Document:

ex10-1.htm

Exhibit 10.1

 

CELSION CORPORATION
2007 STOCK INCENTIVE PLAN

 

Amended and Restated: March 17, 2015

Approved by Stockholders: June 19, 2015

 

TABLE OF CONTENTS

 

	
 
	
 
	
 
	
 
	
Page
	
 

	
1.
	
 
	
Establishment, Purpose and Types of Awards
	
 
	
A-3
	
 

	
2.
	
 
	
Definitions
	
 
	
A-3
	
 

	
3.
	
 
	
Administration
	
 
	
A-5
	
 

	
  
	
 
	
(a) Procedure
	
 
	
A-5
	
 

	
  
	
 
	
(b) Secondary Committees and Sub-Plans
	
 
	
A-6
	
 

	
  
	
 
	
(c) Powers of the Committee
	
 
	
A-6
	
 

	
  
	
 
	
(d) Limited Liability
	
 
	
A-7
	
 

	
  
	
 
	
(e) Indemnification
	
 
	
A-7
	
 

	
  
	
 
	
(f) Effect of Committee's Decision
	
 
	
A-7
	
 

	
  
	
 
	
(g) Apprising the Board
	
 
	
A-7
	
 

	
4.
	
 
	
Stock Available Under the Plan; Maximum Awards
	
 
	
A-7
	
 

	
  
	
 
	
(a) Stock Available Under the Plan
	
 
	
A-7
	
 

	
  
	
 
	
(b) Maximum Awards to Covered Employees
	
 
	
A-8
	
 

	
5.
	
 
	
Participation
	
 
	
A-8
	
 

	
6.
	
 
	
Stock Options
	
 
	
A-8
	
 

	
  
	
 
	
(a) Grant of Option
	
 
	
A-8
	
 

	
  
	
 
	
(b) Exercise Price
	
 
	
A-8
	
 

	
  
	
 
	
(c) Payment
	
 
	
A-8
	
 

	
  
	
 
	
(d) Term of Options
	
 
	
A-9
	
 

	
  
	
 
	
(e) Restrictions on Incentive Stock Options
	
 
	
A-9
	
 

	
  
	
 
	
(f) Other Terms and Conditions
	
 
	
A-9
	
 

	
7.
	
 
	
Restricted Stock and Restricted Stock Units
	
 
	
A-9
	
 

	
  
	
 
	
(a) In General
	
 
	
A-9
	
 

	
  
	
 
	
(b) Vesting Conditions and Other Restrictions
	
 
	
A-9
	
 

	
  
	
 
	
(c) Stock Issuance and Stockholder Rights
	
 
	
A-10
	
 

	
8.
	
 
	
Stock Appreciation Rights
	
 
	
A-10
	
 

	
  
	
 
	
(a) Award of Stock Appreciation Rights
	
 
	
A-10
	
 

	
  
	
 
	
(b) Restrictions of Tandem SARs
	
 
	
A-10
	
 

	
  
	
 
	
(c) Amount of Payment upon Exercise of SARs
	
 
	
A-11
	
 

	
  
	
 
	
(d) Form of Payment upon Exercise of SARs
	
 
	
A-11
	
 

	
9.
	
 
	
Phantom Stock
	
 
	
A-11
	
 

	
10.
	
 
	
Performance Awards
	
 
	
A-11
	
 

	
  
	
 
	
(a) In General
	
 
	
A-11
	
 

	
  
	
 
	
(b) Covered Employee Targets
	
 
	
A-11
	
 

	
11.
	
 
	
Withholding and Reporting of Taxes
	
 
	
A-12
	
 

	
12.
	
 
	
Transferability
	
 
	
A-12
	
 

  

 

A-1

 

 

 

 

 

	
 
	
 
	
 
	
 
	
Page
	
 

	
13.
	
 
	
Adjustments; Business Combinations
	
 
	
A-12
	
 

	
  
	
 
	
(a) Adjustments
	
 
	
A-12
	
 

	
  
	
 
	
(b) Change in Control
	
 
	
A-12
	
 

	
  
	
 
	
(c) Dissolution and Liquidation
	
 
	
A-13
	
 

	
  
	
 
	
(d) Other Adjustments
	
 
	
A-13
	
 

	
14.
	
 
	
Termination and Amendment
	
 
	
A-13
	
 

	
  
	
 
	
(a) Amendment or Termination by the Board
	
 
	
A-13
	
 

	
  
	
 
	
(b) Amendments by the Committee
	
 
	
A-13
	
 

	
  
	
 
	
(c) Approval of Grantees
	
 
	
A-13
	
 

	
15.
	
 
	
Non-Guarantee of Employment
	
 
	
A-14
	
 

	
16.
	
 
	
Termination of Employment
	
 
	
A-14
	
 

	
17.
	
 
	
Written Agreement
	
 
	
A-14
	
 

	
18.
	
 
	
Non-Uniform Determinations
	
 
	
A-14
	
 

	
19.
	
 
	
Limitation on Benefits
	
 
	
A-14
	
 

	
20.
	
 
	
Listing and Registration
	
 
	
A-14
	
 

	
21.
	
 
	
Compliance with Securities Law
	
 
	
A-15
	
 

	
22.
	
 
	
No Trust or Fund Created
	
 
	
A-15
	
 

	
23.
	
 
	
No Limit on Other Compensation Arrangements
	
 
	
A-15
	
 

	
24.
	
 
	
No Restriction of Corporate Action
	
 
	
A-15
	
 

	
25.
	
 
	
Governing Law
	
 
	
A-15
	
 

	
26.
	
 
	
Plan Subject to Charter and Bylaws
	
 
	
A-15
	
 

	
27.
	
 
	
Effective Date; Termination Date
	
 
	
A-16
	
 

  

 

A-2

 

 

 

 

  
CELSION CORPORATION
2007 STOCK INCENTIVE PLAN

 

1.     Establishment, Purpose and Types of Awards

 

        Celsion Corporation, a Delaware corporation (the Company), hereby establishes the Celsion Corporation 2007 Stock Incentive Plan (the "Plan"). The purpose of the Plan is to promote the long-term growth and profitability of the "Company" by (i) providing incentives to improve stockholder value and to contribute to the growth and financial success of the Company, and (ii) enabling the Company to attract, retain and reward the best available persons for positions of substantial responsibility.

 

        The Plan permits the granting of Awards in the form of Incentive Stock Options, Nonqualified Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Phantom Stock, and Performance Awards, in each case as such term is defined below, and any combination of the foregoing.

 

2.     Definitions

 

        Under this Plan, except where the context otherwise indicates, the following definitions apply:

 

         (a)    "Affiliate"   shall mean any entity other than a Subsidiary, if the Company and/or one or more Subsidiaries own directly or indirectly not less than fifty percent (50%) of such entity.

 

         (b)    "Awards"   shall mean Incentive Stock Options, Nonqualified Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Phantom Stock, and Performance Awards, and any combination of the foregoing.

 

         (c)    "Board"   shall mean the Board of Directors of the Company.

 

         (d)    "Change in Control"   shall mean:

 

         (i)    The consummation of an amalgamation, merger or consolidation of the Company with or into another entity or any other corporate reorganization of the Company, if more than fifty percent (50%) of the combined voting power of the continuing or surviving entity's securities outstanding immediately after such amalgamation, merger, consolidation or other reorganization (or, if applicable, more than fifty percent (50%) of the combined voting power of the ultimate parent company that directly or indirectly has beneficial ownership of the securities of such continuing or surviving entity) is not owned directly or indirectly by persons who were holders of the Company's then-outstanding voting securities immediately prior to such amalgamation, merger, consolidation or other reorganization;

 

         (ii)   The sale, transfer or other disposition of all or substantially all of the Company's assets to an entity that is not a Parent, a Subsidiary or an Affiliate of the Company;

 

         (iii)  Any transaction as a result of which any person becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing at least fifty percent (50%) of the total voting power represented by the Company's then-outstanding voting securities. For purposes of this subsection, the term "person" shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude: (A) any Parent, Subsidiary or Affiliate of the Company, (B) any employee benefit plan (or related trust) sponsored or maintained by the Company, a Parent, or any Subsidiary or Affiliate, and (C) any underwriter temporarily holding securities pursuant to an offering of such securities; or

 

 

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        (iv)  A change in the composition of the Board over a period of twenty four (24) consecutive months or less as a result of which individuals who, at the beginning of such period, constitute the Board (the "Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual subsequently becoming a director whose election, or nomination for election by the Company's Stockholders, was approved by a vote of at least a majority of the directors then comprising the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board.

 

        (e)    "Code"   shall mean the Internal Revenue Code of 1986, as amended, and any regulations issued thereunder.

 

        (f)     "Committee"   shall mean the Board or a committee of the Board appointed pursuant to Section 3 of the Plan to administer the Plan.

 

        (g)    "Committee Delegate"   shall mean the Chief Executive Officer or other senior officer of the Company to whom duties and powers of the Board or Committee hereunder have been delegated pursuant to Section 3(c).

 

        (h)    "Covered Employee"   shall mean an employee of the Company or any Parent, Subsidiary or Affiliate who is subject to Code Section 162(m).

 

        (i)     "Exchange Act"   shall mean the U.S. Securities Exchange Act of 1934, as amended and any rules or regulations promulgated thereunder.

 

        (j)     "Fair Market Value"   of the Stock for any purpose on a particular date shall mean:

 

        (i)    if the Stock is traded on a public securities exchange or a national automated quotation system, the closing price for Stock on the relevant date, or (if there were no sales on such date) the closing price on the nearest day before the relevant date, as reported in The Wall Street Journal or a similar publication selected by the Committee; or

 

        (ii)   if the Stock is not traded on a public securities exchange or a national quotation system on such date, the price determined in a manner such as the Committee shall in good faith determine to be appropriate.

 

        (k)    "Grant Agreement"   shall mean a written agreement between the Company and a grantee memorializing the terms and conditions of an Award granted pursuant to the Plan.

 

        (l)     "Grant Date"   shall mean the date on which the Committee formally acts to grant an Award to a grantee or such other date as the Committee shall so designate at the time of taking such formal action.

 

        (m)   "Incentive Stock Options"   shall mean Stock options that meet the requirements of Code Section 422.

 

        (n)    "Nonqualified Stock Options"   shall mean Stock options that do not meet the requirements of Code Section 422.

 

        (o)    "Parent"   shall mean a company, whether now or hereafter existing, within the meaning of the definition of "parent company" provided in Section 424(e) of the Code, or any successor thereto of similar import.

 

        (p)    "Participant"   shall mean a director, officer, employee or consultant of the Company, or any Parent, Subsidiary or Affiliate, who is granted an Award under the Plan.

 

        (q)    "Performance Award"   shall mean an Award under Section 10 hereof.

 

 

A-4

 

 

 

 

 

         (r)    "Performance Measure"   shall mean one or more of the following criteria selected by the Committee to measure performance of the Company or any Parent, Subsidiary or Affiliate or other business division of same for a Performance Period, whether in absolute or relative terms: basic or diluted earnings per share of Stock; earnings per share of Stock growth; revenue; operating income; net income (either before or after taxes); earnings and/or net income before interest and taxes; earnings and/or net income before interest, taxes, depreciation and amortization; return on capital; return on equity; return on assets; net cash provided by operations; free cash flow; Stock price; economic profit; economic value; total stockholder return; gross margins and costs. Each such measure shall be determined in accordance with generally accepted accounting principles as consistently applied and, if so determined by the Committee and, in the case of a Performance Award to a Covered Employee, to the extent permitted under Code Section 162(m), adjusted to omit the effects of extraordinary items, gain or loss on the disposal of a business segment, unusual or infrequently occurring events and transactions and cumulative effects of changes in accounting principles.

 

        (s)    "Performance Period"   means a period of not less than three months nor more than ten years over which the achievement of targets for Performance Measures is determined.

 

        (t)    " Phantom Stock"   shall mean Awards under Section 9.

 

        (u)    "Restricted Stock" and "Restricted Stock Units"   shall mean Awards under Section 7. 

 

        (v)    "Rule 16b-3"   shall mean Rule 16b-3 as in effect under the Exchange Act on the effective date of the Plan, or any successor provision prescribing conditions necessary to exempt the issuance of securities under the Plan (and further transactions in such securities) from Section 16(b) of the Exchange Act.

 

        (w)   "Securities Act"   shall mean the U.S. Securities Act of 1933, as amended and any rules or regulations promulgated thereunder.

 

        (x)    "Stock"   shall mean common stock of the Company, par value $0.01 per share.

 

        (y)    "Stock Appreciation Rights"   shall mean Awards under Section 8.

 

        (z)    "Subsidiary" and "Subsidiaries"   shall mean only a company or companies, whether now or hereafter existing, within the meaning of the definition of "subsidiary company" provided in Section 424(f) of the Code, or any successor thereto of similar import.

 

        (aa)  "2001 Plan"   shall mean the 2001 Celsion Corporation Stock Option Plan.

 

        (bb)  "2004 Plan"   shall mean the Celsion Corporation 2004 Stock Incentive Plan.

 

3.     Administration

 

        (a)     Procedure.     The Plan shall be administered by the Board. In the alternative, the Board may delegate authority to a Committee to administer the Plan on behalf of the Board, subject to such terms and conditions as the Board may prescribe. Such Committee shall consist of not less than two (2) members of the Board each of whom is a "non-employee director" within the meaning of Rule 16b-3 under the Exchange Act, or any successor rule of similar import, and an "outside director" within the meaning of Section 162(m) of the Code and the regulations promulgated thereunder.

 

        Once appointed, the Committee shall continue to serve until otherwise directed by the Board. From time to time, the Board may increase the size of the Committee and appoint additional members thereof, remove members (with or without cause) and appoint new members in substitution therefor, fill vacancies, however caused, and remove all members of the Committee and, thereafter, directly administer the Plan. In the event that the Board is the administrator of the Plan in lieu of a Committee, the term "Committee" as used herein shall be deemed to mean the Board. 

 

        Members of the Board or Committee who are either eligible for Awards or have been granted Awards may vote on any matters affecting the administration of the Plan or the grant of Awards pursuant to the Plan, except that no such member shall act upon the granting of an Award to himself or herself, but any such member may be counted in determining the existence of a quorum at any meeting of the Board or the Committee during which action is taken with respect to the granting of an Award to him or her.

 

 

A-5

 

 

 

 

 

        The Committee shall meet at such times and places and upon such notice as it may determine. A majority of the Committee shall constitute a quorum. Any acts by the Committee may be taken at any meeting at which a quorum is present and shall be by majority vote of those members entitled to vote. Additionally, any acts reduced to writing or approved in writing by all of the members of the Committee shall be valid acts of the Committee.

 

        (b)     Secondary Committees and Sub-Plans.     The Board may, in its sole discretion, divide the duties and powers of the Committee by establishing one or more secondary Committees to which certain duties and powers of the Board hereunder are delegated (each of which shall be regarded as a "Committee" under the Plan with respect to such duties and powers), or delegate all of its duties and powers hereunder to a single Committee. Additionally, if permitted by applicable law, the Board or Committee may delegate any or all of its duties and powers hereunder to the Chief Executive Officer and/or to other senior officers of the Company subject to such conditions and limitations as the Board or Committee shall prescribe. However, only the Committee described under Subsection 3(a) may designate and grant Awards to Participants who are subject to Section 16 of the Exchange Act or Section 162(m) of the Code. The Committee shall also have the power to establish sub-plans (which may be included as appendices to the Plan or the respective Grant Agreements), which may constitute separate schemes, for the purpose of establishing schemes which meet any special tax or regulatory requirements of jurisdictions other than the United States and its subdivisions. Any such interpretations, rules, administration and sub-plans shall be consistent with the basic purposes of the Plan.

        (c)     Powers of the Committee.     The Committee shall have all the powers vested in it by the terms of the Plan, such powers to include authority, in its sole and absolute discretion, to grant Awards under the Plan, prescribe Grant Agreements evidencing such Awards and establish programs for granting Awards. The Committee shall have full power and authority to take all other actions necessary to carry out the purpose and intent of the Plan, including, but not limited to, the authority to:

 

        (i)    determine the Participants to whom, and the time or times at which, Awards shall be granted,

 

        (ii)   determine the types of Awards to be granted,

 

        (iii)  determine the number of shares of Stock and/or amount of cash to be covered by or used for reference purposes for each Award,

 

        (iv)  impose such terms, limitations, vesting schedules, restrictions and conditions upon any such Award as the Committee shall deem appropriate, including without limitation establishing, in its discretion, Performance Measures that must be satisfied before an Award vests and/or becomes payable, the term during which an Award is exercisable, the purchase price, if any, under an Award and the period, if any, following a grantee's termination of employment or service with the Company or any Parent, Subsidiary or Affiliate during which the Award shall remain exercisable,

 

        (v)   modify, extend or renew outstanding Awards, accept the surrender of outstanding Awards and substitute new Awards (subject to the no-repricing provision below),

 

        (vi) accelerate the time in which an Award may be exercised or in which an Award becomes payable and waive or accelerate the lapse, in whole or in part, of any restriction or condition with respect to an Award,

 

        (vii)  establish objectives and conditions, including targets for Performance Measures, if any, for earning Awards and determining whether Awards will be paid after the end of a Performance Period, and

 

        (viii)  permit the deferral of, or require a Participant to defer such Participant's receipt of, the delivery of Stock and/or cash under an Award that would otherwise be due to such Participant and establish rules and procedures for such payment deferrals, provided the requirements of Code Section 409A are met with respect to any such deferral.

 

        The Committee shall have full power and authority to administer and interpret the Plan and to adopt such rules, regulations, agreements, guidelines and instruments for the administration of the Plan as the Committee deems necessary, desirable or appropriate in accordance with the Bylaws of the Company.

 

 

A-6

 

 

 

 

 

        Notwithstanding the foregoing and except for an adjustment pursuant to Section 13 or a repricing approved by stockholders, in no case may the Committee (1) amend an outstanding stock option or stock appreciation right to reduce the exercise price or base price of the Award, (2) cancel, exchange, or surrender an outstanding stock option or stock appreciation right in exchange for cash or other Awards for the purpose of repricing the Award, or (3) cancel, exchange, or surrender an outstanding stock option or stock appreciation right in exchange for a stock option or stock appreciation right with an exercise or base price that is less than the exercise or base price of the original Award.

 

        (d)     Limited Liability.     To the maximum extent permitted by law, no member of the Board or Committee or a Committee Delegate shall be liable for any action taken or decision made in good faith relating to the Plan or any Award thereunder.

 

        (e)     Indemnification.     The members of the Board and Committee and any Committee Delegate shall be indemnified by the Company in respect of all their activities under the Plan in accordance with the procedures and terms and conditions set forth in the Certificate of Incorporation Bylaws of the Company as in effect from time to time. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company's Certificate of Incorporation, as a matter of law, or otherwise.

 

        (f)     Effect of Committee's Decision.     All actions taken and decisions and determinations made by the Committee or a Committee Delegate on all matters relating to the Plan pursuant to the powers vested in it hereunder shall be in the Committee's or Committee Delegate's sole and absolute discretion and shall be conclusive and binding on all parties concerned, including the Company, its stockholders, any Participants in the Plan and any other employee of the Company, and their respective successors in interest.

 

        (g)     Apprising the Board.     The Committee will inform the Board regarding its activities under the Plan not less frequently than at each scheduled Board meeting and at such other times as the Board may request.

 

4.     Stock Available Under the Plan; Maximum Awards

 

        (a)     Stock Available Under the Plan.     

 

        (i)    Subject to adjustments as provided in Section 13 of the Plan, the Stock that may be delivered or purchased or used for reference purposes (with respect to Stock Appreciation Rights, or Phantom Stock) with respect to Awards granted under the Plan, including with respect to Incentive Stock Options, shall not exceed an aggregate of three million four hundred forty-four thousand, four hundred forty-four (3,444,444) shares of Stock, plus the number of shares of Stock available from the 2001 Plan and 2004 Plan as provided in Subsection 4(a)(ii) below. Stock available under the Plan may be, in any combination, authorized but unissued Stock, treasury Stock and Stock that is repurchased, in the market, and canceled by the Company. 

 

           The Company shall reserve said number of shares of Stock for Awards under the Plan, subject to adjustments as provided in Section 13 of the Plan. If any Award, or portion of an Award, issued under the Plan, expires or terminates unexercised, becomes unexercisable or is forfeited or otherwise terminated, surrendered or canceled as to any shares of Stock without the delivery by the Company (or, in the case of Restricted Shares, without vesting) of Stock, the Stock subject to such Award shall thereafter be available for further Awards under the Plan. Notwithstanding the foregoing, if a Stock option or Stock Appreciation Right is settled by the delivery of a net number of shares of Stock, the full number of shares underlying such Stock option or Stock Appreciation Right will not be available for subsequent awards under the Plan. Shares repurchased on the open market with the proceeds of an exercise price will not again be made available for issuance under the Plan. In addition, (i) shares withheld by the Company to satisfy the tax obligations related to an Award granted under the Plan will again be available for grants of Awards under the Plan, (ii) to the extent an Award is paid or settled in cash, the number of shares with respect to which such payment or settlement is made will again be available for grants of Awards under the Plan and (iii) shares underlying Awards that can only be settled in cash will not be counted against the aggregate number of shares of Stock available for Awards under the Plan.

 

 

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        (ii)   There shall be available for issuance under the Plan, in addition to the shares referred to in Section 4(a)(i) above, any shares of Stock subject to any awards issued under the 2001 Plan or 2004 Plan that are outstanding as of June 13, 2007, to the extent such awards subsequently expire or terminate unexercised, become unexercisable or are forfeited or otherwise terminated, surrendered or canceled, without delivery of shares of Stock or other consideration to the holder.

 

        (b)     Maximum Awards to Covered Employees.     The maximum number of shares of Stock subject to Awards that may be granted during any one calendar year to any one Covered Employee (including, for purposes of clarity, the aggregate number of shares of Stock subject to Stock options and Stock Appreciation Rights granted during any calendar year to any Covered Employee) shall be limited to three hundred thousand (300,000) shares, subject to adjustments as provided in Section 13. To the extent required by Section 162(m) of the Code and so long as Section 162(m) of the Code is applicable to persons eligible to participate in the Plan, shares of Stock subject to the foregoing maximum with respect to which the related Award is terminated, surrendered or canceled shall nonetheless continue to be taken into account with respect to such maximum for the calendar year in which granted.

 

5.     Participation

 

        Participation in the Plan shall be open to all directors, officers, employees and consultants of the Company, or of any Parent, Subsidiary or Affiliate of the Company, as may be selected by the Committee from time to time. Notwithstanding the foregoing, participation in the Plan with respect to Awards of Incentive Stock Options shall be limited to employees of the Company or of any Parent or Subsidiary of the Company.

 

        Awards may be granted to such Participants and for or with respect to such number of shares of Stock as the Committee shall determine, subject to the limitations in Section 4 of the Plan. A grant of any type of Award made in any one year to a Participant shall neither guarantee nor preclude a further grant of that or any other type of Award to such person in that year or subsequent years.

 

6.     Stock Options

 

        Subject to the other applicable provisions of the Plan, the Committee may from time to time grant to Participants Awards of Nonqualified Stock Options and/or Incentive Stock Options. The stock option Awards granted shall be subject to the following terms and conditions.

 

        (a)     Grant of Option.     The grant of a stock option shall be evidenced by a Grant Agreement, executed by the Company and the grantee, stating the number of shares of Stock subject to the stock option evidenced thereby, the exercise price and the terms and conditions of such stock option, in such form as the Committee may from time to time determine.

 

        (b)     Exercise Price.     The price per share payable upon the exercise of each stock option shall be determined by the Committee, but shall not be less than the Fair Market Value of the shares on the Grant Date, unless the stock option complies with Section 409A of the Code.

 

        (c)     Payment.     Stock options may be exercised in whole or in part by payment of the exercise price of the Stock to be acquired in accordance with the provisions of the Grant Agreement, and/or such rules and regulations as the Committee may have prescribed, and/or such determinations, orders, or decisions as the Committee may have made. Payment may be made in cash (or cash equivalents acceptable to the Committee) or, if provided in the Grant Agreement and permitted by applicable law, in shares of Stock which have been held by grantee for at least six (6) months, or a combination of cash and such Stock, or by such other means as the Committee may prescribe. The Fair Market Value of Stock delivered on exercise of stock options shall be determined as of the date of exercise.

 

        If the Stock is registered under Section 12(b) or 12(g) of the Exchange Act, the Committee, subject to such limitations as it may determine, may authorize payment of the exercise price, in whole or in part, by delivery of a properly executed exercise notice, together with irrevocable instructions, to: (i) a brokerage firm to deliver promptly to the Company the aggregate amount of sale or loan proceeds to pay the exercise price and any withholding tax obligations that may arise in connection with the exercise, and (ii) the Company to deliver the certificates for such purchased Stock directly to such brokerage firm.

 

 

A-8

 

 

 

 

 

        (d)     Term of Options.     The term during which each stock option may be exercised shall be determined by the Committee; provided, however, that in no event shall a stock option be exercisable more than ten years from the date it is granted. Prior to the exercise of the stock option and delivery of the Stock certificates represented thereby, the grantee shall have none of the rights of a stockholder with respect to any Stock represented by an outstanding stock option.

 

        (e)     Restrictions on Incentive Stock Options.     Incentive Stock Option Awards granted under the Plan shall comply in all respects with Code Section 422 and, as such, shall meet the following additional requirements:

 

         (i)     Grant Date.     An Incentive Stock Option must be granted within ten (10) years of the earlier of the Plan's adoption by the Board of Directors or approval by the Company's stockholders.

 

         (ii)     Exercise Price and Term.     The exercise price of an Incentive Stock Option shall not be less than one hundred percent (100%) of the Fair Market Value of the Stock on the date the stock option is granted and the term of the stock option shall not exceed ten (10) years. Also, the exercise price of any Incentive Stock Option granted to a grantee who owns (within the meaning of Section 422(b)(6) of the Code, after the application of the attribution rules in Section 424(d) of the Code) more than ten percent (10%) of the total combined voting power of all classes of shares of Stock of the Company or any Parent or Subsidiary of the Company shall be not less than one hundred ten percent (110%) of the Fair Market Value of the Stock on the grant date and the term of such stock option shall not exceed five (5) years.

 

         (iii)     Maximum Grant.     The aggregate Fair Market Value (determined as of the Grant Date) of Stock of the Company with respect to which all Incentive Stock Options first become exercisable by any grantee in any calendar year under this or any other plan of the Company and its Parent and Subsidiaries may not exceed One Hundred Thousand Dollars ($100,000) or such other amount as may be permitted from time to time under Section 422 of the Code. To the extent that such aggregate Fair Market Value shall exceed One Hundred Thousand Dollars ($100,000), or other applicable amount, such stock options to the extent of the Stock in excess of such limit shall be treated as Nonqualified Stock Options. In such case, the Company may designate the shares of Stock that are to be treated as Stock acquired pursuant to the exercise of an Incentive Stock Option.

 

         (iv)     Grantee.     Incentive Stock Options shall only be issued to employees of the Company or of a Parent, Subsidiary or Affiliate of the Company.

  

         (v)     Designation.     No stock option shall be an Incentive Stock Option unless so designated by the Committee at the time of grant or in the Grant Agreement evidencing such stock option.

 

         (vi)     Stockholder Approval.     No stock option issued under the Plan shall be an Incentive Stock Option unless the Plan is approved by the stockholders of the Company within twelve (12) months of its adoption by the Board in accordance with the Bylaws of the Company and governing law relating to such matters.

 

        (f)     Other Terms and Conditions.     Stock options may contain such other provisions, not inconsistent with the provisions of the Plan, as the Committee shall determine appropriate from time to time.

 

7.     Restricted Stock and Restricted Stock Units

 

        (a)     In General.     Subject to the other applicable provisions of the Plan and applicable law, the Committee may at any time and from time to time grant Restricted Stock or Restricted Stock Units to Participants, in such amounts and subject to such vesting conditions, other restrictions and conditions for removal of restrictions as it determines. Unless determined otherwise by the Committee, Participants receiving Restricted Stock or Restricted Stock Units are not required to pay the Company cash consideration therefor (except as may be required for applicable tax withholding).

 

        (b)     Vesting Conditions and Other Restrictions.     Each Award for Restricted Stock and Restricted Stock Units shall be evidenced by a Grant Agreement that specifies the applicable vesting conditions and other restrictions, if any, on such Award, the duration of such restrictions, and the time or times at which such restrictions shall lapse with respect to all or a specified number of the shares of Stock that are part of the Award. Notwithstanding the foregoing, the Committee may reduce or shorten the duration of any vesting or other restriction applicable to any Restricted Stock or Restricted Stock Units awarded to any grantee under the Plan.

 

 

A-9

 

 

 

 

 

        (c)     Stock Issuance and Stockholder Rights.     

 

        (i)    Restricted Stock. Stock certificates with respect to Stock granted pursuant to a Restricted Stock Award shall be issued, and/or Stock shall be registered, at the time of grant of the Restricted Stock Award, subject to forfeiture if the Restricted Stock does not vest or other restrictions do not lapse. Any Stock certificates shall bear an appropriate legend with respect to the restrictions applicable to such Restricted Stock Award and the grantee may be required to deposit the certificates with the Company during the period of any restriction thereon and to execute a blank stock power or other instrument of transfer therefor. Except as otherwise provided by the Committee, during the period of restriction following issuance of Restricted Stock certificates, the grantee shall have all of the rights of a holder of Stock, including but not limited to the rights to receive dividends (or amounts equivalent to dividends) and to vote with respect to the Restricted Stock. The Committee, in its discretion, may provide that any dividends or distributions paid with respect to Stock subject to the unvested portion of a Restricted Stock Award will be subject to the same restrictions as the Restricted Stock to which such dividends or distributions relate.

 

        (ii)   Restricted Stock Units. Stock certificates for the shares of Stock subject to a Restricted Stock Unit shall be issued, and/or Stock shall be registered, upon vesting and lapse of any other restrictions with respect to the issuance of Stock under such Award. The grantee will not be entitled to vote such Stock or to any of the other rights of stockholders during the period prior to issuance of the certificates for such Stock and/or the registration of the Stock. An Award of Restricted Stock Units may provide the Participant with the right to receive amounts equivalent to dividends and distributions paid with respect to Stock subject to the Award while the Award is outstanding, which payments may, in the Committee's discretion, either be made currently or credited to an account for the Participant, and may be settled in cash or Stock, all as determined by the Committee. Unless otherwise determined by the Committee with respect to a particular Award, each outstanding Restricted Stock Unit shall accrue such dividend equivalents, deferred as equivalent amounts of additional Restricted Stock Units, which amounts will be paid only when and if the Restricted Stock Unit (on which such dividend equivalents were accrued) vests and becomes payable. To the extent that a Restricted Stock Unit does not vest or is otherwise forfeited, any accrued and unpaid dividend equivalents shall be forfeited.

 

        (i)    Certain Dividend and Dividend Equivalent Rights. Notwithstanding the foregoing provisions of this Section 7, any dividends and/or dividend equivalents as to the unvested portion of a Restricted Stock Award that is subject to performance-based vesting requirements or the unvested portion of a Restricted Stock Unit Award that is subject to performance-based vesting requirements will be subject to termination and forfeiture to the same extent as the corresponding portion of the award to which they relate.

 

8.     Stock Appreciation Rights

 

        (a)     Award of Stock Appreciation Rights.     Subject to the other applicable provisions of the Plan, the Committee may at any time and from time to time grant Stock Appreciation Rights ("SARs") to Participants, either on a free-standing basis (without regard to or in addition to the grant of a stock option) or on a tandem basis (related to the grant of an underlying stock option), as it determines. SARs granted in tandem with or in addition to a stock option may be granted either at the same time as the stock option or at a later time; provided, however, that a tandem SAR shall not be granted with respect to any outstanding Incentive Stock Option Award without the consent of the grantee. SARs shall be evidenced by Grant Agreements, executed by the Company and the grantee, stating the number of shares of Stock subject to the SAR evidenced thereby and the terms and conditions of such SAR, in such form as the Committee may from time to time determine. The term during which each SAR may be exercised shall be determined by the Committee. In no event shall a SAR be exercisable more than ten years from the date it is granted. The grantee shall have none of the rights of a stockholder with respect to any Stock represented by a SAR.

 

  

        (b)     Restrictions of Tandem SARs.     No Incentive Stock Option may be surrendered in connection with the exercise of a tandem SAR unless the Fair Market Value of the Stock subject to the Incentive Stock Option is greater than the exercise price for such Incentive Stock Option. SARs granted in tandem with stock options shall be exercisable only to the same extent and subject to the same conditions as the stock options related thereto are exercisable. The Committee may, in its discretion, prescribe additional conditions to the exercise of any such tandem SAR.

 

 

A-10

 

 

 

 

 

        (c)     Amount of Payment upon Exercise of SARs.     A SAR shall entitle the grantee to receive, subject to the provisions of the Plan and the Grant Agreement, a payment having an aggregate value equal to the product of (i) the excess of (A) the Fair Market Value on the exercise date of one share of Stock over (B) the base price per share of Stock specified in the Grant Agreement, times (ii) the number of shares of Stock specified by the SAR, or portion thereof, that is exercised. In the case of exercise of a tandem SAR, such payment shall be made in exchange for the surrender of the unexercised related stock option (or any portion or portions thereof which the grantee from time to time determines to surrender for this purpose). The base price per share under a SAR shall not be less than the Fair Market Value of a share of Stock on the Grant Date, unless the SAR complies with Section 409A of the Code.

 

        (d)     Form of Payment upon Exercise of SARs.     Payment by the Company of the amount receivable upon any exercise of a SAR may be made by the delivery of Stock or cash, or any combination of Stock and cash, as determined in the sole discretion of the Committee from time to time. If upon settlement of the exercise of a SAR a grantee is to receive a portion of such payment in Stock, the number of shares of Stock shall be determined by dividing such portion by the Fair Market Value of a share of Stock on the exercise date. No fractional shares shall be used for such payment and the Committee shall determine whether cash shall be given in lieu of such fractional shares or whether such fractional shares shall be eliminated.

 

9.     Phantom Stock

 

        The grant of Phantom Stock shall be evidenced by a Grant Agreement, executed by the Company and the grantee, that incorporates the terms of the Plan and states the number of shares of Phantom Stock evidenced thereby and the terms and conditions of such Phantom Stock in such form as the Committee may from time to time determine. Phantom Stock granted to a Participant shall be credited to a bookkeeping reserve account solely for accounting purposes and shall not require a segregation of any of the Company's assets. Each share of Phantom Stock shall represent the value of one share of Stock. Phantom Stock shall become payable in whole or in part in such form, at such time or times and pursuant to such conditions in accordance with the provisions of the Grant Agreement, and/or such rules and regulations as the Committee may prescribe, and/or such determinations, orders or decisions as the Committee may make. Except as otherwise provided in the applicable Grant Agreement, the grantee shall have none of the rights of a stockholder with respect to any shares represented by Phantom Stock as a result of the grant of Phantom Stock to the grantee. Phantom Stock may contain such other provisions, not inconsistent with the provisions of the Plan, as the Committee shall determine desirable or appropriate from time to time.

 

10.   Performance Awards

 

        (a)     In General.     The Committee, in its discretion, may establish targets for Performance Measures for selected Participants and authorize the granting, vesting, payment and/or delivery of Performance Awards in the form of Incentive Stock Options, Nonqualified Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, and/or Phantom Stock to such Participants upon achievement of such targets for Performance Measures during a Performance Period. The Committee, in its discretion, shall determine the Participants eligible for Performance Awards, the targets for Performance Measures to be achieved during each Performance Period, and the type, amount, and terms and conditions of any Performance Awards. Performance Awards may be granted either alone or in addition to other Awards made under the Plan.

 

        (b)     Covered Employee Targets.     After the Company is subject to Code Section 162(m), in connection with any Performance Awards granted to a Covered Employee, the Committee shall (i) establish in the applicable Grant Agreement the specific targets relative to the Performance Measures which must be attained before the respective Performance Award is granted, vests, or is otherwise paid or delivered, (ii) provide in the applicable Grant Agreement the method for computing the portion of the Performance Award which shall be granted, vested, paid and/or delivered if the target or targets are attained in full or part, and (iii) at the end of the relevant Performance Period and prior to any such grant, vesting, payment or delivery certify the extent to which the applicable target or targets were achieved and whether any other material terms were in fact satisfied. The specific targets and the method for computing the portion of such Performance Award which shall be granted, vested, paid or delivered to any Covered Employee shall be established by the Committee prior to the earlier to occur of (A) ninety (90) days after the commencement of the Performance Period to which the Performance Measure applies and (B) the elapse of twenty-five percent (25%) of the Performance Period and in any event while the outcome is substantially uncertain. In interpreting Plan provisions applicable to Performance Measures and Performance Awards with respect to Covered Employees, it is the intent of the Plan to conform with the standards of Section 162(m) of the Code and Treasury Regulations Section 1.162-27(e)(2)(i), and the Committee in interpreting the Plan shall be guided by such provisions.

 

 

A-11

 

 

 

 

 

11.   Withholding and Reporting of Taxes

 

        The Company may require, as a condition to the grant of any Award under the Plan, vesting or exercise pursuant to such Award or to the delivery of certificates for shares of Stock issued or payments of cash to a grantee pursuant to the Plan or a Grant Agreement, that the grantee pay to the Company, in cash or, if approved by the Company, in Stock, including Stock acquired upon grant of the Award or exercise of the Award, valued at Fair Market Value on the date as of which the withholding tax liability is determined, any federal, state or local taxes of any kind or any applicable taxes or other required withholding of any other jurisdiction required by law to be withheld with respect to any taxable event under the Plan. The Company, to the extent permitted or required by law, shall have the right to deduct from any payment of any kind (including salary or bonus) otherwise due to a grantee any federal, state or local taxes of any kind or any applicable taxes or other required withholding of any other jurisdiction required by law to be withheld with respect to the grant, vesting, exercise or payment of or under any Award under the Plan or a Grant Agreement, or to retain or sell a sufficient number of the shares of Stock to be issued to such grantee to cover any such taxes. The Company or any Parent, Subsidiary or Affiliate shall comply with any applicable tax reporting requirements of any jurisdiction imposed on it by law with respect to the granting, vesting, exercise and/or payment of Awards.

 

12.   Transferability

 

        No Award granted under the Plan shall be transferable by a grantee otherwise than by will or the laws of descent and distribution. Unless otherwise determined by the Committee in accordance with the provisions of the immediately preceding sentence, an Award may be exercised during the lifetime of the grantee only by the grantee or, during the period the grantee is under a legal disability, by the grantee's guardian or legal representative. Notwithstanding the foregoing, an Award other than an Incentive Stock Option may, in the Committee's sole discretion, be transferable by gift or domestic relations order to (i) the grantee's child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, daughter-in-law, son-in-law, brother-in-law or sister-in-law, including adoptive relationships (such persons, "Family Members"), (ii) a company, partnership, limited liability company or other business entity whose only stockholders, partners or members, as applicable are the grantee and/or Family Members, or (iii) a trust in which the Grantee and/or Family Members have all of the beneficial interests, and subsequent to any such transfer any Award may be exercised by any such transferee.

 

13.   Adjustments; Business Combinations

 

        (a)     Adjustments.     In the event of a reclassification, recapitalization, stock split, reverse stock split, stock dividend, combination of shares or other similar event, the Committee shall equitably and proportionately adjust (i) the number and type of shares of Stock (or other securities) that thereafter may be made the subject of Awards (including the specific share limits set forth in Section 4 of the Plan), (ii) the number, amount and type of shares of Stock (or other securities or property) subject to any outstanding Awards, (iii) the grant, purchase, or exercise price of any outstanding Awards, and/or (iv) the performance standards applicable to any then-outstanding Performance Awards, in each case to the extent necessary to preserve (but not increase) the level of incentives intended by this Plan and the then-outstanding Awards.  

  

        (b)     Change in Control.     In the event of any proposed Change in Control under Section 2(d)(i), (ii) or (iii), the Committee shall take such action as it deems appropriate and equitable to effectuate the purposes of this Plan and to protect the grantees of Awards, which action may include, without limitation, any one or more of the following, provided such action is in compliance with Code Section 409A if applicable: (i) acceleration or change of the exercise and/or expiration dates of any Award to require that exercise be made, if at all, prior to the Change in Control; (ii) cancellation of any Award upon payment to the holder in cash of the Fair Market Value of the Stock subject to such Award as of the date of (and, to the extent applicable, as established for purposes of) the Change in Control, less the aggregate exercise price, if any, of the Award; and (iii) in any case where equity securities of another entity are proposed to be delivered in exchange for or with respect to Stock of the Company, arrangements to have such other entity replace the Awards granted hereunder with awards with respect to such other securities, with appropriate adjustments in the number of shares subject to, and the exercise prices under, the Award.

 

 

 A-12

 

 

 

 

 

        (c)     Dissolution and Liquidation.     In the event the Company dissolves and liquidates (other than pursuant to a plan of amalgamation, merger or reorganization), then notwithstanding any restrictions on exercise set forth in this Plan or any Grant Agreement, or other agreement evidencing a stock option, Stock Appreciation Right, Phantom Stock, Restricted Stock or Restricted Stock Unit Award, provided such action is in compliance with Code Section 409A if applicable: (i) each grantee shall have the right to exercise his stock option, Stock Appreciation Right, or Phantom Stock or to require delivery of Stock certificates, and/or registration of the Stock, representing any such Restricted Stock or Restricted Stock Unit Award, at any time up to ten (10) days prior to the effective date of such liquidation and dissolution; and (ii) the Committee may make arrangements with the grantees for the payment of appropriate consideration to them for the cancellation and surrender of any stock option, Stock Appreciation Right, Phantom Stock, Restricted Stock or Restricted Stock Unit Award that is so canceled or surrendered at any time up to ten (10) days prior to the effective date of such liquidation and dissolution. The Committee may establish a different period (and different conditions) for such exercise, delivery, cancellation or surrender to avoid subjecting the grantee to liability under Section 16(b) of the Exchange Act. Any stock option, Stock Appreciation Right or Phantom Stock not so exercised, canceled or surrendered shall terminate on the last day for exercise prior to such effective date; and any Restricted Stock or Restricted Stock Units as to which there has not been such delivery of Stock certificates or that has not been so canceled or surrendered, shall be forfeited on the last day prior to such effective date. The Committee shall give to each grantee written notice of the commencement of any proceedings for such liquidation and dissolution of the Company and the grantee's rights with respect to his outstanding Award.

 

        (d)     Other Adjustments.     The Committee is authorized to make adjustments in the terms and conditions of, and the criteria included in, Awards in recognition of unusual or nonrecurring events (including, without limitation, the events described in the preceding paragraphs of this Section 13) affecting the Company, or the financial statements of the Company or any Parent, Subsidiary or Affiliate, or of changes in applicable laws, regulations or accounting principles, whenever the Committee determines that such adjustments are appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan.

 

        Except as hereinbefore expressly provided, issuance by the Company of stock of any class or securities convertible into stock of any class, for cash, property, labor or services, upon direct sale, upon the exercise of rights or warranty to subscribe therefor, or upon conversion of stock or obligations of the Company convertible into such stock or other securities, and in any case whether or not for fair value, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number of shares of Stock subject to Awards theretofore granted or the purchase price per share of Stock subject to Awards.

 

14.   Termination and Amendment

 

        (a)     Amendment or Termination by the Board.     The Board, without further approval of the stockholders, may amend or terminate the Plan or any portion thereof at any time, except that no amendment shall become effective without prior approval of the stockholders of the Company to increase the number of shares of Stock subject to the Plan or if stockholder approval is necessary to comply with any tax or regulatory requirement or rule of any exchange or national automated quotation system upon which the Stock is listed or quoted (including for this purpose stockholder approval that is required for continued compliance with Rule 16b-3 or stockholder approval that is required to enable the Committee to grant Incentive Stock Options pursuant to the Plan).

 

        (b)     Amendments by the Committee.     The Committee shall be authorized to make minor or administrative amendments to the Plan as well as amendments to the Plan that may be dictated by requirements of U.S. federal or state laws applicable to the Company or that may be authorized or made desirable by such laws. The Committee may amend any outstanding Award in any manner as provided in Sections 3(c) and (d) (subject to the no-repricing provision therein) and to the extent that the Committee would have had the authority to make such Award as so amended.

 

  

        (c)     Approval of Grantees.     No amendment to the Plan or any Award may be made that would materially adversely affect any outstanding Award previously made under the Plan without the approval of the grantee. Further, no amendment to the Plan or an Award shall be made which would cause any Award to fail to either comply with or meet an exception from Code Section 409A.

 

 

A-13

 

 

 

 

 

15.   Non-Guarantee of Employment

 

        Nothing in the Plan or in any Grant Agreement thereunder shall confer any right on an employee to continue in the employ of the Company or any Parent, Subsidiary or Affiliate or shall interfere in any way with the right of the Company or any Parent, Subsidiary or Affiliate to terminate an employee at any time.

 

16.   Termination of Employment

 

        For purposes of maintaining a grantee's continuous status as an employee and accrual of rights under any Award, transfer of an employee among the Company and the Company's Parent, Subsidiaries or Affiliates shall not be considered a termination of employment. Nor shall it be considered a termination of employment for such purposes if an employee is placed on military or sick leave or such other leave of absence that is considered as continuing intact the employment relationship; in such a case, the employment relationship shall be continued until the date when an employee's right to reemployment shall no longer be guaranteed either by law or contract.

 

17.   Written Agreement

 

        Each Grant Agreement entered into between the Company and a grantee with respect to an Award granted under the Plan shall incorporate the terms of this Plan and shall contain such provisions, consistent with the provisions of the Plan, as may be established by the Committee.

 

18.   Non-Uniform Determinations

 

        The Committee's determinations under the Plan (including without limitation determinations of the persons to receive Awards, the form, amount and time of such Awards, the terms and provisions of such Awards and the agreements evidencing same) need not be uniform and may be made by it selectively among persons who receive, or are eligible to receive, Awards under the Plan, whether or not such persons are similarly situated.

 

19.   Limitation on Benefits

 

        With respect to persons subject to Section 16 of the Exchange Act, transactions under this Plan are intended to comply with all applicable conditions of Rule 16b-3. To the extent any provision of the Plan or action by the Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Committee. 

 

20.   Listing and Registration

 

        If the Company determines that the listing, registration or qualification upon any securities exchange or upon any listing or quotation system established by the National Association of Securities Dealers, Inc. or under any law of Stock subject to any Award is necessary or desirable as a condition of, or in connection with, the granting of same or the issue or purchase of Stock thereunder, no such Award may be exercised in whole or in part and no restrictions on such Award shall lapse, unless such listing, registration or qualification is effected free of any conditions not acceptable to the Company.

  

 

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21.   Compliance with Securities Law

 

        The Company may require that a grantee, as a condition to exercise of an Award, and as a condition to the delivery of any Stock certificate, provide to the Company, at the time of each such exercise and each such delivery, a written representation that the Stock being acquired shall be acquired by the grantee solely for investment and will not be sold or transferred without registration or the availability of an exemption from registration under the Securities Act and applicable state securities laws. The Company may also require that a grantee submit other written representations that will permit the Company to comply with applicable federal and state securities laws in connection with the issuance of the Stock, including representations as to the knowledge and experience in financial and business matters of the grantee and the grantee's ability to bear the economic risk of the grantee's investment. The Company may require that the grantee obtain a "purchaser representative" as that term is defined in applicable federal and state securities laws. Any Stock certificates for shares issued pursuant to this Plan may bear a legend restricting transferability of the Stock unless such shares are registered or an exemption from registration is available under the Securities Act and applicable securities laws of the states of the U.S. The Company may notify its transfer agent to stop any transfer of Stock not made in compliance with these restrictions. Stock shall not be issued with respect to an Award granted under the Plan unless the exercise of such Award and the issuance and delivery of Stock certificates for such shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act, the Exchange Act, the rules and regulations promulgated thereunder and the requirements of any national securities exchange or Nasdaq System upon which the Stock may then be listed or quoted, and shall be further subject to the approval of counsel for the Company with respect to such compliance to the extent such approval is sought by the Committee.

 

22.   No Trust or Fund Created

 

        Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company and a grantee or any other person. To the extent that any grantee or other person acquires a right to receive payments from the Company pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company.

 

23.   No Limit on Other Compensation Arrangements

 

        Nothing contained in the Plan shall prevent the Company or any Parent, Subsidiary or Affiliate from adopting or continuing in effect other compensation arrangements (whether such arrangements be generally applicable or applicable only in specific cases), including without limitation the granting of stock options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights or Phantom Stock Units otherwise than under the Plan. 

 

24.   No Restriction of Corporate Action

 

        Nothing contained in the Plan shall be construed to limit or impair the power of the Company or any Parent, Subsidiary or Affiliate to make adjustments, reclassifications, reorganizations, or changes in its capital or business structure, or to amalgamate, merge or consolidate, liquidate, sell or transfer all or any part of its business or assets or, except as otherwise provided herein, or in a Grant Agreement, to take other actions which it deems to be necessary or appropriate. No employee, beneficiary or other person shall have any claim against the Company or any Parent, Subsidiary or Affiliate as a result of such action.

 

25.   Governing Law

 

        The validity, construction and effect of the Plan, of Grant Agreements entered into pursuant to the Plan, and of any rules, regulations, determinations or decisions made by the Board or Committee relating to the Plan or such Grant Agreements, and the rights of any and all persons having or claiming to have any interest therein or thereunder, shall be determined in accordance with applicable federal laws and the laws of the State of Maryland. Unless otherwise provided in the Award Agreement, recipients of an Award under the Plan are deemed to submit to the exclusive jurisdiction and venue of the federal or local courts of the State of Maryland, to resolve any and all issues that may arise out of or relate to the Plan or any related Grant Agreement. The Awards under the Plan are intended to either comply with or meet an exception from Code Section 409A and shall be so interpreted.

 

26.   Plan Subject to Charter and Bylaws

 

        This Plan is subject to the Certificate of Incorporation and Bylaws of the Company, as they may be in effect from time to time.

 

 

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27.   Effective Date; Termination Date

 

        The Plan is effective as of the date on which the Plan is approved by the stockholders of the Company. No Award shall be granted under the Plan after the close of business on the day immediately preceding the tenth (10 th ) anniversary of the effective date of the Plan (subject to any extension of the Plan term that may be approved by stockholders). Subject to other applicable provisions of the Plan, all Awards made under the Plan prior to such termination of the Plan shall remain in effect until such Awards have been satisfied or terminated in accordance with the Plan and the terms of such Awards.

 

Date Initially Approved by the Board: March 12, 2007

 

Date Initially Approved by the Stockholders: June 13, 2007 

 

 

A-16ex10-1.htm

 

EXHIBIT 10.1

 

 

 

EARLY ACCESS AGREEMENT

 

This exclusive Early Access Agreement (“Agreement”) is made and entered into the 13th day of January 2015 (“Effective Date”) by and between

 

Celsion Corporation, a company formed and registered under the laws of Delaware, USA and located at 997 Lenox Drive, Suite 100, Lawrenceville, NJ 08648 (hereinafter referred to as “CELSION”), and Impatients N.V., a company formed and registered under the laws of The Netherlands, and located at Pilotenstraat 45, 1059 CH, Amsterdam, The Netherlands (hereinafter referred to as “IMPATIENTS”), hereinafter each of CELSION and IMPATIENTS, referred individually as a “Party” and collectively as the “Parties”.

 

RECITALS

 

WHEREAS, CELSION has developed, and is developing the Product (as defined below), and owns or controls certain patent rights, and technical and scientific information relating to, and the global exclusive rights to distribute, market and sell Product,

 

WHEREAS, IMPATIENTS specialises under the brand myTomorrows in services related to the supply and distribution of products to patients in Early Access Programs (as defined below) through a patient platform (hereinafter referred to as the “myTomorrows platform”),

 

WHEREAS, CELSION is willing to grant IMPATIENTS the exclusive right to develop and execute Early Access Programs in the Territory (as defined below) and to supply quantities of Product to IMPATIENTS for these Early Access Programs in the Territory,

 

WHEREAS, IMPATIENTS agrees to accept such right and to acquire the Product for Early Access Programs from CELSION pursuant to the terms of this Agreement, and

 

WHEREAS, the Parties wish to set forth the terms and conditions under which CELSION grants the exclusive right and supplies the Product and IMPATIENTS implements the Early Access Program.

 

NOW THEREFORE, in consideration of the foregoing premises and the mutual covenants set forth below, the Parties hereto, intending to be legally bound, agree as follows:

 

 

 

 

 

 

 

 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE SECURITIES AND EXCHANGE COMMISSION (THE “COMMISSION”) PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Article 1 Definitions

 

The following terms when used in this Agreement, shall have the meanings set forth in this clause: 

 

	 	
1.1
	
“Accounting Standards” with respect to a Party means that such Party shall maintain records and books of accounts in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

 

	 	
1.2
	
“Affiliate” means, as to any person or entity, any other person or entity, which controls, is controlled by, or is under common control with such person or entity. A person or entity shall be regarded as in control of another entity only if it owns or controls, directly or indirectly, at least fifty percent (50%) of the equity securities or other ownership interests in the subject entity entitled to vote in the election of directors or with the power to direct or elect management of such subject entity.

 

	 	
1.3
	
“Applicable Law” means federal, state, local, national and supra-national laws, statutes, rules, and regulations, including any rules, regulations, guidelines, or other requirements of the Regulatory Authorities, major national securities exchanges or major securities listing organizations, that may be in effect from time to time during the Term and applicable to a particular activity and/or country or other jurisdiction hereunder.

 

	 	
1.4
	
“CELSION Patents” means all of the Patents that are (a) under Control by CELSION or any of its Affiliates as of the Effective Date or at any time during the Term, and (b) reasonably necessary or useful (or, with respect to Patent applications, would be reasonably necessary or useful if such Patent applications were to issue as Patents) for the development, manufacture, or use or sale of the Product.

 

	 	
1.5
	
“Change of Control” means when an unaffiliated third party gains control over the management decisions of a Party relating to this Agreement by virtue of (a) the sale of all or substantially all of the assets of the Party to said unaffiliated third party; (b) a sale resulting in more than fifty (50) % of the equity of the Party being held by said unaffiliated third party; (c) a merger, consolidation, recapitalization or reorganization of the Party with or into an unaffiliated third party; (d) the assignment of the rights and obligations pursuant to the Agreement to said unaffiliated third party.

 

	 	
1.6
	
“Confidential Information” means any Information provided orally, visually, in writing or other form by or on behalf of one Party to the other Party in connection with this Agreement, whether prior to, on, or after the Effective Date, including information relating to the terms of this Agreement, the Product (including the Regulatory Documentation and Regulatory Data), any use of the Product, any know-how with respect thereto developed by or on behalf of the disclosing Party or its Affiliates, or the scientific, regulatory or business affairs or other activities of either Party. Notwithstanding the foregoing, (a) jointly owned Know-How shall be deemed to be the Confidential Information of both Parties, and both Parties shall be deemed to be the receiving Party and the disclosing Party with respect thereto; and (b) after IMPATIENTS proceeds with the EAP, all Regulatory Documentation developed by IMPATIENTS shall be deemed to be the Confidential Information of CELSION, and CELSION shall be deemed to be the disclosing Party and IMPATIENTS shall be deemed to be the receiving Party with respect thereto.

 

	 	
1.7
	
“Control” means, with respect to any item of Information, Regulatory Documentation, material, Patent, or other property right existing on or after the Effective Date and during the Term, the possession of the right, whether directly or indirectly, and whether by ownership, license, covenant not to sue, or otherwise (other than by operation of the license and other grants herein), to grant a license, sublicense or other right (including the right to reference Regulatory Documentation) to or under such Information, Regulatory Documentation, material, Patent, or other property right as provided for herein without violating the terms of any agreement or other arrangement with any third party; provided, however, neither Party shall be deemed to Control any item of Information, Regulatory Documentation, material, Patent, or other property right of a third party if access requires or triggers a payment obligation.

 

 

 

 

 

	 	
1.8
	
“Early Access Program” or “EAP” means the activities directed to (a) the education of physicians and patients regarding the possibility of early access to innovative medical treatments not yet the subject of a Marketing Authorisation through named-patient use, hospital exemption or compassionate use, (b) patient recruitment, (c) the securing of Early Access Approvals, for the use of such treatments, (d) the distribution and sale of Product for such treatments pursuant to such Early Access Approvals, (e) inventory management, accountability and control, (f) pharmacovigilance activities as set forth in the Pharmacovigilance Agreement set forth in Exhibit 6 and/or (g) the collection of data, including but not limited to patient-reported outcomes, doctor-reported experiences and registry data

 

	 	
1.9
	
“EAP Plan” means the plan as agreed by the JSC for the initiation and performance of an early access program for Product in the Field. The EAP Plan will be attached hereto as Exhibit 1.

 

	 	
1.10
	
“Early Access Approvals” means the permissions, exemptions, approvals, authorisations and/or waivers required by Regulatory Authorities for medical treatments, not the subject of a Marketing Authorisation, to be sold to pharmacy or hospital or medical treatment center, to be dispensed to a physician, to be administered to and/or used by a patient.

 

	 	
1.11
	
“Field” means treatment of Recurrent Chest Wall (“RCW”) Breast Cancer.

 

	 	
1.12
	
“First Commercial Sale” means, with respect to a Product and a country, the first sale for monetary value for ultimate use by the patient of such Product in such country after Marketing Authorisation for such Product has been obtained in such country. Sales prior to receipt of Marketing Authorisation for such Product, such as so-called “treatment IND sales,” “named patient sales,” or other “compassionate use sales,” shall not be construed as a First Commercial Sale.

 

	 	
1.13
	
“Good Manufacturing Practice” or “GMP” means the current good manufacturing practices applicable from time to time to the manufacturing of a Product or any intermediate thereof pursuant to Applicable Law.

 

	 	
1.14
	
“Information” means knowledge of a technical, scientific, business, and other nature, including know-how, technology, means, methods, processes, practices, formulae, instructions, skills, techniques, procedures, experiences, ideas, technical assistance, designs, drawings, assembly procedures, computer programs, apparatuses, specifications, data, results and other material, Regulatory Data, and other biological, chemical, pharmacological, toxicological, pharmaceutical, physical and analytical, pre-clinical, clinical, safety, manufacturing and quality control data and information, including study designs and protocols; assays, and biological methodology; in each case (whether or not confidential, proprietary, patented or patentable, of commercial advantage or not) in written, electronic or any other form now known or hereafter developed.

 

 

 

 

 

	 	
1.15
	
“Joint Steering Committee or JSC” means the joint steering committee to be established by the Parties as referred to in article 2. 

 

	 	
1.16
	
“Know How” means information and materials, whether or not confidential, including, but not limited to, pharmaceutical, chemical, products, economic and commercial information, technical and non-technical manufacturing process and equipment data and information, product and process validation data, the results of tests on products, reports and results of product assays, pre-clinical and clinical studies, and drawings, plans, diagrams, specifications and/or other documents containing said information relating to the Product.

 

	 	
1.17
	
“Manufacturer” means the legal entity that physically manufactures and/or fills and/or finishes and/or labels and/or stockpiles GMP grade Product.

 

	 	
1.18
	
“Marketing Authorisation” means, with respect to a country, region or other jurisdiction in the Territory, any and all approvals (including Drug Approval Applications), licenses, registrations, or authorisations of any Regulatory Authority necessary to commercially distribute, sell, or market Product in such country or other jurisdiction, including, where applicable, (a) pre- and post-approval regulatory approvals (including any prerequisite manufacturing approval or authorisation related thereto), and (b) approval of Product labelling.

 

	 	
1.19
	
“Net EAP Sales” means the gross amount invoiced by IMPATIENTS or its affiliates to non-affiliated third parties for the sale of Product less the following reasonable and customary accrual-basis deductions to the extent applicable to such invoiced amounts (to the extent each is actually incurred and included in the invoiced gross sales price) in accordance with Accounting Standards:

 

	 	
(a)
	
all trade discounts or rebates (including without limitation Medicaid rebates);

 

	 	
(b)
	
amounts for claims, allowances or credits for rejections or returns;

 

	 	
(c)
	
packaging, handling fees and prepaid freight, insurance, sales taxes, duties and other governmental charges (including value added tax), but excluding what is commonly known as income taxes.

 

The specific deductions taken under, and the general provision of, (a) through (c) above may be adjusted periodically after agreement between both Parties as necessary to reflect amounts actually incurred. 

 

 

 

 

 

	 	
1.20
	
“Net Sales” means the gross amount invoiced by CELSION or its affiliates to nonaffiliated third parties, in the Field, in the Territory for the sale of Product less the following reasonable and customary accrual-basis deductions to the extent applicable to such invoiced amounts (to the extent each is actually incurred and included in the invoiced gross sales price) in accordance with Accounting Standards:

 

	 	
(d)
	
all trade discounts, or rebates (including without limitation Medicaid rebates);

 

	 	
(e)
	
amounts for claims, allowances or credits for rejections or returns;;

 

	 	
(f)
	
packaging, handling fees and prepaid freight, insurance, sales taxes, duties and other governmental charges (including value added tax), but excluding what is commonly known as income taxes.

 

The specific deductions taken under, and the general provision of, (a) through (c) above may be adjusted periodically after agreement between both Parties as necessary to reflect amounts actually incurred. 

 

For the avoidance of doubt, Net Sales shall not include sales for resale to Affiliates or to licensees or sales agents acting on behalf, and in the name of CELSION, or transfer to an independent non-purchasing agent/distributor of Products. 

 

For purpose of this definition 1.21, a sale shall also include a transfer or other disposition for consideration other than cash, in which case such consideration shall be valued at the fair market value thereof. Transfers or dispositions for charitable purposes or for pre-clinical, clinical, regulatory or governmental purposes prior to receiving Marketing Authorisation are not considered a “sale”. 

 

	 	
1.21
	
“Patents” means (a) all national, regional and international patent applications, including provisional patent applications, and all applications claiming priority therefrom, including divisionals, continuations, continuations-in-part, provisionals, converted provisionals and continued prosecution applications; (b) any and all national patents issued or granted from the foregoing patent applications, including utility patents, utility models, petty patents and design patents and certificates of invention; (c) any and all extensions or restorations by existing or future extension or restoration mechanisms, including revalidations, reissues, re-examinations and extensions (including any supplementary protection certificates and the like) of the foregoing patents or patent applications ((a) and (b)); and (c) any similar rights, including so-called pipeline protection or any importation, revalidation, confirmation or introduction patent or registration patent or patent of additions to any of such foregoing patent applications and patents. 

 

	 	
1.22
	
“Pharmacovigilance Agreement” or “PhVA” means the pharmacovigilance agreement attached as exhibit 6. 

 

	 	
1.23
	
“Price” means the price of Product, established by CELSION at its sole discretion, invoiced by IMPATIENTS to third parties other than Affliates of IMPATIENTS as specified in exhibit 4 excluding discounts, any VAT or other taxes or levies that are applicable. 

 

	 	
1.24
	
“Product” means stock-keeping units (SKU)’s of a temperature-sensitive liposomal doxorubicin product, referred to as of the Effective Date, as ThermoDox®, supplied ready packed and labelled, quality tested and QP released in the Territory in accordance with applicable pharmaceutical law and regulations.

 

 

 

 

 

	 	
1.25
	
“Quality Agreement or QA “ means the quality agreement attached as exhibit 5.

 

	 	
1.26
	
“Regulatory Authority” means any applicable supra-national, federal, national, regional, state, provincial, or local governmental or regulatory authority, agency, department, bureau, commission, council, or other entities (e.g., the FDA, EMA and PMDA) regulating or otherwise exercising authority with respect to activities contemplated in this Agreement.

 

	 	
1.27
	
“Regulatory Documentation” means all (a) applications (including all INDs and Drug Approval Applications and other regulatory filings), registrations, licenses, authorisations, and approvals (including Regulatory Approvals); (b) correspondence and reports submitted to or received from Regulatory Authorities (including minutes and official contact reports relating to any communications with any Regulatory Authority) and all supporting documents with respect thereto, including all regulatory drug lists, advertising and promotion documents, adverse event files, and complaint files; and (c) pre-clinical and clinical data, and data contained or relied upon in any of the foregoing, in each case (a), (b), and (c) relating to Product.

 

	 	
1.28
	
“Revenue” means all cash and non-cash consideration de facto received by CELSION from its licensees related to the Product and/or Net Sales of the Product, in the Territory.

 

	 	
1.29
	
“Specifications” means all data necessary to manufacture the Product and contained in the most recent version of the product specification file or IMPD/IND.

 

	 	
1.30
	
“Territory” includes at the Effective Date the following countries: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Latvia, Liechtenstein, Lithuania, Luxembourg, Malta, Netherlands, Norway, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden, the UK. and Switzerland 

 

	 	
1.31
	
“Trademark” means any word, name, symbol, color, designation or device or any combination thereof that functions as a source identifier, including any trademark, trade dress, brand mark, service mark, trade name, brand name, logo, business symbol or domain names whether or not registered.

 

 

Article 2 – Early Access Program activities & management

 

 

	 	
2.1
	
EAP Activities. 

 

IMPATIENTS shall exert its reasonable commercial efforts to perform EAP activities, including selling distributing, and inventory control and management of the Product in the Territory. IMPATIENTS shall use reasonable commercial efforts to identify the treatment centers in the Territory and assure that all relevant information is presented to decision makers, patients and/or responsible medical specialists, including informing decision makers and/or responsible medical specialists about their opportunities to apply for Early Access Approvals in the Territory.

 

 

 

 

 

	 	
2.2
	
Collaborative Committees. 

 

As soon as practical after the Effective Date, but no later than thirty (30) days, the Parties shall establish a joint steering committee (the “Joint Steering Committee” or “JSC”), which shall (a) oversee the EAP plan for the Product in the Territory, (b) resolve Disputes that may arise in any subcommittees formed by the JSC, (c) coordinate the Parties’ activities under this Agreement, including oversight of any subcommittees formed by the JSC, and (d) perform such other functions as are set forth herein or as the Parties may mutually agree in writing, except where in conflict with any provision of this Agreement. The details of the composition, operating procedures and responsibilities of the Collaborative Committees are described in Exhibit 2.

 

 

Article 3 – Grants of rights, disclosure of know how

 

 

	 	
3.1
	
CELSION Licenses.

 

	 	
3.1.1
	
CELSION hereby grants to IMPATIENTS:

 

	 	
a.
	
an exclusive, non-transferable, royalty-free right to perform EAP activities for Product in the Field in the Territory; and

 

	 	
b.
	
an exclusive non-transferable, royalty-free right of reference, under the Regulatory Approvals and any other Regulatory Documentation that CELSION or its Affiliates may Control with respect to the Products as necessary for purposes of performing EAP activities for Product in the Field in the Territory; and

 

	 	
c.
	
an exclusive, non-transferable, royalty-free right to reproduce and use the Product Trademarks solely in connection with performing the EAP activities for Product in the Field in the Territory, subject to the terms and conditions set forth herein, including in Exhibit 3.

 

	 	
3.1.2
	
The countries in the Territory can be changed by mutual written consent between the Parties. *****

 

	 	
3.1.3
	
CELSION hereby grants IMPATIENTS a right of first negotiation to be a distributor of Product (co-promotion, co-marketing, and/or distribution) in all or part of the Territory subsequent to the Product receiving Marketing Authorisation in a country in the Territory.

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”

 

 

 

 

 

	 	
3.2
	
IMPATIENTS Know How Contribution. 

 

IMPATIENTS undertakes to contribute its know how to perform the EAP, including but not limited to its EAP technical and business knowledge regarding patient recruitment, regulatory and legal support, pharmacovigilance, reimbursement, data collection, logistics and marketing.

 

	 	
3.3
	
CELSION Know How Disclosure. 

 

Immediately after the Effective Date, CELSION shall, and shall cause its Affiliates and collaborators to, without additional compensation, disclose and make available to IMPATIENTS, in whatever form IMPATIENTS may reasonably request, Regulatory Documentation, CELSION Know How, and any other Information relating, directly or indirectly, to the Product (including, but not limited to, all information related to Manufacturing), to the extent not done so already and thereafter immediately upon the availability of such Regulatory Documentation, CELSION Know How, or other Information necessary to the implementation of the EAP for the Product, or required by Applicable Law to obtain Early Access Approval and execution. 

 

	 	
3.4
	
CELSION Know How Assistance. 

 

CELSION, at its sole cost and expense, shall provide IMPATIENTS with all reasonable assistance required in order to transfer to IMPATIENTS the Regulatory Documentation, CELSION Know How, and other Information required to be produced hereunder, in each case in a timely manner, and shall reasonably assist IMPATIENTS with respect to the implementation of the EAP for the Product. Without prejudice to the generality of the foregoing, if visits of CELSION’ representatives to IMPATIENTS’s facilities are reasonably requested by IMPATIENTS for purposes of transferring the Regulatory Documentation, CELSION Know How, or other Information to IMPATIENTS or for purposes of IMPATIENTS acquiring expertise on the practical application of such Information or assisting on issues arising during such Exploitation, CELSION shall send, at its expense, appropriate representatives to IMPATIENTS’s facilities.

 

 

 Article 4 - Regulatory matters

 

 

	 	
4.1
	
Regulatory Activities.

 

	 	
4.1.1
	
Subject to review and input from the JSC, which will reasonably be considered, IMPATIENTS shall have the sole and exclusive right to recruit patients for the EAP of Product, and to file applications for Early Access Approvals therefor, including the setting of the overall regulatory strategy therefor, and to communicate with the Regulatory Authorities to secure Early Access Approvals for Products in the Territory. CELSION shall support IMPATIENTS, as may be reasonably necessary, in obtaining Early Access Approvals for the Product, and in the activities in support thereof, including providing necessary documents or other materials required by Applicable Law to obtain Early Access Approvals, in each case in accordance with the terms and conditions of this Agreement.

 

 

 

 

 

	 	
4.1.2
	
CELSION shall provide IMPATIENTS with (a) access to or copies of all material written or electronic correspondence (other than regulatory filings) relating to the development of Product in the Field received by CELSION or its Affiliates, collaborators or licensees from, or filed by CELSION or its Affiliates, collaborators or licensees with, the Regulatory Authorities, and (b) copies of all meeting minutes and summaries of all meetings, conferences, and discussions held by CELSION or its Affiliates, collaborators or licensees with the Regulatory Authorities relating to the development or commercialization of Product in the Field, including copies of all contact reports produced by CELSION or its Affiliates or licensees, in each case ((a) and (b)) within fifteen (15) Business Days of its receipt, forwarding or production of the foregoing, as applicable. If such written or electronic correspondence received from any such Regulatory Authority relates to the withdrawal, suspension, or revocation of a Regulatory Approval or Early Access Approval for Product in the Field, the prohibition or suspension of the supply of a Product in the Field, or the initiation of any investigation, review, or inquiry by such Regulatory Authority concerning the safety and quality of a Product in the Field, the notified Party shall notify the other Party and provide the other Party with copies of such written or electronic correspondence as soon as practicable, with CELSION’s obligation being limited to matters that involve or have an impact on the EAP.

 

	 	
4.1.3
	
CELSION shall, in accordance with the Quality Agreement, make every reasonable effort to notify IMPATIENTS promptly following its determination that any event, incident, or circumstance has occurred that may result in the need for a recall, market suspension, or market withdrawal of a Product in the Territory in the Field, and shall include in such notice the reasoning behind such determination, and any supporting facts. CELSION (or its licensee) shall have the right to make the final determination whether to voluntarily implement any such recall, market suspension, or market withdrawal in the Territory. If a recall, market suspension, or market withdrawal is mandated by a Regulatory Authority in the Territory, CELSION (or its licensee) shall initiate such a recall, market suspension, or market withdrawal in compliance with Applicable Law. For all recalls, market suspensions or market withdrawals undertaken pursuant to this Section, CELSION (or its licensee) responsible for the recall, market suspension, or market withdrawal shall be solely responsible for the execution thereof, and IMPATIENTS shall reasonably cooperate in all such recall efforts.

 

	 	
4.2
	
Regulatory Data.

 

Each Party shall promptly provide to the other Party copies of or access to all non-clinical data and clinical data, and other information, results, and analyses with respect to any development activities that are controlled by such Party or any of its Affiliates, collaborators or licensees (collectively, “Regulatory Data”), when and as such Regulatory Data becomes available. At the very least, CELSION shall provide IMPATIENTS with the GMP certificate of the manufacturing site, if applicable the Product’s GMP certificate, the Manufacturer’s manufacturing license for the Product, Product stability data and certificate of analysis, and all other Know How that IMPATIENTS is required to include, or may need to include, in its Early Access Approval applications.

 

	 	
4.3
	
Pharmacovigilance.

 

Parties will enter into a separate agreement related to the responsibility and performance of pharmacovigilance activities related to the Product. This Pharmacovigilance Agreement is attached as Exhibit 6.

 

 

 

 

 

Compliance.

 

Each Party shall perform or cause to be performed, any and all of its activities pursuant to this Early Access Agreement, in good scientific manner and in compliance with all Applicable Law.

 

	4.4	Records.
	 	 
	
4.4.1
	
Each of CELSION and IMPATIENTS shall, and shall ensure that its third party providers, maintain records in sufficient detail and in good scientific manner appropriate for regulatory purposes, and in compliance with Applicable Law, which shall be complete and accurate and shall properly reflect all work done and results achieved in the performance of its activities. CELSION or IMPATIENTS shall retain such records, as the case may be, for at least three (3) years after the termination of this Agreement, or for such longer period as may be required by Applicable Law.

 

	
4.4.2
	
Each Party shall have the right, during normal business hours and upon reasonable notice, to inspect and copy all records of the other Party, except for files that cannot be shared due to applicable privacy regulations. The inspecting Party shall maintain such records and the information disclosed therein in accordance with the confidentiality clauses of Article 9 of this Agreement.

 

	
4.4.3
	
Without limiting Section 2, the JSC shall determine what reports shall be generated to track the EAP activities, including the content and timing thereof. 

 

 

Article 5 – Exclusive distribution, supply and manufacture 

 

 

	
5.1
	
Distribution.

 

CELSION hereby appoints IMPATIENTS as its sole and exclusive distributor in respect of EAP use of Product for use in the Field in the Territory, limited to EAP use of Product in accordance with Early Access Approvals.

 

	
5.2
	
Product Supply.

 

	
5.2.1
	
CELSION undertakes, and agrees, to supply to IMPATIENTS on an exclusive basis, IMPATIENTS’ requirements of Product, ordered in accordance with the terms of this Agreement, for distribution and sale in the Territory, limited to EAP use of Product in accordance with Early AccessApprovals. 

 

	
5.2.2
	
IMPATIENTS undertakes, and agrees, to obtain all of its requirements of Product from CELSION in accordance with the terms of this Agreement.

 

 

 

 

 

	
5.3
	
Product Manufacturing.

 

	
5.3.1
	
Manufacturing. 

 

CELSION shall be solely responsible for the manufacturing, fill, finish, labeling and, if applicable, stockpiling of cGMP grade Product in compliance with the Quality Agreement attached as exhibit 5, and shall exert its reasonable commercial best efforts to provide quantities of cGMP Product sufficient to meet the requirements of the EAP. If CELSION contracts the manufacturing and/or filling and/or finishing and/or labeling and/or stockpiling of Product to a third party, such third party shall be considered a Manufacturer. CELSION will ensure that all relevant obligations deriving from this Agreement (including the Quality Agreement) between Parties are part of the contractual relationship between CELSION and any Manufacturer. CELSION shall provide all required documentation to IMPATIENTS related to the manufacturing for purposes of furthering the activities of the EAP.

 

	
5.3.2
	
Labeling

 

If CELSION is not able to supply the Products with the appropriate labels for the designated countries in the Territory, IMPATIENTS can accommodate the relabeling of the Product. All reasonable costs related to this relabeling will be for the account of CELSION, provided that IMPATIENTS will propose and offer market rates, to be reviewed and approved by CELSION before IMPATIENTS engages in such relabeling. IMPATIENTS will provide instructions regarding labeling in accordance with the Quality Agreement attached as exhibit 5. 

 

	
5.3.3
	
Interruption of Supply. 

 

If CELSION is unable to meet IMPATIENTS’ requirements for Product, CELSION, without penalty, will notify IMPATIENTS and the JSC will meet as soon as possible to negotiate a possible resolution.

 

 

 

Article 6 - Supply of Product

 

	
6.1
	
Notification of Requirements. 

 

IMPATIENTS shall notify CELSION of its estimated Product requirements for ***** (“Rolling Forecast”). Said estimate shall not constitute a firm commitment by IMPATIENTS.

 

 

 

	
6.2
	
Available Stock. 

 

CELSION will make all reasonable commercial efforts to ensure sufficient quantities of 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Product for the following ***** projected sales, based on the most recent Rolling Forecast, are in stock at the warehouse of IMPATIENTS’s logistics service provider (“LSP”). The legal ownership of the stock in the warehouse of IMPATIENTS’ LSP (further referred to as “Consignment Stock) shall remain with CELSION and will at no time be transferred to IMPATIENTS or the LSP. At the time of IMPATIENTS’ delivery of the Product through its LSP to its clients legal ownership of the Product will directly transfer from CELSION to the relevant client of IMPATIENTS. Any costs related to the stock keeping itself (including loss and shrinkage due to error of IMPATIENTS or its service providers, but excluding shipment by CELSION to Consignment Stock) shall be at the expense of IMPATIENTS. 

 

Product Shipment. 

 

Products shall be delivered by CELSION DDP (INCOTERMS 2010) at the Consignment Stock warehouse address of IMPATIENTS’ LSP. At the warehouse of IMPATIENTS’ LSP, Products will be made ready for delivery to IMPATIENTS’ clients, in a manner controlled by IMPATIENTS and in accordance with the Quality Agreement.

 

	
6.3
	
Shipment Authorisation. 

 

CELSION hereby authorises IMPATIENTS to order its LSP to use Product from the Consignment Stock for the fulfilling of orders from IMPATIENTS’ clients without further approval from CELSION. CELSION shall make all reasonable commercial efforts to ensure that the Consignment Stock is replenished in a timely manner to comply with the stock level requirement as mentioned in clause 6.2.

 

	
6.4
	
Invoice. 

 

IMPATIENTS shall notify CELSION at ***** of all fulfilled Product orders and Net EAP Sales of Product from the past month. CELSION shall send IMPATIENTS an invoice in Euros (€) ***** and IMPATIENTS shall pay such invoice to CELSION in Euros (€) within *****. 

 

	
6.5
	
Product Pricing. 

 

The Price of Products, established by Celsion at its sole discretion, is specified in Exhibit 4. Prices are stated excluding discounts, VAT or other taxes or levies.

 

Article 7 – Compensation to IMPATIENTS for market development

 

	
7.1.1
	
Royalty Obligation. For each country in which IMPATIENTS has met its contractual obligations in full, IMPATIENTS is entitled to a royalty compensation for its EAP activities that will be calculated in accordance with clause 7.1.2 or 7.1.3, whichever calculation will have the highest outcome and to be calculated in accordance with 7.1.5 and 7.1.6. 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

	
7.1.2
	
If the Product receives Marketing Authorisation in the Field, in the Territory then CELSION, its successors and/or assigns, shall pay IMPATIENTS (or its successors and/or assigns) the following royalty: a) for all Net Sales of Product in the countries for which Marketing Authorisation in the Field is granted up to *****: a royalty of *****% of Net Sales of Product in these countries for which Marketing Authorisation is granted in the Field for a period of 10 years from the First Commercial Sale of Product in any country in the Territory. The royalty percentage will be calculated in accordance with the royalty stipulations of Exhibit 4, sub 2. b) for all Net Sales of Product in the countries for which Marketing Authorisation in the Field is granted above *****: a royalty of ***** % of Net Sales of Product in these countries for which Marketing Authorisation is granted in the Field for a period of 10 years from the First Commercial Sale of Product in any country in the Territory. 

 

	
7.1.3
	
If the Product receives a Marketing Authorisation in the Territory, in any field, then CELSION, its successors and/or assigns, shall pay IMPATIENTS (or its successors and/or assigns the following royalty: a) for all Revenue of Product in the countries in any field for which Marketing Authorisation is granted up to *****: a royalty of ***** % of Revenue of Product in these countries for which Marketing Authorisation is granted for a period of 10 years from the First Commercial Sale of Product in any country in the Territory. The royalty percentage will be calculated in accordance with the royalty stipulations of Exhibit 4, sub 3. b) for all Revenue of Product in the countries for which Marketing Authorisation is granted above *****: a royalty of *****% of Revenue of Product in these countries for which Marketing Authorisation is granted for a period of 10 years from the First Commercial Sale of Product in any country in the Territory.

 

	
7.1.4
	
CELSION shall not be entitled to assign, sell or dispose of its business in respect of the Product to a third party (including granting a third party the right to file for a Marketing Authorisation based on CELSION’s rights and know how) unless such third party undertakes in writing to IMPATIENTS to be bound by the provisions of this Article 7 as if such third party were a party to this article 7 instead of CELSION. For the avoidance of doubt, by third party in this Article 7 is meant any person or entity that is not a Party to this agreement, including any Affiliate of CELSION.

 

	
7.1.5
	
Following Marketing Authorisation and subsequent First Commercial Sale of Product in the Territory, Product Net Sales and Revenues shall be reported, and royalties based on such Net Sales or Net Revenues shall be calculated within *****. The highest outcome of the royalty calculations as referred to in this clause 7 shall be paid to IMPATIENTS within *****. 

 

	
7.1.6
	
At the end of ***** period dictated in 7.1.5, IMPATIENTS shall be obligated to choose one royalty compensation clause, either 7.1.2 or 7.1.3, at its discretion, to be used to calculate the remainder of the royalty term. CELSION, its Affiliates, licensees, successors and/or assigns shall maintain accurate records of Product sales for a period of *****. Such records may be audited for accuracy once a year by an independent public accounting firm, acceptable to both parties, which would be allowed reasonable access at reasonable times to review such records.

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Article 8 - Warranties, liability and indemnity

 

	
8.1
	
Mutual Representations and Warranties.

 

The Parties represent and warrant to each other, as of the Effective Date, as follows:

 

	
8.1.1
	
Organisation. 

 

It is a corporation duly organised, validly existing, and in good standing under the laws of the jurisdiction of its organisation, and has all requisite power and authority, corporate or otherwise, to execute, deliver, and perform this Agreement.

 

	
8.1.2
	
Authorisation. 

 

The execution and delivery of this Agreement and the performance by it of the transactions contemplated hereby have been duly authorised by all necessary corporate action, and do not violate (a) such Party’s charter documents, bylaws, articles of association or other organisational documents, (b) in any material respect, any agreement, instrument, or contractual obligation to which such Party is bound, (c) any requirement of any Applicable Law, or (d) any order, writ, judgment, injunction, decree, determination, or award of any court or governmental agency presently in effect applicable to such Party.

 

	
8.1.3
	
Binding Agreement. 

 

This Agreement is a legal, valid, and binding obligation of such Party enforceable against it in accordance with its terms and conditions, subject to the effects of bankruptcy, insolvency, or other laws of general application affecting the enforcement of creditor rights, judicial principles affecting the availability of specific performance, and general principles of equity (whether enforceability is considered a proceeding at law or equity).

 

	
8.1.4
	
No Inconsistent Obligation. 

 

It is not under any obligation, contractual or otherwise, to any Person that conflicts with or is inconsistent in any material respect with the terms of this Agreement, or that would impede the diligent and complete fulfilment of its obligations hereunder.

 

	
8.2
	
Product Warranty. 

 

CELSION warrants that Product supplied to IMPATIENTS under this Agreement shall comply with the Specifications; be manufactured, filled, finished, labeled and packed in GMP facilities and in accordance with the Quality Agreement and all Applicable Laws; be free from contamination or adulteration; be adequately packed to withstand transportation. At the time of delivery, each Product shall have no less than 12 months of the Product’s registered shelf life remaining.

 

	
8.3
	
Product Liability. 

 

CELSION represents and warrants to IMPATIENTS that the CELSION is legally bound to retain responsibility and liability for the manufacture of the Product at all times and shall maintain product and general liability insurance covering any loss, costs, expenses, liability, actions, demands, claims or proceedings.

 

 

 

 

 

	
8.4
	
Indemnity. 

 

Each Party shall indemnify and hold the other Party harmless from any claims, suits, demands, judgments, actions, liabilities, (including strict liability and infringement of a third party’s patent rights) expenses (including reasonable attorney’s fees) and damages relating to the Product and caused directly or indirectly by any act or omission of the other Party and its officers, directors, employees, subcontractors, agents or suppliers, or (in the case of CELSION only) the Manufacturer. This indemnity shall not apply if any such liability, loss, damage, cost or expense is due to the gross negligence or default in performance by the indemnified Party, its officers, directors, employees, subcontractors, agents or suppliers.

 

	
8.5
	
Waiver of consequential or punitive damages. 

 

Save as for intentional wrongdoing by a Party, neither Party, nor any of their respective directors, officers, employees or agents shall have any liability towards the other Party, for any indirect or consequential damages claimed by the other Party, including, but not limited to the loss of opportunity, loss of use, and/or loss of revenue or profit, in connection with or arising out of this Agreement or breach thereof. 

 

Article 9 - Confidentiality

 

	
9.1
	
The Parties will continue to abide by the confidentiality agreement signed by both Parties dated 26 August 2014. The terms of confidentiality respecting Information shall not impede the appropriate use thereof in IMPATIENTS’s submission of Information in Early Access Approvals applications with Regulatory Authorities, or in execution of the EAP of Product according to the EAP Plan. 

 

CELSION acknowledges that the EAP Plan involves the publication of safety and efficacy information relating to the Product, including CELSION Confidential Information included in the Regulatory Documentation, and the patient- and doctor-reported outcomes and registry data generated and collected during the performance of the EAP. Therefore, CELSION hereby consents to IMPATIENTS publishing such CELSION’s Confidential Information only in accordance with Applicable Laws as required.

 

Article 10 - Duration, termination

 

	
10.1
	
This Agreement will become legally effective on the Effective Date and, unless earlier terminated pursuant to the terms hereof, shall continue in full force and effect for an initial period of 5 (five) years and will automatically be renewed for consecutive periods of 2 years, unless one of the Parties gives written notice not to extend at least 3 months before the contract is to be renewed. 

 

	
10.2
	
Subject to mandatory provision of law, this Agreement may be terminated by a Party, without any liability to the other, if the other Party is dissolved or liquidated, files or has filed against it a petition under any applicable bankruptcy or insolvency law, makes a general assignment for the benefit of its creditors, or has a receiver appointed for substantially all of its assets.

 

	
10.3
	
Each Party may terminate this Agreement for convenience, provided the non-terminating Party is provided with 6 (six) months written notification (or 2 (two) months as set forth in Section 2.3 of Exhibit 2).

 

 

 

 

 

	
10.4
	
Each Party reserves the right to immediately terminate this Agreement if the other Party is in breach of its material obligations under this Agreement and fails to remedy such breach within 120 days by written notification by the other Party of said breach.

 

	
10.5
	
Consequences of Termination.

 

	
10.5.1
	
CELSION will allow IMPATIENTS to continue to distribute and sell the Product until such time that the entire quantity of the Consignment Stock has been sold provided there are no breaches of material obligations by IMPATIENTS under this Agreement. 

 

	
10.5.2
	
Upon termination of this Agreement pursuant to Clause 10.1 or by IMPATIENTS pursuant to Clause 10.4, Clause 7 shall survive such termination and the royalty rate shall be the percentage as specified.

 

	
10.5.3
	
Upon termination of this Agreement pursuant to Clause 10.3 by CELSION, the royalty obligation of clause 7.1.1 to 7.1.3 will be replaced with the following royalty obligation: 

 

Royalty Obligation. IMPATIENTS is entitled to a royalty compensation for its EAP activities that will be calculated in accordance with clause 10.5.3.1. or 10.5.3.2. whichever calculation will have the highest outcome and to be calculated in accordance with 7.1.5 and 7.1.6.

 

10.5.3.1 If the Product receives Marketing Authorisation in the Field, in the Territory, then CELSION, its successors and/or assigns, shall pay IMPATIENTS (or its successors and/or assigns) the following royalty:

 

a) for all Net Sales up to *****, in the countries for which Marketing Authorisation in the Field is granted: a royalty of *****% of Net Sales of Product in the Field in these countries for a period of 10 years from the First Commercial Sale of such Product in the Field in any country in the Territory.

 

b) for all Net Sales above *****, in the countries for which Marketing Authorisation in the Field is granted: a royalty of *****% of Net Sales of Product in the Field in these countries for a period of 10 years from the First Commercial Sales of Product in the Field in any country in the Territory. 

 

10.5.3.2. If the Product receives a Marketing Authorisation in the Territory, in any field, then CELSION, its successors and/or assigns, shall pay IMPATIENTS (or its successors and/or assigns the following royalty:

 

a) for all Revenue of Product up to *****, in the countries for which Marketing Authorisation is granted: a royalty of ***** % of Revenue of Product in these countries for which Marketing Authorisation is granted for a period of 10 years from the first Commercial Sale of Product in any country in the Territory. 

 

b) for all Revenue of Product, above *****, in the countries which Marketing Authorisation is granted, a royalty of ***** % of Revenue of Product in these countries for which Marketing Authorisation is granted for 10 years from the first Commercial Sale of Product of such Product in any country in the Territory. 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

	
10.5.4
	
At the end of ***** period dictated in 7.1.5, IMPATIENTS shall be obligated to choose one royalty compensation clause, either 10.5.3.1 or 10.5.3.2, at its discretion, to be used to calculate the remainder of the royalty term. CELSION, its Affiliates, licensees, successors and/or assigns shall maintain accurate records of Product sales for a period of *****. Such records may be audited for accuracy once a year by an independent public accounting firm, acceptable to both parties, which would be allowed reasonable access at reasonable times to review such records. 

 

	
10.5.5
	
Notwithstanding Clause 10.6, upon termination of this Agreement by IMPATIENTS pursuant to Clause 10.3 or by CELSION pursuant to Clause 10.4, Clause 7 shall not be applicable.

 

	
10.6
	
Survival. 

 

Subject to the terms of this article 10, Article 1, Clause 4.4.1, and Articles 7-11 shall survive termination of this Agreement.

 

Article 11 – Miscellaneous

 

	
11.1
	
Entire Agreement. 

 

This Agreement, together with the Confidentiality Agreement dated 26 August 2014 and signed by the Parties prior to the Effective Date, constitutes the entire agreement between the Parties as regards the Product, and any former agreement relating to the same subject matter hereby becomes null and void. In the event of any inconsistencies between the terms of these Agreements, the terms of this Agreement shall prevail.

 

	
11.2
	
Amendments. 

 

Modifications to this Agreement shall be made in writing only, and shall only take effect when signed by both Parties. 

 

	
11.3
	
Press releases. 

 

Each Party shall have the right to publish the existence of this Agreement, provided that the other Party shall have an opportunity to review press releases for at least five (5) working days prior to public disclosure.

 

	
11.4
	
Independent Contractors. 

 

It is understood that both Parties hereto are independent contractors and engage in the operation of their own respective businesses. Neither Party hereto is to be considered the agent of the other Party for any purpose whatsoever and neither Party has any authority to enter into any contract or assume any obligation for the other Party or to make any warranty or representation on behalf of the other Party. Each Party shall be fully responsible for its own employees, servants and agents, and the employees, servants and agents of one Party shall not be deemed to be employees, servants and agents of the other Party for any purpose whatsoever.

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

	
11.5
	
Remedy; Waiver. 

 

Exercise by any Party of any of its rights under this Agreement shall not be deemed to limit any other right or remedy that such Party may have in law or equity. The waiver by either Party of a breach of any of the provisions of this Agreement by the other Party shall not be construed as a waiver of any succeeding breach of the same or other provisions; nor shall any delay or omission by either Party in exercising any right that it may have under this Agreement operate as a waiver of any breach or default by the other Party.

 

	
11.6
	
Formalities. 

 

Each Party agrees to execute deliver and/or do such further papers, agreements or acts as may be necessary or desirable to give effect to this Agreement and its purpose and to carry out its provisions.

 

	
11.7
	
Mediation Clause. 

 

All disputes arising in connection with the present Agreement, or further contracts resulting therefrom, shall be settled by binding arbitration in accordance with the Arbitration Rules of the Netherlands Arbitration Institute. The arbitral tribunal shall be composed of three arbitrators. Each Party shall select an arbitrator of its choice, with a third arbitrator selected by the two arbitrators chosen by the Parties. The place of arbitration shall be Amsterdam and the procedure shall be conducted in the English language. 

 

	
11.8
	
Choice of Law. 

 

This Agreement shall be governed by and interpreted under the laws of The Netherlands. 

 

	
11.9
	
Language. 

 

This Agreement is executed in the English language. The language used in this Agreement shall be deemed to be the language chosen by the Parties hereto to express their mutual intent and no rule of strict construction against either Party shall apply to any term or condition of this Agreement. The definitive language of this Agreement is English and no reliance shall be placed upon any translation into any other language.

 

	
11.10
	
Assignment; Assumption. 

 

Subject to Clause 7.1.3 neither this Agreement nor any rights or obligations hereunder may be assigned or duties delegated (other than specified in the EAP Plan) by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld. Any assignment in violation of this clause shall be null and void. Any permitted assignee shall, upon the request of the other Party hereto, expressly acknowledge, by written agreement, its assumption of all obligations and liabilities under this Agreement.

 

	
11.11
	
Force Majeure. 

 

Should a Party be unable to perform any of its obligations under this Agreement due to an event of force majeure as determined by law such Party shall be excused to perform its obligation during the period of such force majeure event provided always that it gives the other Party prompt written notice of such force majeure event. If the event of force majeure were to prevent such Party performing its obligations in connection with this Agreement for a continuous period of more than three (3) months, the other Party may terminate the Agreement at its sole option by giving written notice thereof, without any indemnity to be paid by either Party. The termination would then take effect without further notice, at the date of receipt of the above notice. In no event shall this provision relieve either Party of its obligation to make payment when owing.

 

 

 

 

 

	
11.12
	
Severability. 

 

If any provision of this Agreement is found by any court or administrative body of competent jurisdiction to be invalid or unenforceable, the invalidity or unenforceability of such provision shall not affect the other provisions of this Agreement, and all provisions not affected by such invalidity or unenforceability shall remain in full force and effect. The Parties agree to attempt to substitute for any invalid or unenforceable provision a valid or enforceable provision, which achieves to the greatest extent possible the economic objectives of the invalid or unenforceable provision. Should any provision of this Agreement conflict with applicable legislation, then such provision shall be modified by the Parties in order to comply with said legislation. This modification shall not affect the other provisions of this Agreement.

 

	
11.13
	
Notice. 

 

All formal notices to be given pursuant to this Agreement shall be in writing and in English and shall be delivered by hand, sent by registered mail return receipt, or by express courier service to the address of the Party to receive such notice as set out below (or such other address as may be notified by a Party to the other from time to time). Notices shall be deemed to have been received at the time of delivery by hand, at the date affixed on the return receipt or 3 (three) business days after sending if sent by express courier service.

 

	
      
	For CELSION: 	 	
 For IMPATIENTS: 

	 	 	 	 
	
 
	Celsion Corporation: 	 	
Impatients N.V.:

	
 
	Attn: Michael H. Tardugno	 	
Attn.: Govert Schouten

	 	Chairman, President, CEO	 	Pilotenstraat 45
	 	997 Lenox Drive, Suite 100	 	1059 CH 
	 	Lawrenceville, New Jersey, 08648	 	Amsterdam
	 	U.S.A.	 	The Netherlands
	 	Email: mtardugno@celsion.com	 	Email: *****

                             

 

                        

               

               

               

     

                               

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

	
11.14
	
Construction. 

 

Except where the context otherwise requires, wherever used, the singular shall include 

 

the plural, the plural the singular, the use of any gender shall be applicable to all genders and the word “or” is used in the inclusive sense (and/or). Whenever this Agreement refers to a number of days, unless otherwise specified, such number refers to calendar days. The captions of this Agreement are for convenience of reference only and in no way define, describe, extend, or limit the scope or intent of this Agreement or the intent of any provision contained in this Agreement. The term “including,” “include,” or “includes” as used herein shall mean “including, but not limited to,” and shall not limit the generality of any description preceding such term. The language of this Agreement shall be deemed to be the language mutually chosen by the Parties and no rule of strict construction shall be applied against either Party hereto. Each Party represents that it has been represented by legal counsel in connection with this Agreement and acknowledges that it has participated in the drafting hereof. In interpreting and applying the terms and provisions of this Agreement, the Parties agree that no presumption will apply against the Party which drafted such terms and provisions.

 

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement by their respective, duly authorized, representatives:

 

	
             For CELSION:   
	
               For IMPATIENTS:    

	 	 
	 	 
	 	 
	 	 
	
/s/ Michael H. Tardugno           
	
   /s/ Ronald H.P. Brus          

	
 
	
 

	Michael H. Tardugo  	Ronald H.P. Brus
	 	 
	Chairman, President, CEO  	CEO

                       

 

 

 

 

 

 

Exhibit 1 – EAP Plan 

 

LTLD (Lyso-Thermosensitive Liposomal Doxorubicin) EAP Execution Plan Version 1.0 9th March 2015

 

 

*****

 

 

 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Exhibit 2 – JSC and subcommittees

 

	
1
	
JSC.

 

	 	
1.1
	
Composition. 

          The JSC shall consist of *****, each with the requisite experience and seniority to enable such person to make decisions on behalf of a Party with respect to the issues falling within the jurisdiction of the JSC. From time to time, each Party may substitute one or more of its representatives to the JSC on written notice to the other Party. *****. The chairperson shall appoint a secretary of the Joint Steering Committee, who shall be a *****. The roles for the JSC chairperson and secretary shall rotate every year. 

 

	 	
1.2
	
Specific Responsibilities. 

          The JSC shall oversee the EAP for the Product in the Territory, and shall serve as a forum for the coordination of activities for the Product for the Territory. In particular, the JSC shall:

	 	
(a)
	
periodically (no less often than every six (6) months in year one and annually thereafter) review and serve as a forum for discussing the EAP, and review and approve amendments thereto;

	 	
(b)
	
oversee the conduct of EAP activities;

	 	
(c)
	
establish any discounts regarding third parties 

	 	
(d)
	
serve as a forum for discussing and coordinating strategies for obtaining Early Access Approvals and Regulatory Approvals for the Product in the Territory;

	 	
(e)
	
establish secure access methods (such as secure databases) for each Party to access Regulatory Documentation and other JSC related Information as contemplated under this Agreement; and

	 	
(f)
	
perform such other functions as are set forth herein or as the Parties may mutually agree in writing, except where in conflict with any provision of this Agreement.

(g) either Party may request a meeting of the JSC at any time, which will be held in a timely fashion. 

 

	 	
1.3
	
Disbandment. 

 

Upon Marketing Authorisation of the Product in Germany, United Kingdom, France, Spain and Italy, unless otherwise mutually agreed in writing, the JSC shall have no further responsibilities or authority under this Agreement and will be considered dissolved by the Parties. Additionally, in the event of a Change of Control of CELSION, IMPATIENTS shall have the right at any time and for any reason, effective upon written notice, to disband the JSC. 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

	 	
1.4
	
Subcommittees. 

 

From time to time, the JSC may establish and delegate duties to sub-committees or directed teams (“Subcomittee(s)”) on an “as-needed” basis to oversee particular projects or activities (for example, joint project team, joint finance group, and/or joint intellectual property group). Each such Subcomittee shall be constituted and shall operate as the JSC determines; provided that each Subcommittee shall have equal representation from each Party, unless otherwise mutually agreed. Subcommittees may be established on an ad hoc basis for purposes of a specific project or on such other basis as the JSC may determine. Each Subcommittee and its activities shall be subject to the oversight, review and approval of, and shall report to, the JSC. In no event shall the authority of the Subcomittee exceed that specified for the JSC. All decisions of a Subcommittee shall be by unanimous agreement.

 

	
2
	
General Provisions Applicable to committees.

 

	 	
2.1
	
Meetings and Minutes. 

 

The committees shall meet quarterly, or in each case as otherwise agreed to by the Parties, with the location of such meetings alternating between locations designated by CELSION and locations designated by IMPATIENTS. The chairperson of the applicable committee shall be responsible for calling meetings on no less than thirty (30) Business Days’ notice. Each Party shall make all proposals for agenda items and shall provide all appropriate information with respect to such proposed items at least ten (10) Business Days in advance of the applicable meeting; provided that under exigent circumstances requiring input by the committee, a Party may provide its agenda items to the other Party within a shorter period of time in advance of the meeting, or may propose that there not be a specific agenda for a particular meeting, so long as the other Party consents to such later addition of such agenda items or the absence of a specific agenda for such meeting, such consent not to be unreasonably withheld or delayed. The chairperson of the committee shall prepare and circulate for review and approval of the Parties minutes of each meeting within thirty (30) days after the meeting. The Parties shall agree on the minutes of each meeting promptly, but in no event later than the next meeting of the committee. If the Parties cannot agree on the content of the minutes the objecting party shall append a notice of objection with the specific details of the objection to the proposed minutes.

 

	 	
2.2
	
Procedural Rules. 

 

Each committee shall have the right to adopt such standing rules as shall be necessary for its work, to the extent that such rules are not inconsistent with this Agreement. A quorum of the committee shall exist whenever there is present at a meeting at least one (1) representative appointed by each Party. Representatives of the Parties on a committee may attend a meeting either in person or by telephone, video conference or similar means in which each participant can hear what is said by, and be heard by, the other participants. Representation by proxy shall be allowed. Each committee shall take action by unanimous agreement of the representatives present at a meeting at which a quorum exists, with each Party having a single vote irrespective of the number of representatives of such Party in attendance, or by a written resolution signed by at least one (1) representative appointed by each Party. Employees or consultants of either Party that are not representatives of the Parties on a Committee may attend meetings of such committee; provided, however, that such attendees (a) shall not vote or otherwise participate in the decision-making process of the Committee, and (b) are bound by obligations of confidentiality and non-disclosure equivalent to those set forth in Section11.1 of the Agreement.

 

 

 

 

 

	 	
2.3
	
Committee Dispute Resolution. 

 

If a subcommittee cannot, or does not, reach unanimous agreement on an issue at a meeting or within a period of ten (10) Business Days thereafter or such other period as the Parties may agree, then the dispute shall be referred to the JSC for resolution and a special meeting of the JSC may be called for such purpose. If the JSC cannot, or does not, reach unanimous agreement on an issue, including any dispute arising from the JSC, then the dispute shall first be referred to the senior officers of the Parties, who shall confer in good faith on the resolution of the issue. Any final decision mutually agreed to by the senior officers shall be conclusive and binding on the Parties. If the senior officers are not able to agree on the resolution of any such issue within thirty (30) days after such issue was first referred to them, then, such dispute shall be finally and definitively resolved by: (a) the senior officer of IMPATIENTS to the extent the Dispute relates to the performance of the EAP (other than any matter requiring amendment of the Agreement which shall require mutual agreement of the Parties) and (b) by the senior officer of CELSION for all other disputes. In the event of (a), CELSION shall have the right to terminate this Agreement for convenience if it provides IMPATIENTS with two (2) months’ written notification during the thirty (30) day period following Celsion’s receipt of notice of IMPATIENTS’ final and definitive resolution. In the event of (b), IMPATIENTS shall have the right to terminate this Agreement for convenience if it provides CELSION with two (2) months’ written notification during the thirty (30) period following IMPATIENTS’ receipt of notice of Celsion’s final and definitive resolution.

 

	 	
2.4
	
Limitations on Authority. 

 

Each Party shall retain the rights, powers, and discretion granted to it under this Agreement and no such rights, powers, or discretion shall be delegated to or vested in a committee unless such delegation or vesting of rights is expressly provided for in this Agreement or the Parties expressly so agree in writing. No committee shall have the power to amend, modify, or waive compliance with this Agreement, which may only be amended or modified as provided in Section 11.2 of the Agreement.

 

	 	
2.5
	
Alliance Manager. 

 

Each Party shall appoint a person(s) who shall oversee contact between the Parties for all matters between meetings of each committee and shall have such other responsibilities as the Parties may agree in writing after the Effective Date (each, an “Alliance Manager”). Each Party may replace its Alliance Manager at any time by notice in writing to the other Party.

 

 

 

 

 

	
3
	
Discontinuation of Participation on a Committee. 

 

Each committee shall continue to exist until the first to occur of: (i) the Parties mutually agreeing to disband the committee; or (ii) CELSION providing to IMPATIENTS written notice of its intention to disband and no longer participate in such committee, provided that CELSION shall not give such written notice prior to Early Access Approvals in the Major Markets of the Territory. Notwithstanding anything herein to the contrary, once CELSION has provided such written notice, such committee shall be terminated and shall have no further rights or obligations under this Agreement, and thereafter any requirement of CELSION to provide Information or other materials to such committee shall be deemed a requirement to provide such Information or other materials to IMPATIENTS and IMPATIENTS shall have the right to solely decide, without consultation with CELSION, all matters that are subject to the review or approval by such committee hereunder.

 

	
4
	
Expenses. 

 

Each Party shall be responsible for all travel and related costs and expenses for its members and other representatives to attend meetings of, and otherwise participate on, a committee.

 

 

 

 

 

Exhibit 3 - Trademark usage conditions

 

 

	
1.
	
Product Trademark License Terms.

 

	 	
1.1.
	
IMPATIENTS acknowledges CELSION’s exclusive right, title, and interest in and to the Product Trademark ThermoDox and acknowledges that (i) neither this Agreement, nor its use of the Product Trademarks hereunder, shall be construed to accord to IMPATIENTS any rights in the Product Trademarks other than the limited license rights granted herein, and (ii) the goodwill generated thereby will inure solely and entirely to the benefit of CELSION.

 

	 	
1.2.
	
Should it be necessary to record IMPATIENTS as a registered licensee of the Product Trademarks in any jurisdiction, CELSION shall do so at IMPATIENTS’s expense, and IMPATIENTS will cooperate with CELSION to effect such recordation.

 

	
2.
	
Trademark Use. 

 

IMPATIENTS may use the Product Trademarks solely in conjunction with the Product EAP.

 

	 	
2.1.
	
Product Trademarks Usage Requirements.

 

IMPATIENTS agrees to comply with the Product Trademarks usage requirements of this Exhibit 3.

 

	 	
2.2.
	
The Product Trademarks may not be used in connection with the display, advertising, or promotion of Product for any purpose IMPATIENTS has not been appointed for. 

 

	 	
2.3.
	
The Product Trademarks may not be altered. The Product Trademarks are not to be used in conjunction with any other mark or design, i.e., the Product Trademarks must stand alone in terms of the commercial impression generated by the particular usage; provided, however, that IMPATIENTS’s trademarks may be used along with the Product Trademarks as long as such trademarks do not combine, superimpose or overlap with the Product Trademarks.

 

	 	
2.4.
	
IMPATIENTS must exercise care in the use of the Product Trademarks so as not to indicate to the public that IMPATIENTS is a division or affiliate of CELSION or otherwise related to CELSION.

 

	 	
2.5.
	
IMPATIENTS shall not use as its own trademark any word(s) or design(s) confusingly similar to the Product Trademarks. 

 

	
3.
	
Protection of Interest. 

 

If IMPATIENTS becomes aware of any unauthorized use of the Product Trademarks by a third party, IMPATIENTS, subject to its confidentiality obligations to other parties, agrees to promptly notify CELSION and to cooperate fully, at CELSION’s expense, in the enforcement of CELSION’s rights against such a third party. Nothing contained in this Section shall be construed as to require CELSION to enforce any rights against a third party or to restrict CELSION’s rights to license or consent to such a third party’s use of the Product Trademarks.

 

 

 

 

 

Exhibit 4 – Price of Product

 

 

 

1. Product Price to be invoiced by IMPATIENTS to third parties excluding VAT: 

 

 

 

Price: *****. 

 

Price is established by CELSION, at its sole discretion, and may be changed by Celsion. 

 

 

 

2. The royalty referred to in clause 7.1.2 shall be calculated as follows:

 

*****

 

 

 

 

 

3. The royalty referred to in clause 7.1.3 shall be calculated as follows:

 

*****

 

 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Exhibit 5 - Quality Agreement

 

 

 

*****

 

 

 

 

 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

 

 

 

 

 

Exhibit 6 - Pharmacovigilance Agreement

 

 

 

*****

 

 

 

 

 

 

 

 

 

THE COMPANY HAS REQUESTED AN ORDER FROM THE COMMISSION PURSUANT TO RULE 406 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, GRANTING CONFIDENTIAL TREATMENT TO SELECTED PORTIONS. ACCORDINGLY, THE CONFIDENTIAL PORTIONS HAVE BEEN OMITTED FROM THIS EXHIBIT, AND HAVE BEEN FILED SEPARATELY WITH THE COMMISSION. OMITTED PORTIONS ARE INDICATED IN THIS EXHIBIT WITH “*****”.

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