Third Amended and Restated Supply and License Agreement, dated December 17, 2018, by and among Mayne Pharma, Mayne Pharma International and the Company

Table of contents

Details

Agreed terms

1.

1.1

1.2

1.3

2.

2.1

2.2

3.

3.1

3.2

3.3

3.4

3.5

3.6

4.

4.1

4.2

4.3

4.4

5.

5.1

5.2

5.3

5.4

5.5

6.

6.1

6.2

6.3

6.4

7.

7.1

7.2

7.3

7.4

7.5

8.

8.1

8.2

8.3

9.

9.1

9.2

9.3

10.

10.1

10.2

10.3

10.4

11.

11.1

11.2

11.3

11.4

11.5

12.

12.1

12.2

12.3

12.4

13.

13.1

13.2

13.3

14.

15.

15.1

15.2

15.3

16.

16.1

16.2

16.3

16.4

16.5

16.6

16.7

16.8

17.

17.1

17.2

17.3

17.4

18.

18.1

18.2

18.3

18.4

18.5

18.6

18.7

18.8

18.9

19.

19.1

19.2

19.3

19.4

19.5

20.

20.1

20.2

20.3

20.4

20.5

20.6

20.7

20.8

21.

21.1

21.2

22.

22.1

22.2

23.

24.

24.1

24.2

24.3

24.4

24.5

24.6

24.7

24.8

25.

25.1

25.2

26.

26.1

26.2

26.3

26.4

26.5

26.6

26.7

26.8

26.9

26.10

26.11

26.12

26.13

26.14

26.15

Schedule 1 – Agreement details

Schedule 2 – BCCNS Field

Schedule 3 – Trial Master File for Study HP2001

Schedule 4 – Product and Product Specification

Schedule 5 – Economic details

Schedule 6 – Qualification of Backup Manufacturer

Schedule 7 – Licence of HPPI Licensed Rights

1538 Main North Road, Salisbury South, SA 5106 Australia

Facsimile: +61 3 9614 7022

324 South Hyde Park Avenue #350, Tampa, FL 33606, United States

Facsimile: +1 ###-###-####

Mayne Pharma International Pty Ltd, a company incorporated in Australia (ACN 007 870 984) (MPI) and HPPI entered into that certain Supply and License Agreement dated on or about September 3, 2013 (the “Original Agreement”).

MPI and HPPI entered into that certain Amendment No. 1 to the Original Agreement, dated on or about December 17, 2013 (“Amendment No. 1”).

MPI and HPPI entered into that certain Amendment No. 2 to the Original Agreement, dated on or about March 6, 2014 (“Amendment No. 2”).

MPI assigned, and Mayne Pharma assumed, the rights and obligations under the Original Agreement as amended by Amendment No. 1 and Amendment No. 2.

Mayne Pharma had the right to terminate the Original Agreement (as amended), if HPPI did not obtain equity funding of at least Five Million Dollars (USD5 million) or lesser amount as agreed to by the parties, on or before May 30, 2014. In consideration of Mayne Pharma not exercising such termination right, HPPI agreed to issue to Mayne Pharma in a private placement certain stock under the Mayne Pharma Purchase Agreement (as defined) and to enter into related agreements with Mayne Pharma, Hedgepath, LLC (as defined) and others.

Pursuant to clause 26.8 of the Original Agreement, Mayne Pharma and HPPI amended and replaced, in their entirety, their agreements as set forth in the Original Agreement, Amendment No. 1 and Amendment No. 2, with the agreements, terms, conditions, representations and warranties set forth in that certain Amended and Restated Supply and License Agreement, dated on or about June 24, 2014 (“First Amended and Restated Supply and License Agreement”).

MPI and HPPI entered into that certain Amendment No. 1 to the First Amended and Restated Supply Agreement, with effect from September 19, 2014 (“Amendment No. 1 to the First Amended and Restated Supply and License Agreement”).

Pursuant to clause 26.8 of the First Amended and Restated Supply and License Agreement, in connection with Mayne Pharma’s investment of Two Million Five Hundred Thousand Dollars (USD2.5 million) in HPPI under the 2015 SPA (as defined), Mayne Pharma and HPPI desire to amended and replaced, in their entirety, their agreements as set forth in the First Amended and Restated Supply and License Agreement and Amendment No. 1 to the First Amended and Restated Supply and License Agreement, with the agreements, terms, conditions, representations and warranties set forth in that certain Second Amended and Restated Supply and License Agreement, dated on or about May 15, 2015 (“Second Amended and Restated Supply and License Agreement”).

The Second Amended and Restated Supply and License Agreement was amended by Amendment No. 1 on November 22, 2016 (“Amendment No. 1 to the Second Amended and Restated Supply and License Agreement”).

In exchange for Mayne Pharma agreeing to invest up to Five Million Dollars (USD5,000,000) in HPPI under a Securities Purchase Agreement dated January 8, 2018 (as amended, the “2018 SPA”), the Second Amended and Restated Supply and License Agreement was amended by Amendment No. 2 on January 10, 2018 (“Amendment No. 2 to the Second Amended and Restated Supply and License Agreement”).

Pursuant to that certain Agreement, dated as of even date herewith, by and among, HPPI, Mayne Pharma and MPI (December 2018 Agreement) and clause 26.8 of the Second Amended and Restated Supply and License Agreement, as amended, Mayne Pharma and HPPI desire to amend and replace, in their entirety, their agreements as set forth in the Second Amended and Restated Supply and License Agreement, Amendment No. 1 to the Second Amended and Restated Supply and License Agreement and Amendment No. 2 to the Second Amended and Restated Supply and License Agreement, with the agreements, terms, conditions, representations and warranties set forth herein.

Defined terms & interpretation

Defined terms

Affiliates of HPPI will not include Mayne Pharma nor any person that would otherwise be an Affiliate of HPPI as a result of Mayne Pharma’s Control of HPPI; and

Affiliates of Mayne Pharma will not include HPPI nor any person that would otherwise be an Affiliate of Mayne Pharma as a result of Mayne Pharma’s Control of HPPI.

for receiving a notice under clause 22, a day that is not a Saturday, Sunday, public holiday or bank holiday in the place where the notice is received; and

for performing an obligation or exercising a right by Mayne Pharma, a day that is not a Saturday, Sunday, bank holiday or public holiday in Melbourne, Australia;

for performing an obligation or exercising a right by HPPI, a day that is not a Saturday, Sunday, bank holiday or public holiday in New York, New York, USA; and

for all other purposes, a day that is not a Saturday, Sunday, bank holiday or public holiday in Melbourne, Australia.

any prostate cancer, prostatic intraepithelial neoplasia (IEN) and benign prostatic hyperplasia,

any lung cancer and atypical adenomatous hyperplasia, and

familial adenomatous polyposis, colorectal polyps and Barett’s esophagus.

any act or omission of a third person (except for an act or omission of any Affiliate or contractor, or in relation to HPPI, any Sub Licensee);

fire, flood, earthquake, elements of nature or act of God; or

riot, civil disorder, rebellion or revolution.

inventions, know how, patents, copyrights, designs, trade and service marks, logos, rights to data and any right to have information kept confidential; and

any application or right to apply for registration of any of the rights referred to in paragraph (a),

comprising, in respect of patent rights, ***, all in the name of Mayne Pharma, together with and any resulting issued patents in the Territory, and all continuations-in-part, continuations or divisions of any such patent or patents, or substitutes of it, and any reissues, re-examinations, extensions, or renewals of the same, in the Territory;

comprising raw or audited pre-clinical or clinical trial or other data generated or owned by Mayne Pharma related to the Product anywhere in the world, or licensed by Mayne Pharma with the right to sublicense to HPPI;

comprising any Intellectual Property Rights in the Field relating to the Product that are jointly developed by HPPI and Mayne Pharma and their respective Affiliates and Personnel after the Effective Date; and

excluding rights in respect of trade and service marks and logos.

outside the Territory in any field, or

in the Territory outside the Field.

Interpretation

the singular includes the plural and vice versa, and a gender includes other genders;

another grammatical form of a defined word or expression has a corresponding meaning;

a reference to a clause, paragraph, schedule or annexure is to a clause or paragraph of, or schedule or annexure to, this Agreement, and a reference to this Agreement includes any schedule or annexure;

a reference to a document or instrument includes the document or instrument as novated, altered, supplemented or replaced from time to time;

a reference to AUD is to Australian dollars, to USD is to United States dollars, to GBP is to British pounds and to EUR is to euros;

a reference to time is to Melbourne, Australia time;

a reference to a party is to a party to this Agreement, and includes the party’s executors, administrators, successors and permitted assigns and substitutes;

a reference to a person includes a natural person, partnership, corporation, limited liability company, trust, association, governmental or local authority or agency or other entity;

a reference to a statute, ordinance, code or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;

the meaning of general words is not limited by specific examples introduced by including, for example or similar expressions;

a rule of construction does not apply to the disadvantage of a party because the party was responsible for the preparation of this Agreement or any part of it;

if a day on or by which an obligation must be performed or an event must occur is not a Business Day, the obligation must be performed or the event must occur on or by the next Business Day;

headings are for ease of reference only and do not affect interpretation; and

clauses 1 and 26 prevail over a Schedule to the extent of any inconsistency.

Amendment and Restatement

Term

Initial Term

Extension

Licence

Licence to exploit the Product in the Territory

to conduct the activities in the Territory in the Field under the Development Plan; and

to import, promote, market, sell and distribute the Product in the Territory in the Field,

comprises the right to copy and exploit the MP Licensed Rights and to use the Trade Mark, to the extent reasonably necessary or desirable to exploit the Product in the Field in the Territory;

may only be assigned or sub licensed in accordance with this Agreement or otherwise with the prior written consent of Mayne Pharma; and

excludes the right to manufacture, except by a Backup Manufacturer in accordance with Schedule 6.

HPPI obligations

obtain from Mayne Pharma all its requirements for the Product, including for clinical trials, importation, promotion, marketing, sale or distribution in the Territory;

not directly itself, or indirectly through any third party:

research, develop, manufacture, import, promote, market, sell, distribute or otherwise have any commercial interest or involvement in any Competing Product in the Territory during the Term and for *** after the end of the Term; or

sell or distribute the Product to any other party which it knows, or has reasonable grounds for suspecting, will sell or distribute the Product outside the Territory or outside the Field;

import, promote, market, sell or distribute the Product outside the Territory or outside the Field; and

refer to Mayne Pharma all enquiries, sales leads, prospects and other information HPPI may receive concerning sales and prospective sales of the Product outside the Territory or the Field.

Supporting the exclusive licence

Sub licensing the MP Licensed Rights

includes obligations on that third party that relate to use and disclosure of Intellectual Property Rights and Confidential Information at least equivalent to those imposed on the HPPI under this Agreement, without any right of further disclosure or sub license;

ends at the same time as this Agreement ends (whether by expiry or termination); and

includes an assignment to HPPI of all Intellectual Property Rights that relate to the Product,

BCCNS Field

Copies of documents, data and other information embodying the MP Licensed Rights

Development

Development Plan and Budget

On ***, HPPI will provide to Mayne Pharma a Development Plan and Budget, that reasonably demonstrates HPPI’s compliance with its obligations under clauses 5.1(a) and 12.3.

HPPI will conduct the activities set out in, and in accordance with, the Development Plan and further in accordance with the Budget.

***, the JDC will review the Development Plan and Budget and acting in good faith, may provide recommendations to HPPI for amendment.

JDC

From and after the Effective Date, the parties will continue to utilize a joint development committee (JDC):

to make recommendations to HPPI on research, development and registration activities relating to the exploitation of the Product in the Field in the Territory, including medico regulatory strategy;

to review progress against the current Development Plan and Budget and recommend amendments to HPPI;

to review HPPI clinical trial protocols relating to the Product in the Field before they are finalised (which protocols HPPI must provide to the JDC);

to review the progress of any clinical trial relating to the Product; and

to share and discuss clinical data and developments related to the Licensed IPR, including without limitation in furtherance of clause 3.6 and item 2 of Schedule 7,

Each of the parties will appoint two representatives to the JDC. In addition, from time to time the parties may, by agreement in writing, invite additional representatives from either party, or industry experts or consultants, to participate in certain meetings on specific issues as needed, at HPPI’s cost and expense. A representative of and designated by HPPI will be the chairperson of the JDC.

Each of the parties may change its representatives at any time during the term of this Agreement by notice to the other party, except that Nicholas J. Virca will be a representative of HPPI from the Start Date unless or until it is no longer possible for reasons outside HPPI’s reasonable control.

Each member of the JDC (including the chairperson) shall be entitled to one (1) vote on all matters which must be presented under this Agreement (or which are otherwise presented) to the JDC for approval, with the chairperson to have a casting vote that resolves any deadlock. The JDC shall fully abide by such vote or action in the conduct of its affairs, subject always to clause 4.2(a) and the continuing authority of the board of directors of HPPI.

The JDC may hold meetings in person, by teleconference or by video conference:

on a regular basis until the Actual Launch Date, but not less than one per Quarter;

as otherwise reasonably requested by the parties.

The site, date and proposed agenda of any meeting of the JDC must be determined by agreement of the members of the JDC.

Development decisions

Previous Mayne Pharma support

From May 15, 2015 until December 31, 2015, HPPI acknowledges that Mayne Pharma provided to HPPI the following services in connection with the exploitation of the Product in the Territory in the Field and the conduct of the Development Plan, comprising:

coordinating the JDC meetings;

directing the conduct of the entire clinical program for the Product, subject to the oversight and approval by the JDC and, as applicable hereunder or for other matters binding on HPPI, the HPPI board of directors;

medico regulatory strategy, including directing a third party to prepare the regulatory documents to progress and file any Marketing Authorisation, including any application for, maintenance of or variation of, any Marketing Authorisation, for the Product;

intellectual property strategy; and

other administrative services as agreed with HPPI,

Marketing Authorisation

Obtaining and maintaining Marketing Authorisations in the Field

actively seek, in coordination with the JDC and Mayne Pharma and at its own cost and expense, and use reasonable commercial efforts to obtain all Marketing Authorisations in its own name;

pay fees or charges in respect of the application for all Marketing Authorisations, maintenance of all Marketing Authorisations and the making of any variation to all Marketing Authorisations; and

comply with the requirements of any Relevant Regulatory Authority within the Territory, including in connection with any Marketing Authorisation and all reporting obligations.

Obtaining and maintaining Marketing Authorisations in the BCCNS Field

actively seek, at its own cost and expense, and use reasonable commercial efforts to obtain an MP Marketing Authorisation in the Territory for an MP Product in the BCCNS Field in its own name;

pay fees or charges in respect of the application for any MP Marketing Authorisations, maintenance of all MP Marketing Authorisations and the making of any variation to all MP Marketing Authorisations; and

comply with the requirements of any Relevant Regulatory Authority within the Territory, including in connection with any MP Marketing Authorisation and all reporting obligations.

Assistance by Mayne Pharma

assist HPPI in connection with any Marketing Authorisation, including any application for, maintenance of or variation of, any Marketing Authorisation; and

in response to a request by HPPI, provide any documents required by HPPI in connection with any Marketing Authorisation.

Assistance by HPPI

assist Mayne Pharma in connection with any MP Marketing Authorisation, including any application for, maintenance of or variation of, any MP Marketing Authorisation; and

in response to a request by Mayne Pharma, provide any documents required by Mayne in connection with any MP Marketing Authorisation.

Failure to obtain an approved NDA in the Field

to convert the licence in clause 3.1 to a non-exclusive licence; and

to take a non-exclusive, perpetual, irrevocable royalty free licence to copy and exploit the HPPI Licensed Rights inside the Territory in the Field,

Manufacture and supply of Product

Forecasts

Starting *** before the anticipated Actual Launch Date, ***, HPPI must provide Mayne Pharma with a forecast of its monthly requirements for the Product for the following Forecast Period (Forecast).

The first Forecast will include ***. For each subsequent Forecast:

***; and

***.

Orders

HPPI must provide Mayne Pharma with a purchase order setting out the quantities of the Product, desired delivery date and delivery instructions (Order), at least ***.

Each Order must be for at least the Minimum Order Quantity, and any amount above the Minimum Order Quantity for whole multiples of any incremental order quantity specified in item 1 of Schedule 5, unless the parties agree otherwise in writing before an Order is placed.

Within *** of receipt by Mayne Pharma of an Order, Mayne Pharma must confirm its acceptance in writing and notify HPPI of the expected date of delivery (Delivery Date) of the Product. Without limitation, Mayne Pharma may refuse to confirm any quantity of Orders in a Quarter to the extent they exceed ***% of the most recent Forecast provided by HPPI for that Quarter.

Mayne Pharma agrees to use reasonable commercial efforts:

to provide a Delivery Date *** after the delivery date specified in the Order; and

to supply the Order by the Delivery Date.

No Order amends this Agreement unless HPPI expressly states in the Order that it seeks to amend this Agreement, and Mayne Pharma agrees in writing to the Order.

Manufacture; Failure to Supply

Mayne Pharma will manufacture the Product in accordance with all confirmed Orders received from HPPI.

In the situation where Mayne Pharma is not able to supply Product, or Mayne Pharma anticipates that it will be unable to supply Product to HPPI in satisfaction of HPPI’s Orders or forecasted Orders, Mayne Pharma shall use reasonable commercial efforts:

to inform HPPI in a timely manner about such situation and the details causing such situation; and

to provide HPPI with a reasonable estimate of the length and extent of production interruption or other issue affecting Mayne Pharma’s satisfaction of HPPI’s Product demand.

Backup manufacturer

Payments

HPPI Payments

Review of Prices

Mayne Pharma has the right to review and vary any Floor Price set out in Schedule 5 by giving *** notice to HPPI, to reflect any changes in:

***;

***;

***.

Mayne Pharma will consult with HPPI during the *** period of notice of a variation under clause 7.2.

Mayne Pharma Payments

The parties acknowledge that notwithstanding clause 3.3, there is a risk that Mayne Pharma may, directly itself or indirectly through any third party, sell an Alternate Product in the Territory in the Field as a result of off label use (Off Label Sales).

If HPPI becomes aware of any Off Label Sales in any ***, it must notify Mayne Pharma promptly, and in any event, no later than ***, and provide Mayne Pharma with its evidence of such Off Label Sales.

Prior to a Marketing Authorisation being obtained by HPPI, any Affiliate or Sub Licensee, within *** after receipt of a notice from HPPI under clause 7.3(b), Mayne Pharma must pay to HPPI a cash royalty of *** on gross sales up to *** and *** on gross sales over *** for the relevant Quarter for the Alternate Product sold through Off Label Sales ***.

After a Marketing Authorisation is obtained by HPPI, any Affiliate or Sub Licensee, if Off Label Sales of any Alternate Product exceed ***, then the parties agree to enter into a good faith negotiation to enter into an arrangement under which they will share profits from Off Label Sales of any Alternate Product ***.

Payment terms

in the currency specified in Schedule 5 and where necessary, converted:

in respect of any payment covering a Quarter, at the average daily exchange rate for the applicable Quarter as published by the financial institution specified in Schedule 5; and

otherwise, at the daily exchange rate quoted by the financial institution specified in Schedule 5 on the date of payment;

to the bank account of the other party listed on the relevant invoice, with the party making payment to bear the costs of any such remittance; and

in the case of payments due to Mayne Pharma, to Mayne Pharma or its nominee as specified on the relevant invoice.

Reimbursement

Delivery, risk and title

Delivery

Risk

Title

Acceptance of Product

Certificate of Analysis

Defective Product

HPPI must notify Mayne Pharma within *** of delivery of the Product if HPPI reasonably believes any of the Product does not conform to the Product Specification (Defective Product).

If HPPI gives notice under clause 9.2(a), the parties agree to consult with each other to resolve the issue (during which time Mayne Pharma may conduct its own retention sample testing). If the discrepancy is not resolved within a further *** from the receipt of the notice, the parties agree to appoint (at HPPI’s expense) an independent analyst, acceptable to both parties, that will carry out tests on representative samples taken from such shipment, and the results of such tests will be binding on the parties.

If HPPI does not notify Mayne Pharma in accordance with clause 9.2(a), then HPPI will be deemed to have accepted the Product at the end of the *** period after delivery of the Product.

If the independent analyst determines that the Defective Product does not conform to the Product Specification and as long as the Product has been transported, handled and stored in accordance with the Marketing Authorisation and all reasonable directions of Mayne Pharma once the Product has left Mayne Pharma’s facility, then:

Mayne Pharma must, at its expense, replace any such Defective Product and reimburse HPPI for the costs of the independent analyst; and

all quantities of Defective Product must, at Mayne Pharma’s election and expense be either:

returned to Mayne Pharma at an address notified by Mayne Pharma, and packed and shipped according to instructions provided by Mayne Pharma; or

destroyed by HPPI under Mayne Pharma’s direction.

If:

the independent analyst determines that the Defective Product does conform to the Product Specification; or

the Product has not been transported, handled and stored in accordance with the Marketing Authorisation and all reasonable directions of Mayne Pharma once the Product has been delivered to HPPI in accordance with this Agreement,

Sole remedy

Complaints

Handling customer complaints

Notification of complaints

Adverse Drug Events

Supplementary agreements

For Product supplied for clinical trial use, the parties will enter into an agreement outlining the party’s responsibilities with respect to the use of the Product for that purpose.

The parties must execute a Safety Data Exchange Agreement and Quality Agreement at least *** before the Actual Launch Date.

This Agreement prevails to the extent of any inconsistency between it and the Safety Data Exchange Agreement or the Quality Agreement. To avoid doubt, clause 10.1 to 10.3 do not limit any obligations under the Safety Data Exchange Agreement and Quality Agreement.

Recalls

Notice of recall

Directing that the Product be recalled

Administering a recall

Cost of the recall

Submission to independent analysis

Performance obligations

Business Plan

At least *** before the anticipated Actual Launch Date, HPPI must provide a business plan to Mayne Pharma in connection with the distribution of Product in the Territory in the Field outlining the sales and marketing of the Product in the Territory from the Actual Launch Date until the end of *** later, which plan must include market situational analysis, market segmentation, targeting and position, marketing strategies and selling strategies.

After the Actual Launch Date, the parties must meet *** to review HPPI’s Business Plan outlining the sales and marketing of the Product in the Territory in the Field for the following ***. In developing the Business Plan, HPPI will use *** or similar locally sourced data, provided such data are available. The parties will discuss such Business Plan in good faith and HPPI may amend such Business Plan following the discussions.

If HPPI fails to update the Business Plan in accordance with clause 12.1(b), the then current Business Plan will continue until updated in accordance with that clause.

HPPI will use reasonable commercial efforts to achieve the objectives in the Business Plan.

Promotional Material

HPPI is responsible for all sales, distribution, public relations, medical education and similar expenses related to HPPI’s promotion and marketing of the Product in the Territory in the Field.

Mayne Pharma will, at its own expense, provide to HPPI information relating to the Product and promotional information available to Mayne Pharma which HPPI reasonably requires for the promotion and marketing of the Product in the Territory in the Field but only to the extent that Mayne Pharma has the right to provide such information.

HPPI will provide to Mayne Pharma at Mayne Pharma’s expense information relevant to Mayne Pharma’s business outside the Territory and in the Territory, outside the Field.

HPPI must make available to Mayne Pharma samples of all materials (including all advertisements, promotions and other marketing material) used by it in respect of the Product, and grants to Mayne Pharma a non-exclusive, perpetual, irrevocable, royalty free licence to use those materials in connection with the importation, promotion, marketing, sale or distribution of the Product outside the Territory and in the Territory, outside the Field, which licence is capable of sub license to any Affiliate or licensee of Mayne Pharma.

Efforts to maximise sales

Minimum Annual Volumes

HPPI will purchase in each Commercial Year at least the Minimum Annual Volumes as agreed to by the parties in accordance with Schedule 5 hereof.

If, in any Commercial Year, HPPI purchases less than the Minimum Annual Volumes, HPPI may elect to pay to Mayne Pharma the difference between the aggregate Prices paid for the volume of Product actually purchased for that Commercial Year and the value of the Minimum Annual Volumes for that Commercial Year, within *** of the end of that Commercial Year.

If, in any Commercial Year, HPPI purchases less than the Minimum Annual Volumes and has not elected to pay to Mayne Pharma the amount under clause 12.4(b) within *** of the end of the Commercial Year, then Mayne Pharma may, with immediate effect by notice to HPPI, terminate this Agreement.

Compliance with laws and regulations

HPPI’s obligations

promptly obtain and maintain as and when required all necessary registrations, permits, approvals and licences in respect of HPPI’s activities under this Agreement;

advise Mayne Pharma of any matters necessary or relevant to be known by Mayne Pharma to ensure that it manufactures the Product in compliance with all applicable laws, rules and regulations;

conduct the activities under the Development Plan, and import, promote, market, sell and distribute the Product in accordance with all laws, rules and regulations, Good Distribution Practice and any Marketing Authorisation; and

transport, handle and store the Product in accordance with any Marketing Authorisation and all reasonable directions specified by Mayne Pharma not inconsistent with any Marketing Authorisation.

Mayne Pharma’s obligations

obtain and maintain, as and when required, all necessary registrations, permits, approvals and licences in respect of Mayne Pharma’s activities under this Agreement, including in respect of the manufacture of the Product in Australia;

manufacture the Product in accordance with all laws in Australia (or such other jurisdiction in which the Product is manufactured) and the Marketing Authorisation;

manufacture the Product in accordance with Good Manufacturing Practices;

ensure that Mayne Pharma’s premises comply with standards stipulated by relevant State or Commonwealth authorities of Australia; and

transport, handle and store the Product in accordance with all laws and Marketing Authorisations.

Anti-corruption

Without limitation, each party represents that it is now in compliance with, and will at all times remain in compliance with, all applicable laws and regulations relating to anti-corruption in Australia and in the Territory (including the US Foreign Corrupt Practice Act), as well as the UK Bribery Act 2010 and related regulations, and any other applicable anti-corruption laws prohibiting bribery or other forms of corruption, including money laundering, within the public and private sectors.

Except as disclosed in writing, each party warrants that:

it does not have any interest which directly or indirectly conflicts with its proper and ethical performance of this Agreement; and

it will maintain arms-length relations with all third parties (including government officials) with which it deals for, or on behalf of, the other party.

Inspection

Representations and warranties

Legal capacity and relationships

it is a corporation organised and validly existing under the laws of its jurisdiction of incorporation and has the legal capacity and authority to enter this Agreement and perform its obligations under this Agreement; and

this Agreement is a valid and binding obligation of that party enforceable in accordance with its terms, and it will not become a party to any agreement in conflict with this Agreement.

Mayne Pharma warranties

Mayne Pharma represents and warrants that the Product supplied to HPPI under this Agreement:

will conform in all material respects to the Product Specification; and

will be manufactured in conformity with Good Manufacturing Practice, in accordance with all Marketing Authorisations and in accordance with all laws in Australia.

Mayne Pharma represents and warrants that it is the lawful and exclusive owner of the entire right, title and interest in and to all MP Licensed Rights (except to the extent such rights are licensed to Mayne Pharma with the right to grant sub licenses).

To the extent permitted by law, Mayne Pharma makes no other representations or warranties, express or implied, with respect to the Product or this Agreement. In particular:

Mayne Pharma does not warrant that the importation or sale of the Product in the Territory will not infringe the Intellectual Property Rights of any third party; and

except as expressly provided for in clause 4.4, Mayne Pharma provides no warranties in respect of the provision of the services referred to in clause 4.4.

HPPI warranties

represents and warrants that:

as at the Start Date:

HPPI is successor by merger to Commonwealth Biotechnologies, Inc, a Virginia corporation;

the Amended Plan of Reorganization of CBI (the Plan), dated January 4, 2013, and filed in In re: Commonwealth Biotechnologies, Inc., Case No. 11-30381-KRH, U.S. Bankruptcy Court, E.D. Virginia (the Case), has been confirmed pursuant to a final and non-appealable order of the bankruptcy court;

HPPI has delivered a true, correct and complete copy of the Plan with all amendments to Mayne Pharma;

the “Effective Date”, as defined in the Plan, has occurred and is August 12, 2013 and HPPI has taken all actions reasonable and necessary to formally close the Case;

there are no voting trusts, proxies, or other agreements or understandings with respect to the voting of the capital stock of HPPI; and

the HP LLC Patents have been irrevocably assigned to HPPI on a royalty free basis;

it will use reasonable commercial efforts to maintain all warehousing, sales, personnel and facilities required to perform its obligations under this Agreement; and

it is the lawful and exclusive owner of the entire right, title and interest in and to all HPPI Licensed Rights (except to the extent such rights are licensed to HPPI with the right to grant sub licenses).

Liability, indemnity and insurance

No exclusion or limitation

Exclusion and disclaimer of implied obligations

Limitation of liability regarding matters other than Non-Excludable Obligations

***;

***; and

***,

Indemnity

the research, development or registration activities relating to the Product, directly or indirectly, by HPPI;

the importation, promotion, marketing, sale or distribution of the Product, directly or indirectly, by HPPI;

the use or effects of such Product;

to avoid doubt and without limitation, any actual or alleged infringement of Intellectual Property Rights (but excluding the MP Licensed Rights) arising from any of activities, use or effects referred to in clauses 16.4(a) to 16.4(c),

HPPI Insurance

HPPI must take out, at its own cost, adequate insurance cover for the Term (and in the case of a claims based policy, for *** after), with reputable insurers to the reasonable satisfaction of Mayne Pharma, in respect of its liabilities under this Agreement and its activities contemplated by this Agreement, which:

covers each of HPPI, Mayne Pharma and its Personnel for their respective rights, interests and liabilities (to avoid doubt, in whatever country the liability arises); and

notes Mayne Pharma’s interest under the policy.

Without limiting clause 16.5(a):

for such period as there is a Mayne Pharma appointee to the board of directors of HPPI, HPPI must take out, at its own cost, adequate director and officer liability insurance cover;

clinical trial insurance which provides coverage for at least *** for each occurrence and *** in the aggregate or such other level of cover as agreed in writing by the parties, acting reasonably, and which covers each of HPPI, Mayne Pharma and its Personnel for their respective rights, interests and liability arising directly or indirectly from or in respect of the conduct of any clinical trial conducted by or on behalf of HPPI for the Product; and

from the Actual Launch Date, HPPI must effect product and public liability insurance which provides coverage for at least *** for each occurrence, and which covers each of HPPI, Mayne Pharma and its Personnel for their respective rights, interests and liabilities arising directly or indirectly from or in respect of:

the research, development or registration activities relating to the Product, directly or indirectly, by HPPI;

the importation, promotion, marketing, sale or distribution of the Product, directly or indirectly, by HPPI; and

the use or effects of such Product.

Mayne Pharma Insurance

Maintain insurance

Evidence of insurance

Confidentiality and publication

Definition

treated by the Disclosing Party as confidential or in which it would be reasonable to expect that the Disclosing Party has an expectation of confidentiality (even if not specifically identified as confidential); and

disclosed by the Disclosing Party to the other party or of which the other party becomes aware, whether before or after the Start Date,

Restrictions on disclosure and use

to keep the Confidential Information of the Disclosing Party strictly secret and confidential from third parties (including any patent office); and

to use the Confidential Information only for the purposes of this Agreement or exercise of the rights granted under this Agreement, and not for any other activity (including the purchase or sale or securities of the Disclosing Party in the public markets) without the prior written approval of the other party,

with any Affiliate, sub licensee or approved contractors to the extent necessary or reasonably desirable for the purposes of this Agreement, provided each party remains responsible for ensuring such Affiliates, sub licensees or contractors comply with restrictions on use and disclosure of information which are at least equivalent to those set out in this Agreement, without any right of further disclosure;

to the extent reasonably necessary to seek, obtain or maintain (in the case of HPPI) a Marketing Authorisation or (in the case of Mayne Pharma) an MP Marketing Authorisation; and

to the extent reasonably necessary to prepare, file, maintain, enforce or defend patents or patent applications.

Exceptions

was public knowledge or generally known at the date of its disclosure or which subsequently becomes public knowledge or generally known through no act or failure to act on the part of the Recipient;

is or was already in the Recipient’s possession and was not acquired directly or indirectly from the Disclosing Party (in each case as shown by the Recipient’s written records);

is or was acquired by the Recipient in good faith from a third party who was not under an obligation of confidence with respect to that Confidential Information; or

to the extent it is required by law, rule or regulation to be disclosed (including the U.S. federal securities laws and the rules and regulations of the U.S. Securities and Exchange Commission and the listing rules of the Australian Stock Exchange).

Scientific publication

Notwithstanding clauses 17.1 to 17.3, each party has the right to publish Proposed Publications, subject to this clause 17.4.

Each party (Publishing Party) must provide the other party with a copy of any Proposed Publication 30 days before the intended date of publication.

The other party may review the Proposed Publication within the 30 day period and put any reasonable requests it requires to the Publishing Party:

to prevent the disclosure of the other party’s Confidential Information, by amending the Proposed Publication to remove the other party’s Confidential Information or any information from which such Confidential Information can reasonably be ascertained; and/or

to delay publishing the Proposed Publication to prevent prejudicing the other party’s ability to protect or commercially exploit any of its Intellectual Property Rights, up to a maximum further period of *** (for a total period of ***).

For the avoidance of doubt, nothing in this clause prevents a party from ultimately publishing a publication that does not include any other Confidential Information of the other party.

Intellectual Property Rights

Intellectual Property Rights in the Product as at the Start Date

Reserved

Reserved

***

Development of Intellectual Property Rights and Licence of HPPI Licensed Rights

All Intellectual Property Rights relating to the Product:

from the Start Date to the Effective Date, for its use in the Original Field, that are or have been developed:

by HPPI, its Affiliates or Personnel (solely or with any third party);

jointly by HPPI and Mayne Pharma and their respective Affiliates and Personnel; or

solely by Mayne Pharma and its Affiliates and Personnel in providing the services referred to in clause 4.4, and

from the Effective Date, for its use in the Field, that are or have been developed by HPPI, its Affiliates or Personnel (solely or with any third party),

All Intellectual Property Rights relating to the Product, whether or not for its use in the Field, that are or have been developed:

by Mayne Pharma, its Affiliates or Personnel (solely or with any third party) from and after the Start Date, or

from the Effective Date, jointly by HPPI and Mayne Pharma and their respective Affiliates and Personnel,

Notification of infringement or invalidity claim

infringement or misappropriation of the other party’s Intellectual Property Rights;

the infringement of third party rights as a result of the research, development and registration activities relating to the Product, or the manufacture, importation, promotion, marketing, sale or distribution of the Product, as contemplated under this Agreement; or

declaratory judgment or equitable relief action or similar proceeding alleging invalidity of any of the Licensed IPR.

Right to take action

*** after notice of the alleged infringement, misappropriation or claim; or

*** before any deadline imposed by the Hatch-Waxman Act or similar laws (whichever comes first) with respect to an infringement or misappropriation of any HPPI Licensed Rights, or an infringement or misappropriation of any MP Licensed Rights within the scope of the grant of license from Mayne Pharma to HPPI under this Agreement,

Consultation and assistance

Disposition of damages

Branding

Directions regarding use of the Trade Mark

Samples of marketing materials

Use of the Trade Mark

use the Trade Mark as part of its corporate, business or trading name;

use any other trade mark or name in conjunction with or in close proximity to the Trade Mark;

use the Trade Mark in a manner which would jeopardise or invalidate any registration (or prejudice any application for registration) of the Trade Mark or could assist or give rise to an application to terminate, revoke or dilute any such registration; or

use the Trade Mark in a manner which might prejudice the right or title of Mayne Pharma to the Trade Mark.

Goodwill

No right for HPPI to register the Trade Mark

Termination

Termination for breach by a party

that other party breaches any material provision of this Agreement and fails to remedy the breach within *** after receiving notice requiring it to do so;

that other party breaches a material provision of this Agreement where that breach is not capable of remedy; or

any event referred to in clause 20.3 happens to that other party (whether or not notification has been provided under clause 20.3).

Termination by Mayne Pharma for cause arising under a related agreement

HPPI breaches a material provision of the Equity Holders Agreement, and:

fails to remedy the breach within *** after receiving notice requiring it to do so; or

that breach is not capable of remedy;

HPPI breaches a material provision of the Mayne Pharma Purchase Agreement, the 2015 SPA, the 2018 SPA, the Angiogenesis and Hedgehog Patent Sublicense or the December 2018 Agreement and:

fails to remedy the breach within *** after receiving notice requiring it to do so; or

that breach is not capable of remedy.

Notification of insolvency events

that party ceases to carry on its business operations;

that party ceases to be able to pay its debts as they become due;

any step is taken by a mortgagee or secured party to take possession or dispose of the whole or part of that party’s assets, operations or business;

that party makes a general assignment for the benefit of creditors;

that party becomes the subject of the filing or institution of bankruptcy, liquidation or receivership proceedings;

any step is taken to appoint a receiver, a receiver and manager, a trustee in bankruptcy, a provisional liquidator, a liquidator, an administrator or other like person of the whole or part of that party’s assets, operations or business; or

an order is made for winding up or dissolution without winding up of that party or an effective resolution is passed for the winding up of that party.

Change of Control and disposal of assets or business by HPPI

For so long as this Agreement is in effect, HPPI must seek the prior written consent of Mayne Pharma before it disposes of the whole or a substantial part of its assets, operations or business, such consent not to be unreasonably withheld, conditioned or delayed. HPPI must, at its own reasonable expense, provide to Mayne Pharma such information as Mayne Pharma reasonably requires to consider such a request for consent, including an independent third party opinion on valuation that has been approved by the board of HPPI. Without limitation, a breach of this clause is a breach of a material provision of this Agreement not capable of remedy.

For so long as this Agreement is in effect, HPPI must notify Mayne Pharma before it undergoes any change in its direct or indirect Control. If, acting reasonably, Mayne Pharma considers that such change will have a material, negative impact on its rights under this Agreement, it may terminate this Agreement by giving *** notice to HPPI. Mayne Pharma agrees that HPPI is not deemed to have undergone a change in its direct or indirect Control for purposes of this clause 20.4(b) if Mayne Pharma ceases to own more than 50% of the outstanding voting power of HPPI solely as a result of (i) HPPI’s issuance of New Securities in an equity financing with respect to which Mayne Pharma has preemptive or similar contractual rights to participate on the same terms and conditions as investors in the financing and (ii) Mayne Pharma’s election not to participate in such financing on the same terms and conditions as investors in the financing.

Impact of claims of infringement

If Mayne Pharma becomes subject to, or acting in its discretion, considers it is at risk of becoming subject to, any litigation, arbitration or similar proceeding claiming its activities under this Agreement with respect to the Product infringe the Intellectual Property Rights of any third party (the Third Party IPR), then Mayne Pharma may, at any time while such proceeding or risk remains, with immediate effect by notice to HPPI, elect not to supply Product for commercial sales until:

Mayne Pharma enters into written agreement under which it obtains an exclusive license to copy and exploit all Intellectual Property Rights in the applicable Third Party IPR; or

all rights arising from the applicable Third Party IPR in the Territory have expired, lapsed or been invalidated by action of Mayne Pharma, HPPI or otherwise.

During any period that Mayne Pharma has elected not to supply Product for commercial sale under clause 20.5(a):

Mayne Pharma will supply Product:

for uses reasonably related to the development and submission of information under a US Federal law which regulates the manufacture, use, or sale of drugs for clinical trials that have already started at the date of the notice until those clinical trials have completed;

at the Floor Price in accordance with item 5.2(a) of Schedule 5, in which case item 5.1 of Schedule 5 shall no longer apply;

HPPI may allow any Backup Manufacturer to manufacture the Product for commercial sale, in accordance with Schedule 6 except that notwithstanding item 3.1 of Schedule 6, the parties will use their reasonable commercial efforts to Qualify a Backup Manufacturer (both as defined in Schedule 6) within 6 months after consent is provided by Mayne Pharma under item 2 of Schedule 6;

recognizing that the exercise by Mayne Pharma of its election under this clause 20.5 to not provide Product for commercial supply would materially impact the timing for any planned commercial launch of the Product in the Field, should Mayne Pharma exercise its rights under this clause 20.5, HPPI and Mayne Pharma shall, with input from the JDC, promptly take action to amend the Development Plan. The parties shall use reasonable commercial efforts to approve such revised Development Plan within *** of Mayne Pharma’s election; and

in consideration for Mayne Pharma allowing such manufacture by a Backup Manufacturer, at the end of each Quarter:

HPPI must notify Mayne Pharma of the quantities of any Product manufactured by the Backup Manufacturer in that Quarter under clause 20.5(b)(ii); and

HPPI must pay to Mayne Pharma:

Accrued rights and remedies

Sell down or repurchase

Mayne Pharma will fill any Orders provided they are placed *** before the date of the termination or expiry of this Agreement; and

HPPI may promote, market, sell and distribute any Product for a period of *** from the termination or expiry of this Agreement (in which case, to avoid doubt, the provisions of clause 7, 10 and 11 continue to apply), subject to HPPI meeting its contractual obligations after the termination or expiry of this Agreement.

Return of Confidential Information

each party will, as soon as practicable, return to the other party all of the other party’s Confidential Information (other than Confidential Information comprising part of the HPPI Licensed Rights), whether in permanent or magnetic/computer disk form or any other form provided that each party may:

provide one copy of that Confidential Information to its legal advisers, to be held by them solely for the purpose of determining the scope of that party’s obligations under this clause; and

retain one copy of such of that Confidential Information that is required by the Relevant Regulatory Authority, to be retained by that party.

HPPI must, within *** after the termination or expiry of this Agreement, deliver to Mayne Pharma, at Mayne Pharma’s option, all advertising, promotional or sales materials relating to the Product which are still in the power, possession or control of HPPI, any of its Affiliates or any Sub Licensee.

Force majeure

Occurrence of Force Majeure Event

as soon as reasonably practicable after that Force Majeure Event arises, the Precluded Party must notify the other party in writing of:

the Force Majeure Event;

which obligations the Precluded Party is precluded from performing (Affected Obligations);

the extent to which the Force Majeure Event precludes the Precluded Party from performing the Affected Obligations (Precluded Extent); and

the expected duration of the delay arising directly out of the Force Majeure Event;

the Precluded Party’s obligation to perform the Affected Obligations will, to the Precluded Extent, be suspended for the duration of the actual delay arising directly out of the Force Majeure Event; and

the other party’s obligations to perform any obligations dependent on the Affected Obligations will be suspended until the Precluded Party resumes performance.

Termination

Notices and other communications

Service of notices

in writing, in English and signed by a person duly authorised by the sender; and

hand delivered or sent by reputable international courier, prepaid post or by facsimile transmission to the recipient’s address for Notices specified in the Details, as varied by any Notice given by the recipient to the sender.

Effective on receipt

if hand delivered or sent by reputable international courier, on delivery;

if sent by prepaid post, on the second Business Day after the date of posting (or on the seventh Business Day after the date of posting if posted to or from a place outside Australia);

if sent by facsimile, when the sender’s facsimile system generates a message confirming successful transmission of the entire Notice unless, within 8 Business Hours after the transmission, the recipient informs the sender that it has not received the entire Notice,

Dispute resolution

GST

Interpretation

Words or expressions used in this clause 24 which are defined in the A New Tax System (Goods and Services Tax) Act 1999 (Cth) have the same meaning in this clause.

Clause 25 prevails over this clause 24 to the extent of any inconsistency.

Consideration is GST exclusive

Gross up of consideration

Despite any other provision in this Agreement, if the Supplier makes a taxable supply under or in connection with this Agreement (not being a supply the consideration for which is specifically described in this Agreement as ‘GST inclusive’):

the consideration payable or to be provided for that supply under this Agreement but for the application of this clause (‘GST exclusive consideration’) is increased by, and the Recipient must also pay to the Supplier, an amount equal to the GST payable on the supply (‘GST Amount’); and

the GST Amount must be paid to the Supplier by the Recipient without set off, deduction or requirement for demand, at the same time as the GST exclusive consideration is payable or to be provided.

The sale of the Product is intended to be a GST-free export of goods

Mayne Pharma and HPPI acknowledge that the supply of the Product under this Agreement is intended to constitute a GST-free supply of exported goods under item 1 of section 38-185(1) of the GST Act.

HPPI warrants that in relation to each delivery of the Product, it will it satisfy the requirements under:

Item 1 of section 38-185(1) and section 38-185(3) the GST Act; and

The interpretation of those provisions in paragraph (i) as outlined by the Australian Taxation Office in its Public Goods and Services Tax Ruling ‘GSTR 2002/6, Goods and Services Tax: Exports of goods, items 1 to 4A of the table in subsection 38-185(1) of the A New Tax System (Goods and Services Tax) Act 1999’.

HPPI must provide written evidence to the Supplier that it has satisfied the requirements in clause 24.4(b) within *** of the Supplier issuing an invoice for the relevant Product.

In the event HPPI fails to satisfy the requirements in clause 24.4(b), clause 24.4(c) or the Australian Taxation Office otherwise determines that the sale of the Product by Mayne Pharma constitutes a taxable supply, HPPI must immediately pay to Mayne Pharma the GST Amount payable in relation to the supply of the Product in accordance with clause 24.3 and any applicable interest, fines and penalties payable by Mayne Pharma as a result of the supply of the Product being treated as a GST-free supply.

Reimbursements (net down)

Tax invoices

Adjustments

if the Supplier’s corrected GST Amount is less than the previously attributed GST Amount, the Supplier shall refund the difference to the Recipient;

if the Supplier’s corrected GST Amount is greater than the previously attributed GST Amount, the Recipient shall pay the difference to the Supplier;

the Supplier must issue an adjustment note to the Recipient within *** of the adjustment event occurring or otherwise as soon as it becomes aware of the adjustment event; and

any payment under clauses 24.7(a) or 24.7(b) must be paid to the Supplier or Recipient (as the case may be) within *** of the adjustment note being issued by the Supplier.

Similar goods and services taxes or value added taxes

Tax

Payments free of taxes; obligations to withhold; payments on account of taxes

Any and all payments to be made to Mayne Pharma under this Agreement must be, to the extent permitted by law, be made free and clear or and without reduction or withholding for any Tax. HPPI acknowledges and agrees that any amount (in cash, securities or property in kind) received by Mayne Pharma or its nominee from HPPI as consideration arising under or related to this Agreement, is deemed to be a payment made to Mayne Pharma under this Agreement.

Whenever HPPI is required by law to make a deduction or withholding in respect of Tax from any payment to be made to Mayne Pharma under this Agreement, then HPPI will:

make that deduction or withholding from the payment;

promptly pay an amount equal to the amount deducted or withheld as required by law and by the date that Tax is due to be paid to the appropriate governmental or regulatory agency having jurisdiction over HPPI;

if requested by Mayne Pharma, within *** of that request, deliver to Mayne Pharma official relevant receipts issued by such Tax authority, if any, received by HPPI or other documentation of HPPI evidencing payment of that amount; and

pay Mayne Pharma such additional amounts as necessary to ensure Mayne Pharma receives when due a net amount (after deduction or withholding of any Taxes in respect of such additional amounts) equal to the full amount which Mayne Pharma would have received if no deduction or withholding had been made.

Refunds

Miscellaneous

Survival of Obligations

Approvals and consents

Announcements

Subcontracting

Assignment

HPPI may assign any of its rights or obligations under this Agreement only with the prior written consent of Mayne Pharma.

Mayne Pharma may assign any of its rights or obligations under this Agreement to:

an Affiliate or any entity to whom Mayne Pharma has disposed the whole or a substantial part of its assets, operations or business; or

otherwise with the prior written consent of HPPI.

Costs

Relationship

No modification

Non waiver

Entire agreement

Further Action

Severability

Counterparts

Governing law

Embodiments of IIPR

Start Date

Initial Term

10 years from the Actual Launch Date;

all issued patents of Mayne Pharma or any of its Affiliates referred to in paragraph (a) of the definition of MP Licensed Rights (and all continuations-in-part, continuations or divisions of any such patent or patents, or substitutes of it, and any reissues, re-examinations, extensions, or renewals of the same) have lapsed or expired.

Territory

2 – BCCNS Field

Transfer Activities

From the Effective Date, HPPI, in collaboration with Mayne Pharma, must immediately commence all activities necessary or reasonably required to implement the transfer of all of HPPI’s rights to the Product to Mayne Pharma in the Territory in the BCCNS Field (Transfer Activities), including:

the assignment to Mayne Pharma (subject to obtaining applicable third party agreements and consents as necessary) of all relevant contracts and other agreements related to HPPI’s activities in the BCCNS Field in the Territory which are deemed necessary by Mayne Pharma for the future conduct of its activities in the BCCNS Field in the Territory (provided that HPPI shall provide Mayne Pharma copies of all agreements with contract research organisations, clinical trial investigators and key opinion leaders and any other agreements as requested in writing by Mayne Pharma);

the transfer of IND *** and the sponsorship of such IND to Mayne Pharma;

the transfer of all relevant regulatory files relating to the Product in the BCCNS Field to Mayne Pharma, including PDF and word versions of all HPPI correspondence and IND related submissions sent by HPPI to the FDA and PDF copies of all correspondence received from the FDA; and

the transfer to Mayne Pharma of all audited or raw clinical data related to HPPI’s Phase 2b trial in the possession of HPPI or its contractors as of the Effective Date , including the Trial Master File as described in Schedule 3 and a copy of the *** study database in Excel and/or SAS format (“Scoring Study Clinical Data”).

To avoid doubt, the rights to the Product in the Territory in the BCCNS Field which are the subject of the Transfer Activities shall not include a transfer or assignment of the HPPI Patents, the HP LLC Patents or any other patents or patent applications owned or licensed by HPPI themselves, which patents and applications are subject to the license granted by HPPI hereunder.

Mayne Pharma designates *** as its point person in the United States to interface with HPPI management on a frequent basis to coordinate and ensure the efficient execution of the Transfer Activities.

HPPI may not communicate with the FDA after the Effective Date with regard to the MP Product in the BCCNS Field, except to give effect to the transfer as set out above.

From the Effective Date, Mayne Pharma is:

responsible for all expenses related to exploiting the MP Product in the BCCNS Field (including, with respect to third party consulting if Mayne Pharma determines to engage such services); and

responsible (save for HPPI’s Transfer Activity obligations) for compiling the integrated safety study required for any MP Marketing Authorisation in the BCCNS Field.

HPPI is responsible for all liabilities related to the Product in the Territory in the treatment of human patients with cancer via oral administration prior to the Effective Date.

Each of HPPI and Mayne Pharma must use its reasonable commercial efforts to complete all Transfer Activities detailed in clause 1(a) on or prior to December 31, 2018 (subject to any required consents of or negotiations with third party contractors), other than the transfer of the Scoring Study Clinical Data and the IND transfer. Each of HPPI and Mayne Pharma must use its reasonable commercial efforts to complete the transfer of all *** and IND *** to Mayne Pharma on or prior to January 31, 2019.

Advancement of Funds

In consideration of HPPI’s execution and delivery of this Agreement, and HPPI’s performance of its obligations under this Agreement, Mayne Pharma agrees to advance funds to HPPI in an aggregate amount of up to Five Million United States dollars (USD 5,000,000) (each, an Advance, and collectively, the Advances), as set out in this item 2 of Schedule 2.

Base Advances

Tranche One – On the Effective Date, Mayne Pharma must make an Advance to HPPI of Five Hundred Thousand United States dollars (USD 500,000);

Tranche Two – Within three (3) Business Days following the completion of the Transfer Activities (as evidenced by the completion in all material respects of the actions set forth in items 1(a)(i) to 1(a)(iii) of this Schedule 2), Mayne Pharma must make an Advance to HPPI of One Million United States dollars (USD 1,000,000); and

Tranche Three – If, and only if, the Scoring Study Clinical Data has been provided to Mayne Pharma in all material respects so as to allow Mayne Pharma to assume control of the Product in the Territory in the BCCNS Field, upon the earlier of June 30, 2019 or the acceptance for filing by FDA of an NDA for the Product in the BCCNS Field, Mayne Pharma must make an Advance to HPPI of One Million Five Hundred Thousand United States dollars (USD 1,500,000).

Top-Up Right; Elected Advance

If, from Effective Date until June 30, 2021, HPPI proposes to issue New Securities in any transaction that would result in HPPI having received aggregate gross proceeds since the Effective Date of more than Three Million United States dollars (USD 3,000,000) (Threshold) from the issuance of New Securities to one or more investors other than Mayne Pharma, whether in one or a series of related or unrelated financings (collectively, an Equity Issuance), then, Mayne Pharma will have the right, at its option, to purchase concurrently with the most recent Equity Issuance that results in the Threshold being met, up to or equal to the same New Securities being sold to the investors in such Equity Issuance, on terms and conditions the same as the most favourable terms contemplated in any such financing, such that following the Equity Issuance and the exercise of such option Mayne Pharma will own up to the same percentage of equity in HPPI that it owned immediately prior to the Equity Issuance (Top-Up Right).

If Mayne Pharma does not purchase its entire allocation pursuant to the Top-Up Right then, promptly following delivery of notice by HPPI (at its election) to Mayne Pharma requesting a further Advance of up to an amount equal to the difference between Two Million United States dollars (USD 2,000,000) and the amount of aggregate gross proceeds received by HPPI from Mayne Pharma from the sale of New Securities to Mayne Pharma pursuant to the Top-Up Right (Elected Advance), ***.

To avoid doubt, if HPPI receives aggregate proceeds of at least Two Million United States dollars (USD 2,000,000) from Mayne Pharma from the sale of New Securities to Mayne Pharma pursuant to the Top-Up Right, then HPPI is not entitled to request the Elected Advance and Mayne Pharma has no obligation to make the Elected Advance to HPPI.

Additional terms and conditions

Notwithstanding anything to the contrary in this Agreement, Mayne Pharma shall not be required to make any Advance under this item 2 of Schedule 2 if: (A) this Agreement has expired, has been terminated or is not otherwise in full force and effect, or (B) any event referred to in clause 20.3 has happened to HPPI.

HPPI may use the proceeds from each Advance as determined by HPPI in its discretion.

With respect to any Equity Issuance, Mayne Pharma hereby agrees to waive its right to approve any such Equity Issuance pursuant to Section 5.3 of the 2018 SPA.

Optional Conversion in Certain Circumstances

If Mayne Pharma does not obtain FDA approval of an NDA for the MP Product in the BCCNS Field by December 31, 2023, then, from and after December 31, 2023, at any time and from time to time, Mayne Pharma may convert, at its option by notice to HPPI and without the payment of additional consideration by Mayne Pharma, all or any portion of the Advances Amount (as defined below) made under this item 2 of Schedule 2 into such number of fully paid and non-assessable restricted shares of common stock of HPPI as is determined by dividing the amount of Advances Amount being converted by the Per Share Market Price.

No fractional shares of common stock of HPPI shall be issued upon conversion of Advances Amount under this item 2(e) of Schedule 2. In lieu of any fractional shares to which Mayne Pharma would otherwise be entitled, HPPI shall pay cash equal to such fraction multiplied by the Per Share Market Price.

In order for Mayne Pharma to voluntarily convert all or any portion of the Advances Amount into common stock of HPPI pursuant to this item 2(e) of Schedule 2, Mayne Pharma shall provide written notice to HPPI that Mayne Pharma elects to convert all or any portion of the Advances Amount and specify the amount of Advances Amount that is being so converted (a Conversion Notice).

HPPI shall, as soon as practicable after receipt of a Conversion Notice (i) issue and deliver to Mayne Pharma, or to its nominees, a certificate or certificates for the number of full shares of HPPI common stock issuable upon such conversion in accordance with the provisions hereof and an acknowledgement as to the remaining amount of Advances Amount that have not converted into HPPI common stock and (ii) pay in cash such amount as provided in item 2(e)(ii) of Schedule 2 in lieu of any fraction of a share of HPPI common stock otherwise issuable upon such conversion.

For the purposes of this item 2(e) of Schedule 2:

Advances Amount means a USD value determined by multiplying (1) the amount of Advances proposed to be converted into HPPI common stock by (2) 1.10.

Per Share Market Price means (1) if HPPI common stock is then traded primarily on the New York Stock Exchange or Nasdaq Stock Market, the per share volume weighted average trading price of HPPI common stock over the thirty (30) consecutive trading days ending on the trading day immediately prior to HPPI’s receipt of the applicable Conversion Notice (calculated by dividing the total value by the total volume of HPPI common stock traded for the trading days included in such thirty (30) trading day period), (2) if HPPI common stock is then listed or traded on other exchanges, markets and systems, the per share volume weighted average trading price of HPPI common stock over the ninety (90) consecutive trading days ending on the trading day immediately prior to HPPI’s receipt of the applicable Conversion Notice (calculated by dividing the total value by the total volume of HPPI common stock traded for the trading days included in such ninety (90) trading day period) and (3) if HPPI common stock is not then publicly traded, the per share fair market value of HPPI common stock as determined by an appraiser mutually selected by Mayne Pharma and HPPI that is independent of Mayne Pharma and HPPI and their respective Affiliates that is skilled in preparing appraisals of the value of non-publicly traded stock, provided that (i) if Mayne Pharma and HPPI are unable to agree on a single appraiser, then each party must select a qualified independent appraiser and the two qualified independent appraisers must then determine the per share fair market value of HPPI common stock, (ii) if the two qualified independent appraisers cannot agree on the per share fair market value of HPPI common stock within 30 days after their selection, they must, within 30 days, mutually select a third qualified independent appraiser, (iii) the mutually selected qualified independent appraiser (or, if applicable, the third qualified independent appraiser) must determine the per share fair market value of HPPI common stock within 30 days of selection, and such determination is conclusive and binding upon Mayne Pharma and HPPI and (iv) Mayne Pharma and HPPI must bear equally the fees and expenses of such appraisers.

HPPI shall have no obligation to reserve and keep available out of its authorized but unreserved and unissued capital stock any shares of HPPI common stock or other HPPI securities for the purpose of effecting the conversion of Advances pursuant to this item 2(e) of Schedule 2; provided, however, that if at the applicable date of desired conversion of any Advances (Conversion Date), HPPI shall have an insufficient number of authorized, unreserved shares of HPPI common stock available for issuance upon conversion of all of such Advances, Mayne Pharma may elect to convert the applicable amount of such Advances it is permitted to convert based on the then authorized, unreserved shares of HPPI common stock and, with respect to any deficiency amount, to either (A) require HPPI to take, and HPPI shall take, all corporate action within *** of the Conversion Date as may be necessary to increase its authorized but unissued and unreserved shares of HPPI common stock to such number of shares as shall be sufficient for purposes of converting the remaining Advances or (B) recoup the Advances that is unable to be converted as of the Conversion Date in the form of

Any such portion of Advances so converted under this item 2(e) of Schedule 2 shall not be credited and set off against royalty payments, if any, due by Mayne Pharma to HPPI under item 4.1 of Schedule 2 as contemplated by item 4.3 of Schedule 2.

With respect to any and all shares of common stock of HPPI issued upon conversion of Advances under this item 2(e) of Schedule 2, HPPI agrees to provide to Mayne Pharma the same rights and privileges that are set forth in Annex G to the 2018 SPA applicable to Registrable Securities (as defined therein).

Mayne Pharma’s performance obligation for the BCCNS Field

Royalty

Payment each Quarter

***;

***; and

***.

Calculation of the royalty

if such amount is negative in any Quarter, then no royalty is payable for that Quarter and that amount will be carried forward and included as a deduction from the aggregate of the gross invoice price in any subsequent Quarter (as applicable);

Mayne Pharma may reduce the amount of the royalty owed to HPPI under item 4.1 of Schedule 2 by the value of any milestone payments forfeited by Mayne Pharma International under the Angiogenesis and Hedgehog Patent Sublicense;

Mayne Pharma must submit to HPPI a report setting out, in reasonable detail, the calculation of the royalty amount (including the aggregate actual gross invoice price for the MP Product sold by Mayne Pharma, its Affiliates or any sub licensee during the applicable Quarter) at the same time as it makes payment; and

Mayne Pharma must, and must ensure that its Affiliates and any sub licensee must, promptly process any deduction and in any event, process such deductions no later than one Quarter after they are allowed (in the case of discounts, bonuses, commissions and rebates) applied or the Products sold by Mayne Pharma, its Affiliates or any sub licensee are rejected or returned.

Credit for payment of the Advance

With respect to each Advance made by Mayne Pharma prior to the receipt of FDA approval of an NDA for the MP Product in the BCCNS Field, each USD 0.75 increment of each such Advance will be credited and set off against each USD 1.00 increment of royalty due by Mayne Pharma to HPPI under item 4.1 of Schedule 2; and

With respect to each Advance made by Mayne Pharma on or after the receipt of FDA approval of an NDA for the MP Product in the BCCNS Field, each USD 0.85 increment of each such Advance will be credited and set off against each USD 1.00 increment of royalty due by Mayne Pharma to HPPI under item 4.1 of Schedule 2.

Books of account

Mayne Pharma will maintain books of account and records with respect to sales and stocks of the Product in the Territory in the BCCNS Field by Mayne Pharma, its Affiliates and any sub licensee (including stock records) (Mayne Pharma Books of Account).

HPPI will have the right to appoint, on reasonable notice, an Accountant to inspect and examine the Mayne Pharma Books of Account.

HPPI will bear the fees of such Accountant unless an error equivalent to 5% or more (in favor of HPPI) of the amounts payable under item 4.1 of Schedule 2 in any calendar year is discovered, in which case the fees will be borne by Mayne Pharma.

Mayne Pharma will maintain the Mayne Pharma Books of Account in accordance with business accounting standards in the Territory.

Option to buy out the royalty

Indemnity

the research, development or registration activities relating to the MP Product in the Territory in the BCCNS Field, directly or indirectly, by Mayne Pharma;

the importation, promotion, marketing, sale or distribution of the MP Product in the Territory in the BCCNS Field, directly or indirectly, by Mayne Pharma;

the use or effects of such MP Product in the Territory in the BCCNS Field; and

to avoid doubt and without limitation, any actual or alleged infringement of Intellectual Property Rights arising from any activities, use or effects referred to above,

Description of the dosage form

Composition

Container Closure System

Floor Price, Minimum Order Quantity and Minimum Annual Volumes

Floor Price and Minimum Order Quantity

Floor Price per

unit (USD)

Minimum Order

Quantity (MOQ)

(capsules)

Incremental

Order Quantity

(after the MOQ)

(capsules)

SUBA-Itraconazole 50mg

hard capsule

***

***

***

Minimum Annual Volumes

Forecast Period

Delivery terms

Minimum shelf life

Price

Product Mayne Pharma provides ***

Product for which Mayne Pharma ***

any Product required for the conduct of the activities in the Development Plan and any other activities relating to the research, development or registration activities relating to the Product:

above the amount specified in item 5.1 of this Schedule 5; or

***,

all other Product, in accordance with this item 5 of this Schedule 5.

Definitions

Forecast ASP

Transfer Price

Price

the Transfer Price, payable by HPPI within *** of the date of Mayne Pharma’s invoice, to be issued on or after shipment of the Product; and

as adjusted by a reconciliation of the Actual ASP in relation to the Forecast ASP ***.

Timely accounting for deductions

Books of Account

HPPI will maintain books of account and records with respect to sales and stocks of the Product supplied by Mayne Pharma under this Agreement in the Territory by HPPI, its Affiliates and Sub Licensee (including stock records) (HPPI Books of Account).

Mayne Pharma will have the right to appoint, on reasonable notice, an Accountant to inspect and examine the Books of Account.

Mayne Pharma will bear the fees of the such Accountant unless an error equivalent to *** or more of the Total Net Sales in any calendar year is discovered, in which case the fees will be borne by HPPI.

HPPI will maintain the HPPI Books of Account in accordance with business accounting standards in the Territory and at a standard sufficient to facilitate any Product recall.

HPPI will have the right to appoint on reasonable notice an Accountant to inspect and examine Mayne Pharma’s manufacturing costs, including Mayne Pharma’s cost of goods as such is relevant to the calculation of the Floor Price.

Reporting requirements

Currency and exchange rate

Currency

Financial institution for exchange rate

Definitions

Licence of HPPI Licensed Rights

Grant of licence

outside the Territory in any field, and

inside the Territory outside the Field,

relates to, or has potential application in connection with, the Product, including any dossier containing technical or clinical information relating to the Product; and

is owned by HPPI or its Affiliates or Sub Licensees, or licensed by HPPI, its Affiliates or Sub Licensees (without restriction as to license or sub license) at any time during the period starting at the Start Date until the earlier of:

***; or

the termination or expiry of this Agreement,

HPPI to ensure it remains free to licence the HPPI Licensed Rights

ensure that, in respect of any Intellectual Property Rights comprising the HPPI Licensed Rights owned by it, its Affiliates or any Sub Licensee; and

use reasonable commercial efforts to ensure that, in respect of any Intellectual Property Rights comprising the HPPI Licensed Rights licensed by it, its Affiliates and any Sub Licensee,

Restriction on assignment or sub licence

Survival

Copies of documents, data and other information embodying the HPPI Licensed Rights

Intellectual property protection for HPPI Licensed Rights

HPPI will consult with Mayne Pharma regarding intellectual property protection for such rights outside the Territory.

In particular, HPPI must give at least *** prior notice before it, or any of its Affiliates:

discloses any Confidential Information comprised in the HPPI Licensed Rights to any third party unless subject to equivalent restrictions on use and disclosure as those under clause 18, without any right of further disclosure; and

without limitation, discloses any Confidential Information comprised in the HPPI Licensed Rights to any patent office, including as part of a patent application.

If HPPI decides not to file, prosecute or maintain patent protection for any invention comprised in the HPPI Licensed Rights in any country outside the Territory, it must promptly give notice to Mayne Pharma (with such notice to be given at least *** before any deadline for decisions relating to such filing, prosecution or maintenance).

Mayne Pharma may, by notice to HPPI, request that HPPI make a decision in respect of the filing, prosecution or maintenance of patent protection for any invention comprised in the HPPI Licensed Rights in any country outside the Territory, in which case HPPI must respond before any deadline referred to in item 3(c) of this Schedule 7 but in any event no later than *** after the request by Mayne Pharma.

If HPPI gives notice to Mayne Pharma under item 3(c) or (d) of this Schedule 7 of its intention not to file, prosecute or maintain patent protection of any invention comprised in the HPPI Licensed Rights in any country outside the Territory, Mayne Pharma may decide to take over such filing, prosecution or maintenance at its cost by giving notice to HPPI before the relevant deadline, in which case:

HPPI will, or will procure that its Affiliate (as applicable) will, promptly assign to Mayne Pharma or its nominee all rights in respect of the invention (including under any patent application or issued patent); and