Document:

Drug Product Manufacturing Supply Agreement, dated July 13, 2010

 Exhibit 10.6 

DRUG PRODUCT MANUFACTURING SUPPLY AGREEMENT 

THIS DRUG PRODUCT MANUFACTURING SUPPLY AGREEMENT (“Agreement”) is made effective as of July 9, 2010 (the “Effective Date”) by
and between NerPharMa, S.r.l. (“NPM”) Viale Pasteur, 10-20014 Nerviano (MI), Italy, and Cell Therapeutics, Inc. (“CTI”), having an office at 501 Elliott Avenue West, Suite 400, Seattle, WA 98119. 

WHEREAS, NPM has the experience and capability to manufacture and supply Product (as defined below); and 

WHEREAS, NPM agrees to be the non-exclusive manufacturer and supplier of Product; and 

WHEREAS, CTI desires to have available for clinical trials use and, upon regulatory approval, for commercial use, on a coordinated continuing basis, a
supply of Product that shall match the Specifications as defined herein; 
 NOW, THEREFORE, in consideration of the premises and mutual
covenants and conditions contained herein, the Parties hereto agree as follows: 
 ARTICLE 1 

DEFINITIONS 
 For the
purpose of this Agreement, the following words and phrases shall have the following meanings: 
  

	 	1.1	“Affiliate” shall mean, with respect to any party hereto, any person, organization or entity directly or indirectly controlling, controlled by or under common
control with, such party. For purposes of this definition only, “control” of another person, organization or entity shall mean (i) ownership or direct control of fifty percent (50%) or more of the outstanding voting stock or
other ownership interest of the other organization or entity, or (ii) possession of, or the power to elect or appoint fifty percent (50%) or more of the members of the governing body of the organization or other entity.

  

	 	1.2	“Attachment” shall mean the Attachments attached hereto and made part of this Agreement titled respectively Attachment A, Attachment B, etc. Such Attachments
are hereby incorporated by this reference and made a part of this Agreement and shall be subject to the terms and conditions in this Agreement. The Attachments may be amended upon mutual written agreement of the Parties to reflect new requirements,
demands or market conditions. Unless otherwise specifically provided to the contrary in any Attachment to this Agreement, in the event of a conflict between the main body of this Agreement and the Attachments hereto, the terms of the main body of
this Agreement shall control. 

  

	 	1.3	“Binding Forecast” shall have the meaning set forth in Section 2.16. 

 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

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	 	1.4	“Brightstock” shall mean finished unlabeled vials imprinted with information required by cGMP and other applicable current laws, at minimum lot number.
“Drug Product” and “finished unlabeled vials” shall mean drug product that has been formulated, sterile filtered, aseptically filled into vials, lyophilized, and hermetically sealed, tested and bulk packaged.

  

	 	1.5	“cGMP” shall mean the regulatory requirements for current good manufacturing practices as the same are or shall from time to time be established by the
applicable governmental or regulatory authority, including without limitation the United States current good manufacturing practices pursuant to the U.S. Federal Food, Drug, and Cosmetic Act, as amended (21 U.S.C. Sect. 301 et seq.) and the
relevant regulations found in Title 21 of the U.S. Code of Federal Regulations (including Parts 210, 211, 600 and 611), and the European Union’s current good manufacturing practices pursuant to the European Commission in Directive 91/356/EEC,
as amended by 2003/94/EC, and the Guide to Good Manufacturing Practice (Volume 4 of “The rules governing medicinal products in the European Union”). 

 

	 	1.6	“Confidential Information” shall have the meaning set forth in Section 6.1. 

 

	 	1.7	“Cost Reduction Measures” shall have the meaning set forth in Section 3.3. 

 

	 	1.8	“Firm Order” shall have the meaning set forth in Section 2.17. 

 

	 	1.9	“Government Approvals” shall mean any approvals, licenses, permits, registrations or authorizations, howsoever called, of any United States, Italian, European
Union or foreign regulatory agency, department, bureau or other government entity necessary for the manufacture, test, use, storage, transport, export or sale of the Product. 

 

	 	1.10	“Initial Term” shall have the meaning set forth in Section 7.1. “Quality Agreement” shall mean a written document, mutually agreed to by the
Parties, describing the obligations of the Parties with regards to regulatory compliance, quality systems, and testing and release of Product. The Quality Agreement will be attached as Attachment E to this Agreement. 

 

	 	1.11	“NMS Group” means NMS and any and all Affiliates of NMS. 

  

	 	1.12	“Parties” shall mean NPM and CTI together and “Party” means either of them, as the context requires. 

 

	 	1.13	“Pre-commercialization Period” shall mean the time period before the Product has been granted approval for commercial distribution by the applicable
regulatory authority; including, but not limited to the Food and Drug Administration (FDA), and the European Medicines Agency (EMEA). 

  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

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	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	1.14	“Post-commercialization Period” shall mean the time period after the Product has been granted approval for commercial distribution by the applicable
regulatory authority; including, but not limited to the Food and Drug Administration (FDA), and the European Medicines Agency (EMEA). 

  

	 	1.15	“Pricing Schedule” shall have the meaning set forth in Attachment B. 

 

	 	1.16	“Process” shall mean the series of processes, methods, tests and techniques provided by CTI by which the Product is manufactured, as described in detail in a
manufacturing process description document which shall be written in English and agreed by the Parties, and as further defined in the manufacturing records. The Process may be changed from time to time by agreement of the parties and in accordance
with the Quality Agreement. NPM shall not change the Process except at the written request of or with written permission from CTI. 

  

	 	1.17	“Product” shall mean BBR 2778 (pixantrone dimaleate) for Injection (BBR 2778 DP), which is described in Attachment A attached hereto, and, as the
context requires, the Drug Product manufactured under this Agreement, including without limitation all in-process intermediates, samples, derivatives, and improvements thereof. 

 

	 	1.18	“Shipper” shall mean a standard shipper with separation for each vial which is IATA shipping compliant or as otherwise agreed in writing by the Parties.

  

	 	1.19	“Specifications” shall mean the qualitative, quantitative, functional and analytical specifications (including in-process specifications) of and the
analytical tests, methods and acceptance criteria for the finished Product, raw and ancillary materials for the Product provided by NPM, intermediates of the Product, and packaging materials for the Product. The current Product Specifications are
set out in Attachment C attached hereto. During the Pre-commercialization Period, it is understood that these Specifications may be amended as deemed necessary by CTI to accommodate regulatory requests or changes during the development
process. During the Post-commercialization Period, these Specifications may be amended from time to time to accommodate requests from the applicable regulatory authority. Changes to Specification incurring extra costs in processing or analysis of
Product will be borne by CTI and reflected in Pricing Schedule B. Non-regulatory changes to the Specifications will proceed as needed by mutual written agreement of the Parties. 

 

	 	1.20	“Term” shall have the meaning set forth in Section 7.1. 

 

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	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

ARTICLE 2 

SUPPLY 
  

	 	2.1	During the Term, NPM shall allocate capacity to and shall manufacture and sell to CTI no less than the amounts of Product ordered by CTI with the issuance of a Binding
Forecast PO pursuant to Section 2.16. 

 All batches of Product shall be produced utilizing the Process and
in accordance with the Specifications, cGMP, Government Approvals, and the terms of this Agreement. 
  

	 	2.2	Binding Forecast PO’s, as defined below, will be placed on CTI’s standard purchase orders then in effect with a minimum lead time of **. All terms and
conditions of this Agreement shall govern the transactions between the Parties and any terms or conditions of said purchase order which conflict with this Agreement shall be null and void. NPM shall promptly manufacture and deliver all Firm Orders,
as defined below, of Product in accordance with the related schedule and in compliance with the Specifications, cGMP and other applicable laws and regulations. ** 

 

	 	2.3	All Product supplied by NPM shall be delivered to CTI’s designated carrier per ** from NPM’s facility, as specified in the related Firm Order. **

  

	 	2.4	NPM shall ship the Product in accordance with applicable laws and regulations and in a commercially reasonable manner in accordance with the instructions set forth on
Attachment D hereto. 

  

	 	2.5	CTI or its designee may, at CTI’s option, analyze each batch and samples from each batch of Product. ** 

 

	 	2.6	** 

  

	 	2.7	Subject to Sections 2.5 and 2.6, ** 

  

	 	2.8	NPM warrants that all applicable environmental and safety requirements are being and will be followed at its facilities. Additionally, the manufacture of the Product
shall be in accordance with cGMP. For the purpose of quality assurance auditing and to evaluate compliance with applicable cGMPs, environmental and occupational health and safety laws and regulations, CTI shall have the right to audit and inspect
per the Quality Agreement. ** 

  

	 	2.9	NPM shall notify CTI **of significant incidents relating to production of the Product **. 

 

	 	2.10	At CTI’s request, NPM shall, within five (5) business days, provide copies of all relevant environmental licenses and permits in their original language
pertaining to its operation and shall notify CTI of any material change in status. 

  

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	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	2.11	At CTI’s request, NPM will, within five (5) business days, provide the requirements set forth in Attachment F (the “Record Keeping and Accounting
Schedule”). 

  

	 	2.12	At CTI’s request, NPM will, within five (5) business days, provide CTI with copies of all applicable insurance certificates in their original language.
Insurance requirements of the Parties shall be listed in Attachment G (the “Insurance Requirements”). 

  

	 	2.13	During the Post-commercialization period **. 

  

	 	2.14	NPM agrees that it will conduct all necessary testing of the Product as required by the Specifications. All testing is to be performed during and at the completion of
the manufacture of the Product. ** 

  

	 	2.15	NPM will ** provide to CTI copies of all correspondence, inspection reports and other reports issued by the FDA or other regulatory agencies with respect to those
affecting the Product produced for CTI in NPM’ facilities. 

  

	 	2.16	During the Post-commercialization Period CTI shall submit to NPM ** a rolling commercial forecast, as follows: **. For clarification, these forecast and estimate
requirements shall only be required to be provided for periods occurring during the actual Term of the Agreement. ** 

CTI agrees to purchase, and NPM agrees to produce, ** subject to Section 2.17 below. For clarity purposes, CTI shall be credited
with the previous Binding Forecast PO’s in calculating the purchase requirement in this paragraph. 
  

	 	2.17	Each Binding Forecast PO shall identify and reference the quantity of Product ordered, the price to be paid for such Product, packaging requirements, delivery schedule,
delivery locations, invoice information and other applicable instructions. If the amounts in the Binding Forecast PO are in compliance with Section 2.16, and Attachment B to this Agreement, the Binding Forecast PO shall be deemed accepted by
NPM upon its receipt thereof and become a “Firm Order”. ** Use of e-mail is in this case is permitted, and e-mails shall be sent to the respective e-mail addresses indicated by the Parties. Subject to the cancellation and termination
rights in this Agreement, Firm Orders shall be considered firm and non-cancelable, except as provided in Section 2.16 and 2.17 with respect to certain changes, if any, in any Binding Forecast PO. 

 

	 	2.18	During the Pre-commercialization Period CTI may submit NPM Binding Forecast PO with a minimum lead time of **. NPM shall then ** confirm to CTI its acceptance or non
acceptance of the Binding Forecast PO, indicating the delivery date and the quantity of Product to be supplied. ** 

  

 Page 5 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	2.19	In the event NPM fails to deliver any Product due under a Firm Order by the scheduled delivery date, the Price of such Product will be reduced as follows:

  

	 	i)	** 

  

	 	ii)	** 

  

	 	iii)	** 

  

	 	2.20	NPM shall not manufacture or sell the Product to any party other than CTI, or its designated affiliates or designated subsidiaries, without CTI’s prior written
consent. 

  

	 	2.21	NPM shall not use any materials (including drug substance) provided by CTI hereunder for any purpose other than performing NPM’ obligations under this Agreement
and/or the Quality Agreement. 

 ARTICLE 3 

PRICING 
  

	 	3.1	The purchase price to be paid by CTI for NPM’ manufacture and supply of the Product during the Term of this Agreement is set forth in Attachment B (the
“Pricing Schedule”). 

  

	 	3.2	NPM shall invoice CTI via email at ** for each conforming batch Product at the delivery of the batch to CTI, or CTI’s designated carrier per **. CTI shall make
payments to NPM in Euros for the purchase price of the Product (as set forth in the Pricing Schedule) within thirty (30) days after date of invoice. ** Use of e-mail is in this case shall be sent to an e-mail address previously designated by
the Parties. 

  

	 	3.3	 In the event that either of the Parties identify mutually acceptable means of reducing the direct cost of manufacturing the Product (“Cost
Reduction Measures”) and such Cost Reduction Measures are mutually agreed to in writing and subsequently implemented by NPM, each Party shall be entitled to fifty percent (50%) of any savings resulting from any such Cost Reduction Measure
(net of any costs associated with implementing such Cost Reduction Measure). NPM shall not implement any cost reduction measures related to the manufacturing of the Product without the prior written agreement of CTI. Such savings will be passed to
CTI by a proportionate decrease in the prices set forth in this Agreement to be reflected in a written amendment to the Pricing Schedule. The resulting price decrease to CTI shall be effective from the date of the first Firm Order submitted by CTI
following the implementation of the Cost Reduction Measure and shall remain in effect until any subsequent Cost Reduction Measure or other pricing amendment, or the termination or expiration of this Agreement,

  

 Page 6 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	 
whichever is earlier. In the event of unpredictable direct or indirect cost increases of more than ten percent (10%) each, the Parties may in good faith renegotiate the Pricing Schedule set
forth in Attachment B. 

  

	 	3.4	During the Term of this Agreement any changes in price (other than changes pursuant to Section 3.3, and changes caused by changes to Specification as outlined in
Section 2.2) must be agreed by the Parties in writing. 

 ARTICLE 4 

REPRESENTATIONS AND WARRANTIES 
  

	 	4.1	Each Party hereby represents each on behalf of itself, that it has the corporate power and authority and the legal right to enter into this Agreement and that it has
taken all necessary corporate action on its part to authorize the execution and delivery of this Agreement; and that this Agreement has been duly executed and delivered on behalf of itself, and constitutes a legal, valid, binding obligation,
enforceable against itself in accordance with its terms. 

  

	 	4.2	Each Party represents and warrants that, to the best of its knowledge as of the Effective Date of this Agreement, no patents, patent applications if issued, or any
other intellectual property rights of any third party would be infringed by the performance of each Party’s obligations with respect to the manufacture of the Product under this Agreement. Except as provided in the preceding sentence, neither
Party makes any warranty or representation that the performance of its obligations will not infringe the rights of third parties. It is understood neither Party will perform any patent infringement or freedom to operate searches as a part of its
services hereunder. 

  

	 	4.3	NPM warrants that all Product supplied by NPM pursuant to Article 2(a) shall be manufactured in accordance with the Process, the Specifications, and the applicable
batch records, and in compliance with all applicable material laws and regulations, including cGMP and related Government Approvals, and processed in compliance with the Quality Agreement, (b) shall conform to applicable regulatory
requirements, (c) shall have all mutually agreed Government Approvals, (d) shall conform to cGMP and the terms of this Agreement, (e) will be transferred free and clear of any liens or encumbrances of any kind arising through NPM or
its affiliates or their respective agents or subcontractors and (f) shall meet the Specifications at the time of delivery. At CTI’s request, NPM shall certify in writing that it is in compliance with all applicable environmental and
occupational health and safety laws and regulations. NPM further warrants it will perform the services under this Agreement, including but not limited to the manufacture and supply of the Product, in accordance with this Agreement and the Quality
Agreement. 

  

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	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	4.4	EXCEPT FOR THE WARRANTIES EXPRESSLY SET FORTH IN THIS AGREEMENT, THE PARTIES DISCLAIM ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY
IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR AGAINST ANY INFRINGEMENT OF PRODUCTS OR OTHERWISE. EXCEPT FOR A PARTY’S INDEMNIFICATION OBLIGATIONS HEREUNDER, AND EXCEPT IN THE EVENT OF A BREACH OF ARTICLE 6
(CONFIDENTIALITY), THE PARTIES SHALL NOT IN ANY EVENT BE LIABLE FOR INCIDENTAL, CONSEQUENTIAL OR SPECIAL DAMAGES OF ANY KIND, EVEN IF THEY HAVE BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGE INCLUDING, WITHOUT LIMITATION, LIABILITY FOR LOSS OF USE,
LOSS OF WORK IN PROGRESS, DOWN TIME, LOSS OF REVENUE OR PROFITS, FAILURE TO REALIZE SAVINGS, LOSS OF PRODUCTS OF CTI OR ITS CUSTOMER TO A THIRD PARTY ON ACCOUNT OF SUCH LOSS, OR FOR ANY LABOR OR ANY OTHER EXPENSE, DAMAGE OR LOSS OCCASIONED BY SUCH
PRODUCT INCLUDING PERSONAL INJURY OR PROPERTY DAMAGE UNLESS SUCH PERSONAL INJURY OR PROPERTY DAMAGE IS CAUSED BY SUCH PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. 

 

	 	4.5	Subject to and except to the extent of the indemnity provided under Section 4.6, NPM shall indemnify, defend and hold harmless CTI, and it affiliates and
subsidiaries, from all actions, losses, claims, demands, damages, costs and liabilities (including reasonable attorney’s fees) to which CTI is or may become subject insofar as they arise out of (i) any breach by NPM of any of its
obligations or warranties made under this Agreement by NPM, or (ii) any negligent or willful act or omission by NPM or any of its employees, agents or subcontractors. 

 

	 	4.6	Subject to and except to the extent of the indemnity provided under Section 4.5, CTI shall indemnify, defend and hold harmless NPM from all actions, losses,
claims, demands, costs and liabilities (including reasonable attorney’s fees) to which NPM is or may become subject insofar as they arise out of (i) any breach by CTI of any of its obligations under this Agreement or warranties of CTI,
(ii) any negligent or willful act or omission by CTI or any of its employees, agents or subcontractors, (iii) personal injury, death or property damage sustained by any third party under the direction of CTI, or (iv) any labeling,
advertising or promotional materials used by CTI. 

  

	 	4.7	 A Party entitled to indemnification hereunder agrees to give prompt written notice to the indemnifying Party after the receipt by such Party of any
written notice of the commencement of any action, suit, proceeding or investigation or threat thereof made in writing for which such Party will claim indemnification pursuant to this Agreement and cooperate fully with the indemnifying Party in
conducting such defense. Unless, in the reasonable judgment of the indemnified Party, a 

  

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	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	 
conflict of interest may exist between the indemnified Party and the indemnifying Party with respect to a claim, the indemnifying Party may assume the defense of such claim with counsel
reasonably satisfactory to the indemnified Party. If the indemnifying Party is not entitled to, or elects not to, assume the defense of a claim, it will not be obligated to pay the fees and expenses of more than one counsel with respect to such
claim. The indemnifying Party will not be subject to any liability for any settlement made without its consent, which shall not be unreasonably withheld. 

 

	 	4.8	EXCEPT WITH RESPECT TO (I) A PARTY’S INDEMNIFICATION OBLIGATIONS HEREUNDER, (II) A PARTY’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, (III) A BREACH OF
ARTICLE 6 (CONFIDENTIALITY), AND (IV) NPM’S REPLACEMENT AND REFUND OBLIGATIONS UNDER ARTICLE 2 HEREUNDER, EACH PARTY’S TOTAL RESPECTIVE LIABILITY, HOWSOEVER ARISING, DIRECTLY OR INDIRECTLY, IN CONNECTION WITH THIS AGREEMENT, SHALL NOT
EXCEED AN AMOUNT EQUAL TO THE SUM OF THE PURCHASE PRICE PAID BY CTI HEREUNDER IN THE TWELVE (12) MONTHS PRECEDING THE INCIDENT GIVING RISE TO THE CLAIM. 

  

	 	4.9	The provisions and obligations of this Article 4 shall survive any expiration or termination of this Agreement. 

ARTICLE 5 

RECALLS AND RETURNS 
  

	 	5.1	In the event a recall involving any CTI finished dosage form of the Product containing the Product supplied hereunder is required by a governmental agency or authority
of competent jurisdiction or if recall is reasonably deemed advisable by CTI, such recall shall be promptly implemented and administered by CTI in a manner which is appropriate and reasonable under the circumstances and shall conform with accepted
trade practices, at CTI’s sole cost and expense. However, subject to Section 4.8, in the event that a recall is required solely as a result of NPM’ breach of its obligations hereunder, as determined by ** Quality Assurance department,
a government agency, or authority of competent jurisdiction, all costs and expenses incurred in connection therewith shall be borne by NPM. 

  

	 	5.2	The provisions and obligations of this Article 5 shall survive any expiration or termination of this Agreement. 

 

 Page 9 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

ARTICLE 6 

CONFIDENTIALITY 
  

	 	6.1	During the Term of this Agreement each Party may disclose information to the other Party that is of a confidential or proprietary nature. Information which is
designated in writing to be confidential or, if disclosed orally, reduced to writing and designated as confidential within thirty (30) days of such disclosure (“Confidential Information”) shall be maintained in confidence by the
receiving Party and not disclosed to third parties except upon the disclosing Party’s prior written consent. 

“CTI Confidential Information” means all technical and other information, whether patented or unpatented, contained in
or relating to the CTI materials, Inventions, manufacturing documentation, the Process, the Product, and/or in or to CTI processes, formulas, formulations, methods, operations, technologies, forecasts, business, research or development information,
and (a) that is disclosed or supplied to NPM or a NPM Affiliate or Subcontractor by or on behalf of CTI pursuant to this Agreement, in writing, orally, or by inspection or observation of tangible items, or (b) which NPM or a NPM Affiliate
or Subcontractor obtains or develops under this Agreement, and which is contained in or relates to the CTI materials, manufacturing documentation, the Process, the Product, and/or in or to CTI processes, formulas, formulations, methods, operations,
technologies, forecasts, business, research or development information, or (c) of which NPM may become aware of through the presence of its employees or agents at CTI offices or facilities or at other facilities that are involved in the
manufacture of the Product, and all of the foregoing includes, without limitation, proprietary information, industrial information, trade secrets, know-how, research, experimental methods and results, product plans, products, services, customer
lists, development plans, inventions, processes, concepts, formulas, formulations, technology, ideas, designs, drawings, marketing, finances, and other business and scientific plans and information and facility layout and schematics. CTI
Confidential Information includes without limitation the drug master file for the Product. 
 It shall be understood, however,
that Confidential Information shall not include, and the obligations of confidentiality and nondisclosure shall not apply to, disclosed information that: 
  

	 	i)	is or becomes publicly available through no fault of the receiving Party; 

  

	 	ii)	is disclosed without restriction to the receiving Party by a third party entitled to disclose it; 

 

	 	iii)	is already known to the receiving Party at the time of disclosure by the disclosing Party as shown by its prior written records; 

 

 Page 10 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	iv)	is developed independently by an employee or consultant of the receiving Party who had no knowledge of disclosures made under this Agreement as shown by its written
records; or 

  

	 	6.2	Nothing in this Agreement shall prohibit the receiving Party from disclosing the disclosing Party’s Confidential Information if legally required to do so by law or
governmental regulation (including any securities filing requirements) or by judicial or administrative process, provided that the receiving Party shall (i) give the disclosing Party prompt notice prior to such disclosure as reasonably
practical (including email), and (ii) cooperate with the disclosing Party, at the disclosing Party’s expense, in the event it elects to contest such disclosure or seek a protective order with respect thereto. Notwithstanding the foregoing,
Section 6.2(ii) shall not apply to disclosures required by the United States Securities Exchange Commission or foreign equivalent. 

  

	 	6.3	NPM shall not use CTI’s Confidential Information for any purpose other than performing its obligations under this Agreement or the Quality Agreement, without first
obtaining CTI’s prior written consent to each such other utilization. 

  

	 	6.4	No right or license, either expressed or implied, under any patent or other intellectual property right is granted hereunder. All right, title and interest in and to
Inventions, and the right to file for patents thereon worldwide, shall be exclusively owned by CTI. “Inventions” means all intellectual property rights that are developed in whole or in part by or on behalf of the NPM under this Agreement
or otherwise derived from the Confidential Information, including without limitation any inventions, improvements discoveries and trade secrets related to the Product. 

 

	 	6.5	The obligations of confidentiality and non-disclosure and non-use shall remain in effect and survive for a period of five (5) years from the expiration or
termination of this Agreement, except for NPM’s obligations of confidentiality and non-disclosure with respect to CTI’s Confidential Information, which shall survive in perpetuity. 

ARTICLE 7 

TERM AND TERMINATION 
  

	 	7.1	The term of this Agreement shall commence on the Effective Date and expire as of midnight of the fifth anniversary of the date the first Government Approval has been
obtained either in the United States or in Europe, whichever is earlier (the “Initial Term”), unless terminated earlier as provided in this Article 7. Prior to expiration of the Initial Term, this Agreement may be renewed for a two
(2) year period upon mutual written agreement of the Parties. Prior to the end of such renewal period, this Agreement may be renewed for one successive two (2) year period upon mutual written agreement of the Parties. The totality of all
such terms, if any, is the “Term” 

  

 Page 11 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	7.2	If either Party defaults in the performance or observation of any of its material obligations under this Agreement, the non-defaulting Party may terminate this
Agreement if such default is not cured within sixty (60) days after written notice thereof, which notice shall contain a specific identification of the circumstances giving rise to the default. Failure to terminate this Agreement for any
default or breach shall not constitute a waiver by the aggrieved Party of its right to sue for damages or its right to terminate this Agreement for any other default or breach. Notwithstanding the foregoing, CTI may terminate this Agreement upon
thirty (30) days prior written notice in the event of failure of three (3) or more of seven (7) consecutive lots of Product. 

  

	 	7.3	Either Party may terminate this Agreement upon written notice in the event that the other Party files for bankruptcy, liquidation, dissolution, or takes similar action
seeking protection against creditors under insolvency laws, or has entered against it involuntarily a decree in bankruptcy or similar decree which remains in effect for sixty (60) days. 

 

	 	7.4	This Agreement may be terminated at any time upon the mutual written agreement of the Parties. 

 

	 	7.5	CTI may terminate this Agreement upon thirty (30) days prior written notice in the event that NPM, or a substantial portion of NPM’s assets to which this
Agreement relates, is acquired by another company or entity other than a company or entity which was included in the NMS Group prior to the effective date of such acquisition (and which was not formed in part to effect such acquisition).

  

	 	7.6	Upon termination of this Agreement for any reason other than NPM default, CTI shall purchase the Product from NPM for Firm Orders issued prior to the date on which
notice of such termination is given, or expiration, as applicable, including safety stock from CTI (if so requested by NPM). Upon notice of termination, NPM shall use reasonable efforts to mitigate and cancel, to the extent possible, all obligations
that would incur expense, and NPM shall not, without CTI”s approval, perform any other additional services applicable to this Agreement, incur any other expenses, or enter into any other obligations related to the services applicable to this
Agreement. Upon expiration or termination of this Agreement, unless otherwise directed by CTI, NPM shall promptly return, or at CTI’s election destroy, at CTI’s expense, all CTI Confidential Information, Product, and materials owned by CTI
that is being held by NPM, with any such destruction to be certified in writing to CTI by an authorized NPM officer. In addition, if requested by CTI, NPM shall transfer any equipment or materials purchased by NPM on behalf of CTI that is in
NPM’s possession. 

  

 Page 12 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	7.7	Upon request of CTI, NPM shall use commercially reasonable efforts to effect a transfer of the manufacture of Bulk Product requirements from NPM and its subcontractors
(if any) to a CTI designated facility pursuant to the transfer plan. If this transfer activity is requested by CTI, CTI agrees to pay NPM’s actual cost – which shall be agreed upon in writing in advance between the parties ** to execute
the activities identified in the transfer plan. The transfer plan will be agreed to by both parties in writing in advance. If the transfer of the manufacture of Bulk Product requirements from NPM and its subcontractors to a CTI designated facility
is due to the uncured breach of this Agreement by NPM, any notice of termination delivered by CTI may contain CTI’s election to commence transfer of manufacturing pursuant to this Section 7.7, and NPM shall transfer such information within
thirty (30) days of such request. If CTI’s notice of termination includes such an election, the effective date of termination shall not be until the completion of activities under this Section 7.7 or such earlier date as may be
specified in CTI’s notice of termination. 

  

	 	7.8	In the event that CTI determines that NPM is unable to manufacture Product that meets the Specifications and warranties, or to meet Binding Purchase Orders per
Section 2.17, or annual minimum requirements per Section 2.1 using commercially reasonable efforts, NPM shall promptly provide CTI with technology transfer services at NPM’s expense in the form of documentation and technical expertise
for a period not to exceed ** sufficient to enable a alternate manufacturer to produce Product to Specification. 

ARTICLE 8 

TRADEMARKS AND TRADE NAMES 
  

	 	8.1	CTI and NPM hereby acknowledge that neither Party now has and shall not hereunder acquire any interest in any of the other Party’s trademarks, trade names, service
marks or logos appearing on the labels or packaging materials containing the Product. No Party shall, without the prior written consent of the affected Party, use in advertising, publicity or otherwise, the name, trademark, logo, symbol or other
image of the other Party. 

  

	 	8.2	Neither Party will issue or disseminate any press release or statement, nor initiate any communication of information regarding the existence of the terms of this
Agreement, written or oral, to the communications media or a third party without the prior written consent of the other Party. 

  

	 	8.3	The obligations of this Article 8 shall remain in effect and survive the expiration or termination of this Agreement. 

 

 Page 13 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

ARTICLE 9 

ASSIGNMENT AND AMENDMENT 
  

	 	9.1	This Agreement may not be assigned by either Party without the prior written consent of the other, such consent will not be unreasonably withheld, except that CTI may
assign this Agreement to any corporation with which it may merge or consolidate, or to which it may transfer all or substantially all of its assets to which this Agreement relates without obtaining the consent of NPM, provided the assignee agrees to
be bound, in written notice sent to NPM, by the terms and conditions of this Agreement. Subject to the foregoing, this Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and assigns.
Notwithstanding the foregoing, in the event CTI’s assignee does not agree to be bound by the terms of the Agreement, such assignee may terminate this Agreement upon three hundred sixty (360) days prior written notice.

  

	 	9.2	Except as otherwise provided herein, this Agreement may not be amended, supplemented or otherwise modified except by an instrument in writing signed by both Parties.

  

	 	9.3	NPM shall obtain CTI’s prior written approval to use a subcontractor and/or affiliate of NPM to perform any of the services under this Agreement, such approval not
to be unreasonably withheld by CTI. Any and all such subcontractors and/or affiliates (other than NPM) shall be bound to contracts with NPM on substantially similar terms as this Agreement. Furthermore, NPM shall be legally responsible for the acts
of any such subcontractors and affiliates, provided CTI may look to NPM for legal recourse and remedy in addition to such subcontractors and/or affiliates. 

ARTICLE 10 

NOTICES 

Any notice provided for under this Agreement shall be in writing and in English, shall be deemed to have been sufficiently provided and
effectively made as of the delivery date if hand-delivered, or as of the date received if sent by courier service or mailed by registered or certified mail, postage prepaid, and addressed to the receiving Party at its respective address as follows:

  

			
	If to CTI:	  	 Cell Therapeutics, Inc.

		  	 501 Elliott Avenue West, Suite 400

		  	 Seattle, Washington 98119

		  	 Attn: Legal Affairs

		  	 Facsimile: **

  

 Page 14 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

			
	With a copy to:	  	 Cell Therapeutics, Inc.

		  	 501 Elliott Avenue, West Suite 400

		  	 Seattle, Washington 98119

		  	 Attn: **

		  	 Phone: **

		  	 Facsimile: **

		
	If to NPM:	  	 NerPharMa, S.r.l.

		  	 Viale Pasteur, 10

		  	 20014 Nerviano (MI)

		  	 Italy

		  	 Attn: **

		  	 Phone: **

		  	 Fax: **

ARTICLE 11 

INDEPENDENT CONTRACTOR 

The relationship of the Parties under this Agreement is that of independent contractors and not as agents of each other or joint
venturers, and neither Party shall have the power to bind the other in any way with respect to any obligation to any third party unless a specific power of attorney is provided for such purpose. Each Party shall be solely responsible for its own
employees and operations. 
 ARTICLE 12 

FORCE MAJEURE 

Neither Party shall be liable to the other for failure to perform its obligations under this Agreement where such failure is caused by
strikes, fires, embargoes, any governmental act or regulation, acts of God, acts of war, insurrection, riot, strike, or civil disturbance, or any other cause not under the reasonable control of the defaulting Party. If any event of force majeure
should occur, the affected Party shall promptly give notice thereof to the other Party, and the affected Party shall use its commercially reasonable efforts to cure or correct any such event of force majeure. Notwithstanding the foregoing, CTI may
terminate this Agreement in the event such event of force majeure exceeds sixty (60) days. 
  

 Page 15 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

ARTICLE 13 

MISCELLANEOUS 
  

	 	13.1	Should one of the provisions of this Agreement become or prove to be null and void, the validity of this Agreement as a whole is not affected. Both Parties will,
however, endeavor to replace the void provision by a valid one that in its economic effect is most consistent with the void provision. Both Parties must agree to any such replacement provision in writing. 

 

	 	13.2	This Agreement contains the entire agreement of the parties and supersedes and cancels all other agreements, discussions, representations or understandings between the
parties with respect to the subject matter hereof. Notwithstanding the foregoing, the Service Agreement dated October 24, 2007 (the “2007 Agreement”) will continue in place except to the extent that the terms of the 2007 Agreement
conflict with this Agreement, in which case the terms of this Agreement shall control. No amendments hereto, or waivers or releases of obligations hereunder, shall be effective unless agreed to in writing by the parties hereto. This Agreement may be
signed in counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument. The Parties hereby agree that this Agreement shall govern any commercial manufacture and supply of the Product.

  

	 	13.3	Each Party hereto agrees to execute, acknowledge and deliver such further instruments, and to do all such other acts, as may be necessary or appropriate in order to
carry out the purposes and intent of this Agreement. 

  

	 	13.4	The waiver by either Party of a breach of any provision contained herein shall be in writing and shall in no way be construed as a waiver of any succeeding breach of
such provision or the waiver of the provision itself. 

  

	 	13.5	 The controlling language of this Agreement and all related documents, correspondence and notices is English. This Agreement is governed by and
construed in accordance with, and this Agreement and the obligations of the parties will be determined in accordance with, the internal substantive laws of London, England without regard to any conflicts of laws principles to the contrary. This
Agreement shall not be governed by the United Nations Convention on Contracts for the International Sale of Goods, the application of which is expressly disclaimed. Any controversy or claim arising out of or relating to this Agreement or the breach
thereof shall be settled exclusively by arbitration administered by the international division of the American Arbitration Association, the International Centre for Dispute Resolution, in accordance with its International Arbitration Rules. Judgment
on the award rendered by the arbitrators shall be binding and may be entered in any court having jurisdiction thereof. Such arbitration shall be filed and conducted in London, England. The arbitration shall be conducted in English by a Board of
Arbitration consisting of three members who shall be appointed by the parties to the dispute jointly, one 

  

 Page 16 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

	 	 
arbitrator being appointed by each party to the dispute, and an additional arbitrator appointed by the mutual consent of all such arbitrators. Each party shall bear its own attorneys’ fees
and associated costs and expenses. Any award rendered by the arbitrators shall be in writing, shall be the final binding disposition on the merits, and shall not be appealable to any court in any jurisdiction. Judgment on an award rendered may be
entered in any court of competent jurisdiction, or application may be made to any such court for a judicial acceptance of the award and an order of enforcement, as appropriate. Any award may be recognized and enforced in accordance with the United
Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards. The Parties waive any right they may enjoy under the law of any nation to apply to the courts of such nation for relief from the provisions of this Section 13.5
or from any decision of the arbitrators. In the event a court of competent jurisdiction determines that this Agreement is invalid or unenforceable for any reason, this provision shall not be affected thereby and shall be given full effect without
regard to the invalidity or unenforceability of the remainder of this Agreement. Notwithstanding anything herein seemingly to the contrary, any party may seek injunctive relief from a court of competent jurisdiction to prevent or limit damage to
that Party’s intellectual property. 

 [SIGNATURE PAGE FOLLOWS] 

 

 Page 17 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

IN WITNESS WHEREOF, the duly authorized representatives of the Parties hereto have caused this Agreement to be executed in duplicate
originals. 
  

									
	CELL THERAPEUTICS, INC.	 		 	NerPharMa S.r.l.
					
	By:	  	 /s/ JAMES BIANCO
	 		 	By:	  	 /s/ CORRADO CASTELLUCCI

					
	Name:	  	James Bianco	 		 	Name:	  	Corrado Castellucci
					
	Title:	  	Chief Executive Officer	 		 	Title:	  	Chief Executive Officer
					
	Date:	  	July 13, 2010	 		 	Date:	  	July 13, 2010

  

 Page 18 of 26 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

  

ATTACHMENT “A” 

DEFINITION OF PRODUCT 

**** 
 Table 3.2.P.1–1. Composition of
BBR 2778 Drug Product 
 ** 

Container/Closure System of BBR 2778 Drug Product 

**  
 Table 3.2.P.1-2.
Container Closure System Components 
 ** 
  

 Page 19 of 26 

 ATTACHMENT “B” 

PRICING SCHEDULE 
 This
Pricing Schedule has been prepared pursuant to the Agreement, the terms and conditions thereof shall govern this Pricing Schedule. 
 This
Pricing Schedule covers production of Product (as defined in the Agreement) according to the current Process, which was validated in the previous production campaign dated December 2008. 

Deliverables: 
 ** 

Pricing 
 ** 

 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

 ATTACHMENT “C” 

BBR 2778 DP SPECIFICATIONS**  

**** 
  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

 ATTACHMENT “D” 

SHIPPING INSTRUCTIONS 

NerPharMa (NPM) S.r.l. shall ship Product per the following requirements.

 

	 	1.	Provide a Commercial Invoice containing the following: 

** 
  

	 	2.	Provide a copy of the Material Safety Data Sheet with each shipment 

  

	 	3.	Provide all shipments with ** 

  

	 	4.	Provide two (2) ** 

  

	 	5.	Provide USDA Product Declaration Letter 

  

	 	6.	Provide shipment tracking numbers for each package shipped 

  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

 ATTACHMENT “E” 

QUALITY AGREEMENT 
  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

 ATTACHMENT “F” 

RECORD KEEPING AND ACCOUNTING 

NPM shall provide CTI with a data feed **. The data required is detailed in Section 1.5 below. This count shall be done **. 

 

	1.1	**. 

  

	1.2	CTI requires the following minimum data information listed below in electronic format sent to **. NPM and CTI may add additional data fields or modify the layout of the
data fields upon written agreement between the parties. 

 Commercial data information for producing Drug Product:

 ** 
  

	1.3	** 

  

	1.4	If required by CTI, **. 

  

	1.5	**. 

  

	1.6	All invoices shall be sent electronically to **. 

  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

 ATTACHMENT “G” 

INSURANCE REQUIREMENTS 

NPM Insurance Requirements: 
 During the
Term of this Agreement, and through delivery of any Binding Purchase PO’s, NPM shall obtain and maintain the following insurance with limits not less than those specified below. ** 

 

	1.1	Products and Completed Operations Liability Insurance 

**  
  

	1.2	Workers Compensation and Employers Liability Insurance 

**  
  

	1.3	Commercial General Liability Insurance 

**  
  

	1.4	Evidence of Insurance 

 NPM shall supply
to CTI copies of certificates of insurance which fully comply with all terms and conditions previously stated in the above referenced sections. NPM will provide annual certificates of insurance **. 

In the event that any of the required policies of insurance are written on a claims made basis, than such policies shall be maintained during the entire
Term of this Agreement. 
 CTI Insurance Requirements 

During the Term of this Agreement, CTI shall obtain and maintain the following insurance with limits not less than those specified below 

 

	1.5	Product Liability Insurance 

 **

  

	1.6	Workers Compensation and Employers Liability Insurance 

** 
  

	1.7	Commercial General Liability Insurance 

** 
  

	1.8	Property Insurance 

 ** 

 

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions. 

	1.9	Evidence of Insurance 

 CTI shall supply
to NPM copies of certificates of insurance which fully comply with all terms and conditions previously stated in the above referenced sections. ** 

In the event that any of the required policies of insurance are written on a claims made basis, than such policies shall be maintained during the entire
Term of this Agreement. 
  

	**	Indicates that certain information contained herein has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been
request with respect to the omitted portions. 

	****	Indicates that the amount of information omitted was a page or more in length, and such information was filed separately with the Securities and Exchange Commission.
Confidential treatment has been request with respect to the omitted portions.Restricted Stock and Deferred Compensation Plan for Non-Employee Directors

 Exhibit 10.1 

INTERNATIONAL PAPER COMPANY 

RESTRICTED STOCK AND 

DEFERRED COMPENSATION PLAN 

FOR NON-EMPLOYEE DIRECTORS 

Effective May 11, 2009 

As Amended and Restated May 10, 2010 

 INTERNATIONAL PAPER COMPANY 

RESTRICTED STOCK AND DEFERRED COMPENSATION PLAN 

FOR NON-EMPLOYEE DIRECTORS 

1. Purpose and Effective Date of Plan 

This plan shall be known as the International Paper Company Restricted Stock and Deferred Compensation Plan for Non-Employee Directors (the
“Plan”). The purpose of the Plan is to enable International Paper Company (“International Paper”) to attract and retain persons of outstanding competence to serve as non-employee directors of International Paper, and to permit
such non-employee directors to defer receipt of all or a portion of their annual retainer and committee fees, payable in cash or restricted shares of International Paper common stock, for services in 2005 and thereafter. 

Prior to January 1, 2007, equity compensation to non-employee directors was governed by the International Paper Company Restricted Stock Plan for
Non-Employee Directors, originally effective January 1, 1988; and, deferrals of cash and equity compensation by non-employee directors were governed by the International Paper Company Nonfunded Deferred Compensation Plan for Directors,
originally effective December 11, 1973. Effective January 1, 2007, these two plans were combined into this Plan and renamed the International Paper Company Restricted Stock and Deferred Compensation Plan for Non-Employee Directors.

 The Plan was amended, effective January 1, 2008, to conform the date used to determine the number of shares awarded for the fixed dollar
value of compensation to the last business day immediately preceding the first day of the Performance Year. This was intended to conform the date used to determine the number of shares for the equity retainer under Section 3 with the date that
has been used to determine the number of shares for the cash retainer under Section 4. 
 Effective May 11, 2009, this plan became a
subplan of the International Paper Company 2009 Incentive Compensation Plan (“ICP”), consisting of a program for the grant of restricted stock under Article 9 of the ICP and referenced under Section 4.3 of the ICP. 

Effective May 10, 2010, this plan was amended and restated to provide for payment of a Presiding Director Fee, if approved by the Board, and to
refer to the definition of mandatory retirement age as set forth in the International Paper Corporate Governance Guidelines. 
 This Plan is a
non-funded, non-qualified deferred compensation plan that is intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”). The Plan is not subject to full protection under the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”). 
 2. Eligibility 

Participation in this Plan is limited to persons who serve as members of the Board of Directors (the “Board”) of International Paper and who are
not employees of International Paper or its subsidiaries (“Participants”). An employee-director who retires from employment with International Paper (and its subsidiaries) shall become eligible to participate in this Plan upon his or her
re-election as a non-employee director. 
  

 1 

 3. Equity Compensation 

(a) Awards of restricted common stock of International Paper are made to each Participant on an annual basis on the day of the Annual Meeting of
Shareowners of International Paper in an amount equal to: (i) a fixed dollar value determined by the independent members of the Board based on a review of competitive market practices of International Paper’s comparator peer group of
companies for compensation analysis (the “Compensation Comparator Group”), divided by (ii) the closing market price of common stock of International Paper as reported for the New York Stock Exchange Composite Transactions on the last
business day immediately preceding the first day of the Performance Year. The fixed dollar value for the annual restricted stock awards shall be set forth on Exhibit A hereto, as approved and changed from time to time by the independent
members of the Board. 
 (b) For purposes of this Plan, a “Performance Year” shall mean the approximately one-year period beginning on
the date of the Annual Meeting of Shareowners of International Paper for a given year and ending on the last business day immediately preceding the next Annual Meeting of Shareowners of International Paper. 

(c) A Participant who is elected by the Board to fill a vacancy during a Performance Year shall receive a number of shares of restricted common stock
representing a pro rata portion of the number of shares of restricted common stock awarded to non-employee directors for the Performance Year in which such Participant is elected, determined by dividing the number of full months of eligible
service during the Performance Year by the number twelve (12). 
 (d) Each award of restricted shares under this Plan shall be immediately
registered in book entry form in the name of the Participant but shall be expressly subject to all of the restrictions, service provisions, and all other terms and conditions set forth in Section 6 of this Plan and the terms and conditions of
the ICP, of which this Plan is a subplan. In the event of any actual or alleged conflict between the provisions of the ICP and the provisions of this Plan as it relates to restricted shares, the provisions of the ICP shall be controlling and
determinative. 
 4. Cash Compensation 

(a) Each non-employee director of the Board shall receive an annual cash retainer (“Cash Retainer Fee”) in an amount determined by the
independent members of the Board. Each non-employee director who serves as Chair of a standing committee of the Board, as a member of a committee designated by the Board to have member fees, or as Presiding Director, shall receive an additional
annual cash retainer (such “Committee Fee” and “Presiding Director Fee” shall, together with the Cash Retainer Fee, be referred to as “Cash Compensation”). The amount of the Cash Compensation shall be determined by the
independent members of the Board based on a review of competitive market practices of the International Paper’s Compensation Comparator Group. The Cash Retainer Fee and Committee Fees shall be set forth on Exhibit A hereto, as approved
and changed from time to time by the independent members of the Board. 
 (b) Each non-employee director of the Board may elect, in the form and
manner prescribed by International Paper, to receive shares of restricted stock of International Paper in lieu of all or a portion of his or her Cash Compensation. A non-employee director who elects to receive

  

 2 

 
shares of restricted stock in lieu of Cash Compensation will receive a number of shares of restricted stock determined by dividing (A) the sum of (i) the portion of Cash Compensation
elected to be received in the form of restricted stock, plus (ii) an additional 20% of the Cash Retainer Fee, by (B) the closing market price of common stock of International Paper as reported for the New York Stock Exchange Composite
Transactions on the last business day immediately preceding the first day of the Performance Year. 
 5. Deferral Elections 

(a) Prior to the first day of a calendar year, non-employee directors may elect to defer in the form of restricted stock units (“RSUs”) receipt
of all or a portion of shares of restricted stock or Cash Compensation for services on the Board in the following Performance Year by filing an initial deferral election notice in the manner and form prescribed by International Paper (the
“Initial Deferral Election Notice”). 
 (b) Non-employee directors newly elected to the Board may submit an
Initial Deferral Election Notice by the 30th day after
becoming eligible to participate in the Plan; but such deferral election shall be applicable only with respect to compensation earned after the filing of such Initial Deferral Election Notice. 

(c) Notwithstanding the foregoing, an Initial Deferral Election Notice may not be completed during a period when directors and officers of International
Paper are restricted from trading in shares of International Paper common stock, referred to as a “Black-out Period.” 
 (d) Deferral
elections are effective for one Performance Year only and do not carry over from year to year. Participants must submit a new Initial Deferral Election Notice prior to the first day of each calendar year in order to defer compensation to be earned
in the next Performance Year. 
 (e) An Initial Deferral Election Notice may change the percentage to be deferred only with respect to
compensation payable on a prospective basis, and may not change the percentage to be deferred with respect to a prior year’s election. 

6. Restrictions, Removal of Restrictions, and Terms and Conditions of Awards of Restricted Shares 

(a) A Participant shall have the right to receive all dividends and other distributions made with respect to restricted shares registered in his or her
name, and shall have the right to vote or execute proxies with respect to such registered restricted shares, unless and until such shares are forfeited pursuant to the provisions of this Plan. 

(b) A Participant shall have the right to elect, in the form and manner prescribed by International Paper, the manner in which dividends on shares of
restricted stock shall be paid to the Participant (i.e., in cash or reinvested in additional shares of restricted stock). 
 (c) As indicated
above, restricted stock awards under the Plan will normally be issued in book-entry form until the provisions of the Plan relating to removal of the restrictions have been satisfied. If stock certificates are issued for shares of restricted stock,
such certificates shall be 
  

 3 

 
endorsed with a legend referring to the restrictions imposed by this Plan. Possession of the certificates of shares shall be retained by the Corporate Secretary of International Paper until the
provisions of the Plan relating to removal of the restrictions have been satisfied. After the expiration of the restricted period, stock certificates without such legend shall be delivered to the Participant or his or her designee upon request.

 (d) Shares of restricted stock may not be sold, assigned, pledged or otherwise transferred by the Participant unless and until all of the
restrictions imposed by this Plan have been removed pursuant to the provisions of this Plan. 
 (e) Shares of restricted stock awarded under
this Plan on and after May 7, 2002, shall become free of restrictions and non-forfeitable on the first anniversary of the date of the award of the restricted shares. Notwithstanding the foregoing, shares of restricted stock awarded under this
Plan shall become free of restrictions and non-forfeitable upon the occurrence of one of the following events: 
  

	 	(i)	the Participant’s death or disability; 

  

	 	(ii)	mandatory retirement at the end of the calendar year during which the Participant reaches mandatory retirement age, pro rated for the number of months of service for
the Performance Year in which retirement occurs; or 

  

	 	(iii)	resignation or failure to stand for re-election with the consent of the Board (which shall mean approval by at least 80% of the directors voting, with the affected
director abstaining), or any failure to be reelected after being duly nominated. In the event of a resignation with consent during the first year in which an award is received, the number of shares with respect to which the restrictions shall be
removed will be a pro rata portion of shares originally awarded determined by dividing the number of months served during the first year of the award by the number twelve (12). 

None of the shares of restricted stock awarded under this Plan prior to May 7, 2002 shall become free of restrictions and non-forfeitable until the
termination of the Participant’s service as a director of International Paper. Accordingly, such shares shall become non-forfeitable upon the occurrence of one of the following events: 

 

	 	(i)	the Participant’s death or disability; 

  

	 	(ii)	the mandatory retirement at the end of the calendar year during which the Participant reaches mandatory retirement age; or 

 

	 	(iii)	resignation or failure to stand for re-election with the consent of the Board (which shall mean approval by at least 80% of the directors voting, with the affected
director abstaining), or any failure to be reelected after being duly nominated. In the event of a resignation with consent during a term, the number of shares with respect to which the restrictions will be removed will be a pro rata portion
of shares originally awarded determined by dividing the period of the director’s term served to the effective date of resignation by the original term for which the director was elected or appointed. 

 

 4 

 Termination of service as a director for any reason other than those specified in this Section 7(e),
including, without limitation, any involuntary termination effected by Board action, shall result in forfeiture of the restricted shares. 

Mandatory retirement age under this Plan shall have the definition as set forth in the International Paper Corporate Governance Guidelines. 

(f) In the event of a “change in control” of International Paper (as defined below), the Board may accelerate the removal of all restrictions
relating to all or an equal portion of the outstanding restricted shares. Termination of Board service resulting from a change of control will result in immediate lapse of the forfeiture provisions relating to all of the affected director’s
restricted shares. In any situation involving acceleration of the removal of restrictions relating to the awarded shares upon a change of control, the Board may elect to repurchase such shares at the then fair market price instead of releasing the
shares to the Participant owning such shares. For purposes of this Plan, a “change in control” of International Paper shall mean a change in control of a nature that would be required to be reported in response to Item 1(a) of Form
8-K promulgated under the Securities Exchange Act of 1934, as amended (“Exchange Act”); provided that, without limitation, such a change in control shall be deemed to have occurred if (a) any “person” (as such term is used
in Sections 13(d) and 14(d)(2) of the Exchange Act other than company benefit plans) except a transaction that is approved by the Board in accordance with the standards set forth in section 7-17 of the New York Business Corporation Law or any
successor provision is or becomes the beneficial owner, directly or indirectly, of securities of International Paper representing 30% or more of the combined voting power of International Paper’s then outstanding securities, or (b) during
any period of two consecutive years, individuals who at the beginning of such period constitute the Board of Directors of International Paper cease for any reason to constitute at least a majority thereof unless the election, or the nomination for
election, by shareholders of each new director was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period. 

(g) All shares with respect to which the restrictions are not removed in accordance with the provisions of this Plan shall be forfeited and shall revert
to the Treasury of International Paper. 
 (h) All awarded shares shall remain subject to the Plan’s restrictions prohibiting sales or
transfer of such shares during the period of time while the Participant continues to serve as a director of International Paper, and all certificates of shares shall be endorsed with a legend referring to such restriction; in addition, the issuance
or delivery of any shares may be postponed for such period as may be required to comply with any applicable requirements of any national securities exchange or any requirements under any other law or regulation applicable to the issuance or delivery
of such shares, and International Paper shall not be obligated to issue or deliver any such shares if the issuance or delivery thereof shall constitute a violation of any provision of any law or any regulation of any governmental authority or any
national securities exchange. 
  

 5 

 7. Restrictions, Removal of Restrictions, and Terms and Conditions of Awards of Restricted Share Units

 (a) All amounts deferred in the form of RSUs shall be issued pursuant to and shall be subject to the terms and condition of the ICP. In
the event of any actual or alleged conflict between the provisions of the ICP and the provisions of this Plan as it relates to RSUs, the provisions of the ICP shall be controlling and determinative. All such RSUs shall be credited to a bookkeeping
account on behalf of the Participant. Such account shall be credited with a number of RSUs (calculated to the nearest thousandth of a unit) computed by dividing: (i) the value of the Cash Compensation and restricted stock deferred for the
Performance Year by (ii) the closing market price of common stock of International Paper as reported for the New York Stock Exchange Composite Transactions on the last business day immediately preceding the first day of the Performance Year.

 (b) RSUs may not be sold, assigned, pledged or otherwise transferred by the Participant. If any such assignment is made, International Paper
may disregard such assignment and may discharge its obligation hereunder by making payment as though no such assignment had been made. 
 (c) A
Participant has an interest as an unsecured creditor in the cash value represented by the RSUs in his or her account, but has no interests or rights in any common stock of International Paper or dividends, and has no right to elect delivery of
shares of common stock of International Paper. 
 (d) RSUs shall vest annually upon the last day of the Performance Year, pro rated for the
number of months of service in such Performance Year. 
 (e) Whenever a dividend is declared on the common stock of International Paper, the
number of RSUs in the Participant’s account shall be increased by the result of the following calculation: 
  

	 	(i)	the number of RSUs in the Participant’s account multiplied by any cash dividend declared by International Paper on a share of its common stock, divided by the
closing market price of such common stock on the business day immediately prior to the related dividend payment date as reported for New York Stock Exchange Composite Transactions; and/or 

 

	 	(ii)	the number of RSUs in the Participant’s account on the related dividend payment date multiplied by any stock dividend declared by International Paper on a share of
its common stock. In the event of any change in the number or kind of outstanding shares of common stock of International Paper including a stock split or splits (other than a stock dividend as provided above) an equitable and proportionate
adjustment shall be made in the number of RSUs credited to the Participant’s account, as provided in the ICP. 

 (f) A
statement shall be delivered to each Participant in this Plan annually setting forth the amount deferred, the amount of RSUs credited to the Participant’s account, the amount of any payments made during the year, and the closing market price of
International Paper common stock used for determining the number of RSUs earned and credited through dividend equivalents. 
  

 6 

 8. Time and Method of Payment of RSUs 

(a) After a Participant ceases to be a director of International Paper (and has incurred a “separation from service” as defined in
Section 409A of the Code and applicable regulations), payment of RSUs shall be made in the form of a lump sum cash payment payable in January of the next calendar year following the year in which the Participant terminates service as a
director. 
 (b) The amount payable to the Participant shall be equal to (i) the number of RSUs credited to the Participant’s account
multiplied by (ii) the closing price of common stock of International Paper as reported for the New York Stock Exchange Composite Transactions on the last business day of the calendar year in which the Participant terminates service as a
director. 
 9. Amendment or Termination of Plan 

International Paper reserves the right to amend, modify or terminate this Plan at any time by action of the Board, provided (a) no amendment shall be
made more than once every six months, other than to comport with changes in the Code, ERISA, or the rules thereunder; (b) that such action shall not adversely affect any Participant’s rights under the provisions of this Plan with respect
to awards of restricted stock or RSUs that were made prior to such action; (c) that such amendment is consistent with Section 409A of the Code and any regulations promulgated thereunder; and (d) that no modification of this Plan shall
be made which shall increase the aggregate number of shares available for award under this Plan without the approval of the shareowners of International Paper. 

10. Source of Funds for Payment of RSUs 

Any benefit payments to Participants pursuant to the Plan shall be paid from the general assets of International Paper. Participants shall have the status
of general unsecured creditors of International Paper and the Plan constitutes a mere promise by International Paper to make benefit payments in the future. Any contract, policy or other asset which International Paper may utilize to assure
themselves of the funds to provide the benefits under the Plan shall not serve in any way as security for the payment of Plan benefits and International Paper shall not be under any obligation whatsoever to purchase or maintain any contract, policy
or other asset to provide the benefits payable under the Plan. 
 11. Administration of Plan 

This Plan shall be administered by the Senior Vice President, Human Resources of International Paper (the “Administrator”). All decisions which
are made by the Administrator with respect to interpretation of the terms of the Plan, with respect to the restrictions, terms and conditions of the restricted shares, and with respect to any questions or disputes arising under this Plan, shall be
final and binding on International Paper and the Participants (and their heirs or beneficiaries). 
  

 7 

 12. Changes in Stock and Adjustment of Number under the Plan 

In the event of any stock dividend, split-up, reclassification or other analogous change in capitalization or any distribution (other than regular cash
dividends) to holders of International Paper’s common stock, the number of shares awarded and earned under this Plan, and the aggregate number of shares covered by this Plan shall be equitably and proportionately adjusted by the Administrator
to take account of such change, all in accordance with the terms of the ICP. 
 13. Designation of Beneficiary 

A Participant may file with the Administrator a designation of beneficiary or beneficiaries on a form approved by the Administrator (which designation may
be changed or revoked by the Participant’s sole action) to receive distribution of all or a designated portion of the Participant’s restricted stock account and/or RSUs under this Plan upon the death of the Participant. If no beneficiary
has been designated or survives the Participant, then the account shall be distributed as directed by the executor or administrator of the Participant’s estate. 

 

 8 

 EXHIBIT A 

NON-EMPLOYEE DIRECTOR COMPENSATION 

AS OF MAY 10, 2010 

UNDER THE 

NON-EMPLOYEE RESTRICTED STOCK AND DEFERRED
COMPENSATION PLAN 
 The following compensation amounts are effective for the Performance Year beginning
May 11, 2010, and shall remain in effect for future Performance Years until changed by the independent members of the Board. 
  

				
	 Type of Fee
	  	Approved Program
(2010-2011)

	Board Fees	  		
	 Cash Retainer
	  	$	80,000
	 Equity Retainer
	  	$	120,000
		
	Committee Fees	  		
	 Audit and Finance Committee Chair
	  	$	25,000
	 Audit and Finance Committee Member
	  	$	10,000
	 Management Development & Compensation Committee Chair
	  	$	15,000
	 Governance Committee Chair
	  	$	15,000
	 Public Policy and Environment Chair
	  	$	15,000
		
	Presiding Director Fee	  		
	 Presiding Director
	  	$	15,000

  

 9

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