Contract analysis

Section 1.1 Defined Terms As used in this Agreement, the following terms shall have the meanings set forth below: "Affiliate" means, with respect to any Person, any other Person that directly or indirectly controls, is controlled by, or is under common control with such Person, where "control" means ownership, directly or indirectly, of fifty percent (50%) or more of the outstanding voting securities of such Person,

Section 1.2 Rules of Interpretation In this Agreement, unless the context otherwise requires: (a) the singular shall include the plural and vice versa, and the masculine gender shall include the feminine and neuter genders and vice versa; (b) the words "herein," "hereof," "hereunder," and words of similar import shall refer to this Agreement as a whole, including all Schedules and Exhibits hereto, and not to any part

Section 2.1 Exclusive License Grant Subject to the terms and conditions of this Agreement, Licensor hereby grants to Licensee an exclusive (even as to Licensor), royalty-bearing license, with the right to sublicense in accordance with Section 2.3, under the Licensed IP to Develop, manufacture, have manufactured, use, import, export, offer for sale, sell, distribute, promote, market, and otherwise Commercialize Licens

Section 2.2 Retained Rights Notwithstanding the exclusive license granted in Section 2.1, Licensor hereby expressly retains all right, title, and interest in and to the Licensed IP in the Retained Territory, including without limitation the right to develop, manufacture, have manufactured, use, import, export, offer for sale, sell, and Commercialize Licensed Products in the United States, Canada, the European Union a

Section 2.3 Sublicensing (a) Licensee shall have the right to grant sublicenses under the license granted in Section 2.1 in the Territory, subject to the prior written consent of Licensor, which consent shall not be unreasonably withheld, conditioned, or delayed. Licensee shall provide Licensor with a written request for sublicensing consent at least thirty (30) days prior to the intended grant of any sublicense, tog

Section 2.4 No Implied Licenses Except as expressly granted in this Agreement, no license or other right is granted or implied under any patent, patent application, trade secret, know-how, trademark, copyright, or other intellectual property right of either Party, whether by implication, estoppel, or otherwise. Each Party retains all rights not expressly granted to the other Party hereunder.

Section 2.5 Exclusivity Covenant During the Term, Licensor shall not, directly or indirectly, grant to any Third Party a license, option, right of first refusal, or any other right under the Licensed IP in the Territory. Licensor shall not itself develop, manufacture, or commercialize Licensed Products in the Territory except as expressly provided in this Agreement. Licensor shall promptly notify Licensee in writing

Section 3.1 Overview To facilitate effective oversight, coordination, and communication between the Parties regarding the development and commercialization activities contemplated by this Agreement, the Parties shall establish and maintain a Joint Steering Committee ("JSC") and a Joint Patent Committee ("JPC") in accordance with the provisions of this Article 3. Each committee shall operate in accordance with its cha

Section 3.2 Joint Steering Committee (JSC) (a) Establishment and Composition. Within thirty (30) days of the Effective Date, the Parties shall establish the JSC, which shall consist of three (3) representatives designated by Licensor and three (3) representatives designated by Licensee. Each Party's representatives shall be senior employees or officers with sufficient authority and expertise to address the matters wi

Section 3.3 Joint Patent Committee (JPC) (a) Establishment and Composition. Within thirty (30) days of the Effective Date, the Parties shall establish the JPC, which shall consist of two (2) representatives designated by Licensor and two (2) representatives designated by Licensee. Each Party's representatives shall be employees or officers with expertise in patent prosecution, patent strategy, and intellectual proper

Section 3.4 Limitations on Committee Authority Neither the JSC nor the JPC shall have the authority to amend, modify, or waive any provision of this Agreement or any ancillary agreement executed in connection herewith. The authority of each committee shall be advisory and coordinative in nature, except to the extent that specific decision-making authority is expressly granted to such committee under this Agreement. N

ARTICLE 4 — DEVELOPMENT AND REGULATORY

Section 4.1 Development Obligations Licensee shall use Commercially Reasonable Efforts to Develop Licensed Products in the Territory in accordance with the Development Plan attached hereto as Schedule E. Licensee shall bear all costs and expenses associated with the Development of Licensed Products in the Territory, including without limitation costs associated with clinical trials, regulatory submissions, manufactur

Section 4.2 Development Plan The Development Plan is attached hereto as Schedule E and outlines, among other things, the Phase III trial design (including study endpoints, randomization protocol, and blinding methodology), patient enrollment targets, the countries in which clinical trial sites will be established, the anticipated timelines for regulatory submissions to the NMPA and PMDA, and the key milestone trigger

Section 4.3 Regulatory Responsibilities (a) Licensee shall be the sole regulatory sponsor and shall hold (or cause its applicable Affiliate to hold) all INDs, NDAs, BLAs, and other regulatory filings for Licensed Products in each country of the Territory. Licensee shall be responsible for all regulatory filings, correspondence, communications, and interactions with Regulatory Authorities in the Territory, and shall b

Section 4.4 Regulatory Data Sharing (a) All regulatory data, clinical data, non-clinical data, CMC data, and regulatory filings generated by or on behalf of Licensee in the Territory during the Term shall be promptly shared with Licensor for Licensor's use in connection with global regulatory purposes, including regulatory submissions in the Retained Territory. Licensee hereby grants to Licensor a non-exclusive, roya

Section 4.5 Clinical Supply Licensor shall supply, or cause its designated CMO (initially Alkerra Manufacturing Inc.) to supply, API and reference standard to Licensee for use in clinical trials of Licensed Products in the Territory during the first three (3) years following the Effective Date (i.e., through October 20, 2026), in accordance with the terms and conditions of the Supply Agreement. The supply price for A

Section 4.6 Diligence Milestones Licensee shall use Commercially Reasonable Efforts to achieve First Commercial Sale of at least one Licensed Product in at least one Major Market Country within five (5) years of the Effective Date (i.e., on or before October 20, 2028). For purposes of this Agreement, "Major Market Country" means each of the People's Republic of China, Japan, the Republic of Korea, and Australia. In t

Section 5.1 Upfront Payment In partial consideration for the rights and licenses granted hereunder, Licensee shall pay to Licensor a one-time, non-refundable, non-creditable upfront payment of Eighteen Million United States Dollars ($18,000,000) (the "Upfront Payment"). The Upfront Payment shall be made in accordance with the Escrow Agreement entered into by the Parties with Velthorn National Bank, N.A. (the "Escrow

Section 5.2 Development Milestone Payments Licensee shall pay to Licensor the following non-refundable, non-creditable development milestone payments within thirty (30) days following the first achievement of each of the corresponding development milestone events, as applicable: Each development milestone payment shall be payable only once upon the first occurrence of the applicable milestone event, regardless of the

Section 5.3 Regulatory Milestone Payments Licensee shall pay to Licensor the following non-refundable, non-creditable regulatory milestone payments within thirty (30) days following the first achievement of each of the corresponding regulatory milestone events: Each regulatory milestone payment shall be payable only once upon the first occurrence of the applicable milestone event for the first Licensed Product to ach

Section 5.4 Commercial / Sales Milestone Payments Licensee shall pay to Licensor the following non-refundable, non-creditable commercial milestone payments within forty-five (45) days following the end of the calendar year in which Annual Net Sales of Licensed Products in the Territory first exceed the applicable threshold: Each commercial milestone payment shall be payable only once, upon the first calendar year in

Section 5.5 Total Deal Value The total potential consideration payable by Licensee to Licensor under this Agreement consists of: (a) the Upfront Payment of $18,000,000; (b) aggregate development milestone payments of up to $32,000,000; (c) aggregate regulatory milestone payments of up to $25,000,000; and (d) aggregate commercial milestone payments of up to $45,000,000, for a total of up to One Hundred Twenty Million

Section 5.6 Royalties on Net Sales (a) During the Royalty Term, Licensee shall pay to Licensor tiered royalties on Annual Net Sales of Licensed Products in the Territory, calculated on an incremental (marginal) basis as follows: (b) For the avoidance of doubt, the royalty rates set forth above shall apply only to the incremental portion of Annual Net Sales within each respective tier. By way of example, if Annual Net

Section 5.7 Royalty Term, Adjustments, and Minimum Royalty (a) Royalty Term. The obligation to pay royalties under Section 5.6 shall continue, on a country-by-country basis, for the period commencing on the date of First Commercial Sale of a Licensed Product in such country and ending on the later of: (i) the date of expiration of the last-to-expire Valid Claim of a Licensed Patent Covering such Licensed Product in s

Section 5.8 Most Favored Nation Pricing (a) MFN Obligation. Licensee shall not, and shall cause each of its Affiliates and sublicensees not to, offer, sell, or otherwise make available Licensed Products in any country of the Territory at a net price (calculated as Net Sales divided by units sold for the applicable dosage strength and comparable pack size) that is more than fifteen percent (15%) below the lowest net p

Section 5.9 Payment Terms (a) All payments due under this Agreement shall be made in United States Dollars (US$) by wire transfer of immediately available funds to the bank account(s) designated in writing by Licensor from time to time. Licensor shall provide Licensee with written wire transfer instructions at least ten (10) business days prior to the first payment due hereunder, and shall promptly notify Licensee in

Section 5.10 Taxes and Withholding (a) All payments under this Agreement are inclusive of, and subject to, all applicable withholding taxes. Licensee shall withhold and remit to the appropriate governmental authority any and all withholding taxes required to be withheld from payments to Licensor under Applicable Law, and shall provide Licensor with official tax receipts or other documentation evidencing the payment o

Section 5.11 Sublicense Income Licensee shall pay to Licensor fifty percent (50%) of all Sublicense Income received by Licensee or its Affiliates from sublicensees, net of Licensee's documented, verifiable out-of-pocket development costs (excluding internal costs and overhead) directly and solely attributable to the development of Licensed Products in the sublicensee's specific territory. Such payments shall be due w