1.

DEFINITIONS AND INTERPRETATION

1.1

Definitions. Unless the context otherwise requires, the terms in this Agreement with initial letters capitalized will have the meanings set forth below, or the meaning as designated in the indicated places throughout this Agreement.

(a)

such Party ceases to function as a going concern by suspending or discontinuing its business;

(b)

such Party is the subject of voluntary or involuntary bankruptcy proceedings instituted on behalf of or against such Party (except for involuntary bankruptcy proceedings that are dismissed within ninety (90) days);

(c)

an administrative receiver, receiver and manager, interim receiver, custodian, sequestrator, or similar officer is appointed for such Party;

(d)

a resolution to wind up such Party is passed at a meeting of the directors or shareholders of such Party;

(e)

a resolution shall have been passed by such Party or its directors to make an application for an administration order or to appoint an administrator for all of such Party’s assets; or

(f)

such Party makes any general assignment for the benefit of all of its creditors.

(a)

credits, price adjustments or allowances for damaged products, returns or rejections of Licensed Products;

(b)

normal and customary trade, cash and quantity discounts, allowances and credits (other than price discounts granted at the time of invoicing which have already been included in the gross amount invoiced);

(d)

discounts, refunds, rebates, chargebacks, retroactive price adjustments, and any other allowances which effectively reduce the net selling price granted to any Third Party;

(c)

any invoiced freight, postage, shipping, distribution fee, insurance and other transportation charges;

(e)

sales, value-added, and excise taxes, tariffs and duties, and other taxes directly related to the sale (but not including taxes assessed against the income derived from such sale);

(f)

actual sales write-offs for uncollectible amounts consistently applied under Accounting Standards, provided that if the amount is thereafter paid, the corresponding amount shall be added to the Net Sales of the period during which it is paid and

(g)

any other customary adjustments in accordance with U.S. GAAP as generally and consistently applied by Amphastar in the preparation of its financial statements filed with the SEC to determine “Net Sales”.

(a)

all patent applications, including any provisional patent applications, in any country;

(b)

any patent application claiming priority from such patent application in (a) or provisional application, including all divisionals, continuations, substitutions, continuations-in-part, provisionals, converted provisionals and continued prosecution applications, or any foreign equivalents;

(c)

any patent that has issued or in the future issues from any of the foregoing patent applications, ((a) and (b)), including any utility patent, utility model patent, petty patent, design patent, certificate of invention, or any foreign equivalents;

(d)

any re-examinations, reissues, additions, renewals, extensions, registrations, supplemental protection certificates of any of the foregoing patents or patent applications ((a), (b), and (c)), or any foreign equivalents; and

(e)

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 such foregoing patent application or patent.

(a)

the Net Sales of the Licensed Product during the reporting period by Licensee , its Affiliates and its sublicensees (in all cases itemizing by category the various deductions taken from gross to compute Net Sales as set forth in the definition of Net Sales, above); and

(b)

the royalties payable (in USD), and the rate of exchange with supporting calculations if the currency of sale was not U.S. dollars), which will have accrued hereunder with respect to such Net Sales, with supporting calculations showing the applicable royalty rate applied.

(a)

a claim of an issued and unexpired patent of a granted Licensed Patent (as may be extended through supplementary protection certificate or patent term extension or the like) that, in each case:

(i)

Covers the Development, manufacture, use, offer for sale, sale or import of the relevant Licensed Compound or Licensed Product in the relevant jurisdiction;

(ii)

has not been irrevocably or unappealable disclaimed, cancelled, withdrawn, or abandoned, or been held unenforceable, unpatentable or invalid by a decision of a court or other governmental agency or tribunal of competent jurisdiction; and

(iii)

has not been admitted to be invalid or unenforceable through reissue, disclaimer, or otherwise by Regulatory Authority; or

(b)

a claim included in a pending patent application within the Licensed Patents that:

(i)

would Cover the Development, manufacture, use, offer for sale, sale or import of the relevant Licensed Compound or Licensed Product in the relevant jurisdiction if such claim were part of a pending patent application; and

(ii)

has not been cancelled, withdrawn or abandoned, nor been pending for more than seven (7) years since its official filing date in the Region in which such patent application was filed.

1.2

Interpretation. In this agreement unless otherwise specified:

(a)

“includes” and “including” mean, respectively, includes without limitation and including without limitation;

(b)

a Party includes its permitted assignees and the respective successors in title to substantially the whole of its undertaking;

(c)

a statute or statutory instrument or any of their provisions is to be construed as a reference to that statute or statutory instrument or such provision as the same may have been or may from time to time hereafter be amended or re-enacted;

(d)

words denoting the singular will include the plural and vice versa and words denoting any gender will include all genders;

(e)

the Exhibits and other attachments form part of the operative provision of this Agreement and references to this Agreement shall, unless the context otherwise requires, include references to the Exhibits and attachments;

(f)

the headings in this Agreement are for information only and will not be considered in the interpretation of this Agreement;

(g)

general words will not be given a restrictive interpretation by reason of their being preceded or followed by words indicating a particular class of acts, matters or things;

(h)

references to days means calendar days unless otherwise indicated; and

(i)

the terms of this Agreement are the result of negotiations between the Parties, and this Agreement will not be construed in favor of or against any Party by reason of the extent to which any Party participated in the preparation of this Agreement.

2.

INTELLECTUAL PROPERTY LICENSE

2.1

License Grant. Subject to the terms of this Agreement, Licensor and its Affiliates hereby grant to Licensee an exclusive (even as to Licensor and its Affiliates), royalty-

2.2

Sublicense and Subcontract Rights.

(a)

Subject to the terms and conditions of this Agreement, Licensee may sublicense (through multiple tiers) the license set forth in Section 2.1 at any time at its sole discretion to any Person.

(b)

Each sublicense shall be subject to a written agreement that is consistent with the terms of this Agreement. Each sublicense of the Licensed IP shall be consistent with the terms of this Agreement. A copy of any sublicense agreement (or any supplements or amendments thereto) executed by Licensee shall be provided to Licensor within thirty (30) business days after the execution, provided that Licensee may redact any terms that are commercially sensitive which are unnecessary for Licensor to confirm compliance with this Agreement, notwithstanding of the foregoing, Licensee shall not redact or obscure any terms related to financial consideration (e.g., upfront payments, royalties, milestone payments, or pricing structure), sublicense scope, field of use limitations, or termination rights, which are necessary for Licensor to confirm compliance with this Agreement.

(c)

Licensee may engage subcontractors, including but not limited to Third Party contract research organization (“CRO”), Third Party contract manufacturing organization (“CMO”) and Third Party contract sales organization (“CSO”) (such subcontractor(s) individually and collectively, “Subcontractor(s)”) to exercise its rights or perform its obligations under this Agreement; provided that such subcontracting will be pursuant to a written and executed subcontracting agreement that does not conflict with and is subject to the terms

(d)

Licensee shall remain directly responsible for all of its obligations under this Agreement that have been delegated or sublicensed to any sublicensee or other Subcontractor. Any sublicensee or Subcontractor conduct, act, omission or state of affairs that would have constituted a breach of this Agreement shall be imputed to Licensee and deemed a breach of this Agreement as if such conduct, act, omission or state of affairs had been directly attributable to Licensee.  Licensee shall not grant a sublicense to any sublicensee or engage the services of any Subcontractor that has been debarred or disqualified by a Regulatory Authority.

2.3

Cross-license. Amphastar and its Affiliates grant to Licensor a non-exclusive, non-transferable, sublicensable (subject to second paragraph in this Section 2.3), royalty-bearing license under the Patent Rights that Amphastar owns from Development, manufacture, use of Licensed Compound and Licensed Products and Commercialization of Licensed Products under this Agreement (the “Cross-license Patents”) to research, Develop, make and have made, use Licensed Compound and Licensed Products and Commercialize Licensed Products in the Field outside the Territory.

2.4

Retained Rights; No Implied Licenses. Except for the licenses expressly granted to the other Party pursuant to this Agreement, the Parties on behalf of itself and its Affiliates (and on behalf of its sublicensees) and contractors) grant no other rights or

3.

GOVERNANCE.

3.1

Alliance Managers. Within thirty (30) days after the Effective Date, each Party shall appoint (and notify the other Party of the identity of) a senior representative having a general understanding of pharmaceutical development to act as its alliance manager under this Agreement (“Alliance Manager”). The Alliance Managers will (a) serve as the contact point between the Parties for the purpose of providing Licensor with information on the progress of Licensee’s Development of Licensed Compound and Licensed Products; and (b) subject to Section 13.3(c), be primarily responsible for facilitating the flow of information and otherwise promoting communication, coordination, and the transfer of Licensed Know-How from Licensor to Licensee as described in Article 4; (c) facilitate the prompt resolution of any disputes. Each Party may replace its Alliance Manager on written notice to the other Party.

3.2

Final decision. Licensee will be solely responsible for and, subject to compliance with the terms of this Agreement, will have the final decision-making authority with respect to the Development, manufacture and otherwise exploitation of the Licensed Products and Licensed Compound and Commercialization Licensed Products in the Field in the Territory, provided that Licensee shall not use such final decision making authority in a manner that would violate Applicable Laws or create material financial burden upon Licensor.

4.

DISCLOSURE OF LICENSED IP & COOPERATION

4.1

Disclosure of Licensed IP, transfer of Licensor Materials and other documents.

(a)

Within fifteen (15) days after each quarter during the Agreement Term, Licensor shall provide to Licensee a complete list of Licensed Patents that is not specified in Exhibit A (i.e. the Licensed Patents Controlled by Licensor after the Effective Date). For avoidance of doubt, such Licensed Patents shall also be licensed to Licensee in accordance with the terms herein.

(b)

Within fifteen (15) days (or the timeline otherwise specified in Exhibit B) after execution of this Agreement, Licensor shall provide to Licensee a copy (in electronic format if it is available in electronic format or a hard copy upon written request if it is not available in electronic format) of the documentation listed on Exhibit B. All documentation and information within the Licensed Know-How will be provided in the language such documentation was generated and will not be translated.

(c)

If any Party reasonably identifies specific documents that constitute Licensed Know-How Controlled by Licensor that were used for or arose from the Development of any Licensed Compound or Licensed Product which is not included on Exhibit B, Licensor shall locate and provide such documents to Licensee within fifteen (15) days thereafter, and the content of such documents shall be deemed to be Licensed Know-How and licensed for Licensee’s use under this Agreement, subject to Article 2. Without prejudice to the foregoing provisions, during the Agreement Term and upon reasonable request by Licensee, Licensor shall promptly and continuously provide the Licensee with documents, data, or materials related to the Licensed Know-How and Licensed Patents that are acquired by Licensor and have not been previously disclosed to Licensee.

(d)

Within fifteen (15) days after execution of this Agreement, Licensor shall provide to Licensee the Licensor Material specifically identified on each of Exhibit C, at no cost to Licensee, in the form and quantities set forth on each of Exhibit C.

(e)

In addition to the Licensed Know-How and Licensor Materials, Licensor will provide reasonably necessary assistance to Licensee, which are reasonably required for the proper use and understanding of the aforementioned Licensed Know-How and Licensor Material or the Development and Manufacture of Licensed Compound and Licensed Products.

4.2

Assistance and FTE Rate. At the request of Licensee, Licensor shall provide Licensee with reasonable technical assistance to help Licensee to understand and use Licensed Know-How and Licensed Compound in connection with the Development of the Licensed Products in the Field in the Territory, for avoidance of any doubts, excluding any assistance relating to knowledge innovation, derivative improvements, or the research and development of new products (whether or not based on the Licensed Know-How).  Licensee shall reimburse Licensor for the amount that has been previously agreed by both Parties, including documented, reasonable out-of-pocket costs and internal costs at the applicable FTE Rate incurred to provide such technical assistance.

5.

REGULATORY; DEVELOPMENT

6.

MANUFACTURING

7.

COMMERCIALIZATION

8.

FINANCIAL PROVISIONS

8.1

Development Milestone Payments.

(a)

During the Initial Licensing Term, upon achievement of each of the Milestones corresponding to the AC02 Product (each a “Development Milestone”) by or on behalf of Licensee or its Affiliates or its sublicensees, the corresponding Milestone Payment (a “Development Milestone Payment”) will be payable to Licensor in USD:

(b)

Each Development Milestone Payment in the table above will be paid not more than once; for further clarity, if a Development Milestone is firstly triggered in Canada, the corresponding Development Milestone Payment shall become due and payable, and Licensee will not make any payment for the same Development Milestone again which is later triggered in the United States. Accordingly, unless otherwise agreed in this Agreement, in no event shall the Licensee or its Affiliates pay the Licensor more than [***] in the aggregate pursuant to Section 8.1(a). Licensee will provide Licensor with written notice of the achievement of each Development Milestone within ten (10) days after such Milestone is achieved by or on behalf of Licensee or its Affiliates or its sublicensees. Licensor shall following receipt of such notice issue an Invoice to Licensee in respect of the relevant Development Milestone Payment. Licensee shall pay such invoice to Licensor within thirty (30) days after the date of its receipt of such invoice, with the exception of Development Milestone No.1, which shall be within ten (10) business days after receipt of such invoice.

(c)

For each Development Milestone 2# to 6#, if any Development Milestone event is bypassed and a later Development Milestone event is achieved, the payment corresponding to any such bypassed Development Milestone event shall be due at the same time that payment is due for the achievement of such later Development Milestone event.

8.2

Sales Milestone Payments.

(a)

During the Licensing Term, upon achievement of the Net Sales amount of the AC02 Product in any one (1) Calendar Year period in the Territory set forth below (each a “Sales Milestone”, collectively with the Development

(b)

Each Sales Milestone Payment in the table above will be paid not more than once. Accordingly, unless otherwise agreed in this Agreement, in no event shall the Licensee or its Affiliates pay the Licensor more than [***] in the aggregate pursuant to Section 8.2(a). Licensee will provide Licensor with written notice of the achievement of each Sales Milestone and the corresponding Sales & Royalty Report before March 31^st of the next Calendar Year after such Milestone is achieved by or on behalf of Licensee and its Affiliates and its sublicensees. Licensor shall following receipt of such notice issue an Invoice to Licensee in respect of the relevant Sales Milestone Payment. Licensee shall pay such invoice to Licensor within thirty (30) days after the date of its receipt of such invoice. For clarity, if multiple Sales Milestone Events are achieved in the same Calendar Year, then each applicable Sales Milestone Payment associated with such Sales Milestone events would nonetheless be owed to Licensor in full after the end of such Calendar Year in accordance with this Section 8.2(b).

8.3

Royalty Payments.

(a)

In further consideration of the licenses and rights granted to Licensee hereunder, each Calendar Year during the Royalty Term, Licensee will make royalty payments (“Royalty Payment”) to Licensor on annual Net Sales in the Territory by Licensee and its Affiliates and its sublicensees at the rates set forth below.

(b)

The Royalty Payment (excluding any Milestone Payment) shall be subject to a maximum annual amount of [***] each Calendar year for AC02 Product (the “Maximum Annual Royalty Payment”) and a maximum accumulated amount of [***] for AC02 Product (the “Maximum Accumulated Royalty Payment”). Once the Maximum Accumulated Royalty Payment has been paid, the Royalty Payment obligation shall be deemed to be terminated.

(c)

Before March 31^st of the next Calendar Year, Licensee shall provide a Sales & Royalty Report of the previous Calendar Year to Licensor. Licensor shall submit an Invoice to Licensee with respect to the royalty amount shown therein. Licensee shall pay such royalty amount to Licensor within thirty (30) days after the date of receipt of the Invoice.

8.4

Payments.

(a)

All payments from Licensee to Licensor will be made by wire transfer in USD to the credit of such bank account as may be designated by Licensor in this Agreement or in writing to Licensee. Any payment which falls due on a date which is not a business day in the location from which the payment may be made shall occur on the next succeeding business day in such location. Licensor shall be solely responsible for obtaining all applicable permits necessary for receiving all payments required to be made under this Agreement. Licensee shall not be responsible nor required to reissue any amounts, whether whole or partial, for any payments issued by Licensee pursuant to Licensor’s written instruction(s).

(b)

In case that Licensee fails to provide Licensor with such notice of any Milestones within such time period as set forth under Section 8.1(b) and Section 8.2(b), while Licensor believes that any Milestone has been achieved, it shall have the right to notify Licensee in writing of the same and issue an invoice for the Milestone Payments to Licensee, and in the case the Milestone was actually achieved, Licensee shall make the corresponding Milestone Payments to Licensor within thirty (30) days thereafter for the relevant Milestone Payments. If Licensee disputes this matter, Licensee will notify Licensor within thirty (30) days from receipt of Licensor’s notice, and both Parties shall resolve the dispute in accordance with Section 15.5.

(c)

All payments under this Agreement shall be made in U.S. dollars. Payments shall be made by electronic wire transfer of immediately available funds to the account of Licensor. Licensee will record all Net Sales in accordance with the Accounting Standards.

(d)

During the Licensing Term, once the Maximum Accumulated Royalty Payment and the Maximum Sales Milestone Payment (as listed in Section 8.2) have been paid, the licenses granted to Licensee pursuant to this Agreement shall be considered as fully paid-up by Licensee and such license will continue in effect, but will become fully paid-up, royalty-free, transferable, perpetual and irrevocable regardless of whether the Agreement Term has expired or terminated. For avoidance of doubt, the Maximum Accumulated Royalty Payment (as listed in Section 8.3) and the Maximum

(e)

For avoidance of doubt, if Licensee extends the Initial Licensing Term to the Extended Licensing Term, during the Extended Licensing Term, the only applicable payment obligation of Licensee is Sales Milestone Payment and Royalty Payment as long as the Maximum Sales Milestone Payment (as listed in Section 8.2) and Maximum Accumulated Royalty Payment (as listed in Section 8.3) have not been paid during the Initial Licensing Term.

(f)

Each Party shall each bear any and all taxes levied against such Party on account of any payment received by such Party under this Agreement.  All amounts payable by the Licensee to Licensor under this Agreement shall be deemed to be inclusive of all applicable taxes, levies, duties, or similar governmental charges, including without limitation any income tax, gross receipts tax, value-added tax, sales tax, use tax, or other tax of a similar nature that may be imposed by any governmental authority in connection with or arising out of the receipt of such payments by the Licensor. The Licensee shall have no obligation to gross up or otherwise pay any additional amount to Licensor to account for or compensate Licensor for any tax, deduction or withholding assessed or imposed on such payments, except to the extent otherwise expressly provided in this Agreement.

(g)

If any withholding tax is required to be withheld by Licensee under the Applicable Law of any jurisdiction, including extra-territorial taxation and is paid over to the applicable tax authority, Licensee will deduct the withholding tax from the payment made to Licensor and such payment shall be treated as having been paid to Licensor for all purposes under this Agreement. Licensee will reasonably assist Licensor in lawfully claiming exemption from or minimizing such withholding tax under double taxation laws including but not limited to the submission or issuance of requisite forms.

(h)

Other than as provided in Section 8.4(g), each Party shall be responsible for its own taxes, including any tax, fee, assessment or other charge based on or measured by the capital or net income, or any other tax imposed by any jurisdiction and neither Party shall have any obligation towards the other Party for the taxes of the other Party.

(i)

With respect to any amounts owed under this Agreement by a Party to the other Party for which no other invoicing and payment procedure is specified herein, the Party owing such payment obligation will provide to the other Party an invoice, together with reasonable supporting documentation, for such amounts owed and such other Party will pay any undisputed amounts within thirty (30) days after receipt of the invoice.

(j)

Licensee shall be solely responsible for obtaining all applicable permits necessary for making all payments required to be made under Sections 8.1 to 8.3 and will bear all costs associated with such payments.

8.5

Records.

(a)

Licensee will keep, and will require its Affiliates to keep, complete, true and accurate books and records in accordance with its Accounting Standards in relation to Milestones, Net Sales and Royalty Payments payable to Licensor hereunder with respect to Licensed Compound and Licensed Products.

(b)

Subject to Section 13.3(c), Licensee will, and will require its Affiliates and its sublicensees to, make their records available for inspection by Licensor’s designated third-party auditor (the “Auditor”) (subject to confidentiality obligations and shall only disclose the results to Licensor), during regular business hours at such place or places where such records are customarily kept, upon receipt of notice at least thirty (30) days in advance from Licensor. The records will be reviewed to solely verify the accuracy of the Sales & Royalty

8.6

No Projections. Licensor and Licensee acknowledge that nothing in this Agreement will be construed as representing an estimate or projection of anticipated sales of any Licensed Product, and that the Milestones and Net Sales levels set forth above or elsewhere in this Agreement or that have otherwise been discussed by the Parties are merely intended to define the Milestone Payments and Royalty Payments obligations to Licensor if the applicable Milestones or Net Sales levels are achieved.  LICENSEE MAKES NO REPRESENTATION OR WARRANTY, EITHER EXPRESS OR IMPLIED, THAT IT WILL BE ABLE TO SUCCESSFULLY COMMERCIALIZE ANY LICENSED PRODUCT OR, IF COMMERCIALIZED, THAT ANY PARTICULAR NET SALES LEVEL OF SUCH LICENSED PRODUCT WILL BE ACHIEVED.

8.7

Royalty for Amphastar.

(a)

Each Calendar Year during the Amphastar Royalty Term, for the license of Cross-license Patents, Licensor will pay [***] royalty to Amphastar from the Net Sales (calculated in the same principle as the “Net Sale” of the AC02 Product) of the commercial sales of products that are based on such Cross-license Patents (the “Royalty for Amphastar”).

(b)

The Royalty for Amphastar shall be subject to a maximum annual amount of [***] each Calendar year and a maximum accumulated amount of [***] (the “Maximum Accumulated Royalty Payment for Amphastar”). Once the Maximum Accumulated Royalty Payment for Amphastar has been paid, the payment obligation of Royalty for Amphastar shall be deemed to be terminated.

(c)

During the Amphastar Royalty Term, before March 31st of every Calendar Year, Licensor shall provide a sales & royalty report (prepared in the same principle as the “Sales & Royalty Report” of the AC02 Product) of the previous Calendar Year to Amphastar. Amphastar shall submit an Invoice to Licensor with respect to the royalty amount shown therein. Licensor shall pay such royalty amount to Amphastar within thirty (30) calendar days after the date of receipt of the Invoice by wire transfer in RMB to the credit of such bank account as may be designated by Amphastar.

(d)

Licensor shall be solely responsible for obtaining all applicable permits necessary for making all payments required to be made under this Section 8.7 and will bear all costs associated with such payments.

(e)

Section 8.4 and 8.5 shall apply to Licensor mutatis mutandis with respect to the payment of Royalty for Amphastar.

9.

Intellectual Property.

9.1

Ownership of Background Intellectual Property.  As between the Parties, (a) Licensor shall solely own and retain all right, title and interest in and to any and all Licensed IPs, including any improvements made by Licensor thereto; and (b) each Party shall solely own and retain all right, title and interest in and to any and all Know-How, inventions, Patent Rights and other intellectual property rights that are owned or otherwise Controlled by such Party or its Affiliates or its or their sublicensees (as applicable) outside of this Agreement.

9.2

Arising Product IP. All intellectual properties (including but not limited to inventions, whether or not patentable or reduced to practice, trademarks, copyrights and Know-How) arising from Licensee’s activities under this Agreement, including activities conducted by or on behalf of Licensee or its Affiliates, including any Patent Rights claiming such inventions that arise from such activities after the Effective Date (collectively, the “Arising Product IP”), will be owned by Licensee.

9.3

Ownership of Results and Data. All data and results arising from Licensee’s activities under this Agreement, including activities conducted by or on behalf of Licensee or its Affiliates, including Development, clinical and regulatory data and information generated for regulatory purposes relating to Licensed Compound or Licensed Product will be solely owned by Licensee.

9.4

Patent Prosecution and Maintenance After the Effective Date.

(a)

Licensor will control prosecution and maintenance of the Licensed Patents outside the Territory at Licensor’s sole cost and expense and in the Territory at Licensee’s sole cost and expense. Licensor will use Commercially Reasonable Efforts to keep Licensee informed of matters relating to the prosecution and maintenance of the Licensed Patents in the Territory, and will provide Licensee with copies of documents relevant to such prosecution and maintenance in sufficient time. With respect to communications issued by competent patent offices within the Territory concerning the Licensed Patents, Licensor will use Commercially Reasonable Efforts to notify Licensee of said communications but no later than forty-five (45) days after their issuance. With respect to documents to be filed at competent patent offices within the Territory concerning Licensed Patents, Licensor will use Commercially Reasonable Efforts to notify Licensee but no later than thirty (30) days prior to the filing of such documents to allow for review and comment by Licensee, and Licensor will reasonably consider Licensee’s comments in good faith. Licensor will notify Licensee of any decision not to continue to pay the expenses of prosecution and maintenance of any Licensed Patent within the Territory, which notice must be delivered at least ninety (90) days prior to any payment due date or the relevant action’s due date. Licensee will provide Licensor, at Licensee’s expense, with all reasonable assistance and cooperation in relation to Licensor’s prosecution and maintenance of Licensed Patents in the Territory, including providing any necessary powers of attorney and any other documents or instruments required therefor. Licensor shall have no obligation to continue to prosecute any Licensed Patents in the Territory. If Licensor elects not to prosecute any Licensed Patent in the Territory, Licensor shall notify Licensee of any decision to cease prosecution of any Licensed Patents in the Territory. Licensee shall have the right to continue the prosecution and maintenance of such Licensed Patent in such Region at its own cost. If Licensee undertakes such prosecution and maintenance, (i) Licensor will provide Licensee, with all reasonable assistance and cooperation in relation thereto, including providing any necessary powers of attorney and any other documents or instruments required therefor, and (ii) the expenses of such prosecution and maintenance necessary to preserve the validity of the Licensed Patents in relevant Region shall be borne by Licensee. Such assistance and cooperation by Licensor shall not be unreasonably withheld, delayed or conditioned upon.

(b)

Licensee shall be solely responsible for the prosecution, maintenance, defense, and enforcement against infringement of Arising Product IP in the Territory.

9.5

Third Party Infringement.

(a)

Each Party will promptly notify the other of any infringement by a Third Party of any of the Licensed Patents or misappropriation of any Licensed Know-How in the Territory of which it becomes aware, including any filing of an Abbreviated New Drug Application (“ANDA”) in the United States or such similar filing under Applicable Law in jurisdictions in the Territory other than the United States. Each Party shall provide the other Party with all available evidence supporting such infringement, suspected infringement, unauthorized use or misappropriation or suspected unauthorized use or misappropriation (collectively, “Third Party Infringement”).

(b)

As between the Parties, Licensee shall have the right to bring and control any legal action in connection with the Third Party Infringement in the Territory relating to any Licensed Patent at its own expense as it reasonably determines appropriate, and Licensor will have the right (but not the obligation), at its own expense, to be represented in any such action by counsel of its own choice. If Licensee does not bring such legal action within sixty (60) days after its aware of such Third Party Infringement, Licensor shall have the right to bring and control any legal action in connection with such Third Party Infringement in the Territory at its own expense as it reasonably determines appropriate.

(c)

At the request of the Party controlling the Third Party Infringement claim, the other Party will provide assistance in connection therewith, including by executing reasonably appropriate documents, access to such Party’s employees, cooperating reasonably in discovery and joining as a party to the action if required.

(d)

In connection with any such proceeding, neither Party will enter into any settlement admitting the invalidity of, or otherwise impairing any Party’s rights in, the Licensed IP without the prior written consent of the other Party, which will not be unreasonably withheld or delayed.

(e)

Any recoveries resulting from such an action relating to a Third Party Infringement  shall be first applied against payment of each Party’s costs and expenses in connection therewith, and any recoveries in excess of such costs and expenses shall be retain by the enforcing Party.

9.6

Third Party Patent Invalidity Claim. If a Third Party at any time asserts a claim that any Licensed Patent is invalid or otherwise unenforceable in the Territory (an “Invalidity Claim”), whether as a defense in an infringement action brought by a Party pursuant to Section 9.5, in a declaratory judgment action or any patent office proceeding anywhere in the world (e.g., inter-partes review), the provisions of Section 9.5 will apply to such Invalidity Claim, mutatis mutandis as they apply to Third Party Infringement suits.

9.7

Defense of Infringement Claims of Licensed IP. Subject to Section 14.1, if any Third Party asserts a claim, demand, action, suit or proceeding against a Party (or any of its Affiliates), alleging that any Licensed Product manufactured or sold, or the use or practice of the Licensed IP, by or on behalf of Licensee or any of its Affiliates infringes, misappropriates or violates the intellectual property rights of any Person in the Territory (any such claim, demand, action, suit or proceeding being referred to as an “Infringement Claim”), the Party first having notice of the Infringement Claim shall promptly notify the other Party thereof in writing specifying the facts, to the extent known, in reasonable detail and the following shall apply:

(a)

In the case of any such Infringement Claim being asserted against either Party individually or against both Licensor and Licensee, in each case, with respect to the Licensed Product, Licensee shall assume control of the defense of such Infringement Claim. Both Parties shall share equally the defense costs. Licensor, upon request of Licensee and if required by Applicable Law, will join in any such litigation, and in any event will reasonably cooperate with Licensee. Licensor will have the right to consult with Licensee concerning such Infringement Claim and to participate in and be represented by independent counsel in any litigation in which Licensee is a party, at its own expense.  If Licensee elects not to defend or control the defense of or otherwise fails to initiate and maintain the defense of any such Infringement Claim within such time periods so that either Party is not prejudiced by any delays, Licensor may conduct and control the defense of such Infringement Claim, at its own cost and expense.

(b)

Licensee shall not have the right to settle any Infringement Claim without the written consent of Licensor (provided, however, that Licensee may settle such suit without such consent if such settlement involves only the payment of money and Licensee makes all such payments, and such settlement would not adversely impact or diminish the rights and benefits of Licensor under this Agreement, and would not impose any new obligations or adversely impact any obligations of Licensor under this Agreement).

(c)

During the period in which such Infringement Claim is pending and following the resolution thereof, both Parties shall bear equally, all costs incurred in connection therewith (including litigation costs, attorneys’ fees, costs of settlement) including damage awards, and any other payment resulting therefrom, provided that to the extent such Infringement Claim is attributable to the Licensed IP, then Licensor shall compensate Licensee for any losses incurred by Licensee and its Affiliates.

(d)

Any recoveries awarded to Licensee in connection with any Infringement Claim defended under this Section 9.7 shall be applied first to reimburse the Parties for their reasonable costs and expenses and then be retained by such Party controlling the defense.

(e)

Licensor shall have the exclusive right to control the defense of such Infringement Claim outside the Territory, at its own expense and as it reasonably determines appropriate.

9.8

Trademarks. Licensee will have the right to brand the Licensed Products using Licensee related trademarks and any other trademarks and trade names it Controls and determines appropriate for Licensed Products in the Territory, which may vary by country or within a country (“Product Marks”). Licensee will own all rights in the Product Marks within the Territory and register and maintain the Product Marks in the countries and regions it determines reasonably necessary within the Territory.

9.9

Inventor Remuneration Obligations. As between the Parties, Licensor shall be solely responsible for the payment of any rewards and remuneration for inventions as required by Applicable Law, to named inventors of the Licensed Patents.

10.

CONFIDENTIALITY

10.1

Duty of Confidence. Subject to the other provisions of this Article 10 and during the Term and for a period of seven (7) years thereafter, all Confidential Information disclosed by a Party or its Affiliates under this Agreement will be maintained in confidence and otherwise safeguarded by the recipient Party. The recipient Party may only use the Confidential Information for the purposes of this Agreement and pursuant to the rights granted to the recipient Party under this Agreement. Subject to the other provisions of this Article 10, each Party will hold as confidential such Confidential Information of the other Party or its Affiliates in the same manner and with the same protection as such recipient Party maintains its own confidential information. Subject to the other provisions of this Article 10, a recipient Party may only disclose Confidential Information of the other Party to employees, agents, contractors, consultants and advisers of the Party and its Affiliates and to Third Parties to the extent reasonably necessary for the purposes of, and for those matters undertaken pursuant to, this Agreement; provided that such Persons are bound to maintain the

10.2

Exceptions. The obligations under this Article 10 will not apply to any information to the extent the recipient Party can demonstrate by competent evidence that such information:

(a)

is (at the time of disclosure) or becomes (after the time of disclosure) known to the public or part of the public domain through no breach of this Agreement by the recipient Party or its Affiliates;

(b)

was known to, or was otherwise in the possession of, the recipient Party or its Affiliates prior to the time of disclosure by the disclosing Party or any of its Affiliates;

(c)

is disclosed to the recipient Party or its Affiliate on a non-confidential basis by a Third Party who is entitled to disclose it without breaching any confidentiality obligation to the disclosing Party or any of its Affiliates; or

(d)

is independently developed by or on behalf of the recipient Party or its Affiliates, as evidenced by its written records, without use, reliance or reference to the Confidential Information disclosed by the disclosing Party or its Affiliates under this Agreement.

10.3

Authorized Disclosures.

(a)

Except as otherwise required by Applicable Law and/or Regulatory Authorities, neither Party shall issue any press release, trade announcement or make any other public announcement or statement with regard to the transactions contemplated by this Agreement without the other Party’s prior written consent, which shall not be unreasonably withheld or delayed.  If either Party is required to disclose this Agreement or other Confidential Information related to this Agreement as required by Applicable Law and/or Regulatory Authorities, the Party obligated to make the disclosure shall provide the other Party a copy of the proposed disclosure. The other Party shall provide comments and proposed redactions within two (2) business days of receiving the proposed disclosure. The Party obligated to make the disclosure shall consider all comments in good faith; make reasonable efforts to minimize such disclosure; and make reasonable efforts to obtain confidential treatment for any Confidential Information it is required to disclose.  No press release can be made before the payment of the Development Milestone No.1 under Section 8.1(a) of this Agreement.

(b)

In addition to disclosures permitted pursuant to Sections 10.1 and 10.2, either Party may disclose Confidential Information without notice to or consent from the other Party, belonging to the other Party or its Affiliates, to the extent such disclosure is necessary in the following instances: (i) filing or prosecuting Patent Rights Covering Licensed Products to a patent authority as may be reasonably necessary or useful for purposes of obtaining or enforcing a Patent as permitted by this Agreement, provided that reasonable measures shall be taken to assure confidential treatment of such information; (ii) in connection with Regulatory Filings with Regulatory Authority for Licensed Products; (iii) prosecuting or defending litigation as permitted by this Agreement (in which case, notice and/or consent shall be required as otherwise contemplated in this Agreement); (iv) complying with applicable court orders, governmental regulations, or the inquiries of Regulatory Authorities; (v) in connection with an offering of securities or securities law disclosure requirements if counsel

(c)

If the recipient Party is required to disclose Confidential Information of the disclosing Party by law or in connection with a bona fide legal process, such disclosure will not be a breach of this Agreement; provided that the recipient Party (i) informs the disclosing Party as soon as reasonably practicable of the required disclosure; (ii) limits the disclosure to the required purpose; and (iii) at the disclosing Party’s request and expense, assists in an attempt to object to or limit the required disclosure or to otherwise receive “confidential” or “trade secret” treatment with respect to relevant portions of such disclosure. The disclosing Party shall not be required to complete the requirements outlined in this paragraph if the disclosing Party’s use of the Confidential Information is pursuant to the disclosing Party’s performance obligation(s) contemplated herein.

10.4

Scientific Publications. Licensor shall not publish or give other forms of public disclosure, such as by public oral presentation, manuscript or abstract, of the plan, progress or results of Development activities, including clinical trials, with respect to the Licensed Product without Amphastar’s prior written approval. Licensee shall not publish or give other forms of public disclosure, such as by public oral presentation, manuscript or abstract, of any Licensor’s Confidential Information without Licensor’s prior written approval. Any such proposed publication or disclosure shall be subject to the prior review and written consent of the other party, and the parties shall cooperate in good faith to resolve any concerns regarding authorship, confidentiality prior to publication.

10.5

Ongoing Obligation of Confidentiality. Upon early termination of this Agreement for any reason, each Party and its Affiliates will immediately return to the other Party or destroy any Confidential Information disclosed by the other Party, except for one copy which may be retained in its confidential files for archive purposes.

11.

TERM AND TERMINATION

11.1

Agreement Term.

(a)

The term of this Agreement will commence on the Effective Date and unless earlier terminated pursuant to this Article 11, shall expire on the last expiration date of the Licensing Term for the Licensed Product in the Territory.  The period commencing on the Effective Date and ending on the expiration date or early termination date of this Agreement in its entirety shall be referred to herein as the “Agreement Term”.

(b)

Subject to the requirement as set forth in Section 12.1(b), if this Agreement is expired or terminated by either Party pursuant to this Article 11, and a clinical trial of a Licensed Compound or Licensed Product is ongoing as of the effective date of termination, the Parties shall discuss in good faith the appropriate steps to take regarding the closure or handover of such clinical trial, and in no event will the Party sponsoring the clinical trial be required to breach any Applicable Law or ethical requirement concerning treatment of study subjects.

11.2

Termination by Licensor. In the event Licensee fails to pay undisputed amount due and payable hereunder for a period of ninety (90) days from the due date, Licensor shall have the right to terminate this Agreement

11.3

Termination by Licensee. Licensee may terminate this Agreement in whole or in part, by providing written notice to Licensor, due to any one of the following reasons:

(a)

Licensor is in material breach of this Agreement, and such material breach is not cured within ninety (90) days after written notice by the Licensee specifying the claimed particulars of such breach;

(b)

Efficacy or safety do not meet the regulatory requirement and rejected by FDA;

(c)

In the event the stability (i.e. product shelf life) of the Licensed Products(s) cannot meet the Regulatory Authority requirements after intensive efforts by Licensee, and 6-month after Licensor’s efforts to provide Licensee with formulation that will meet the Regulatory Authority requirements;

(d)

In the event the United States market for Licensed Product has changed that Licensee decided not to pursue the Licensed Product any longer;

(e)

Any other force majeure causes.

11.4

Termination by Licensee Without Cause. Licensee may terminate this Agreement, in whole or in part, without cause at any time, by providing at least ninety (90) days’ prior written notice to Licensor.

11.5

Insolvency. If an Insolvency Event occurs, (a) the Party subject to the Insolvency Event will give immediate (not longer than three (3) business days’) notice to the other Party of such occurrence, and (b) the other Party will have the right to immediately terminate this Agreement by giving written notice to the Party that is subject to the Insolvency Event. In the event that Licensor is the insolvent Party, and Licensee does not elect to terminate this Agreement pursuant to this Section 11.5, Licensee is entitled to, (i) request Licensor to continue to perform this Agreement, and (ii) if Licensor is unable to perform this Agreement or this Agreement is otherwise terminated, Licensee shall have the right to purchase the Licensed IP in its entirety at the fair market value appraised by a Third Party appraisal agency. The Parties hereby acknowledge and agree that, to the extent permitted by Applicable Laws, Licensee shall have the right of first refusal to purchase the Licensed IP under same terms and conditions in the event of any bona fide offers from third parties.  To the extent permitted under Applicable Law, Licensor will provide any and all assistance to facilitate Licensee's achievement of the foregoing objectives.

11.6

Termination for Sanctions.  Licensee may terminate this Agreement immediately or upon such other date as may be designated by the Licensee in its written notice, if: (a) Licensor is added to any US or non-US sanctions- or export-related restricted party list, including without limitation the US Department of the Treasure Office of Foreign Assets Control's List of Specially Designated Nationals and Blocked Persons and the US Commerce Department Bureau of Industry and Security’s Entity List or Denied Persons List; or (c) the purpose of this Agreement is prohibited or materially limited by any Applicable Laws (including the US BIOSECURE Act and similar legislation, if passed). This Agreement will automatically and immediately terminate without action by either Party if the performance of the Agreement would be in violation of Applicable Laws because of the Licensor’s status under US sanctions laws.  Notwithstanding anything to the contrary in this Agreement, neither Party shall have any liability to the other whatsoever for termination of the Agreement pursuant to this Section 11.6 (Termination for Sanctions).

11.7

Remedy-in-lieu-of-termination. If Licensee has the right to terminate this Agreement pursuant to Section 11.3 or Section 11.5, then as the monetary remedy

12.

EFFECT OF TERMINATION

12.1

Effect of Termination. Upon termination of this Agreement:

(a)

Licenses. The licenses and other rights granted by a Party to the other Party under the Licensed IP or Cross-license Patents will terminate;

(b)

Clinical Trials. Licensee will responsibly wind-down, in accordance with accepted pharmaceutical industry norms and ethical practices and all legal and regulatory requirements, any on-going clinical trials for which it has responsibility hereunder in which patient dosing has commenced

(c)

Return of Confidential Information. At the disclosing Party’s election, the receiving Party shall return or destroy all tangible materials to the extent comprising or containing any Confidential Information of the disclosing Party that are in receiving Party’s or its Affiliates’ possession or control and provide written certification of such destruction, provided that the receiving Party may retain one (1) copy of such Confidential Information for its archives solely to monitor compliance with its obligations herein;

(d)

Except as set forth in this Section 12.1 and in Section 12.2, the rights and obligations of the Parties hereunder will terminate as of the date of such termination.

12.2

Survival. Expiration or termination of this Agreement will not relieve the Parties of any obligation accruing prior to such expiration or termination. Without limiting the foregoing, Articles 1, 8, 9, 12, 14 and 15will survive the expiration or termination of this Agreement for any reason. Article 10 (Confidentiality) of this Agreement

12.3

Termination Not Sole Remedy. Termination is not the sole remedy under this Agreement and, whether or not termination is effected and notwithstanding anything contained in this Agreement to the contrary, all other remedies will remain available except as agreed to otherwise herein. For the avoidance of doubt, nothing in this Agreement shall obligate a Party to terminate this Agreement if the other Party breaches any obligation under this Agreement, and failure to terminate this Agreement shall not prohibit or modify the recovery of damages available to it pursuant to Section 15.5 or at law.

13.

REPRESENTATIONS, WARRANTIES AND COVENANTS

13.1

Representations and Warranties by Each Party. Each Party represents and warrants to the other as of the Effective Date that:

(a)

it is a corporation duly organized, validly existing, and in good standing under the laws of its jurisdiction of formation;

(b)

it has full corporate power and authority to execute, deliver, and perform this Agreement, and has taken all corporate action required by law and its organizational documents to authorize the execution and delivery of this Agreement and the consummation of the transactions contemplated by this Agreement;

(c)

this Agreement constitutes a valid and binding agreement enforceable against it in accordance with its terms, except as enforceability may be limited by bankruptcy, fraudulent conveyance, insolvency, reorganization, moratorium and other laws relating to or affecting creditors’ rights generally and by general equitable principles and public policy constraints (including those pertaining to limitations or exclusions of liability, competition laws, penalties and jurisdictional issues including conflicts of laws);

(d)

all consents, approvals and authorizations from all governmental authorities or other Third Parties required to be obtained by such Party in connection with this Agreement have been obtained;

(e)

the execution and delivery of this Agreement and all other instruments and documents required to be executed pursuant to this Agreement, and the consummation of the transactions contemplated hereby do not and will not (i) conflict with or result in a breach of any provision of its organizational documents; (ii) result in a breach of any agreement to which it is a party; or (iii) violate any Applicable Laws;

(f)

it is not aware of any action, suit, inquiry or investigation instituted by any Person or governmental agency that questions or threatens the validity of this Agreement;

(g)

neither such Party nor, to the actual knowledge of such Party, any employee, agent or subcontractor of such Party involved or to be involved in the Development or manufacture of any Licensed Compound or Licensed Product has been debarred under Subsection (a) or (b) of Section 306 of the Federal Food, Drug and Cosmetic Act (21 USC §§ 335a) or any equivalent or similar provision under Applicable Law in the People’s Republic of China or elsewhere; and

(h)

neither such Party or its Affiliates, nor any of its current and former directors, officers, employees, or agents have provided, offered, or promised the provision of anything of value (regardless of monetary value), directly or indirectly, to any governmental official or agent, for the purpose of securing any improper or illegal advantage in violation of relevant and applicable anti-bribery and anti-corruption laws, regulations, and international conventions, including, but not limited to, the US Foreign Corrupt Practices Act of 1977 and the Criminal Law and Anti-Unfair Competition Law in China.

13.2

Additional Representations and Warranties by Licensor. Licensor represents and warrants to Licensee as of the Effective Date that:

(a)

Exhibit A and Exhibit B set forth a true, complete and correct list of all intellectual properties Controlled by Licensor or its Affiliates as of the Effective Date that claim the composition or method of use of Licensed Compound;

(b)

each Person who has or has had any rights in or to any Licensed IP has assigned by virtue of employment or written assignment its entire right, title and interest in and to such Licensed IP to Licensor or its Affiliates;

(c)

Licensor and its Affiliates are the sole and exclusive owners of the entire right, title and interest in, to and under the Licensed IP, free and clear of all liens, encumbrances, security interests, claims, restrictions, licenses, options, or any other third-party rights that would interfere with Licensee’s rights, and have not granted any license or other right under the Licensed IP that is in conflict with the license hereunder or prejudices Amphastar’s rights granted hereunder; Licensor has procured all of its Affiliates to have exclusively licensed or assigned to Licensor all of their right, title, and interest in and to the Licensed IP as of the Effective Date hereof (if necessary);

(d)

each of the Licensed Patents properly identifies each and every inventor of the claims thereof as determined in accordance with the Applicable Laws of the jurisdiction in which such Licensed Patent is issued or patent application is pending; provided, however, that if a Licensed Patent does not properly identify each and every inventor in accordance with the foregoing, Licensor shall be responsible for correcting the inventorship of such Licensed Patent at its sole cost and expense;

(e)

Licensor has filed and prosecuted patent applications within the Licensed Patents in good faith and complied with all duties of disclosure with respect thereto;

(f)

to the knowledge of Licensor, there are no facts that could form the basis for the invalidation or unenforceability of the Licensed Patents;

(g)

Licensor has not initiated or been involved in any proceedings or Claims in which it alleges that any Third Party is or was infringing or misappropriating any Licensed IP relating to Licensed Compound or Licensed Products, or any other proceedings or Claims that resulted in or would reasonably be expected to result in monetary damages or changes in intellectual property rights to the Licensed IP or impairing Amphastar’s ability to use and commercialize the Licensed Compound or Licensed Products;

(h)

to the knowledge of Licensor, there are no activities by Third Parties that would constitute infringement or misappropriation of the Licensed Patents (in the case of pending claims, evaluating them as if issued);

(i)

to the knowledge of Licensor, the development and practice of the Licensed IP do not and will not infringe or otherwise conflict with any intellectual property rights or other rights of any Third Party;

(j)

Licensor has not entered into any agreement with a Third Party that is in conflict with the rights granted to Licensee under this Agreement, and has not taken any action that would prevent it from granting the rights granted to Licensee under this Agreement, or that would otherwise materially conflict with or materially adversely affect the rights granted to Licensee under this Agreement;

(k)

Licensor and its Affiliates have taken reasonable precautions to preserve the confidentiality of the Licensed Know-How, including securing binding, written confidentiality agreements with respect thereto from all employees, consultants, agents and independent contractors of Licensor and its Affiliates No employee, consultant, agent or independent contractor of Licensor and its Affiliates is in violation of the terms of any such agreement or has otherwise made unauthorized use of or misappropriated any Licensed IP. No employee or consultant of Licensor and its Affiliates, of whom are subject to such non-compete obligations, is in violation of the terms of any such agreement or has otherwise carried out any actions that would adversely affect Licensor’s right to grant any license of Licensed IP hereunder or Licensee’s right to use any Licensed IP hereunder; and

(l)

To Licensor’s knowledge, all core information and core data that Licensor and/or its Affiliates provide to Licensee in relation to this Agreement are true, complete, accurate, unadulterated and not misleading in material respect, and further, Licensor and its Affiliates have not retained, deleted or otherwise withheld any material information regarding the Licensed IP from Licensee that is necessary to perform the license hereunder;

13.3

Covenants of Licensor. Licensor covenants that:

(a)

it will not grant any interest in the Licensed IP that is inconsistent or otherwise conflicting with the terms of this Agreement;

(b)

if, at any time after execution of this Agreement, it becomes aware that it or any employee, agent or subcontractor of Licensor who participated in the Development or manufacture of a Licensed Compound or Licensed Product is on, or is being added to the FDA Debarment List or to any of the FDA clinical investigator enforcement lists, it will provide written notice of this to Licensee within ten (10) business days after becoming aware of this fact.

(c)

Licensor understands and agrees that, notwithstanding any other provision of this Agreement, neither Licensor nor any entity acting on behalf of Licensor, including the Auditor and Licensor’s Alliance Manager, shall request or accept from Amphastar, its affiliates or its sublicensees, and Amphastar, its affiliates or its sublicensees is not obligated to provide, “access” to any “government-related data” or “bulk U.S. sensitive personal data,” within the meaning ascribed to each such term under the US Data Security Program. Licensor agrees to not evade or avoid, cause a violation of, or attempt to violate any of the prohibitions set forth in the US Data Security Program in connection with this Agreement.

13.4

Covenants of Licensee. Licensee covenants that:

(a)

Licensee understands and agrees that, notwithstanding any other provision of this Agreement, neither Licensee nor any entity acting on behalf of Licensee, including the Auditor and Licensee’s Alliance Manager, shall request or accept from Licensor, its affiliates or its sublicensees, and Licensor, its affiliates or its sublicensees is not obligated to provide any data in violation of Chinese data security laws and regulations.  Licensee agrees to not evade or avoid, cause a violation of, or attempt to violate any of the prohibitions set forth in Chinese data security laws and regulations in connection with this Agreement.

14.

INDEMNIFICATION; LIABILITY

14.1

Indemnification by Licensor. Licensor will indemnify and hold Licensee, its Affiliates, and their respective officers, directors and employees (“Licensee Indemnitees”) harmless from and against any Claims against them to the extent arising or resulting from:

(a)

the breach of any of the obligations, covenants, warranties or representations made by Licensor to Licensee under this Agreement; or

(b)

any activities conducted by Licensor or its Affiliates in the Territory with respect to the Licensed Compound or Licensed Products prior to the Effective Date;

14.2

Indemnification by Licensee. Licensee will indemnify and hold Licensor, its Affiliates, and their respective officers, directors and employees (“Licensor Indemnitees”) harmless from and against any Claims against them to the extent arising or resulting from:

(a)

actions by Licensee, its Affiliates, its sublicensees, and their respective employees, agents and Subcontractors, in connection with the Development, manufacture or Commercialization of any Licensed Compound or Licensed Products by Licensee in the Territory after the Effective Date; or

(b)

the breach of any of the obligations, covenants, warranties or representations made by Licensee to Licensor under this Agreement;

14.3

Indemnification Procedure.

(a)

For the avoidance of doubt, all indemnification claims in respect of a Licensee Indemnitee or Licensor Indemnitee will be made solely by Licensee or Licensor, respectively.

(b)

A Party seeking indemnification hereunder (“Indemnified Party”) will notify the other Party (“Indemnifying Party”) in writing reasonably promptly after the assertion against the Indemnified Party of any Claim or fact in respect of which the Indemnified Party intends to base a claim for indemnification hereunder (“Indemnification Claim Notice”), but the failure or delay to so notify the Indemnifying Party will not relieve the Indemnifying Party of any obligation or liability that it may have to the Indemnified Party, except to the extent that the Indemnifying Party demonstrates that its ability to defend or resolve such Claim is adversely affected thereby. The Indemnification Claim Notice will contain a description of the Claim and the nature and amount of the Claim (to the extent that the nature and amount of such Claim is known at such time). Upon the request of the Indemnifying Party, the Indemnified Party will furnish promptly to the Indemnifying Party copies of all correspondence, communications and official documents (including court documents) received or sent in respect of such Claim.

(c)

Subject to the provisions of Sections 14.3(d) and 14.3(e), the Indemnifying Party will have the right, upon written notice given to the Indemnified Party within thirty (30) days after receipt of the Indemnification Claim Notice, to assume the defense and handling of such Claim, at the Indemnifying Party’s sole expense, in which case the provisions of Section 14.3(d) will govern. The assumption of the defense of a Claim by the Indemnifying Party will not be construed as acknowledgement that the Indemnifying Party is liable to indemnify any indemnitee in respect of the Claim, nor will it constitute a waiver by the Indemnifying Party of any defenses it may assert against any Indemnified Party’s claim for indemnification. If it is ultimately decided that the Indemnifying Party is not obligated to indemnify or hold an indemnitee harmless from and against the Claim, the Indemnified Party will reimburse the Indemnifying Party for any and all costs and expenses (including attorneys’ fees and costs of suit) and any losses incurred by the Indemnifying Party in its defense of the Claim. If the Indemnifying Party does not give

(d)

Upon assumption of the defense of a Claim by the Indemnifying Party: (i) the Indemnifying Party will have the right to and will assume sole control and responsibility for dealing with the Claim; (ii) the Indemnifying Party may, at its own cost, appoint as counsel in connection with conducting the defense and handling of such Claim any law firm or counsel reasonably selected by the Indemnifying Party; (iii) the Indemnifying Party will keep the Indemnified Party informed of the status of such Claim; and (iv) the Indemnifying Party will have the right to settle the Claim on any terms the Indemnifying Party chooses; provided, however, that it will not, without the prior written consent of the Indemnified Party, agree to a settlement of any Claim which will admit any liability or fault by the Indemnified Party, could harm the Indemnified Party’s reputation or goodwill, could lead to liability or create any financial or other obligation on the part of the Indemnified Party for which the Indemnified Party is not entitled to indemnification hereunder or which admits any wrongdoing or responsibility for the claim on behalf of the Indemnified Party. The Indemnified Party will cooperate with the Indemnifying Party and will be entitled to participate in, but not control, the defense of such Claim with its own counsel and at its own expense. In particular, the Indemnified Party will furnish such records, information and testimony, provide witnesses and attend such conferences, discovery proceedings, hearings, trials and appeals as may be reasonably requested in connection therewith. Such cooperation will include access during normal business hours by the Indemnifying Party to, and reasonable retention by the Indemnified Party of, records and information that are reasonably relevant to such Claim, and making the Indemnified Party and its employees and agents available on a mutually convenient basis to provide additional information and explanation of any records or information provided.

(e)

If the Indemnifying Party does not give written notice to the Indemnified Party as set forth in Section 14.3(c) or fails to conduct the defense and handling of any Claim in good faith after having assumed such, the Indemnified Party may, at the Indemnifying Party’s expense, select counsel reasonably acceptable to the Indemnifying Party in connection with conducting the defense and handling of such Claim and defend or handle such Claim in such manner as it may deem appropriate. In such event, the Indemnified Party will keep the Indemnifying Party timely apprised of the status of such Claim and will not settle such Claim without the prior written consent of the Indemnifying Party, which consent will not be unreasonably withheld. If the Indemnified Party defends or handles such Claim, the Indemnifying Party will cooperate with the Indemnified Party, at the Indemnified Party’s request but at no expense to the Indemnified Party, and will be entitled to participate in the defense and handling of such Claim with its own counsel and at its own expense.

14.4

Mitigation of Loss. Each Indemnified Party will take and will procure that its Affiliates take all such reasonable steps and action as are necessary or as the Indemnifying Party may reasonably require in order to mitigate any Claims (or potential losses or damages) under this Article 14. Nothing in this Agreement will or will be deemed to relieve any Party of any common law or other duty to mitigate any losses incurred by it.

14.5

Special, Indirect and Other Losses. NO PARTY NOR ANY OF SUCH PARTY’S AFFILIATES SHALL BE LIABLE IN CONTRACT, TORT, NEGLIGENCE, BREACH OF STATUTORY DUTY OR OTHERWISE FOR ANY SPECIAL, INDIRECT, INCIDENTAL, PUNITIVE OR CONSEQUENTIAL DAMAGES OR FOR ANY ECONOMIC LOSS OR LOSS OF PROFITS SUFFERED BY THE OTHER PARTY, EXCEPT TO THE EXTENT ANY SUCH DAMAGES ARE

15.

GENERAL PROVISIONS

15.1

Assignment. This Agreement may not be assigned or otherwise transferred (however structured, whether by merger, acquisition, sale of all or substantially all of its assets to which this Agreement relates or otherwise), in whole or in part, nor, except as expressly provided hereunder, may any right or obligation hereunder be assigned or transferred, by either Party without the prior written consent of the other Party; provided, however, that (i) either Party may, without such consent, assign this Agreement and its rights and obligations hereunder, in whole or in part, to any of its Affiliates; provided that the assigning Party shall continue to remain fully responsible for the actions or inactions of such Affiliate, and (ii) either Party may, without such consent, assign this Agreement and its rights and obligations hereunder, to its successor in interest in connection with (x) a Change of Control or (y) a sale of all or substantially all of its assets to which this Agreement relates, or in connection with a merger, acquisition or similar transaction.  Written notice of any permitted assignment of this Agreement shall be promptly provided to the non-assigning Party promptly following consummation and any permitted assignee shall assume all rights and obligations of its assignor under this Agreement. Any permitted assignee will assume all obligations of its assignor under this Agreement. Subject to the terms of this Agreement, this Agreement will be binding upon and inure to the benefit of the Parties and their respective successors, heirs and permitted assigns.

15.2

Extension to Affiliates. Each Party will have the right to extend the rights, immunities and obligations granted in this Agreement to one or more of its Affiliates. All applicable terms of this Agreement will apply to any such Affiliate to which this Agreement has been extended to the same extent as such terms apply to

15.3

Severability. Should one or more provisions of this Agreement become void or unenforceable as a matter of law, then this Agreement will be construed as if such provision were not contained herein and the remainder of this Agreement will be in full force and effect, and the Parties will use their commercially reasonable efforts to substitute for the invalid or unenforceable provision a valid and enforceable provision which conforms as nearly as possible with the original intent of the Parties.

15.4

Governing Law and Jurisdiction. This Agreement will be governed by and construed under the laws of Singapore, without giving effect to the conflicts of laws provision thereof.

15.5

Dispute Resolution.

(a)

In the event of a dispute relating to, arising out of or in any way connected with this Agreement or any term hereof, or the performance by either Party of its obligations hereunder (a “Dispute”), the Parties will refer the Dispute to the Alliance Managers for discussion and resolution. If the Alliance Managers are unable to resolve the Dispute within thirty (30) days after the Dispute is referred to them, either Party may require that the Parties forward the Dispute to the Senior Officers (or designees with similar authority to resolve such Dispute), who will attempt in good faith to resolve the Dispute. If the Senior Officers cannot resolve the Dispute within thirty (30) days after the Dispute is referred to them, either Party will be free to initiate the arbitration proceeding set forth in Section 15.5(b) to resolve the Dispute.

(b)

Any unresolved Disputes between the Parties, whether arising before or after termination of this Agreement, will be resolved by final and binding arbitration. Whenever a Party decides to institute arbitration proceedings, it will give written notice to that effect to the other Party. Arbitration will be held by the International Chamber of Commerce (“ICC”) in accordance with

15.6

Force Majeure. If either Party is prevented from performing its obligations under this Agreement as a result of any contingency beyond its reasonable control (“Force Majeure”), including any actions of governmental authorities or agencies, war, hostilities between nations, civil commotions, riots, sabotage, energy shortages, fire, floods and acts of nature such as typhoons, hurricanes, earthquakes, or tsunamis, the Party so affected will not be responsible to the other Party for any delay or failure of performance of its obligations hereunder, for so long as Force Majeure prevents such

15.7

Waivers and Amendments. The failure of any Party to assert a right hereunder or to insist upon compliance with any particular term of this Agreement will not constitute a waiver of that right or excuse a similar subsequent failure to perform any such term by the other Party. No waiver will be effective unless it has been given in writing and signed by the Party giving such waiver. No provision of this Agreement may be amended or modified other than by a written document signed by authorized representatives of each Party.

15.8

Relationship of the Parties. Nothing contained in this Agreement will be deemed to constitute a partnership, joint venture, or legal entity of any type between Licensor and Licensee, or to constitute one as the agent of the other. Moreover, each Party will not construe this Agreement, or any of the transactions contemplated hereby, as a partnership for any tax purposes. Each Party will act solely as an independent contractor, and nothing in this Agreement will be construed to give any Party the power or authority to act for, bind, or commit the other.

15.9

Non-Solicitation.  Each Party agrees that during the Licensing Term and for twelve (12) months thereafter, each Party will not, either directly or through others, solicit or encourage or attempt to solicit or encourage any employee or consultant of the other Party to terminate his or her relationship with such Party in order to become

15.10

Notices. All notices, consents, waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when: (a) delivered by hand (with written confirmation of receipt); (b) received by the addressee, if sent by an internationally recognized overnight delivery service (receipt requested); or (c) immediately upon electronic delivery with receipt for confirmation of delivery, in each case to the appropriate addresses set forth below (or to such other addresses as a Party may designate by notice):

15.11

Further Assurances. Licensee and Licensor will execute, acknowledge and deliver any and all such other documents and take any such other action as may be reasonably necessary to carry out the intent and purposes of this Agreement.

15.12

Compliance with Law. Each Party will perform its obligations under this Agreement in accordance with all Applicable Laws. No Party will, or will be required to, undertake any activity under or in connection with this Agreement which violates, or which it believes, in good faith, may violate, any Applicable Law, including but not limited to any and all applicable anti-bribery laws such as the United States Foreign Corrupt Practices Act and the Anti-Unfair Competition Law enacted and amended by the People’s Republic of China. To the extent that registration or record-filing of this Agreement with a governmental authority is required under the Technology Import and Export Administrative Regulations of the People’s Republic of China in respect of any of the licenses granted or envisaged hereunder, Licensor shall take necessary steps to register or record-file a redacted version of this Agreement or a summary thereof, using reasonable efforts to seek confidential treatment for the terms of this Agreement or all other Confidential Information, with the relevant governmental authority in consultation with Licensee.

15.13

No Third Party Beneficiary Rights. The provisions of this Agreement are for the sole benefit of the Parties and their successors and permitted assigns, and they will not be construed as conferring any rights to any Third Party (including any third party beneficiary rights).

15.14

Cumulative Remedies. No remedy referred to in this Agreement is intended to be exclusive, but each will be cumulative and in addition to any other remedy referred to in this Agreement or otherwise available under law.

15.15

Expenses. Except as otherwise expressly provided in this Agreement, each Party will pay the fees and expenses of its respective lawyers and other experts and all

15.16

Entire Agreement. This Agreement, together with its Exhibits and schedules, sets forth the entire agreement and understanding of the Parties as to the subject matter hereof and supersedes all proposals, oral or written, and all other prior communications between the Parties with respect to such subject matter. In the event of any conflict between a substantive provision of this Agreement and any Exhibit or schedule hereto, the substantive provisions of this Agreement will prevail.

15.17

Counterparts. This Agreement may be executed in two or more counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. Signatures provided by facsimile transmission or in Adobe Portable Document Format (.pdf) sent by electronic mail shall be deemed to be original signatures.

15.18

Language.  This Agreement is written in English and Chinese with both languages equally binding.