progen with copies of all documents that Progen may
  require to properly account for and report the cancellation of its equity
  investment and such other documents relating to the cancellation of the
  equity investment as Progen reasonably requires.

  

 

 

6

 

6.                                                      Options

6.1                                               Issuance of options

Within 10 Business Days after of the delivery of the HCC
PR88204 Stage I Study Report under clause 4.2, Progen must issue to MBC one
million options to subscribe for ordinary shares in Progen on the terms set out
in Annexure A.

6.2                                               Certificate

On the date of issue of
Options, Progen must deliver to MBC a certificate for the Options issued on
that date or such other evidence of issue of the Options as MBC reasonably requires.

6.3                                               Options not to be
listed

MBC acknowledges that Progen
is not obliged to apply for or cause the Options to be listed for quotation on
ASX or any other stock exchange.

6.4                                               Grant of Options
conditional

The grant by Progen of the
Options under clause 6.2 is conditional on MBC performing in full its
obligations under this Agreement which are due to be performed by the date for
issue of the Options under clause 6.2, including delivery of the HCC PR88204
Stage I Study Report under clause 4.2.

7.                                                      Resignations

7.1                                               Resignation from
Progen

On the Execution Date, MBC must
procure that Dr Stanley Chang resigns as a director of Progen and, subject to
payment by Progen of all director’s fees owing to Dr Chang up to the date of
resignation, releases Progen from any claims for director’s fees, remuneration
or any other matter absolutely.

7.2                                               Cessation of alternate
director

On the Execution Date, MBC must
procure that Dr Stanley Chang revokes the appointment of Mr Eugene Cheng as his
alternate director of Progen and procure that Mr Cheng provides an
acknowledgement to Progen that he has no claims against Progen for director’s
fees, remuneration or in respect of any other matter absolutely.

7.3                                               Resignation from MBC

On the Execution Date, Progen must give notice to MBC of its resignation from the
board of directors’ of MBC and release MBC from any claims for director’s fees,
remuneration, loss of office or any other matter absolutely.  Progen must also procure that the two
representatives appointed by Progen to the MBC board of directors’ are
discharged or resign as directors of MBC and release MBC from any claims for
directors’ fees, remuneration, loss of office or any other matter absolutely.

8.                                                      Representations,
warranties and undertakings

8.1                                               General

Each party
represents and warrants to the other party that:

 

7

 

	
  (a)

  	
  this
  Agreement constitutes its valid and legally binding obligation in accordance
  with its terms;

  
	
   

  	
   

  
	
  (b)

  	
  the
  execution, delivery and performance of this Agreement by it does not violate
  any statute or law, or any document or agreement to which it is a party and
  which is binding on it or any of its assets; and

  
	
   

  	
   

  
	
  (c)

  	
  all
  consents, licences, approvals and authorisations required to be obtained by
  it in connection with the execution, delivery and performance of this
  Agreement have been obtained and are valid and subsisting.

  

 

8.2                                               Warranties by MBC
regarding data

MBC represents and warrants
for the benefit of Progen that each of the Preliminary HCC PR88204 Stage I
Data, the Final HCC PR88204 Stage I Data and the HCC PR88204 Stage I Study
Report will:

	
  (a)

  	
  be materially accurate and complete; and

  
	
   

  	
   

  
	
  (b)

  	
  to the best of MBC’s knowledge
  and belief, not be subject to any material misstatement.

  

 

8.3                                               Warranties by MBC
regarding equity

MBC represents and warrants
for the benefit of Progen that:

	
  (a)

  	
  it is aware
  that any ordinary shares issued under this Agreement will be issued with a
  view that offers for sale of those securities can be made subject to section
  708A of the Corporations Act;

  
	
   

  	
   

  
	
  (b)

  	
  it is aware
  that section 708A may not apply in the event that the Company does not
  satisfy the requirements under section 708A (including if a notice given to
  ASX under subsection 708A(5)(e) does not comply with subsection 708A(6));

  
	
   

  	
   

  
	
  (c)

  	
  it will not
  offer to sell those securities to any person that is a person to whom a
  disclosure document needs to be given under Chapter 6D of the Corporations
  Act until the day after a notice is lodged by the Company with ASX that
  complies with subsections 708A(5)(e) and 708A(6); and

  
	
   

  	
   

  
	
  (d)

  	
  its
  acceptance of securities is in compliance with all relevant laws and
  regulations (including, without limitation, the requirements of the
  Australian Foreign Acquisitions and Takeovers Act 1975) in any applicable
  jurisdiction.

  

 

8.4                                               Warranties by Progen

Progen
warrants that there has been no withheld information to MBC pertaining to any
written offer received pertaining to a possible Transaction Event as of the
Execution Date.

8.5                                               Survival of warranties

Each representation and warranty in this Agreement:

	
  (a)

  	
  is severable; and

  
	
   

  	
   

  
	
  (b)

  	
  will survive the termination
  of this Agreement.

  

 

 

8

 

8.6                                               Undertaking as to
share sales

As long as MBC continues to hold
more than 3.5% of all issued and outstanding shares of Progen, MBC undertakes to notify Progen of any
intended on-market sale of shares in Progen by MBC at least 5 Business Days
before the intended date for sale. Progen agrees
to keep such information
confidential. MBC must give
reasonable consideration to any proposal by a purchaser (which is not an associate
of Progen) for the shares introduced by Progen or any other person before the
intended date for sale, with the intention that if the proposal is comparable
to, or better than, the market prices for the shares at that time, after
considering transaction costs, then MBC will prefer the proposal to selling the
shares in any other way.  Nothing in this
clause gives Progen or any other person power to control the exercise of a
power to dispose of the shares.

8.7                                               Undertaking as to a
Transaction Event

To
the extent permitted by law, Progen will notify MBC of a Transaction Event on execution of any binding
memorandum or agreement or at least 15 Business Days before the intended date
of the Transaction Event, whichever is earlier. In respect of a Transaction Event
of the type described in paragraphs (a) and (b) of the definition in clause
1.1, Progen agrees that:

	
  (a)

  	
  MBC
  is not restricted under this Agreement from selling or disposing of all of
  its shares in Progen or on a pro-rata basis with other sellers; and

  
	
   

  	
   

  
	
  (b)

  	
  this
  Agreement and the rights granted under this Agreement shall continue to bind
  Progen or its successor.

  

 

9.                                                      Confidentiality and
public announcements

9.1                                               Confidentiality

Subject to clauses 9.4
and 9.5, each party must keep the terms of this Agreement confidential.

9.2                                               MBC confidentiality
obligations

MBC must keep confidential:

	
  (a)

  	
  the Preliminary HCC PR88024
  Stage I Data;

  
	
   

  	
   

  
	
  (b)

  	
  the Final HCC PR88024 Stage I
  Data;

  
	
   

  	
   

  
	
  (c)

  	
  the HCC PR88024 Stage I Study
  Report;

  
	
   

  	
   

  
	
  (d)

  	
  all data and the study report
  arising from the follow-on study of the HCC PR88204 Trial stage I being
  conducted by MBC;

  
	
   

  	
   

  
	
  (e)

  	
  all data relating to the Phase
  II PR88205 Study; and

  
	
   

  	
   

  
	
  (f)

  	
  any other information of
  whatsoever nature which:

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  was the subject of obligations of confidentiality under the ASA; or

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  is produced as a result of this Agreement being entered into and
  which relates to PI-88.

  

 

 

9

 

9.3                                               ASA obligations

Notwithstanding clause 2.1,
each of the parties agree to continue to be bound by the confidentiality
obligations in clauses 10 and 11 of the ASA as if they were incorporated in
full in this Agreement.

9.4                                               Exceptions

A party may make any
disclosure in relation to this Agreement:

	
  (a)

  	
  to a professional adviser,
  financial adviser, banker, financier or auditor if that person is obliged to
  keep the information disclosed confidential;

  
	
   

  	
   

  
	
  (b)

  	
  to comply with the law, or a
  requirement of a regulatory body (including any relevant stock exchange);

  
	
   

  	
   

  
	
  (c)

  	
  to any of its employees to
  whom it is necessary to disclose the information;

  
	
   

  	
   

  
	
  (d)

  	
  to obtain the consent of a
  third party to a term of, or to an act under, this Agreement;

  
	
   

  	
   

  
	
  (e)

  	
  to enforce its rights or to
  defend a claim or action under this Agreement;

  
	
   

  	
   

  
	
  (f)

  	
  to a Agreement, on receipt of its undertaking to keep the information
  disclosed confidential; or

  
	
   

  	
   

  
	
  (g)

  	
  if the information disclosed
  has come into the public domain through no fault of the party making the
  disclosure.

  

 

9.5                                               Public announcements

	
  (a)

  	
  Except as required by law or a
  regulatory body (including a relevant stock exchange), all press releases and
  other public announcements in connection with this Agreement must be in terms agreed by the parties.

  
	
   

  	
   

  
	
  (b)

  	
  Unless compelled by law, MBC
  must not make any public statement about PI-88 or Progen which is negative or
  may have an adverse effect on Progen or its business.

  
	
   

  	
   

  
	
  (c)

  	
  If MBC becomes legally
  compelled to disclose any information which is the subject of the
  confidentiality obligations in this Agreement or which is negative or adverse
  to PI-88 or Progen, then MBC will immediately notify Progen so that Progen
  has the opportunity to apply for a protective order or other appropriate
  remedy.

  
	
   

  	
   

  
	
  (d)

  	
  Unless compelled by law, Progen must not make any public statement
  which is negative or may have an adverse effect on MBC or its business.

  
	
   

  	
   

   

  
	
  (e)

  	
  If Progen becomes legally compelled to
  disclose any information which is the subject of the confidentiality
  obligations in this Agreement or which is negative or adverse to MBC, then Progen will immediately notify MBC so that MBC has the opportunity to apply for a protective order or
  other appropriate remedy.

  

 

10.                                               Termination

10.1                                        Termination for
Default

Either party may terminate
this Agreement by notice to the other party if:

 

10

 

	
  (a)

  	
  an event of insolvency set out
  in clause 11.2 occurs in respect of the other party; or

  
	
   

  	
   

  
	
  (b)

  	
  that other party commits any
  breach of a term of this Agreement and:

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  the breach is material and not capable of being cured; or

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  the breach is capable of being cured, but is not cured within
  15 Business Days after a notice specifying the breach or default is
  given to the other party.

  

 

10.2                                        Event of Insolvency

An event of insolvency in
respect of a party means:

	
  (a)

  	
  an application has been made
  for winding up or the appointment of a liquidator or provisional liquidator
  is made and not dismissed, stayed, enjoined or withdrawn within 21 days;

  
	
   

  	
   

  
	
  (b)

  	
  any order is made or
  resolution passed for winding up (except for the purpose of reconstruction on
  terms approved by the other party);

  
	
   

  	
   

  
	
  (c)

  	
  it enters into a scheme of
  arrangement with its creditors or any class of creditors;

  
	
   

  	
   

  
	
  (d)

  	
  it has a receiver or manager
  of any of its assets appointed;

  
	
   

  	
   

  
	
  (e)

  	
  it has an administrator
  appointed under the Corporations Act 2001 (Cth), or any equivalent
  legislation;

  
	
   

  	
   

  
	
  (f)

  	
  it is taken to be insolvent
  under any relevant provision of the Corporations Act 2001 (Cth);

  
	
   

  	
   

  
	
  (g)

  	
  it stops payment of its debts
  or announces an intention to do so;

  
	
   

  	
   

  
	
  (h)

  	
  it is struck off or
  deregistered or otherwise ceases to exist or have full capacity;

  
	
   

  	
   

  
	
  (i)

  	
  execution is levied against
  any of its assets; or

  
	
   

  	
   

  
	
  (j)

  	
  it has any action taken
  against it or happen to it which is equivalent to paragraphs (a) to (i) under
  the law of any jurisdiction.

  

 

10.3                                        Consequences of
termination - obligations

Termination of this Agreement takes effect without prejudice to the
rights or remedies arising out of any antecedent breach of the Agreement.

10.4                                        Consequences of
termination - information

If this Agreement is
terminated, MBC must return to Progen within 10 Business Days of termination
all information, data or documents of any nature in relation to PI-88 which is
within its power, possession or control.

11.                                               Arbitration

11.1                                        Reference to
arbitration

	
  (a)

  	
  Any controversy, claim or
  dispute directly or indirectly based upon, arising out of, relating to or in
  connection with this Agreement
  (including but not limited to any question relating to the existence,
  validity or termination of this Agreement)
  shall

  

 

 

11

 

	
   

  	
  be referred to and finally
  resolved by arbitration in accordance with the arbitration rules of the Singapore International Arbitration Centre.

  
	
   

  	
   

  
	
  (b)

  	
  The seat of the arbitration
  will be Singapore.

  
	
   

  	
   

  
	
  (c)

  	
  The number of arbitrators will
  be 1.

  
	
   

  	
   

  
	
  (d)

  	
  The language of the
  arbitration will be English.

  

 

11.2                                        General principles

The parties further agree to
the following general principles relating to the procedure of the arbitration:

	
  (a)

  	
  that they have chosen
  arbitration for the purposes of achieving a just, quick and cost-effective
  resolution of any dispute;

  
	
   

  	
   

  	
   

  
	
  (b)

  	
  that any arbitration conducted
  pursuant to this clause shall not necessarily mimic court proceedings and the
  practices of those courts will not regulate the conduct of the proceedings
  before the arbitral tribunal;

  
	
   

  	
   

  	
   

  
	
  (c)

  	
  that in conducting the
  arbitration, the arbitral tribunal must take into account the matters set out
  above, particularly in deciding issues such as:

  
	
   

  	
   

  	
   

  
	
   

  	
  (i)

  	
  how many written submissions will be allowed;

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  where appropriate, the length of written submissions;

  
	
   

  	
   

  	
   

  
	
   

  	
  (iii)

  	
  the extent of document discovery permitted, if any;

  
	
   

  	
   

  	
   

  
	
   

  	
  (iv)

  	
  the length of any hearing; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (v)

  	
  the
  number of experts, if any, each party is allowed to appoint; and

  
	
   

  	
   

  	
   

  
	
  (d)

  	
  that
  the arbitral tribunal has the power to grant all legal, equitable and statutory remedies, except punitive
  damages.

  
				

 

11.3                                        Award final and
binding

Any
award will be final and binding upon the parties.

11.4                                        Governing law of
arbitration agreement

The
law governing this arbitration agreement is the law in Singapore.

12.                                               Notices

Each communication
(including each notice, consent, approval, request and demand) under or in
connection with this Agreement:

	
  (a)

  	
  must be in writing;

  
	
   

  	
   

  
	
  (b)

  	
  must be addressed as follows
  (or as otherwise notified by that party to each other party from time to
  time):

  

 

 

12

 

	
  To Progen:

  
	
   

  
	
  Name:

  	
  Progen Industries Limited

  
	
  Address:

  	
  16
  Benson Street, Toowong, Qld 4066

  
	
  Fax:

  	
  61
  7 3720 9624

  
	
  For the attention of:

  	
  Company Secretary

  
	
   

  	
   

  
	
  To MBC:

  	
   

  
	
   

  	
   

  
	
  Name:

  	
  Medigen Biotechnology Corporation

  
	
  Address:

  	
  Building F, Room A, 14F., No.3, Yuancyu
  St., Nangang District, Taipei City 115, Taiwan

  
	
  Fax:

  	
  886 2 2785 5781

  
	
  For the attention of:

  	
  Chief Executive

  

 

	
  (c)

  	
  must be signed by the party
  making it or (on that party’s behalf) by the solicitor for, or any attorney,
  director, secretary or authorised agent of, that party;

  	 

	
   

  	
   

  	
   

  	 

	
  (d)

  	
  must be delivered by hand or
  posted by prepaid post to the address, or sent by fax to the number, of the
  addressee, in accordance with clause 12(b); and

  	 

	
   

  	
   

  	
   

  	 

	
  (e)

  	
  is taken to be received by the
  addressee:

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
  (i)

  	
  (in the case of prepaid post sent to an address in the same country)
  on the third day after the date of posting;

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
  (ii)

  	
  (in the case of prepaid post sent to an address in another country)
  on the fifth day after the date of posting by airmail;

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
  (iii)

  	
  (in the case of fax) at the time in the place to which it is sent
  equivalent to the time shown on the transmission confirmation report produced
  by the fax machine from which it was sent; and

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
  (iv)

  	
  (in the case of delivery by hand) on delivery,

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
  but if the communication is taken to be received on a day that is not
  a working day or after 5.00 pm, it is taken to be received at
  9.00 am on the next working day (“working day” meaning a day that is not
  a Saturday, Sunday or public holiday and on which banks are open for business
  generally, in the place to which the communication is posted, sent or
  delivered).

  
					

 

13.                                               General

13.1                                        Amendments

This Agreement may only be
varied by a document signed by or on behalf of each party.

13.2                                        Assignment

A party cannot assign,
novate or otherwise transfer any of its rights or obligations under this
Agreement without the prior consent of each other party.

13.3                                        Counterparts

This Agreement may be executed in any number of counterparts and by the
parties on separate counterparts. Each counterpart constitutes an original of
this Agreement, and all together
constitute one agreement.

 

13

 

13.4                                        Entire agreement

To the extent permitted by
law, in relation to its subject matter, this Agreement:

(a)                                                   embodies the entire understanding of
the parties, and constitutes the entire terms agreed by the parties; and

(b)                                                  supersedes any prior written or other
agreement of the parties.

13.5                                        Expenses

Except as otherwise provided
in this Agreement, each party must pay
its own costs and expenses in connection with negotiating, preparing, executing
and performing this Agreement.

13.6                                        Further acts and
documents

Each party must promptly do
all further acts and execute and deliver all further documents (in form and
content reasonably satisfactory to that party) required by law or reasonably
requested by another party to give effect to this Agreement. Any obligation to
assign or deliver up any intangible matter includes an obligation to deliver up
any media embodying that intangible matter.

13.7                                        Governing law

This Agreement is governed
by and must be construed according to the law applying in Queensland.

13.8                                        No representation or
reliance

(a)                                                   Each party acknowledges that no party
(nor any person acting on a party’s behalf) has made any representation or
other inducement to it to enter into this Agreement,
except for representations or inducements expressly set out in this Agreement.

(b)                                                  Each party acknowledges and confirms
that it does not enter into this Agreement
in reliance on any representation or other inducement by or on behalf of any
other party, except for representations or inducements expressly set out in
this Agreement.

13.9                                        Severance

If at any time a provision
of this Agreement is or becomes illegal,
invalid or unenforceable in any respect under the law of any jurisdiction, that
will not affect or impair:

(a)                                                   the legality, validity or
enforceability in that jurisdiction of any other provision of this Agreement; or

(b)                                                  the legality, validity or
enforceability under the law of any other jurisdiction of that or any other
provision of this Agreement.

13.10                                 Waiver

(a)                                                   Failure to exercise or enforce, or a
delay in exercising or enforcing, or the partial exercise or enforcement of, a
right, power or remedy provided by law or under this Agreement by a party does not preclude, or operate as a waiver of,
the exercise or enforcement, or further exercise or enforcement, of that or any
other right, power or remedy provided by law or under this Agreement.

 

14

 

(b)                                                  A waiver or consent given by a party
under this Agreement is only effective
and binding on that party if it is given or confirmed in writing by that party.

(c)                                                   No waiver of a breach of a term of this
Agreement operates as a waiver of another
breach of that term or of a breach of any other term of this Agreement.

13.11                                 Text of agreement

This Agreement is binding in this
English text form. Any translation is for convenience only.

 

15

 

Signed as an agreement.

 

 

	
  Executed by Progen Industries Limited  in

  accordance with section 127 of the Corporations

  Act by or in the presence of:

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Signature of Secretary/other Director

  	
   

  	
  Signature of Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name of Secretary/other
  Director in full

  	
   

  	
  Name of Director

  	
   

  

 

 

 

	
  The Common Seal of Medigen

  Biotechnology Corporation was affixed in the

  presence of:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Signature of Director

  	
   

  	
  Signature of Secretary/other Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name of Director in full

  	
   

  	
  Name of Secretary/other
  Director in full

  	
   

  

 

 

16

 

Annexure A -
Option terms (clause 6.1)

1.                                                       Each
Option entitles the holder to subscribe for one fully
paid ordinary share (“Share”) in accordance with these terms at an exercise
price equal to the volume weighted closing
trading price of Progen ordinary shares on ASX for the 60 Business Days up to
and including the date of delivery of the HCC PR88204 Stage I Study Report
under clause 4.2 of the ASA Termination Agreement
(“Exercise Price”).

2.                                                       The
Option expires at 5.00pm Sydney time on the second anniversary of the date of
issue (“Expiry Time”). The holder may exercise the Option at any time until the
Expiry Time.

3.                                                       Subject
to any applicable law, the holder may transfer some or all of the Options:

(a)                                                   if the Options are quoted on ASX, by a proper ASTC
transfer or any other method permitted by the Applicable Law; or

(b)                                                  by an instrument of transfer approved by the Directors
from time to time.

4.                                                       The
holder may exercise the Options
in whole or in part in accordance with this Annexure A.

5.                                                       Options
may be exercised by delivery to the Company of a notice signed by the holder
specifying the number of Options exercised together with payment to the Company
by cheque or electronic funds transfer of the Exercise Price for each Option
exercised. If the Options are not quoted on ASX, the holder must also deliver
the certificate for the Options or if the certificate for the Options has been
lost, mutilated or destroyed, a declaration to that effect.

6.                                                       On
valid exercise of Options, the Shares must be issued within 10 Business Days of
exercise. The Company must promptly apply for quotation of the Shares. The
Shares issued will, subject to the constitution of the Company, rank in all
respects equally with the existing ordinary shares at the date of issue.

7.                                                       The
holder may only participate in new issues of Shares if the holder exercises an
Option and becomes the holder of Shares on or prior to the record date for the
new issue of Shares.

8.                                                       If
the Company makes a pro rata issue, the Exercise Price of each Option will be
reduced with the new exercise price of each Option to be calculated in
accordance with the formula in Listing Rule 6.22.2. No change will be made to
the number of Shares to which the Holder is entitled.

9.                                                       If
the Company makes a bonus issue, the number of Shares issued on exercise of
each Option will be increased by the number of bonus Shares that the holder
would have received if the Option had been exercised prior to the record date
for the bonus issue.  No change will be
made to the Exercise Price.

10.                                                 If
there is a reorganisation (including consolidation, sub-division, reduction or
return) of the share capital of the Company, the rights of holders in respect
of any unexercised Options will only
be changed to the extent necessary to comply with the Listing Rules
applying to a reorganisation of capital at the time of the reorganisation.  The
remaining rights of the holders will remain unchanged.

 

17Exhibit
4(a)(2)

MASTER
SERVICES AGREEMENT

 

 

This Master Services Agreement (“Agreement”) is made
between Progen Pharmaceuticals Limited ABN 82 010 975 612 which has a place of business 16 Benson
Street, Toowong, Queensland 4066, Australia  (hereinafter “Sponsor”), and Quintiles East
Asia Pte Ltd a
Singaproe corporation having its principal place of business at 89 Science Park
Drive, Lobby B, #03-08 The Rutherford, Science Park One, Singapore 118261 (hereinafter “Quintiles”). When signed
by both parties, this Agreement will set forth the terms and conditions under
which Quintiles agrees to provide certain services to Sponsor as set forth
herein.

 

Recitals:

 

A.            Sponsor
is in the business of developing, manufacturing and/or distributing
pharmaceutical products, medical devices, biotechnology and/or pharmaceutical
products and has made significant, up-front investments in technologies related
to those products and building on important inventions.  Quintiles is in the business of providing
clinical trial services, research, and other services for the pharmaceutical,
medical device and biotechnology industries and has made significant, up-front
investments in technologies related to those industries, building on important
inventions and web-based technologies.

 

B.            Sponsor
and Quintiles desire to enter into this Agreement to provide the terms and
conditions upon which Sponsor may engage Quintiles from time-to-time to provide
services for individual studies or projects by executing individual Work Orders
(as defined below) specifying the details of the services and the related terms
and conditions.

 

Agreement:

 

1.0                                 Scope
of the Agreement; Work Orders; Nature of Services.

 

(a)                                  Scope of Agreement. 
As a “master” form of contract, this Agreement allows the parties to
contract for multiple projects through the issuance of multiple Work Orders (as
discussed in Section 1(b) below), without having to re-negotiate the basic
terms and conditions contained herein. 
This Agreement covers the provision of services by Quintiles and Quintiles’
corporate affiliates (see Section 18) and, accordingly, this Agreement
represents a vehicle by which Sponsor can efficiently contract with Quintiles
and its corporate affiliates for a broad range of services.

 

(b)                                 Work Orders. 
The specific details of each project under this Agreement (each “Project”)
shall be separately negotiated and specified in writing on terms and in a form
acceptable to the parties (each such writing, a “Work Order”).  A sample Work Order is attached hereto as
Exhibit A.  Each Work Order will include,
as appropriate, the scope of work, time line, and budget and payment schedule.
Each Work Order shall be subject to all of the terms and conditions of this
Agreement, in addition to the specific details set forth in the Work Order.  To the extent any terms or provisions of a
Work Order conflict with the terms and provisions of this

 

CONFIDENTIAL

 

 

1

 

Agreement, the terms and
provisions of this Agreement shall control, except to the extent that the
applicable Work Order expressly and specifically states an intent to supersede
the Agreement on a specific matter. All Work Orders and other exhibits hereto
shall be deemed to be incorporated herein by reference.

 

(c)                                  Nature of Services. 
The services covered by this Agreement may include strategic planning,
expert consultation, clinical trial services, statistical programming and
analysis, data processing, data management, regulatory, clerical, project
management, central laboratory services, preclinical services, pharmaceutical
sciences services, medical device services, and other research and development
services requested by Sponsor and agreed to by Quintiles as set forth in the
relevant Work Order (collectively, the “Services”).

 

2.0                             Payment
of Fees and Expenses.   Sponsor will pay Quintiles for fees, expenses
and pass-through costs in accordance with the budget and payment schedule
contained in each Work Order.  Based on the
estimated cash flow of the Project, Sponsor agrees that a prepayment may be
needed for Quintiles to maintain cash neutrality over the term of the Project
taking into account the payment terms agreed to between the parties.  For Projects
over multiple calendar years, the budget will include an annualization
percentage.  Unless otherwise agreed in a particular Work Order,
the following shall apply: (a) Quintiles will invoice Sponsor for it fees in
accordance with the payment schedule, and monthly for its expenses and
pass-through costs at cost to Quintiles with no mark-up, incurred in performing
the Services; and, (b) with the exception of any prepayment or advances and
investigator invoices, which are
due and payable upon receipt, all other invoice payments shall be made to
Quintiles within thirty (30) days of receipt. In the event that taxes or duties, of whatever
nature, are required to be made or withheld on payments made pursuant to this
Agreement or an applicable Work Order by any state, federal, provincial or
foreign government, including, but not limited to, Value Added Tax, Sponsor
shall promptly pay said taxes and duties to the appropriate taxing authority
without any deduction to any amount owed to Quintiles.  Sponsor shall secure and deliver to Quintiles
any official receipt for any such taxes paid. Alternatively, Quintiles may
invoice Sponsor for the taxes accompanied by the official invoice showing that
such taxes have been charged, without a mark-up, as a pass-through expense,
collect the taxes from Sponsor, and pay the taxes due on the Services.  For the avoidance of doubt, the requirements
of this provision shall not apply to any employment-related taxes, duties, or
withholding and shall only apply to taxes applicable to the Services. Expenses and
pass-through costs will be supported by a summary sheet. If any portion of an invoice is disputed, then
Sponsor shall pay the undisputed amounts as set forth in the preceding sentence
and the parties shall use good faith efforts to reconcile the disputed amount
as soon as practicable.  Sponsor shall
pay Quintiles interest in an amount equal to four percent (4%) above the base
interest rate established by Hambros Bank Limited per month of all undisputed
amounts owing hereunder and not paid when due (or the maximum lesser amount
permitted by applicable law.

 

3.0                                 Term. 
This Agreement shall commence on the date it has been signed by all
parties and shall continue for a period of five (5) years from the date of
execution, or until terminated by either party in accordance with Section 17
below.  The Agreement will automatically

 

2

 

renew each year
thereafter for a period of one year, unless either party notifies the other
party in writing at least 30 days prior to the renewal date that it does not
want to renew the Agreement.

 

4.0                                 Change
Orders. 
Any change in the details of a Work Order or the assumptions upon which
the Work Order is based (including, but not limited to, changes in an agreed
starting date for a Project or suspension of the Project by Sponsor) may
require changes in the budget and/or time lines, and shall require a written
amendment to the Work Order (a “Change Order”). 
Each Change Order shall detail the requested changes to the applicable
task, responsibility, duty, budget, time line or other matter.  The Change Order will become effective upon
the execution of the Change Order by both parties, and Quintiles will be given
a reasonable period of time within which to implement the changes.  Both parties agree to act in good faith and
promptly when considering a Change Order requested by the other party.  Without limiting the foregoing, Sponsor
agrees that it will not unreasonably withhold approval of a Change Order, even
if it involves a fixed price contract, if the proposed changes in budgets or
time lines result from, among other appropriate reasons, forces outside the
reasonable control of Quintiles or changes in the assumptions upon which the
initial budget or time lines were based, including, but not limited to, the
assumptions set forth in the budget or timelines.  Quintiles reserves the right to postpone
effecting material changes in the Project’s scope until such time as the
parties agree to and execute the corresponding Change Order.   For any Change Order that affects the scope
of the regulatory obligations that have been transferred to Quintiles,
Quintiles and Sponsor shall execute a corresponding amendment to the Transfer
of Obligations Form.  Sponsor shall file
such amendment where appropriate, or as required by law or regulation.

 

5.0                                 Confidentiality. 
It is understood that during the course of this Agreement, Quintiles and
its employees may be exposed to data and information that are confidential and
proprietary to Sponsor.  All such data
and information (hereinafter “Sponsor Confidential Information”) written or
verbal, tangible or intangible, made available, disclosed, or otherwise made
known to Quintiles and its employees as a result of Services under this
Agreement shall be considered confidential and shall be considered the sole
property of Sponsor.  All information
regarding Quintiles’ operations, methods, and pricing and all Quintiles’
Property (as defined in Section 6.0 below), disclosed by Quintiles to Sponsor
in connection with this Agreement is proprietary, confidential information
belonging to Quintiles (the “Quintiles Confidential Information”, and together
with the Sponsor Confidential Information, the “Confidential Information”).  The Confidential Information shall be used by
the receiving party and its employees only for purposes of performing the
receiving party’s obligations hereunder. 
Each party agrees that it will not reveal, publish or otherwise disclose
the Confidential Information of the other party to any third party without the
prior written consent of the disclosing party. 
Each party agrees that it will not disclose the terms of this Agreement
or any Work Order to any third party without the written consent of the other
party, which shall not unreasonably be withheld.  These obligations of
confidentiality and nondisclosure shall remain in effect for a period of ten
(10) years after the completion or termination of the applicable Work Order.

 

3

 

The foregoing obligations shall not apply to
Confidential Information to the extent that it: (a) is or becomes generally
available to the public other than as a result of a disclosure by the receiving
party;  (b) becomes available to the
receiving party on a non-confidential basis from a source which is not prohibited
from disclosing such information;  (c)
was developed independently of any disclosure by the disclosing party or was
known to the receiving party prior to its receipt from the disclosing party, as
shown by contemporaneous written evidence; or, (d) is required by law or
regulation  to be disclosed.

 

6.0                                 Ownership
and Inventions.  All data and information generated or
derived by Quintiles as the result of services performed by Quintiles under
this Agreement shall be and remain the exclusive property of Sponsor.  Any inventions that may evolve from the data
and information described above or as the result of services performed by
Quintiles under this Agreement shall belong to Sponsor and Quintiles agrees to
assign its rights in all such inventions and/or related patents to Sponsor.
Quintiles acknowledges that Sponsor possesses certain inventions, processes,
know-how, trade secrets, improvements, other intellectual properties and other
assets, including but not limited to analytical methods, procedures and
techniques, procedure manuals, personnel data, financial
information, computer technical expertise and software, which have been
independently developed by Sponsor and which relate to its business or
operations (collectively “Sponsor’ Property”). 
Quintiles and Progen agree that any Sponsors’ Property or improvements
thereto which are used, improved, modified or developed by Sponsor under or
during the term of this Agreement are the sole and exclusive property of
Sponsor.  Notwithstanding the foregoing,
Sponsor acknowledges that Quintiles possesses certain inventions, processes,
know-how, trade secrets, improvements, other intellectual properties and other
assets, including but not limited to analytical methods, procedures and
techniques, procedure manuals, personnel data, financial
information, computer technical expertise and software, which have been
independently developed by Quintiles and which relate to its business or
operations (collectively “Quintiles’ Property”).  Sponsor and Quintiles agree that any
Quintiles’ Property or improvements thereto which are used, improved, modified
or developed by Quintiles under or during the term of this Agreement are the
sole and exclusive property of Quintiles.

 

7.0                                 Records and Materials.  At the completion of the Services by Quintiles or upon
termination of this Agreement, all materials, information and all other data
owned by Sponsor, regardless of the method of storage or retrieval, shall be
delivered to Sponsor in such form as is then currently in the possession of
Quintiles, subject to the payment obligations set forth in Section 2
herein.   Alternatively, at Sponsor’s
written request, such materials and data may be retained by Quintiles for
Sponsor for  an agreed-upon time period, or
disposed of pursuant to the written directions of Sponsor.  Sponsor shall pay the costs associated with
any of the above options and shall pay a to-be-determined fee for storage by
Quintiles of records and materials after completion or termination of the
Services.  Quintiles, however, reserves
the right to retain, at its own cost and subject to the confidentiality
provisions herein, copies of all materials that may be needed  to satisfy regulatory requirements or to resolve disputes
regarding the Services.  Nothing in this
Agreement shall be construed to transfer from Sponsor to Quintiles any FDA or

 

4

 

regulatory record-keeping
requirements unless such transfer is specifically provided for in the
applicable Transfer of Obligations Form.

 

8.0                                 Independent
Contractor Relationship.  For the
purposes of this Agreement, the parties hereto are independent contractors and
nothing contained in this Agreement shall be construed to place them in the
relationship of partners, principal and agent, employer/employee or joint
venturers.  Neither party shall have the
power or right to bind or obligate the other party, and neither party shall
hold itself out as having such authority. 
If, however, Sponsor desires to conduct clinical trials in one or more
countries that require a local sponsor or representative, and Sponsor requests
that Quintiles or its affiliates serve as its agent for that purpose, then
Quintiles may serve as Sponsor’s agent for the purpose of fulfilling local
sponsor or representative duties. 
[Sponsor shall pay Quintiles for such local representative services at
Quintiles’ standard daily rates, unless otherwise specified in the Work Order.

 

Certain countries require
that the local representative must indemnify sites for harm caused by the Study
Drug or otherwise assume primary responsibility for harm caused by the Study
Drug.  Those countries are currently
Singapore, Australia, Indonesia, Korea, Taiwan, China (depending on local
regulatory requirements) and Mexico (if IMSS sites are used). If Sponsor
requests that Quintiles serve as its local representative in those countries,
the parties must negotiate and enter into a Local Representative Agreement,
either as part of the applicable Work Order or as a stand alone agreement . In
addition, if Sponsor is not based in the European Union (“EU”) and services
will be performed in the EU, Sponsor may request that Quintiles serve as its
Legal Representative in the EU, and, if Quintiles agrees, the parties will
negotiate and enter into a separate agreement specifying the terms of such
legal representation.

 

9.0                                 a)  Regulatory
Compliance. Quintiles agrees that its Services will be
conducted in compliance with all applicable laws, rules and regulations, and
with the standard of care customary in the contract research organization
industry.  If the Services will be conducted under an FDA Investigational New Drug
Application (“IND”) or Investigational Device Exemption (“IDE”), then regarding
the FDA’s electronic records and signatures regulation, 21 CFR Part 11 (“Part
11”), Quintiles represents that it has a compliance plan in place as to its
applicable database applications and electronic records systems and it is
working diligently to implement its plan. Quintiles, however, is not
responsible for the compliance or non-compliance of applications or systems
used by third parties (including, but not limited to, investigative sites or
third party laboratories), or any Part 11 audits or assessments thereof, unless
such applications or systems are owned by Quintiles.  Quintiles’ standard operating procedures
will be used in performance of the Services, unless otherwise specifically
stated in the Scope of Work. Quintiles certifies that it has not been debarred
under the Generic Drug Enforcement Act and that it will not knowingly employ
any person or entity that has been so debarred to perform any Services under
this Agreement.  Sponsor represents and
certifies that it will not require Quintiles to perform any assignments or
tasks in a manner that would violate any applicable law or regulation.  Sponsor further represents that it will
cooperate with Quintiles in taking any actions that Quintiles reasonably
believes are necessary to comply with the regulatory obligations that have been
transferred to Quintiles.

 

5

 

                                                b)  Inspections and Audits. Each
party acknowledges that the other party may respond independently to any
regulatory correspondence or inquiry in which such party or its affiliates is
named.  Each party, however, shall notify
the other party promptly of any FDA or other governmental or regulatory
inspection or inquiry concerning any study or Project of Sponsor in which
Quintiles is providing Services. During any such inspection or inquiry, the
parties agree to make reasonable efforts to disclose only the information
required to be disclosed.  During the
term of this Agreement, Quintiles will permit Sponsor’s representatives (unless
such representatives are competitors of Quintiles) to examine  or audit  the work
performed hereunder and the facilities at which the work is conducted upon
reasonable advance notice during regular business hours to determine that the
Project assignment is being conducted in accordance with the agreed task and
that the facilities are adequate. Sponsor agrees that it shall not disclose to
any third party any information ascertained by Sponsor in connection with any
such audit or examination, except to the extent required by law or
regulation.  Sponsor shall reimburse
Quintiles for its time and expenses (including reasonable attorney fees and the
costs of responding to findings) associated with any inspection, audit or
investigation relating to the Services (“Inspection”) instigated by Sponsor or
by a governmental authority, unless such Inspection finds that Quintiles
breached this Agreement or any applicable law or regulation.

 

10.0                           Relationship
with Investigators.  If Quintiles
will be obligated to contract with investigators or investigative sites
(collectively, “Investigators”) then Quintiles will use its local CTA forms (“Local
CTAs”) that have developed for use in specific countries based on local
requirements with the benefit of local legal advice, which have been prepared
in local language and English language where applicable, unless an
industry-standard form is required in the country in question or a
site-specific form is required by a site that has been selected. If no Local
CTAs or industry-standard form exists for the country at issue, the Quintiles
Global CTA will be used. Any applicable Local CTAs, industry-standard forms,
site-specific forms, and the Global CTA will be provided for inspection by the
Sponsor and a copy of the fully executed version shall be provided to the
Sponsor for its legal records to fulfill its obligations herein.  Quintiles’ proposals, budgets and timelines
are based on the use of the CTA forms specified above, and use of other forms
may require changes to budgets and timelines and require increased costs for
local legal review and translations. If an Investigator insists upon any
material changes to any provisions that directly affect Sponsor
(confidentiality, intellectual property, publication, protocol compliance and
inspections), then Quintiles shall submit the proposed change to Sponsor, and
Sponsor shall review, comment on and/or approve such proposed changes within
five (5) working days.  If the forms
specified above, or any changes approved by Sponsor, differ from the terms of
this Agreement or an applicable Work Order (including, but not limited to, provisions
allowing an Investigator to publish results or data that Quintiles is
prohibited from revealing), then Quintiles shall have no liability for any such
provisions or changes.  Unless otherwise
stated in the attached Budget, [the time incurred by Quintiles in negotiating
CTA changes proposed by sites shall be billed at Quintiles’ Standard Rates.

 

6

 

Quintiles  reserves the right to contract with certain
Investigators who a) may be employees of a Quintiles Affiliate;  or, b) may employ or utilize the services of
clinical research coordinators or similar personnel who may be employed or
provided by Quintiles or its Affiliates. Quintiles’ affiliations with such
Investigators will be identified to Sponsor and payments made to such
Investigators will be invoiced and paid as stated in the Investigator budget as
approved by Sponsor.  The parties
acknowledge and agree that, except as to employees of Quintiles or its
Affiliates, Investigators shall not be considered the employees, agents, or
subcontractors of Quintiles.  All
Investigators, however, shall exercise their own independent medical
judgment.  Quintiles’ responsibilities
with respect to Investigators shall be limited to those responsibilities
specifically set forth in this Agreement or the applicable Work Order.

 

                                                If Quintiles will be paying Investigators
on behalf of Sponsor, the parties will agree in the applicable Work Orders as
to a schedule of amounts to be paid to Investigators.  Sponsor acknowledges and agrees Quintiles
will only pay Investigators from advances or pre-payments received from Sponsor
for Investigators’ services, and that Quintiles will not make payments to
Investigators prior to receipt of sufficient funds from Sponsor.  Sponsor acknowledges and agrees that
Quintiles will not be responsible for delays in a study or Project to the
extent that such delays are caused by Sponsor’s failure to make adequate
pre-payment for Investigators’ services. 
Sponsor further acknowledges and agrees that payments for Investigators’
services are pass-through payments to third parties and are separate from
payments for Quintiles’ Services. 
Sponsor agrees that it will not withhold Investigator payments except to
the extent that it has reasonable questions about the services performed by a
particular Investigator.

 

11.0                           Third Party Indemnifications and
Agreements.  If any investigative sites or any other third
parties, including, but not limited to, Data Safety Monitoring Boards,
independent laboratories, Advisory Boards, or End Point Adjudication Committees
(collectively, “Third Parties”), request an indemnification for loss or damage
caused by the sponsor’s Project , then Sponsor shall provide such
indemnification directly to the Third Party. 
If Sponsor requests Quintiles’ assistance in negotiating the terms of
such indemnities, Quintiles shall provide such negotiation services at its
standard daily rates, unless otherwise agreed in the Work Order.  Quintiles shall not sign such
indemnifications on Sponsor’s behalf unless Sponsor has expressly authorized
Quintiles to act as its agent for such purpose or has given Quintiles a written
power of attorney to sign such indemnifications.

 

If Sponsor requests that Quintiles enter into
agreements to retain Third Parties to perform services regarding the Project,
such Third Parties shall be independent contractors and shall not be considered
the employees, agents, or subcontractors of Quintiles or Sponsor.  Sponsor shall pay Quintiles for its
reasonable time and expenses in negotiating and administering any such Third
Party Agreements.

 

12.0                           Conflict
of Agreements.  Quintiles represents to Sponsor that it is
not a party to any agreement which would prevent it from fulfilling its
obligations under this Agreement and that during the term of this Agreement,
Quintiles agrees that it will not enter into any agreement to provide services
which would in any way prevent it from providing the

 

7

 

Services contemplated
under this Agreement.  Sponsor agrees
that it will not enter into an agreement with a third party that would alter or
affect the regulatory obligations delegated to Quintiles in any study or
Project without the written consent of Quintiles, which will not be
unreasonably withheld.

 

13.0                           Publication. 
Project results may not be published or referred to, in whole or in
part, by Quintiles or its affiliates without the prior expressed written
consent of Sponsor.  Neither party will
use the other party’s name in connection with any publication or promotion
without the other party’s prior, written consent.

 

14.0                           Limitation
of Liability.

 

a)             Neither
Quintiles, nor its affiliates,  directors,
officers, employees, subcontractors or agents shall have any liability
(including without limitation, contract, negligence and tort liability)  for any loss of profits, opportunities or goodwill or any
type of indirect or consequential damages in connection with this Agreement or
any Work Order or the Services performed by Quintiles.

 

                                                b)            In
no event shall the collective, aggregate liability (including without
limitation, contract, negligence and tort liability) of Quintiles or its
affiliates, directors, officers, employees, subcontractors or agents under this
Agreement exceed the amount of fees actually received by Quintiles from Sponsor
under the applicable Work Order.

 

c)             Nothing
herein is intended to exclude or limit any liability for willful misconduct or
any liability for death or personal injury caused by negligence.

 

15.0                           Indemnification.

 

a)             Sponsor shall indemnify, defend and hold harmless
Quintiles and its affiliates, and its and their directors, officers, employees
and agents (each, a “Quintiles Indemnified Party”), from and against any and
all losses, damages, liabilities, reasonable attorney fees, court costs, and
expenses (collectively “Quintiles Losses”), joint or several, resulting or
arising from any third-party claims, actions, proceedings, investigations or
litigation relating to or arising from or in connection with this Agreement,
any Work Order, or the Services contemplated herein (including, without
limitation, any Quintiles Losses arising from or in connection with any study,
test, device, product or potential product to which this Agreement or any Work
Order relates), except to the extent such Quintiles Losses are determined to
have resulted from the negligence or intentional misconduct of the Quintiles
Indemnified Party seeking indemnity hereunder.

 

b)            Quintiles shall indemnify, defend and hold harmless
Sponsor and its affiliates, and its and their directors, officers, employees
and agents, from and against any and all losses, damages, liabilities,
reasonable attorney fees, court costs, and expenses (collectively “Sponsor
Losses”), joint or several, resulting or arising from any third-party claims,
actions, proceedings, investigations or litigation relating to or arising from
or in connection with this Agreement or the Services contemplated herein
(including, without limitation, any Sponsor Losses arising from or in
connection with any study, test, device, product or potential product to which
this Agreement relates), to the extent such Sponsor

 

8

 

Losses are determined to
have resulted from the negligence or intentional misconduct of Quintiles.

 

16.0                           Indemnification
Procedure.
Each person or entity seeking indemnification under sections 15.0 a) or b)
shall promptly notify the indemnifying party 
of any such claim or lawsuit (including provision of  a copy thereof) served upon it and shall
fully cooperate with the indemnifying party 
and its legal representatives in the investigation of any matter the
subject of indemnification.   Under no
circumstances shall an indemnified party settle or otherwise compromise any
claim, liability, or action covered by this Indemnification provision without
the indemnified party’s prior written consent, which consent will not be
unreasonably withheld.

 

17.0                           Termination. 
Sponsor or Quintiles may terminate this Agreement or any Work Order
without cause at any time during the term of the Agreement on sixty (60) day’s
prior written notice to Quintiles or Sponsor, as appropriate.  Either party may terminate this Agreement or
any Work Order for material breach upon thirty (30) days’ written notice
specifying the nature of the breach, if such breach has not been substantially
cured within the thirty (30) day period. 
During the 30-day cure period for termination due to breach, each party
will continue to perform its obligations under the Agreement.  If the termination notice is not due to a
breach, or if the cure period has expired without a substantial cure of the
breach, then the parties shall promptly meet to prepare a close-out schedule,
and Quintiles shall cease performing all work not necessary for the orderly
close-out of the Services or required by laws or regulations.   If Quintiles determines, in its sole
discretion, that its continued performance of the Services contemplated by one
or more Work Orders would constitute a potential or actual violation of
regulatory or scientific standards of integrity, then Quintiles may terminate
the applicable Work Order(s) by giving written notice stating the effective
date (which may be less than thirty days from the notice date) of such
termination.  Either party may terminate
this Agreement or any Work Orders immediately upon provision of written notice
if the other party becomes insolvent or files for bankruptcy.  Any written termination notice shall identify
the specific Work Order or Work Orders that are being terminated.

 

                                                If this Agreement or any Work Order is
terminated, Sponsor shall pay Quintiles for all Services performed in
accordance with this Agreement and any applicable Work Order and reimburse
Quintiles for all costs and expenses incurred in performing those Services,
including all non-cancelable costs incurred prior to termination but paid after
the termination date. Sponsor shall pay for all the work actually performed in
accordance with this Agreement and the applicable Work Order, even if the
parties’ original payment schedule spreads-out payments for certain services or
defers payments for certain services until the end of the Study.  If payments are unit or milestone based, and
the Agreement or a Work Order is terminated after costs have been incurred
toward achieving portions of one or more incomplete units or milestones,
Sponsor will pay Quintiles’ standard fees for actual work performed toward
those incomplete units or milestones up to the date of termination, in addition
to paying for completed units or milestones.  
Sponsor shall pay for all actual costs, including time spent by
Quintiles personnel (which shall be billed at Quintiles’ standard daily rates
in effect as of the date of the termination notice), incurred to complete
activities associated with the termination

 

9

 

and close-out of affected
Projects, including the fulfillment of any regulatory requirements.  In addition, if the termination is by Sponsor
without cause, or by Quintiles for cause, and the total fees for the Project are
greater than one million U.S. dollars in value, then Sponsor shall pay to
Quintiles an amount equal to ten percent (10%) of the budget for the remainder
of Services that have not yet been performed and are scheduled to be performed
within the twelve (12) months following termination, to cover Quintiles’ costs
associated with early termination.

 

18.0                           Relationship
with Affiliates.  Sponsor agrees that Quintiles
may use the services of its corporate affiliates as subcontractors to fulfill Quintiles’ obligations under this
Agreement or any Work Order.  Quintiles shall remain responsible for all
Services performed by its affiliates, and its affiliates shall be subject
to all of the terms, conditions and
rights applicable to Quintiles under this Agreement or any Work Order.
Any affiliate of Quintiles or Sponsor may enter into a Work Order under this
Agreement, and the terms, conditions and rights in this Agreement shall be
incorporated into the Work Order and be binding on such affiliate.  The term “affiliate” shall mean all entities
controlling, controlled by or under common control with Quintiles.  The term “control” shall mean the ability to
vote fifty percent (50%) or more of the voting securities of any entity or
otherwise having the ability to influence and direct the polices and direction
of an entity.

 

19.0                           Cooperation;
Sponsor or Quintiles Delays; Disclosure of Hazards. Sponsor shall forward to Quintiles in a
timely manner all documents, materials and information in Sponsor’s possession
or control necessary for Quintiles to conduct the Services.  Quintiles agrees
and acknowledges that time is of the essence and shall use commercially
reasonable efforts to perform its’ obligations in the conduct of the Services
within the timeframe(s) set forth under the applicable Work Order , including
but not limited to the Scope of Work and 
any other Attachments(s)  and any
amendments thereto agreed to by the parties in writing. Quintiles shall
not be liable to Sponsor nor be deemed to have breached this Agreement for errors,
delays or other consequences arising from Sponsor’s failure to timely provide
documents, materials or information or to otherwise cooperate with Quintiles in
order for Quintiles to timely and properly perform its obligations, and any
such failure by Sponsor shall automatically extend any timelines affected by a
time period reasonably commensurate to take into account such failure, unless
Sponsor agrees in writing to pay any additional costs  that would be required to meet the original
timeline.  If Sponsor delays a project
from its agreed starting date or suspends performance of the project then
either: a) Sponsor will pay the standard daily rate of the Quintiles’ personnel
assigned to the project, based on the percentage of their time allocated to the
project, for the period of the delay, in order to keep the current team
members; or, b) Quintiles may re-allocate the personnel at its discretion, and
Sponsor will pay the costs of re-training new personnel. In addition, Sponsor
will pay all non-cancelable costs and expenses incurred by Quintiles due to the
delay and will adjust all timelines to reflect additional time required due to
the delay. In order for Quintiles to comply with the Health and Safety at Work
Act 1974 and any applicable regulation made pursuant thereto it is a condition
of Quintiles providing the contract Services that Sponsor shall provide
Quintiles with all information available to it regarding known or potential
hazards associated with the use of any substances supplied to Quintiles by
Sponsor, and

 

10

 

Sponsor shall comply with
all current legislation and regulations concerning the shipment of substances
by the land, sea or air.

 

20.0                           Force
Majeure.  In the event either party shall be delayed or
hindered in or prevented from the performance of any act required hereunder by
reasons of strike, lockouts, labor troubles, inability to procure materials or
services, failure of power or restrictive government or judicial orders, or
decrees, riots, insurrection, war, Acts of God, inclement weather or other
reason or cause beyond that party’s control, then performance of such act
(except for the payment of money owed) shall be excused for the period of such
delay.

 

21.0                           Notices
and Deliveries.  Any notice required or
permitted to be given hereunder by either party hereunder shall be in writing
and shall be deemed given on the date received if delivered personally or by a
reputable overnight delivery service, or three (3) days after the date postmarked
if sent by registered or certified mail, return receipt requested, postage
prepaid to the following addresses:

 

	
  If to Quintiles:

  	
   

  	
  If to Sponsor:

  
	
  Quintiles East Asia Pte Ltd

  89 Science Park Drive

  Lobby B #03-08

  The Rutherford, Science Park One

  Singapore 118261

  	
   

  	
  Liz Wilson

  Director of Clinical Operations

  Progen Pharmaceuticals Ltd

  16 Benson Street (PO Box 2403)

  Toowong, QLD 4066 Australia

  
	
  Attention: Anand Tharmaratnam

  	
   

  	
   

  
	
  Head
  of Clinical

  	
   

  	
   

  
	
  Development,
  Asia Pacific

  	
   

  	
   

  

 

 

With a copy to:

 

	
  If to Quintiles:

  Quintiles Transnational Legal

  Department

  P.O. Box 13979

  Research Triangle Park, North

  Carolina, U.S.A.

  27709-3979

  Attention: Head of Legal Department

  	
   

  	
  Progen Legal Department

  Progen Pharmaceuticals Ltd

  16 Benson St (PO Box 2403)

  Toowong, QLD 4066 Australia

  

 

 

If Sponsor delivers, ships, or mails materials or
documents to Quintiles, or requests that Quintiles deliver, ship, or mail
materials or documents to Sponsor or to third parties, then the expense and
risk of loss for such deliveries, shipments, or mailings shall be borne by
Sponsor.  Quintiles disclaims any
liability for the actions or omissions of third-party delivery services or
carriers. All information transmitted by Quintiles pursuant to this

 

11

 

Agreement will be sent by the standard transmission
method selected by Quintiles (telephone, facsimile, mail, personal delivery or
email).  Sponsor hereby consents and
authorizes Quintiles to send facsimiles relating to the Services, or relating
to potential future services, to any office of Sponsor or Sponsor’s affiliates.

 

22.0                     Insurance. During the term of this Agreement to
cover its obligations hereunder, each party shall maintain insurance coverage
with a reputable insurance company as follows: i) Clinical Trials and/or
Product Liability insurance for Sponsor of not less than US$5,000,000 per
annum; ii)  Professional Indemnity
insurance for Quintiles of not less than US$5,000,000 per annum; and, iii)  Liability to third parties with a limit of
$1,000,000 per claim or series of related claims, or at the minimum statutory
level, whichever is greater. All insurance amounts may be obtained by full,
individual primary policy amount; a primary amount of less than minimum
requirement enhanced by a blanket excess umbrella policy; or a combination of
either. Each party shall provide the other party with a certificate of
insurance upon request. The insured party will ensure that the other party’s
interest is noted on the policy or policies.

 

23.0                       Foreign Currency Exchange. 
The currency to be used for invoice and payment shall be the currency
stated in the Budget or Table attached to the applicable Work Order (the “Contracted
Currency”). If Quintiles incurs pass-through costs in a currency other than the
Contracted Currency, then Sponsor shall reimburse Quintiles for Quintiles’
actual costs in the Contracted Currency based on the Oanda foreign currency
exchange rate (Oanda.com) for the applicable currencies on the last business
day of the month in which such pass-through costs are submitted.  If a
currency referenced within the Budget is replaced by the Euro or otherwise
ceases to become legal tender, the applicable replacement currency will be
substituted for such currency for purposes of this provision at an established
conversion rate.

 

If this Agreement involves the performance of Services
by Quintiles or its affiliates in any country that uses a currency other than
the Contracted Currency, then the Budget for those Services will be based on
the local rates in the currency used by Quintiles for pricing that country, but
converted to and reflected in the Contracted Currency.  Sponsor acknowledges that, due to
fluctuations in currency exchange rates, Quintiles’ actual fees may be greater
or lesser than the budgeted or estimated amounts contained in this
Agreement.  If the fees for Services in
currencies other than the Contracted Currency exceed $500,000 and the
conversion rate between the local currencies and the Contracted Currency has
fluctuated more than 2%, plus or minus, since the Budget was prepared,
Quintiles may calculate a foreign currency exchange adjustment based upon the
following:

 

a)             In
the case of Fee for Service budgets, fees will be converted on each invoice
based on the Oanda foreign currency exchange spot rate (Oanda.com) from the
last Friday of the preceding month in which services were performed; or,

 

b)            For
all other budget types including fixed fee, milestone or unit priced budgets,
the adjustment will be calculated every 12 months after the contract execution
date (or in the final invoice if the agreement is for less than 12 months). The
foreign currency adjustment will be calculated by comparing the foreign
currency exchange rate stated in

 

12

 

the Budget or Table attached to the Agreement to the
Oanda (Oanda.com) average rate over the preceding 12 months. Any resulting
decrease in costs will be credited to Sponsor and any resulting increase in
costs will be invoiced to Sponsor.

24.0                           Data Protection.  Quintiles and Sponsor agree to comply with all
applicable privacy laws and regulations. 
If the services will involve the collection or processing of personal
data (as defined by applicable data protection legislation) within the European
Economic Area (“EEA”), then Sponsor shall serve as the controller of such data,
as defined by the European Union (“EU”) Data Protection Directive (the “Directive”),
and Quintiles shall act only under the instructions of the Sponsor in regard to
personal data.  If Sponsor is not based
in the EEA, Sponsor must appoint an EEA company to act as its local
representative for data protection purposes in order to comply with the
Directive, and if Sponsor requests that a Quintiles Affiliate in the EEA serve
as its local representative, and Quintiles agrees, then the parties shall
negotiate and enter into a separate agreement specifying such representative
duties. If Quintiles determines that it is required, the parties shall enter
into a Data Transfer Agreement between the parties containing the Standard
Contractual Clauses set forth by the EU Commission Decision of 15 June 2001
(Decision 2001/497/EC) before Quintiles will assume any such representative
duties.

25.0                           Binding Agreement and  Assignment.
This Agreement shall be binding upon and inure to the benefit of Sponsor and
Quintiles and their respective successors and permitted assigns.  Except as stated above in Section 18, neither
party may assign any of its rights or obligations under this Agreement to any
party without the express, written consent of the other party.

 

26.0                           Choice of Law, Waiver and
Enforceability.
This Agreement shall be construed, governed, interpreted, and applied in
accordance with the laws of Singapore. The failure to enforce any right or
provision herein shall not constitute a waiver of that right or provision.  Any waiver of a breach of a provision shall
not constitute a waiver of any subsequent breach of that provision.  If any provisions herein are found to be
unenforceable on the grounds that they are overly broad or in conflict with
applicable laws, it is the intent of the parties that such provisions be
replaced, reformed or narrowed so that their original business purpose can be
accomplished to the extent permitted by law, and that the remaining provisions
shall not in any way be affected or impaired thereby.

 

27.0                           Survival. 
The rights and obligations of Sponsor and Quintiles, which by intent or
meaning have validity beyond such termination (including, but not limited to,
rights with respect to inventions, confidentiality, discoveries and
improvements, indemnification and liability limitations) shall survive the
termination of this Agreement or any Work Order.

 

28.0                           Arbitration. Any controversy or claim arising out of
or relating to this Agreement or the breach thereof shall be settled by
arbitration administered by the International Chamber of Commerce (“ICC”) under
its International Rules of Arbitration, and judgment on the award rendered by
the arbitrator shall be binding and may be entered in any court having
jurisdiction thereof.  Such arbitration
shall be filed and conducted at the office of the ICC closest to the Quintiles
office having responsibility for the Project, and shall be conducted 

 

13

 

in English by one
arbitrator mutually acceptable to the parties selected in accordance with ICC
Rules.

 

29.0                                 Entire Agreement, Headings and
Modification.
This Agreement, together with the applicable Work Orders, contains the entire
understandings of the parties with respect to the subject matter herein, and
supersedes all previous agreements (oral and written), negotiations and
discussions. The descriptive headings of the sections of this Agreement are
inserted for convenience only and shall not control or affect the meaning or
construction of any provision hereof. 
Any modifications to the provisions herein must be in writing and signed
by the parties.

 

 

IN WITNESS WHEREOF, this
Agreement has been executed by the parties hereto through their duly authorized
officers on the date(s) set forth below.

 

 

 

ACKNOWLEDGED,
ACCEPTED AND AGREED TO:

 

	
  Quintiles East Asia Pte
  Ltd

  	
   

  	
  Progen Pharmaceuticals
  Limited

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  (signature)

  	
   

  	
   

  	
  (signature)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Print Name:

  	
   

  	
   

  	
  Print Name:

  	
   

  
	
   

  	
   

  	
   

  	
  James Garner

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Vice President of Clinical & Medical Affairs

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (signature)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Name:

  	
   

  
	
   

  	
   

  	
   

  	
  Linton Burns

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
  CFO & Company Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
													

 

14

 

 

	
   

  	
   

  	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (signature)

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Print Name:

  	
   

  
	
   

  	
   

  	
   

  	
  T. Justus Homburg

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Title: CEO & Managing Director

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
								

 

15

 

EXHIBIT A

SAMPLE WORK ORDER

 

WORK ORDER

 

This Work Order (“Work Order”) is between                         
(“Sponsor”) and                                          
(“Quintiles”) and relates to the Master Services Agreement dated                            
(the “Master Agreement”), which is incorporated by reference herein.  Pursuant to the Master Agreement, Quintiles
has agreed to perform certain services in accordance with written work orders,
such as this one, entered into from time-to-time.

 

The parties hereby agree as follows:

 

1.             Work
Order.  This document constitutes a “Work
Order” under the Master Agreement and this Work Order and the services
contemplated herein are subject to the terms and provisions of the Master
Agreement.

 

2.             Services
and Payment of Fees and Expenses.  
The specific services contemplated by this Work Order (the “Services”)
and the related payment terms and obligations are set forth on the following
attachments, which are incorporated herein by reference:

 

	
  SCOPE OF WORK

  	
  ATTACHMENT 1

  
	
  PROJECT BUDGET

  	
  ATTACHMENT 2

  
	
  TIMELINE

  	
  ATTACHMENT 3

  
	
  PAYMENT SCHEDULE

  	
  ATTACHMENT 4

  
	
  TRANSFER OF OBLIGATIONS

  	
   

  
	
  (if applicable)

  	
  ATTACHMENT 5

  
	
  LOCAL REPRESENTATIVE DUTIES

  	
   

  
	
  (if applicable)

  	
  ATTACHMENT 6

  

 

 

3.             Term.  The term of this Work Order shall commence on
the date of execution and shall continue until the services described in Attachment
1 are completed, unless this Work Order is terminated in accordance with
the Master Agreement.  If the Master
Agreement is terminated or expires, but this Work Order is not terminated or
completed, then the terms of the Master Agreement shall continue to apply to
this Work Order until the Work Order is either terminated or completed.

 

4.             Subcontractors.   Any subcontractors or consultants (other
than Quintiles’ affiliates) that will be used by Quintiles in performing the
Services are listed below:

 

[Insert names  of  any subcontractors or consultants, other than Quintiles’ affiliates,
that will be used]

 

16

 

5.             Amendments.  No modification, amendment, or waiver of this
Work Order shall be effective unless in writing and duly executed and delivered
by each party to the other.

 

6.             Currency
Exchange.

 

7.             Inflation
and Cost Adjustment.

 

 

ACKNOWLEDGED,
ACCEPTED AND AGREED TO:

 

	
  [Quintiles]

  	
   

  	
  [Sponsor]

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  
							

 

17

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